| By Our Business Reporter
Due to growing competition from local supermarkets owners , South African retail giants Massmart, who own Game Stores at the popular shopping center Forest Mall Lugogo have announced plans to exit the Ugandan market.
The South African franchise will join others like Shoprite Holdings SHPJ.J that has also announced its exit plans citing the impact of the novel -global -Covid-19 pandemic that has led to the collapse of many businesses across the world .
The Massmart Chief Executive, Mitchell Slape attributed the company’s woes to a ” difficult business environment” -that has pushed the supermarket chain to close at least 14 of its poorly performing stores outside South Africa. Uganda has not been spared either .
“The performance and the complexity in running those businesses is something that frankly we needed to address. We’ve commenced a formal sales process, we’re currently in discussions with potential purchasers to take on those stores,” Slape told the media .
“But that is not enough. Achieving break-even performance isn’t going to be sufficient for us to be satisfied, we’ve got to really get Game back to a healthy level of profitability and performance,” he added.
Market experts said that big stores like game faced fierce competition from the many local supermarkets dotted across Kampala . “The local supermarkets like capital Shoppers have the same goods ,which are cheaper and closer to the people . With the wanton jams in the central district -shoppers no-longer find it necessarily to travel long distances for shopping purposes . They get much of what they need from supermarkets near their homes ,” a business executive who declined to be named explained .
And because of a significant drop in business revenues – Slape said the company has put on the market five Game Stores in Nigeria, four in Ghana, three in Kenya, one in Uganda and one in Tanzania for sale to potential buyers.
The Johannesburg Security Exchange-listed company expects its move to result into an annual profit before interest and tax improvement of 750 million rand ($50.24 million).
Game is a promotionally driven discount retailer of predominantly general merchandise and non-perishable groceries for home, leisure and business use. Some Game Stores also stock a select range of fresh food, including fruit and vegetables, pre-packed meats and pre-baked goods.
Game, which opened in Uganda in 2004, operates in 12 African countries including: South Africa, Nigeria, Zambia, Ghana, Malawi, Mauritius, Mozambique, Namibia, Botswana, Uganda, Kenya and Tanzania. | |
