Online Reporter
Business Reporter
AXIA CORPORATION is positioning itself for strategic growth by tapping into Zimbabwe’s fast-expanding informal sector.
Group Chief Executive Officer, Ray Rambanapasi, said the company had recorded notable growth across several business segments in the previous financial year, despite challenges such as currency volatility and supply chain pressures.
Mr Rambanapasi noted that Axia had successfully expanded into exclusive product lines aimed at higher-end customers, while also tailoring new offerings to suit the informal market.
“In the segment of exclusive offerings to a particular clientele, the pricing of such products is slightly higher compared to our standard TV Sales and Home (TVSH) range. Even the product quality is superior to what we previously offered. It’s a way to tap into a market that felt our products were too basic,” he said.
The Victoria Falls Stock Exchange-listed company has opened a new factory shop to serve price-sensitive buyers.
“We want to tap into the informal market through collaboration with our manufacturers and their support, so that we can begin operating across a broader range,” said Mr Rambanapasi.
The bedding division, which produces under the Restapedic brand, has become central to Axia’s manufacturing strategy. Revenue in the fourth quarter rose by 24 percent, driven by a 28 percent increase in volumes following expanded plant capacity.
“At half-year, we indicated that Restapedic bedding is now the heart of our manufacturing operations. We believe our volumes will continue to grow. Year-to-date, revenue increased by 18 percent, supported by a 25 percent rise in volumes,” said Mr Rambanapasi.
Growth was further supported by the opening of a distribution hub in Bulawayo and the use of business-to-business channels.
TVSH has also begun producing bedding under licence from South Africa’s Restronic, targeting the high-end segment but at accessible pricing.
“In terms of capacity utilisation, we’re operating at around 60 to 70 percent. Our main focus is to serve the Zimbabwean market first before expanding beyond borders,” he said.
Despite strong demand, the group acknowledged that relocating its main factory operations in Harare temporarily disrupted performance. The movement of machinery and management structures during the fourth quarter led to an 18 percent decline in output.
However, Mr Rambanapasi said the consolidation would yield benefits from the second quarter of the current financial year.
“Having all machinery under one roof helps create synergies, manage costs more effectively, and reduce operating expenses such as electricity and security,” he noted.
Axia’s automotive retail and fitment centres, Transerv, experienced mixed results, with a modest rise in sales offset by weaker solar product revenues due to market oversupply.
Nonetheless, the specialised division, including fitment services, grew by 84 percent.
New store roll-outs boosted revenue, with eight outlets opened during the year, although two were closed due to under-performance.
“If there is non-performance, we are not hesitant to close, because we want to ensure we serve our customers while achieving a return,” Mr Rambanapasi said.
Distribution operations under DGA also saw changes, with the subsidiary restructuring certain joint ventures to streamline its core agency business.
The company recently secured a significant portion of Nestlé’s distribution portfolio in Zimbabwe — a move expected to strengthen earnings from October onwards.
While operations outside Zimbabwe, notably in Malawi and Zambia, were affected by currency fluctuations and agency changes, the group remains focused on defending its balance sheet and prioritising domestic growth.
Mr Rambanapasi said the depreciation of the Zimbabwe dollar in September 2024 and delays in foreign currency settlements had cost the business nearly US$2 million.
However, the majority of retail transactions are now conducted in hard currency.
“Ninety percent of our sales are in US dollars. We believe market stability will assist with planning and forecasting,” he said.
Looking ahead, the chief executive expressed confidence that Axia will continue to expand.
“Our pricing is another area we constantly review in relation to the market we operate in. With the quality we offer, customers should feel confident in what they’re buying from us,” he said.
For Axia, Zimbabwe remains both the anchor and the growth engine of the group. The bedding business, informal market strategy, and distribution partnerships are expected to underpin performance in the year ahead, even as regional challenges persist.
