Uchumi hires Naivas manager in turnaround quest (Business Daily (Kenya))


Uchumi Supermarkets has hired Naivas business development and marketing manager Willy Kimani to be its chief operations officerin a management restructuring intended to reverse the loss-making retailer’s fortunes.

Mr Kimani reported to work at Uchumi headquarters Thursday. He will be expected to help the retailer to regain its market share while fixing corporate governance loopholes that have exposed Uchumi to losses.

“I’m happy to join the team that will help rebuild Uchumi. I’m ready to take on the challenge,” said Mr Kimani in an interview.

Uchumi’s board is also set to appoint a new chief executive officer to replace Owino Ayodo, who has been serving in an acting capacity since June when the former boss Jonathan Ciano was sacked.

Uchumi board signed-up consultancy firm Deloitte to recruit a new chief executive officer.

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Mr Kimani joined Naivas Supermarkets five years ago. Naivas is a family-owned business with 35 branches spread across the country. He has also previously held senior positions in Tuskys Supermarkets.

“I had a six-year stint at Tuskys supermarkets and five years at Naivas,” said Mr Kimani.

Uchumi has been on expansion spree across the region but this has not translated into increased sales.

The retailer now plans to shed off some jobs as well as close outlets not located in prime areas. It is yet to announce the expected number of stores to be closed down, or the number of staff to be affected.

The retailer which is listed at the Nairobi bourse has 39 branches spread across Kenya, Uganda, Tanzania and Rwanda with the current staff standing at 4,500.

Uchumi has also informed sub-tenants who operate speciality shops inside their outlets that they face termination of their contracts starting next month.

The management intends to bring on board international investors to replace the current tenants in a move likely to deepen its revenue base by entering into more lucrative lease agreements. Speciality shop owners normally pay the host supermarket a commission forevery product sold.

Uchumi reported a pre-tax loss of Sh262.3 million in the half-year ended December compared to a pre-tax profit of Sh106.9 million a year earlier, after sales fell to Sh6.8 billion from Sh7.2 billion during the same period.

The retailer also has been accused of cooking books, hiding its net loss figures by leaving them out of its financial statements.

Uchumi re-listed on the NSE in June 2011 after a five-year suspension, following gross mismanagement that saw it close shop. It has alsobeen struggling to pay suppliers since late last year forcing it to sell its non-core assets like land to raise Sh2 billion.