The recent government directive to close shops early has been met with resistance by shopkeepers, who argue that customers will not adjust to new timings soon. How true is that?
he federal, the Punjab and Sindh governments have made it mandatory for all markets and shops to close by 9pm. The directives came into force from June 20. This was done to conserve the use of power at peak-use time.
The shopkeepers are not pleased with this restriction. Their contention is that 9pm to midnight are peak hours of activity in many commercial markets. The government says that traders should take advantage of early light in summer mornings and open their outlets at 9am or earlier. The markets usually open between 11am and around noon. Shopkeepers say that customers usually come out for shopping in the afternoon and throng the markets in the evening, and that is when they make most of their sales. They do not agree with the argument that if they open shops and markets early, and close early, customers will adjust to the new timings.
That customers adapt to new timings was proved during the Covid-19 restrictions when restrictions on trade time were even more stringent. All purchases were made during the limited time available, be it groceries, clothing, shoes or electronic items like TVs, air conditioners and various gadgets. All commercial activities were completed within the limited time allowed for shopping during the pandemic. There was no significant loss of sales. It was during this period that an accelerated growth of online shopping was observed for almost all items. Today, grocery and food startups are among the busiest online players in the market. It was a mistake on part of the past government to allow late night trading after the Covid-19 threat subsided. The traders were then under pressure to conform to the new timings and would have agreed to limit their timings and continue with a restricted operation even later.
The power production capacity in Pakistan is over 36,000 MW but due to various reasons, it produces a maximum of 25,000 to 26,000 MW at peak demand (reasons include inability to produce most hydro-electricity due to water shortage in dams; high cost of fossil fuel, limited availability of RLNG). The pattern of power consumption in Pakistan is such that 7.5 percent of the power is consumed by commercial users, 27 percent by the industrial sector, over 47 percent by domestic consumers and the rest by the agriculture sector. At peak use (7:30pm till midnight) when around 25,000 MW power is produced, the use of power can be controlled by the agriculture sector. The use by the industrial sector also declines as 50 percent of the industries operate in the morning; but these are small industries that hardly consume 25 percent of total industrial consumption, which comes to around 6 percent of the total consumption. This saves 2,500 MW of energy consumption in the evening. The commercial use in the evening reaches 10 percent of the total use. This means a burden of 2,500 MW. The power supply on average falls short by 5,000 MW in the evening. The closure of agricultural use, a cut in industrial consumption and closure of commercial markets can save 5,000 MW. This can close the supply demand gap after 9pm.
Early closure of shops will benefit even the shopkeepers and their workers who remain engaged from 11am till 1am. Workers come early to clean the premises and put the display items in the proper places. They leave an hour past business activity to put display items back in the shuttered premises.
Socialising is another challenge. They have no time to enjoy life with their families. Shops in most developed economies open at 9am or earlier and close at 5pm. In some countries, the market times may linger on to 7pm but no further. However, previous efforts in Pakistan to close shops early have failed. Shopkeepers are somehow convinced that their sales will decline if they are not allowed to operate late in the night.
This makes little sense. Markets operate on supply and demand. If there is a demand each shop will get its due share irrespective of the market timings. If all shops open and close at the same time there will be a level playing field for all. We have seen that in some areas, competitors continue operations late into the night although the flow of shoppers is down to a trickle. This way they tire themselves and their employees without adding much to their sales.
Markets have started closing at 9pm for the time being but some traders have threatened to observe a shutter down strike in July after Eid. Only time will tell if the government can tolerate the pressure of a long shutter-down. If traders succeed in reversing the time restrictions, this will embolden them and they may come up with more demands.
Petrol pumps and medical stores are exempt from the directive for new closing hours. Pharmacies may cash in on this opportunity to sell some items like soft drinks, bread, eggs, candies and chocolates etc. This will not consume additional electricity but will impact the sales of shopkeepers that regularly sell these items. Moreover, it will encourage shoppers to roam the markets at night.
Early closure of markets can also save fuel consumed by motorists and cyclists during the evening rush hours. Most of these are window shoppers. Under the new directives, eateries will also close at 11pm instead of the usual 1am.
The writer is a senior reporter at The News International