By Natalie Nyathi
Renowned Retail Chain, OK Zimbabwe has acquired the Food Lovers Market franchise in Bulawayo, Borrowdale and Avondale.
Food Lover’s Market is a South African supermarket chain that operates franchised grocery shops and convenience stores in Southern Africa including Botswana, Namibia and Zimbabwe.
OK chain is expecting to begin rolling a new in-store pharmaceutical offering, Alowell Pharmacies, during this festive season.
Whilst presenting the group’s half year financials for period ended 30 September 2022, Board chairman Herbert Nkala, said negotiations to acquire Food Lovers outlets kicked off in the period under review.
“During the reporting period, the company commenced negotiations for the acquisition of the Food Lovers Market business in Borrowdale, Avondale and Bulawayo.
The negotiations included the acquisition of a Territorial License Agreement that will see the company refreshing the existing stores and expanding the brand representation in the Zimbabwean market”,said Nkala.
He added:
“Subsequent to the reporting period, management received the requisite regulatory approvals and is now proceeding to conclude the transaction. The acquisition is well aligned to the new strategy of augmenting the Group’s premium offering.”
On its financial performance, the group highlighted that revenue for the half-year grew by 34,91 percent to $129 billion from $95,6 billion in the comparative period.
Volumes, which had marginally grown by one percent during the first quarter, declined during the second quarter to result in a net decrease of 8,23 percent over the half-year owing to depressed consumer spending power. Profit before tax for the period increased by 150 percent to $7,6 billion.
Capital expenditure for the period was $2,1 billion, down from $3,9 billion in inflation adjusted terms for the same period in the prior year. The capital expenditure was largely deployed on store refurbishments.
Maxen Karombo, the group’s Chief executive, told an analyst briefing that:
“Food Lovers, now part of the group and what we have is Food Lovers Borrowdale, Avondale and in Bulawayo. It excludes the Greendale shop because it is under a different franchise arrangement.
We will have synergies across the group and have partnerships with local producers, suppliers and shoppers. We will be investing into this brand and we will look at new stores,” said Karombo.
He noted that the partnership is about widening the choice for shoppers not product substitution because at the moment 90 percent of products in OK stores are locally sourced.
“Therefore, we are just widening choice, affordability and ensuring that we remain relevant to our shopping public,” he said.