OK Zimbabwe closes 11 stores amid financial struggles
Retailer cuts outlets to reduce losses and improve liquidity; company implements cost-cutting and asset sales to manage debt
ZIBAMBWE – Debt-laden retailer OK Zimbabwe Limited (OK) has closed 11 stores nationwide as part of a consolidation strategy aimed at lowering losses and easing liquidity pressures, reducing its total store count to 62.
The company attributed its financial difficulties to declining revenues caused by supply chain disruptions, volatile exchange rates, falling consumer spending, liquidity constraints, and rising competition from the informal sector.
OK Zimbabwe is carrying over US$30 million in debt and plans to address the shortfall through a US$20 million capital raise via a renounceable share rights offer, alongside planned sales of freehold properties expected to generate US$10.5 million.
For the financial year ending March 31, 2025, the retailer recorded a loss of US$25.03 million, a tax penalty, a nearly 40-fold increase from the prior year, though audited results showed a slight improvement from an initial unaudited loss of US$29.61 million.
In comparison, the audited loss for the 2024 financial year narrowed to US$619,367 from an initial unaudited deficit of US$11.04 million, highlighting the volatility in the company’s earnings.
Under the restructuring plan, three Food Lover’s Market outlets have been closed with franchise agreements not renewed, while three additional stores are in the process of closure, with operations concentrated on higher-performing locations.
Resources and stock supplies have been redirected to stores considered capable of generating stronger turnover and improving liquidity, as OK seeks to stabilize its core retail operations.
The company is redeveloping Chisipite Shopping Centre and relocating the Bon Marche supermarket to a newly constructed, larger facility. At the same time, a new store at Makoni Shopping Centre has been built to better compete in a high-traffic area.
Cost-cutting measures have already reduced operating expenses by 35 percent, with an additional 15 percent reduction projected by December 2025, while the loss-making pharmacy division has been shuttered and head-office staff have been trimmed.
Sales of properties intended to raise US$10.5 million have faced delays, with some transactions still under review, prompting OK to continue efforts to dispose of assets and improve cash flow.
The retailer has negotiated with suppliers on outstanding balances as of February 2025, implementing partial payments to resume deliveries, although limited trading terms have hindered inventory rebuilding.
OK Zimbabwe acknowledged that revenue remains below break-even levels due to limited product availability and short trading terms, and emphasized that operational rationalization will continue while seeking supplier cooperation during the peak trading season.
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