Uchumi Supermarkets has shut five branches in Kenya, culminating in 253 employees losing their jobs. The retailer yesterday announced the closure of Taj Mall, Embu, Eldoret Sugarland, Nakuru and Kisii outlets as a cost-cutting measure and part of its reorganisation process.
The decision, the supermarket said was informed by the need help it cut down on its operational costs,which should see it focus on a leaner structure as dictated by the current business environment. The chief executive, Dr Julius Kipng’etich, said the move is expected to hasten the supermarket’s recovery.
“Closures will enable us channel our resources to fewer branches and optimise operations for maximum gain,” said Kipng’etich. Uchumi said in a statement it has followed all the required legal and statutory requirements in the implementation of the decision.
The process affects 253 employees as the positions will be rendered redundant and follows similar closures of its non-performing branches in the country including Syokimau and Maua and two outlets in Uganda and Tanzania subsidiaries.
The move is also part of a shake-up aimed at reviving the retailer’s local performance after the sacking of CEO Jonathan Ciano alongside chief finance officer Chadwick Okumu for what the board termed gross misconduct and negligence.
The retailer posted half year loss of Sh1.02 billion for the period ended December 31, 2015 against a loss of Sh262.4 million a year earlier. Net sales dipped to Sh4.26 billion from Sh6.83 billion.