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OK Zimbabwe Limited has closed 11 stores in a sweeping consolidation effort aimed at stemming mounting losses and alleviating liquidity pressures.
The move, which includes the closure of three Food Lover’s Market outlets, reduces the group’s national footprint to 62 stores. However, analysts warn that deeper cuts may be necessary to stabilize the company’s finances.
The retailer reported a staggering US$25.03 million loss for the financial year ended March 31, 2025 — nearly 40 times worse than the previous year — driven by declining consumer spending, supply chain disruptions, volatile exchange rates, and intensifying competition from the informal sector.
To address its ballooning debt, which has surpassed US$30 million, OK raised US$20 million through a rights issue and is pursuing an additional US$10.5 million via property sales. However, delays in finalizing these transactions have left the company with a negative working capital position of US$19 million.
Retail analyst Tinashe Mukogo warns that the current store count may be unsustainable. “In 2015, OK operated 61 stores with a positive working capital of US$19 million. Today, they have 62 stores but half the liquidity and diminished supplier credit. To regain stability, they may need to close another 20 or more outlets,” he said. “It’s better to have 30 well-stocked stores than 60 with empty shelves.”
OK has begun redirecting inventory to high-performing locations, downsizing head office staff, and cutting operating costs — already down 35%, with a further 15% reduction targeted by December 2025. The company has also exited its loss-making pharmacy business and is relocating select stores, including Bon Marché Chisipite, to more strategic premises.
Despite these efforts, the group admits revenue remains below break-even, constrained by limited product supply and short supplier credit terms. Engagements with suppliers are ongoing to improve stock availability and extend payment periods.
“The success of our turnaround depends on strong partnerships with our suppliers,” the company said in a recent market update. “We appeal to them to work with us during the critical summer trading season — our success is your success.”
As OK Zimbabwe continues to rationalize operations and refocus on core retail, the coming months may prove decisive in determining whether the country’s largest supermarket chain can weather the storm — or if more closures lie ahead.
