Climate

OK Zimbabwe feels heat of economic crisis

OK Zimbabwe

By Nevson Mpofu

Retailing giant OK Zimbabwe says it is feeling the heat of business difficulties the country is facing, Chief Executive Officer Mr Alex Siyavora said at the OK Annual General Meeting held  in Harare.

Economic challenges, among them inflation characterised by deterioration in exchange rate, were some of the reasons causing the difficulties. This has resulted in the escalation in the prices of basic goods. Mr. Siyavora pointed out that the retail business organisation experienced difficulties in accessing foreign currency to import goods. Suppliers faced the same problems.

‘’The macro-economic environment is unstable, characterised by deterioration in the exchange rate .This escalates prices of goods. Other difficulties are in accessing foreign currency. It has been a challenge in the long run.

‘’Our suppliers had the same problems. Erratic of goods supply were encountered. However our stores remained reasonably stocked with these goods. Our biggest promotion OK Grand Challenge JackPot was successful despite challenges faced.’’

Zimbabwean businesses have since 2008 experienced a plethora of difficulties. These are still biting in the business sector. The deterioration of the exchange rate caused a steep price increase in June this year.

‘’We however managed to succeed with our greatest national OK Grand Challenge JackPot. Price increases were tense in June, but we made it a win. The rate stabilised following the introduction of local currency. There were accompanying policy measures. Prices have stabilised since July 2019. We hope this will continue for the benefit of our own consumers’’.

The lack of electricity continues to affect the whole country and business operations. Most of the businesses are operating below minimum levels. The retail giant is facing the same problem. The retail group has turned to other forms of energy.

‘’The lack of electricity is affecting our operations. We operate our stores on generator power. This is costly in both fuel and repairs. We have been forced to rationalise opening hours, making sure that we open at peak times so that our customers are not inconvenienced. Some operations like in store bakeries have been affected. In the near future as we move on, we have to use solar power and other other forms of power.”

Mr Siyavora said that the retail giant continues to refurbish its stores and improve customer experience. OK is continuing to open new stores. He added that the retail giant is soon opening in Karoi . The construction of the building is on.

‘’We are in the process of doing refurbishments. We do this to improve customer experience and satisfaction. If there is any reason for opening new branches we have to do so. Sales grew by 167%. Net sales amounted to $398, 9 million. Our Gross profit margin has been maintained at about the same levels as those reported for the year ending 31 March. We are experiencing increasing cost pressures. We will however ensure we meet our profit targets’’, Mr Siyavora said.

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Byron Adonis Mutingwende