Online Reporter
Nelson Gahadza
Former OK Zimbabwe’s long-serving chief executive, Willard Zireva, has bounced back to lead the retail giant and lift it from obtaining operational challenges.
Zireva previously led the company as chief executive from 2001 until his departure in 2017 and comes back at a time the group has embarked on a business review and restructuring exercise aimed at enhancing operational efficiency and driving sustainable growth in a dynamic market.
OK Zimbabwe, in a statement today, said the conclusion of voluntary separation saw agreements with three top executives: chief executive Maxen Phillip Karombo, chief financial officer Phillimon Mushosho and supply chain director Knox Mupaya.
The new management apart from Zireva, has Alex Edgar Siyavora as chief financial officer and Muzvidzwa Richard Chingaira as supply chain director.
The appointments take effect immediately, with the new leadership expected to stabilise ship and implement a strategic recovery plan over the next six months, while the company searches for permanent executive replacements.
“The Board would like to acknowledge the outgoing executive team for their service through this challenging period and to welcome back the team entrusted with stabilising and turning the business around,” OK Zimbabwe said in the statement.
In a recent trading update, Ok Zimbabwe said it has begun restocking the operating units with support from supplier partners as well as financial institutions that continue to assist with short-term funding structures.
In addition, the business said new alternative procurement models have been developed, which include, but are not limited to, a structured stock supply arrangement with a third party for supplier assurance purposes as the business works to restore critical supply relationships with both local and foreign suppliers.
This comes as the group experienced episodes of stockouts during the quarter to December 31, 2024, and continued in the first two months of this year.
“This was evidenced by daily availability levels of around 50 percent of normal stocking levels, and these stockouts arose from restricted supplies from manufacturers and distributors,” the company said in a trading update for the quarter ended December 31, 2024.
The group said it is confident of restoring normal stocking levels before the closure of the current financial year.
During the period under review, volumes decreased by 36 percent in comparison to the same period last year. However, on a year-to-date basis, the group recorded volume growth of 10 percent over the same period.
The company noted that the reduction in volumes recorded during the quarter translated to a decline in revenue of 36 percent as compared to the prior period.
The group said it had outstanding and overdue creditors’ balances, which were predominantly denominated in US dollars against a backdrop of low US dollar sales collection, at times reaching as low as 20 percent of sales revenue.
The company noted that the low stocking levels are a direct manifestation of sub-economic pricing arising out of exchange rate distortions and suppliers’ need for foreign currency invoicing to cover their operational and raw material needs.
“Suppliers continued to insist on shorter trading terms and, in some cases, prepayments for supplies invoiced in local currency. This exerted pressure on the business’ working capital and necessitated the need to access short-term funding,” it said.
To mitigate against rising operating costs, the group resolved to close four branches in Glen Norah, Kuwadzana 5, Chitungwiza Town Centre, and Robson Manyika Street, all in Harare.”
The business said review and consideration of the future of branches saddled with the stifling impact of unsustainable operating cost structures and costly licensing requirements is in progress.
Bongani Ndlovu