Nakumatt Rwanda stable despite regional turbulence – management

Nakumatt Rwanda continues to be stable and has no plans to shut down any of their Rwandan branches despite its parent company’s move to shut down some operations in the region.
Nakumatt supermarket located in the city centre. (Nadege Imbabazi)
Nakumatt supermarket located in the city centre. (Nadege Imbabazi)

Nakumatt Rwanda continues to be stable and has no plans to shut down any of their Rwandan branches despite its parent company’s move to shut down some operations in the region.

Adam Ramata, the firm’s country manager told The New Times that the closure of some of Nakumatt Holdings’ branches in Kenya and Uganda will not affect local operations.

 

Ramata said that Nakumatt Rwanda is in the process of opening up a fourth branch in Rwanda in the next one month ‘if all goes well.”

 

The regional Nakumatt branch has been going through somewhat turbulent times over the last one and a half years owing to debts to suppliers estimated at about Rwf 120billion.

 

The period saw the brand’s stores across the region characterised by empty shelves void of the variety of products that they have been known for.

This saw the brand close some of poorly performing branches in Kenya and Uganda as part of cost-cutting measures.

Already, a number of stores have been closed in Kenya and Uganda leading to uncertainties of implications to staff.

A statement by Atul Shah, the Nakumatt managing director explained that it would largely affect poorly performing branches.

“The branch culling strategy will start off with sub-optimally performing branches for whose leases contracts are due for renewal to be followed by branches in poor locations,” the statement read.

Ramata said that Rwandan operations remain stable and has so far been able to meet their obligations to suppliers and debtors.

He said that this has been through good relations with their suppliers and partners as well as guidance from the head office.

He, however, admitted to smaller challenges stemming from the perception of some of their partners and suppliers about the brand’s ability to meet financial obligations.

“Our shelves are not empty; we have good relations with our suppliers. We may have faced challenges due to the issues our parent firm has been experiencing, however we got past this by explaining that whatever is supplied to us is paid by Nakumatt Rwanda and not the parent company.  We have good relations with our suppliers who have been understanding and we have always made sure to pay whatever we owed,” he said.

Currently, Nakumatt Rwanda has about 400 suppliers with about half of them local which Ramata attributes in part to the Made in Rwanda campaign.

“The improved local products enabled us to reduce the ratio between the imported and increased locally sourced products on our shelves,” he said. 

He also reassured the over 250 employees of the firm in Rwanda that their jobs were secure, adding that they were also keen on taking in more staff as they expand operations.

East African Community’s move to remove non-tariff barriers to reduce the period taken to move goods across the region as well as cost has also had much impact on the firm’s operations in the country.

“It has helped us that it has reduced the delays and increased the shelf life of the products,” he observed.

Nakumatt Rwanda set up shop in 2008, at a time when the city’s shopping culture was adopting all-under-one-roof supermarkets.

 Nine years later, a number of competitors have come up which the management says is healthy for the industry.

The firm is planning to open their fourth branch to serve their Remera based clients.  However, the fate of one of their largest and oldest branches hangs in balance as building management of Union Trade Centre is undergoing issues which could see all tenants vacate the building.

In May this year, Rwanda Revenue Authority issued a public notice asking the general public to avoid doing business  (including leasing) with UTC over tax arrears.

The supermarket management say that they are in talks with authorities to find an amicable solution for the interest of both parties.

editorial@newtimes.co.rw

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