Understanding markets crucial

Understanding markets crucial
Markets can be manipulated by unscrupulous people.

Markets can be manipulated by unscrupulous people.

By Venon Chamba

EXAMPLES galore evidently show us that many Africans — and Zimbabweans in particular — have very little understanding of markets.
An interesting example, to put things into perspective, is the imported second hand reconditioned cars from Japan.
How can anyone in their right senses exchange $5 000 for a car that is worth $500!
Yes the Zimbabwe Revenue Authority is more than happy to take its dues, but still there is no justification for such unfair trade practices.
The cars are not wanted in their country of origin so they are shipped to Africa where suddenly their value is miraculously restored.
Do Africans really know what a reconditioned car is?
The African perception of value must be corrected for one to profit in the global trading village.
Our understanding of foreign markets begins at home.
Markets are people.
Therefore, consumers and customer behaviour is motivated by so many factors including family, price, education, preferences and perceptions.
Markets can unfortunately be manipulated by unscrupulous people. This is common with African markets where corruption, mismanagement and misappropriation of funds are commonplace.
There are many factors that affect the growth and death of markets and these include people, prices, policies, platforms, politics, enterprises and demand.
Interestingly, in various markets, the value placed on the goods being exchanged is always a fascination for critical thinkers.
For example, the Great Zimbabwe society reached more than 10 000 people at its prime and it was a trade centre with people coming from as far as Portugal to exchange ivory for glass, beads and cloth.
Glass beads may seem useless today, but at Great Zimbabwe — a long time ago, one could marry a wife or wives using them.
Africa needs to move with the times.
The value system is critical in African markets because it seems historically, we have been taken advantage of by other countries; be it Britain, America, China or Japan.
And presently we are still being taken advantage of by the same trading partners.
In the past, trade involved the exchange of rum from America for slaves from Africa who were then sold in the Carribean for molasses.
Fast forward to 2017, platinum ore is sold in its raw form and we are stuck with glass beads and rum while they get the gold, ivory and platinum.
The African value system in global markets must be revised for the Africans to benefit from their resources.
Value is a function of price, perception and demand.
However, as Africans, we need to be alive to what markets are so as not to be taken for a ride.
Markets have become bigger and more open with an increased number of buyers and sellers transacting worldwide via billion dollar market products such as facebook, twitter, instagram, amazon.com, yahoo and americaonline.
So Africa needs to work up and smell the coffee.

Venon Chamba is a local entrepreneur.

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