9 November 2012

Zimbabwe: Joy Back at Rufaro Marketing


Old habits and practices die hard, it is said, but when they finally do new ways, it may bring joy and relief to those who vigorously fought to preserve the old way of doing things.

The dying and rotting could well be the healthiest ground for new beginnings. Take the city's beer halls, which were run in every suburb by Rufaro Marketing, the beverage manufacturing and marketing arm of the City of Harare.

Over the years, the beer halls had become derelict, disused and virtual failures. They had become a haunt for the elderly, perhaps out of nostalgia, which earned the joints the sobriquets of "kumachembere" (place for the elderly).

The young at heart simply have moved on to newer and vibrant phenomena of sports bars and night clubs. No revenue was coming and the infrastructure was crumbling. Then Rufaro Marketing made the decision to abandon the traditional beer selling business.

The move met resistance, suspicion and derision. However, the decision has turned out to be a master stroke and happy times are returning to Rufaro Marketing.

Some of the bars have been converted into wedding venues, recreational centres, shops, banks and sewing co-operatives. Business committee chairman Councillor Thomas Muzuva says the devolution of the business model has boosted revenue collections for the city.

"Each business operator has to pay licence fees to the city in addition to the rentals paid to Rufaro Marketing," he said.

"Some of the beer outlets that were bringing zero revenue are now contributing up to US$12 000 a month in rentals to the company. The rentals are paid on time," he said.

He gave the examples of TN Holdings which pays the city US$74 000 in rentals per month for the 14 outlets it is renting.

Harare City which wholly owns the company has fewer headaches today as the funds are "free falling" into the company's accounts.

More so the company has only retained less than 15 employees to manage its new business line - Real Estate.

At its peak Rufaro Marketing operated 86 beer outlets - but as market trends would decide the business crumbled under a host of factors ranging from poor management, migration of the clientele to better managed outlets which moved with the times such as introduction of satellite television, snooker and other games.

A visit to the outlets which have now changed business focus tells of a much bigger story - genius of thought. Shawasha Bar in Mbare is one of the shining examples of empowerment where 150 small-scale operators have taken up stalls in the disused beerhall.

The buzzing sewing machines, hustling and bustling of the over 300 people in the complex at any given time signifies the huge hunger for business space that was "unwisely" being kept for the revival of the beer outlet.

Small and big traders throng the premises placing their orders for school uniforms, school bags, baby clothes and all sorts of clothing wares that one can think of.

Prior to that the small business operators worked from home where family demands restrict business hours to a minimal.

Outside the hall carpenters, welders and crafts sculptors do what they know best. Overnight a place that used to employ not less than 20 people is now home to over 150 self employed people and over 200 of their own employees.

This is job creation at its best. A bakery, canteen and other support businesses such as drink vendors, thread and cloth vendors have all set up kiosks within the huge Shawasha complex.

The small scale traders are involved in sewing, carpentry, and bakery, welding and retail business. One of the directors of Shawasha Sewing Cooperative Mr Brighton Chibuwe said the new business model had empowered a lot more people.

"We now have a one stop shop here. We are excited with this model," he said.

A tour of the other outlets that have been taken over by former employees showed brisk business.

Mrs Judith Magwenzi a former employee who together with four others is running Hamamaoko Bottle Store in Glen View 3 said business was good.

Some former employees have taken up some of the loss making beerhalls confirming suspicions that while they worked for the company they were running parallel outlets. But that is now water under the bridge as the former employees have an obligation to pay rentals to the real estate business like everybody else.

The outlets they are running used to generate around US$100 a day but now under their management the turnover per day has increased to nearly US$1000. Rufaro Marketing acting chief executive Mr Daniel Mutiwadirwa confirmed the developments at the company.

"We have remodeled the business. We have moved from liquor retailing to real estate," he said.

He said the company stopped liquor trading on September 30.

"We have asked our employees to go on leave while the city arranges modalities of absorbing them," he said.

He said when all the outlets are taken up the company would be making on average US$300 000 a month in rentals which will translate to about US$3,6 million a year.

He said the real estate company would employ no more than 15 people and its overheads would not exceed US$50 000 per month. Fifty-six of the former beer outlets are now being rented by private individuals, companies and cooperatives. Twenty are still open for take up.

The company's properties are open for such businesses as banking halls, furniture shops, as shopping malls, clinics and pharmacies, schools, play centres, amusement parks, service stations, churches among a host of other uses.

Rufaro Marketing chairman Mr Philip Mataranyika said other local authorities that operated beer outlets fell over other visiting Harare to learn of the model. What started in Harare could very well be duplicated in all local authorities across the country.

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