Uchumi shuts Meru branch due to lack of stock

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Stockouts force closure of Uchumi’s Meru branch

Wednesday, March 27, 2019 20:59

By ELIJAH MWANGI |

Cash-strapped retail chain Uchumi Supermarkets #ticker:UCHM has closed its Meru branch due to lack of stock and a long-term row with its workers that has affected its operations.

Its doors have remained closed for the past one week, but were later reopened Wednesday and then closed again in the afternoon.

“We had closed last week due to failure of payment and no stock where the management told us to go home and report on Tuesday this week to check if stock would have come from the main office but we left in the afternoon due to no stock” said a worker at the branch.

A spot check established that the outlet had nearly empty shelves and an empty gas cylinder cage along the walls of the building which is situated right at the centre of Meru town. It was also noted that there were no customers coming in to the branch to shop, opting for the competition.

Despite this, the store’s management insists that they are in operation at the premises behind closed doors.

This week, the firm gave its suppliers and banker creditors two stark choices; either take 30 percent of what the retailer owes them and give up an estimated Sh2.5 billion in debts or be prepared to lose all their money.

The move is part of the retailer’s recovery plan filed in court that revealed the retailer is deeply financially troubled and that it only has a chance of recovery creditors agreed to relinquish most of what they are claiming that stands at about Sh3.6 billion.

Suppliers have opposed the proposal.

The National Treasury has pumped Sh1.2 billion into Uchumi to support its turnaround plan, but all indications are that the move has not worked.