Retail chain Uchumi Supermarkets aims to align its growth strategy by acquiring 300 neighbourhood stores in the next three years.
Dr. Julius Kangogo Kipng’etich, Chief Executive Officer at the retail in an interview on Citizen Television, says this will be implemented through partnership with existing store owners.
“We are going to call the adopted stores Uchumi Express,” he said.
“The outlets will not be owned by Uchumi, but through partnership with successful stores. We shall deliver goods to them from our warehouses at a cheaper rate,” he added.
According to the CEO the approach will improve their fortunes different from the initial adoption of having large stores.
In Kenya, the local retailers dominate the food sector while facing competition from international retailers on the other sectors especially fashion.
Sentiments from Cytonn Investments’ Retail Report state that, “Over the next two to five years, key retail players expect the sector to grow at between 10-20% y.o.y leading up to doubling in revenues. They also believe that the retail chains currently almost unanimous, will be clearly differentiated according to product offerings.”
According to the Analysts, local retail chain is by focusing on client retention through pricing, customer service, and product differentiation in the short term, most of the mare focusing on increasing distribution channels through organic growth, partnerships and franchising in the medium term online shopping is also a key target area for developers in the medium term.
The listed retailer, notice on the late publication of its audited financial statements for year ended June 30, 2016 citing ‘turbulent business environment faced by the company’ from December 31, 2016 to end of this month.
Kipng’etich in a brief said they were facing a problem with putting all financial records in order for operations in Uganda and Tanzania.
“We are almost finalising the accounting work. They (Uganda and Tanzania units) operated for only three months of the reporting period and when they closed we did not have the chance to do a proper accounting audit on the ground.”
Uchumi Supermarkets owes its suppliers Sh3.6 billion.
In July, the Cabinet approved Sh1.8 billion bailout for the company higher from what it had requested of Sh1.2 billion to settle part of the suppliers’ Sh3.6 billion debts in their turn-around strategy.