Sakal Aims to Restore Its Duty Free Allure

Consumer products leader Sakal Group said yesterday that it would reduce its duty free prices to create a 40 percent gap against electronics stores among the most popular products. In some categories, Sakal said, electronics prices would go down 80 percent.

Sakal's move is meant to bring back consumers to its duty free electronics stores, whose competitiveness declined after dramatic reductions in import duties on electronics items in recent months.

Purchase taxes on electronics items were lowered by 15 percent in February 2004, but prices in most stores only went down by 10 percent. Merchants cited the rise of the euro as the reason for not fully lowering prices.

At the time, Sakal said that it would keep prices of major appliances like refrigerators at 5 percent below competitors and items under $200, like 25" televisions, VCR's, and DVDs, at 20 percent below local market prices. However, this apparently was not enough.

Sakal said yesterday that it would lower prices on items whose "market share is on the rise." For example, it will reduce the price of DVD-Video combos to $160, the Astra 25" TV from $200 to $150, and the Astra 21" TV from $150 to $100.

Sakal, which won the tender to operate in Ben Gurion 2000, has seen sales rise 22 percent since the move to Terminal 3, according to VP for Marketing Kobi Sakal.