Consumers Decry Government Plan to Abolish MRP Stickers

Based on a recent decision by the Ministry of Industry, Mine, and Trade, price stickers will be eliminated from some consumer products, starting from the beginning of autumn on September 23. The announcement has already drawn gross criticism from most people even before the rule comes into effect.

A controversial directive passed by Industry Minister Mohammad Shari’atmadari earlier this month orders manufacturers across the country to stop printing price labels on certain food and grocery items, including honey, snacks, condiments, canned food, and tissue paper, tejaratnews reported.

The ministry claims that the practice of printing prices on all products is restrictive and that by removing the price tags the prices would become more competitive and eventually benefit consumers.

It is further claimed that “the maximum retail price is incompatible with the free market system, because it involves manufacturers deciding what profit retailers will make.

“The price tags on goods are maximum retail prices (MRP), which is the highest price that can be charged for a product. However, retailers may choose to sell the products for a lesser amount to attract more buyers,” Yadollah Sadeqi, the Industry Ministry’s director for economic and trade affairs, told ISNA.

“Moreover, the products included in the scheme are not household essentials, such as, say, dairy products. Therefore, retailers will not be able to take undue advantage of the consumers’ needs or gouge prices,” Sadeqi said.

According to the official, a trial phase of the ministry’s directive over the past months “resulted in discounts of up to 40-50% in certain retail markets.”  

  Consumers Opposed

However, opponents of the new directive believe that while some shops may charge some goods slightly below the MRP to lure customers, many others can and will abuse it to overcharge and cheat consumers.

Ali Mohammad Rahmanizadeh, head of Khuzestan Consumer Rights Protection Association says: “Removing the price tags from goods is against consumers’ rights because it will create confusion in the market.”

Another concern is that retailers could overcharge foreign buyers and tourists… without any legal process to prosecute the price gougers, he noted.

In most countries prices of products are visible on the display shelves rather than on the products. The measure, which is not the norm in Iran, can prevent pricing chaos and also help inspectors to check retail prices, he suggested.

In recent days the mass media, especially state-owned radio and TV stations, have talked to shoppers and people in the streets about the unprecedented move by the government to get rid of the pricing practice. The strong majority of those interviewed were strongly opposed to the measure for the simple reason that the end result will “unquestionably be against the consumers.”

Most shoppers from different age groups and walks of life told a TV program that jacking up prices has become a norm in the retail market and “shop-owners charge according to their wish and whim.” They also complained that there is no effective control mechanism to punish the wrong-doers.  “Even with prices pasted on the products the shopkeepers charge what they want… Just imagine what will be the situation when the price tags disappear” one senior citizen shopping in the main bazaar in downtown Tehran asked.