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Uchumi Supermarkets is in trouble again and I am really not surprised. Rather than repeat the remarks I made months ago, I will re-publish the entire post here complete with the date;
Saturday, July 22, 2006
Business Special: More Trouble Ahead For Uchumi
In all the hype being generated by the media and show of goodwill towards the Uchumi Supermarkets rescue efforts, alarm bells are beginning to ring loudly in my ears.
I really started to get nervous when I heard about the latest move by the new supermarket chain management to raise extra funds from shareholders. In the plan, shareholders will lend a minimum of Kshs 10,000 each to Uchumi. In fact the plan was to initially get a minimum of Kshs 100,000 from each shareholder. Shareholders quite rightly pointed out that this was too much for most of them.
What is going on here?
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Any nincompoop why threw money at the revival of Uchumi deserves no tears. Patriotism doesn’t mix with business. Like I always tell folks, If you want to invest in energy, don’t buy KenGen simply because it’s a Kenyan company; the sector is extremely wide. The rule as always should be profit first.
ReplyDeleteWhereas Nakumatt not only made the successful transition from small-scale shop to big chain super-stores but went on to do rip-roaring business and now eye stock exchange listing(albeit with lingering tax evasion allegations), Uchumi is still offering the same one-track pony approach to retail shopping (what you see is all what you get) and playing the sympathy card, calling on Kenyans in the name of patriotism to give this ailing potential monster yet another shot in the arm
ReplyDeleteHey Uchumi,simply put...what are you offering us in store now that we can't get better elsewhere?(that's your red herring right there) I'm proud to buy Kenyan but prefer to go to Nakumatt where all you see isn't only what you get
The playing field has changed-it's in your best interest to level it
(i'm too much e-cop;handing over to Mwalimu now)
Uchumi's case may be the calssic case of plastic growth. But at the risk of inviting all the murk and being labelled angel of doom, I will take leave and snore enjoying the HISTORIC GROWTH. A pack of cards simply suffers domino effects at no prompting. We are watching and keenly so.
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