Top retailer OK Zimbabwe has tabled plans to adapt to the changing economic environment after suffering setbacks on the back of rapid dynamism.
Over the past years, the local operating terrain has shifted complicating business for traditional retail firms in a move which has seen some reputable brands folding operations.
The environment has seen the rise of the informal sector which ordinarily enjoys lowered regulatory measures and tax evasion among other benefits not enjoyed by formal retailers.
To this end, OK Zimbabwe has clashed with authorities over the need to create an enabling operating environment which protects formal business players.
Presenting a trading update for the third quarter period ended December 31 2023, OK Zimbabwe company secretary, Margaret Munyuru said the top retailer is now ready to up the game.
"Looking ahead, the Group remains optimistic about its prospects and recognises the need to adapt to the changing operating environment. The business is focusing on delivering value to its customers by enhancing customer experience, executing fair pricing, improving market presence and optimising operational efficiencies for long-term sustainability," she said.
During the just-ended reporting period, the retailer's volumes declined by 32% for the quarter versus the prior year and by 28% for the 9 months ended 31 December 2023 on the back of stringent supplier payment terms on ZWL-denominated purchases as well as credit limitations on foreign currency denominated purchases affected stock availability and pricing dynamics during the quarter.
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The group continues to implement volume growth strategies to stabilise business performance.
"Group revenue for the quarter of ZWL568 billion was 50% above last year in inflation-adjusted terms. In historical cost terms, Group revenue grew by 535% to ZWL490.5 billion.
"Revenue for the nine (9) months ended 31 December 2023 grew by 57% to ZWL1.6 trillion in inflation-adjusted terms and by 501% to ZWL1 trillion in historical cost terms. The business has adopted a structured cost containment programme to align overhead costs with business performance," said Munyuru.
The firm also bemoaned the depreciation of the local currency against foreign currencies continued in the quarter under review.
Consequently, persistent price changes adversely impacted consumer demand and supply dynamics. Compliance with laws and regulations governing currency resulted in high instore prices and loss of competitiveness especially against unregulated markets.
"The Group continued to engage amicably with regulatory authorities to enhance macroeconomic stability and support the sustainable growth of formal retail business," added the retailer.
