Zimbabwe — After enduring terrible years of operating in a hyperinflationary environment, supermarket giants TM and OK may soon close down in Zimbabwe.

 

Sources from the TM supermarkets top management said they cannot continue operating profitably in such an environment of hyperinflation and government imposed repressive price controls.

 

The supermarket chain has already started scaling down operations and closing down some of its branches.

“The operations have become difficult as we cannot get the goods on our shelves, and when we struggle to acquire the scarce commodities, the government descends and forces us to charge low uneconomical prices and at the end we run serious losses,” said a TM official.

Last month TM closed down one of its major branches in Nelson Mandela Avenue, Harare.

Multinational consortium Thomas Meikles Limited owns TM Supermarkets.

There is also speculation that supermarket giant OK Zimbabwe, owned by Delta Corporation, is also in the middle of scaling down in a move that will eventually lead to complete pull out from the country.

Ok Zimbabwe has already retrenched a large chunk of its staff to ease the burden on the huge salary bills.

“We are currently operating on a skeleton staff" said an OK official.

 

An analyst who spoke to ZimDaily said shops have been the most affected by the current economic crisis crippling the country.

“Supermarkets are the most hit as they cannot acquire the scarce goods that make their business vibrant,” said the analyst, “when they do they are forced to sell the goods at uneconomical prices resulting in massive losses.”

ZimDaily carried out a snap survey in some Harare supermarkets and can reveal the effects of the economic decline in Zimbabwe.

Due to acute shortages of commodities, most shops are failing to fill the empty shelves and have resorted to closing some shopping floors and reducing the shopping spaces, with some big supermarkets ending up looking like ‘little kiosks’.

Enduring an eighth consecutive year of failed agricultural seasons, Zimbabwe is importing most of the basic goods including cooking oil, maize meal and soap.

While there has been a relaxation of import duty on the foodstuffs, supermarkets have not benefited from the facility as the government monitors their prices.

Instead, the move has fuelled informal trading, with large number of people importing basic commosities into the country to sell them at black market rates.

 

Zimbabweans have already coined terms like ‘The shops are selling shelves.’