Kumasi: Depreciating cedi, high port charges; spare parts business seriously impacted

A dejected Godfred Adu (R), spare parts dealer narrating his predicament to Ibrahim Abubakar (L).

It has been one of the profitable and thriving businesses in the country for many years.

But the narrative seems to be changing in recent times as the spare parts business, according to the dealers, is increasingly becoming unattractive owing to high cost of doing business and low patronage.

At Suame magazine, one of the busiest business enclaves dealing in all kinds of vehicle parts, not only in Kumasi but Ghana, dealers complain the once booming spare parts business is recording a dip in returns.

Godfred Adu has been importing and selling spare parts for more than two decades, but says his interest in the business is now waning due to what he described as increasing unfavorable business environment.

Godfred Adu

“Day in day out, your capital continues to depreciate because of the falling cedi. People are folding their businesses. We don’t have a future in this business if things will continue like this. We hope for things to improve else we may all have to look elsewhere”, Chairman Adu stressed.

The weakening of the cedi is not the only contributory factor to the swelling cost of doing the business but also the high port charges.

A Toyota vitz engine which was selling at 5,500 cedis just two months ago now goes for between 7,500 and 8,000 Ghana cedis.

Emmanuel Anane said the current harsh market environment is the worst he is experiencing since he started spare parts business 46 years ago.

Emmanuel Anane

“We were paying GHC15,000 to clear a 20-footer container at the harbour. The people at Suame Magazine lauded President Akufo-Addo when he introduced that fixed charge. But currently, we are paying 53,000 cedis to clear the same container. The increment is too high, and this has affected the cost of the spare parts.

“Customers hardly are able to afford the parts so it has led to low sales.
You see some people playing draught and others sitting idle, it’s because no one is coming to buy anything”, Mr Anane said.

Godfred, like many of his colleagues, is now left with no option than to reduce the number of his employees due to low sales.

“I was having 11 workers, but I’ve allowed 4 to go because daily sales have dwindled. Business is not moving like before,” he lamented.

With the continuous decline of the Ghana cedi against major currencies and high port charges, customers are to brace up for higher cost of spare parts and related services.

But for most customers, they’re already finding it difficult to afford the current prices of spare parts, thus any further increment will mean they will have to park their vehicles.

The Spare parts dealers want government to intervene by stabilizing the exchange rate and reducing the port charges.