OK Zimbabwe Limited (OK), one of the country’s leading retail chains, has closed 11 stores as part of a strategic effort to curb mounting losses, reduce operational costs, and improve liquidity. Following the closures, the retailer’s national footprint now stands at 62 outlets, focusing on locations deemed strategically viable and capable of sustaining profitability.
The decision comes amid a prolonged period of financial pressure for OK, which has struggled with declining revenues since 2024. The company attributes these challenges to multiple factors, including supply chain disruptions, currency volatility, liquidity shortages, weakening consumer spending, and intensified competition from informal traders who continue to erode market share. These conditions collectively created an unsustainable operating environment, prompting management to undertake a comprehensive restructuring plan.
In its latest financial statements, OK Zimbabwe revealed that it incurred a loss of US$25.03 million for the year ended 31 March 2025. The company’s debt burden, which exceeds US$30 million, has further exacerbated the pressure on operations. To address the financial strain, OK successfully raised US$20 million through a renounceable rights offer and generated an additional US$10.5 million by selling select freehold properties. These measures were intended to improve liquidity and stabilize operations while the company navigates a challenging retail landscape.
“The group has closed 11 stores, which were no longer viable,” the company stated in a release. “Included in the 11 stores are three Food Lover’s Market outlets, which were wound down, and the franchise was not renewed. Three more stores are in the process of being closed. The company will continue to operate 62 stores in strategic and high-performing locations. Close monitoring continues, and stores that cease to contribute meaningfully will also be closed.”
OK Zimbabwe Shuts 11 Stores Amid Restructuring Effort to Stem Losses and Boost Liquidity
The closures are not limited to smaller outlets; some locations are being reconfigured or relocated to strengthen competitiveness. For instance, the Chisipite Shopping Centre is being redeveloped into a larger mall, with Bon Marche, one of OK’s supermarket brands, relocating to a new facility within the development. Similarly, OK Makoni, currently a small outlet unable to accommodate a broad product range, is being replaced by a larger, more spacious store at Makoni Shopping Centre. This move is expected to enhance product offerings and attract higher customer traffic in a key commercial area.
The restructuring exercise has also involved trimming staff at the company’s head office and other support functions. Management reports that operating costs have already been reduced by 35%, with an additional 15% reduction targeted by December 2025. As part of the rationalisation strategy, OK has also closed its loss-making pharmacy business, which had failed to achieve profitability despite years of operation.
Despite the challenging economic environment, OK’s audited financial results show some improvement compared to earlier unaudited reports. The loss for the year ended 31 March 2025 represents a 15.5% improvement from the previously reported unaudited loss of US$29.61 million. A similar trend is evident in the 2024 results, where the final audited loss was narrowed to US$619,367 from an earlier unaudited loss of US$11.04 million. These adjustments suggest that the company’s efforts to rationalize operations, streamline costs, and focus on profitable outlets are beginning to yield tangible benefits.
OK Zimbabwe’s management has emphasised that the current restructuring is part of a long-term strategy to strengthen the company’s position in the retail sector while maintaining a focus on operational efficiency. By consolidating underperforming stores, redeveloping strategic locations, and reducing overheads, the group aims to restore profitability and build resilience against market fluctuations.
While the closures will inevitably impact some employees and local communities, the company asserts that these difficult decisions were necessary to safeguard the future sustainability of the business. By concentrating on core outlets and expanding in high-potential areas, OK Zimbabwe is seeking to balance financial recovery with continued service to its loyal customer base.
As the retailer continues its turnaround plan, stakeholders and customers alike will be watching closely to see whether these strategic measures can stabilize operations, improve profitability, and ensure that OK Zimbabwe remains a leading player in the nation’s retail landscape.
Source- iHarare
