Nakumati mall Remera branch in Kigali. In other East African countries, the store has been facing financial problems
Amidst bankruptcy of Nakumatt Holdings in neighbouring countries, the Kigali division has announced plans to open the fourth outlet in one of the city’s strategic commercial areas.
The Retail chain has the intention to stay in the market to compete with international competitors establishing their businesses in Rwanda. Nakumatt has been one of biggest retail stores in terms of branch network and sales revenue in East Africa.
However, Nakumatt Kenya and Tanzania are struggling to survive while in Uganda, customers have now turned to other stores for shopping.
News coming from other East African countries shows that the store has been facing financial problems.
In July this year, Nakumatt shut down four branches in Uganda and three in Kenya due to taxes arrears and debts.
At the time, management explained that it was ‘a stock-taking exercise’ but media reported that it was due to legal battles with its suppliers and landlords that have aggravated its financial situation.
Due to the financial crisis, Nakumatt Kenya is to be taken over by Tuskys, the second largest supermarket.
The deal was reached after Nakumatt failed to secure a $75 million financing deal quickly enough to avoid its suppliers cutting it off.
In Tanzania, Quality Group Ltd, a company that buys business and turns them around bids to buy Nakumatt Tanzania after the retail chain announced plans to sell 51% of its shares to raise more capital.
Quality Group expects to use Nakumatt to expand its market share and presence in Tanzania’s retail sector.
In Rwanda however, Nakumatt is here to stay.
Speaking to KT Press this morning, the Nakumatt Country Manager Adan Ramata confirmed that Nakumatt – Rwanda is going even stronger, despite problems being faced in other countries.
“For us we are working hard by the support of government and the local suppliers. We are even opening a new store in Remera near Airtel. We were supposed to open today but we had some internet connectivity and installation issues,” Ramata told KT Press adding that by the end of the week, Nakumatt Remera will open.
The fourth shop to be established in Remera, an upcoming major commercial hub of Kigali will join the strategic ones in the Union Trade Centre (UTC), Kigali City Tower (KCT) in downtown and Kagugu shop.
Nakumatt in Rwanda is making profit compared to similar branches in East African countries
Remera, adjacent to Amahoro National Stadium on the road to Kigali International Airport is also very strategic. It is home to branches of all commercial banks which close business at 8pm, work through the week-end, compared to downtown where businesses close two hours earlier and are off in week-ends.
Remera is also acts as the junction to important residential areas of the city.
Nakumatt is making profit in Rwanda to the Rwanda’s Revenue collection body – RRA.
Nakumatt Rwanda was awarded among ‘2016 best taxpayer of the year’ and ‘Best Electronic Billing Machine User’ by Rwanda Revenue Authority during ‘Taxpayer Appreciation day’ that took place on October 13th.
Speaking to KT Press, Ramata also dispelled the rumors that Nakumatt would relocate from UTC following the auctioning of the building two weeks ago.
“We have managed to maintain our store at UTC,” Ramata said.
Prior to its financial problems, Nakumatt had been employing 7,000 people and had 45 stores in Kenya, eight in Uganda, three in Rwanda and five in Tanzania. It boasted an annual turnover of $ 600 million.
Meanwhile, more foreign companies are registering as domestic companies in Rwanda.
The Rwanda Development Board (RDB) registered 100 companies after the annual Kigali International Trade fair that took place in August.
