By Debt-strapped retailer OK Zimbabwe Limited has embarked on a sweeping consolidation exercise, shutting 11 stores across the country as it races to contain mounting losses and ease severe liquidity pressures.
The closures, which include three Food Lover’s Market outlets whose franchise the group opted not to renew, have reduced OK’s nationwide footprint to 62 stores. A further three outlets are already in the process of being wound down as the company intensifies efforts to streamline operations and focus on branches that remain viable.
The restructuring comes at a time when the retailer is battling a significant decline in revenue, driven by supply chain disruptions, volatile exchange rates, a liquidity crunch, waning consumer spending and stiff competition from informal traders. These challenges have pushed OK into debt of over US$30 million, forcing the company to raise US$20 million through a rights offer and pursue the sale of freehold properties worth US$10.5 million to shore up liquidity. Although the group posted a loss of US$25.03 million for the financial year ended March 31, 2025, this was a marginal improvement from the unaudited US$29.61 million initially reported.
OK said the decision to shut down non-performing stores was necessary to preserve value and redirect product supplies to branches located in stronger trading zones. The Chisipite Shopping Centre, one of the group’s major properties, is currently being redeveloped into a larger retail complex that will house a relocated and expanded Bon Marche supermarket. In Makoni, where the existing OK branch has long struggled due to limited space and poor product range capacity, the group is preparing to move into a new, more competitive site designed to support higher volumes and stock turnover.
As part of the restructuring, OK has embarked on extensive cost-cutting measures, trimming operating expenses by 35% so far, with a further 15% reduction targeted by December 2025. The company has also shut down its loss-making pharmacy business and reduced head office staffing levels to match its smaller store footprint. However, progress on raising funds from property disposals has been slower than anticipated, with sale agreements still being finalised and several offers under review. The delays have hampered the retailer’s ability to build adequate stock levels, as tight trading terms continue to limit supplier support.
In recent months, OK’s interim management team has been engaging suppliers to settle outstanding balances and renegotiate credit terms in order to restore product availability. While suppliers agreed to partial settlements that enabled trading to resume, the retailer acknowledges that existing terms remain restrictive and have prevented it from achieving the necessary stock build-up to drive sales and restore profitability. The company appealed to suppliers for renewed support during the summer trading period, emphasising that improved trading terms and stronger stock flows are vital to turning around the business.
OK Zimbabwe says it will continue to rationalise operations and sharpen its focus on core retail activities. Despite the extensive restructuring efforts, revenue generation remains below break-even levels, constrained largely by limited product supply and ongoing liquidity pressures. The group maintains that long-term recovery will depend on its ability to secure better supplier terms, stabilise stock availability and complete its property transactions — steps it hopes will position it for a more sustainable future.
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