Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.

Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.


Uchumi to close branches, retrench workers

07 July 2015, 21:44

Nairobi - Kenya's Uchumi Supermarkets will close unprofitable branches after it expanded at a rapid pace in recent years, its new finance chief said on Tuesday.

The company fired its chief executive, Jonathan Ciano, and its finance chief, Chadwick Omondi Okumu, on June 15 and ordered a forensic audit to determine why it was bleeding cash and falling behind on supplier payments.

"We made an attempt to expand faster than our capabilities and we will be taking a pit stop in terms of branch and country expansion," Sam Oduor told an investor briefing.

Uchumi, which also has outlets in Uganda and Tanzania, opened several branches in recent years under Ciano.

Oduor accused the previous management of not properly assessing new outlets and of failing to keep an eye on whether they made a profit.

"We are looking at this on a case-by-case basis," Oduor said, adding that unprofitable stores will be closed down.

Uchumi has negotiated a 500 million shilling ($4.98 million) loan from KCB Bank to tide it over as it sells off assets, including land in Nairobi valued at around 2 billion shillings.

"Some of our branches are not fully stocked," Oduor said.

Uchumi has hired KPMG to carry out a forensic audit spanning the last two years when the rot began to set in.

The company is talking to consultancy firms over developing a new corporate strategy, including assessing whether the chain requires a investor from within the industry, Oduor said.

He said Uchumi would not allow members of its board or staff to be involved with suppliers contrary to past practices.

"Have we had insiders supplying to Uchumi? Yes. Have they been giving us value for money? No," he said, adding they would also cut out middlemen and buy directly from suppliers.

Uchumi is facing competition in Kenya from other domestic brands such as Nakumatt and new entrants. Carrefour is due to open stores starting this year, under its franchisee, the United Arab Emirates-based Majid al-Futtaim.

Its shares have fallen 21 percent since Ciano and Okumu were fired, and were down 3 percent at 8.20 shillings on Tuesday.

For the latest on national news, politics, sport, entertainment and more follow us on Twitter and like our Facebook page!

- Reuters


Read News24’s Comments Policy

Comment on this story
Comments have been closed for this article.

Read more from our Users

Submitted by
S Mbinya
What To Do If She Has A Boyfriend

Here are tips to help you get a girl who has a boyfriend: Read more...

Submitted by
George Vodongo
Kalonzo blasts DP Ruto for ‘grabb...

11 Kamba MPs declared their allegiance to Jubilee last month. Read more...

Submitted by
George Vodongo
President Uhuru Kenyatta pardons ...

President Uhuru Kenyatta on Thursday released 7,000 petty offenders to create room in the prisons. Read more...

Submitted by
Ben Wangui
Why Mashujaa Day celebrations wer...

Find out why this year's Mashujaa Day celebrations were held in Machakos. Read more...

Submitted by
S Mbinya
Foods that burn belly fat fast

You can take your best foods and snacks and still be able to get rid of that pot belly. Read more...