Are Iranians ready to ‘Buy Iranian’?

By Maysam Bizaer for Al-Monitor. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iran Business News.

In keeping with the tradition of declaring an annual motto at the beginning of each Iranian year, Supreme Leader Ayatollah Ali Khamenei has named the current year that began March 21 “Support for Iranian Products.”

Many observers say the motto is a continuation of last year’s, “Economy of Resistance: Action and Deeds,” and is a clear sign that Iran is continuing to focus on the economy, its Achilles’ heel. Indeed, the function of the annual motto is to provide a discursive framework for the state’s policy priorities and to signal to the public that issues of concern are being addressed.

Following Khamenei’s Nowruz speech on March 21, Iranians have had mixed reactions to his urging citizens to buy domestically made products. President Hassan Rouhani quickly pledged support and promised that his administration will do everything in its capacity to implement the guidelines.

Meanwhile, government spokesman Mohammad Bagher Nobakht tweeted that the administration will repay more than 1 quadrillion rials ($26.5 billion) of its debts to local contractors in the new Iranian year as a means to support embattled banks and domestic production.

Yet Iranian attitudes toward locally made goods vary widely. One group is wholly in favor of “buying Iranian,” even if the product quality is inferior to imports. This group believes that buying Iranian is the only way to improve the quality of domestic output.

Another group of consumers only buys high-quality Iranian products that are sold at competitive prices and offer after-sale services. Last are those who tend to be more brand-sensitive. This group of mostly young Iranians living in major cities, as well as wealthy Iranians, prefers foreign goods, especially those from major international brands.

Given the country’s young population, the consumption of foreign products has become a culture in its own right among many Iranians, some of whom prefer imitations of foreign branded goods over the cheaper and better-quality Iranian originals. Demand for foreign products is so high that many Iranian manufacturers falsely label their goods as foreign.

One salesman in Tehran’s affluent district of Tajrish, a shopping hub, told Al-Monitor, “A great majority of the clothes we sell are made in Iran, but since customers care about the brand, the manufacturers put fake foreign labels on them.”

Although not all Iranians are so sensitive to brands, the fake-label phenomenon mainly affects fashion-related products and home appliances.

In this vein, despite all of its advancements, Iran’s automobile industry — the largest in the Middle East and a major employer — is often seen by many Iranians as a failure. Indeed, the unpopularity of Iranian-made cars, which have enjoyed nearly four decades of both government support and market advantages, is so great that they have become a symbol of mistrust in locally made goods.

Indeed, in 2015, a popular campaign on social media called on people not to buy Iranian cars. This went to the heart of politics and led to a national debate about the state of the auto industry.

One Iranian in his mid-50s, who preferred not to be named, told Al-Monitor that, excluding the auto industry, Iran’s local industry offers high-quality products at reasonable prices. “Our food industry, clothing, shoes and leather products, Persian carpets, all kinds of handicrafts and even furniture, are just a few good examples,” he said. “These are just some of the best Iranian products that are both consumed in Iran and even exported to Europe or the US.”

When asked if he and his family preferred locally made or foreign goods, he said, “For main home appliances, such as refrigerators and washing machines, my wife insists on buying foreign products for two reasons: their better quality and their much better after-sale services. But for all other needs, such as food and clothing, we only buy Iranian goods.”

Although public opinion on the quality of Iranian products varies, most agree that the low quality of after-sale services of many local goods and services is a decisive factor when making a purchase.

Despite Iranian officials’ attempts to encourage support for local products, it is clear that “Buy Iranian” campaigns won’t achieve their goals through the holding of seminars and the display of advertising on billboards and national TV — all of which have been done over the last few decades with few tangible results.

Moreover, if past experience is a predictor of the future, any request by a state official to support local products will likely be met by public distrust and even outright civil disobedience by a significant portion of Iranians.

“People want quality products at a competitive price,” Leila, a 35-year-old housewife, told Al-Monitor. “No one can force me or have the right to expect me to buy a bad quality product or service just because it is Iranian. For decades, we’ve been forced to buy Iranian cars, but this situation not only failed to improve their products — people have been forced to pay even higher prices for the junk they produce.”

Instituting a widespread mindset of preference for Iranian-made products will take years, and only after Iranian officials address the issues plaguing local industry, including the high rate of smuggling, high credit interest rates, lack of transparency and excessive bureaucracy and business-related regulations. Until these issues are addressed, Iranian manufacturers and producers will continue to grapple over how to be more competitive.

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