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Nakumatt eyes Sh35b gross revenue

NAIROBI, September 6 – Nakumatt retail chain expects to attain total gross revenue of Sh35 billion by February 2010, when it opens additional branches in Uganda and Tanzania in addition to the recently opened, 25,000sq ft – outlet in Kigali, Rwanda.

Operations Director, Thiagarajan Ramamurthy told Capital News that the chain had embarked on a regional expansion plan in which it expected to establish a minimum of 30 outlets in East Africa, up from the current 20 in the course of next year.

Ramamurthy revealed that concessions with established supply chains were already ongoing in Uganda and Tanzania in a bid to ease the chain’s inception into the new territories.
“We have twenty branches now, but am sure that ten more branches will be coming up in the course of the next year,” Ramamurthy said.

He admitted that since the introduction of the 24-hour shopping concept in five of its outlets, the chain has experienced exponential growth in transactions which has gone up by 1.7 million transactions in the last six months as compared to last year’s.

According to the Operations Director, the chain entertains an average of 7,000 customers per night in all the five 24-hour outlets; which he says has contributed to the immense growth recorded over the last six months.

Turnover for the same period, he added, increased by 22 percent from the previous Sh11 billion to settle at the current turnover of Sh13.5 billion.

He confidently attributed the growth to the positive appreciation of the new 24-hour shopping concept, which he termed as a purely a ‘gutsy investment move’.

“Our customers are happy with this new shopping concept and we are sure that we will this is our motivation,” he said.

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The growth, in his words, is expected to create over 1,250 additional jobs opportunities to the current employee number standing at 3,750.

He however said the five branches: Nakumatt Downtown, Nakumatt Ukay, Nakumatt Ngong, Nakumatt Eldoret and Nakumatt Nyanza have been a challenge in terms of personnel who now work in two, 12-hour shifts.


Meanwhile, the director noted the company, like other businesses, has chocked immensely under the increased inflation, coupled with global high fuel prices, occasioned by the rise in global crude oil prices.

He informed that power costs have gone up by a bigger margin compared to previous bills, whereby the company is paying well over Sh42 million monthly up from the previous Sh27 million, which though has not been passed down to the consumer.

He explained that cost sky-rocketed by reason of the fact that the use of air conditioners, ambience, CCTVs and other electrical requirements to facilitate the shopping concept has remained necessary, and could not be done away with, so as to ensure good service for its customers.

Similarly, he allayed fears that infrastructural bottlenecks would hamper growth of extra terrestrial outlets, with reference to the Nakumatt Kigali, considering the fact that Rwanda is a land – locked country.

Long queues

To address the issue of long queues at the chain outlets, Ramamurthy said the chain was establishing extra tills and check-outs in busy branches such as Lifestyle and Down Town in Nairobi, in a bid to salvage the current situation whereby the available tills are bogged down by overwhelming   numbers of customers.

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He said the cues have been exacerbated by the lack of bar codes especially on Kenyan manufactured goods and revealed that the supermarket has devised its own bar coding system which is being used to abate cues during the cashing process.

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