Almot Maqolo, Staff Writer 
RETAIL giant OK Zimbabwe Limited (OK Zim) is strengthening its relationships with key suppliers to iron out conflict in base currencies of trade and prevent supply chain disruptions.
The country’s largest retail chain by store footprint, has lost significant market share due to the sprawling informal retail market as well as uncompetitive trading conditions resulting from exchange control measures by the authorities to boost usage of a weak local currency.
OK Zim has found the going tough in recent months as customers’ payment patterns lean towards the local currency.
The growing disparity of around 80 percent between the official and parallel market exchange rates has seen suppliers refuse payments in local currency which has created supply problems for the retailer.
OK Zim chief executive Max Karombo
OK Zim chief executive Max Karombo speaking at a virtual annual general meeting recently said the fortunes of the business were closely tied to the stability of foreign exchange rates.
“We have launched our Fair-Price campaign, which is focused on promoting price stability and volume growth.
“However, as a business, we look forward to continued engagement with our monetary authorities, in particular, to explore how we can collectively contribute strategies and improve availability, especially in the formal market,” he said.
Karombo believes that a stable foreign exchange rate is essential for promoting volume growth, as seen in the first quarter.
“We will also continue to strengthen our relationships with key suppliers, a top strategic priority.
“This is crucial because we need to balance the base currency of trade with our suppliers against the currency of trade from our customers.”
Formal business players are struggling to stay afloat in a volatile economic environment that is worsened by government controls compelling them to use a heavily discounted official rate for local currency pricing.
Volume, a key indicator of demand, rose by 20 percent during the first quarter ending June 30, 2024, anchored on a 28 percent growth in basket size. Basket size refers to the number of units in a shopper’s basket each time they shop at OK Zim.
“This business performance was driven by the effective implementation of our group’s volume recovery strategies,” Karombo added.
The introduction of the Zimbabwe Gold currency (ZWG) brought relative stability to the economy, driving price stability and affordability for shoppers during the period under review.
Gains have however been offset by the recent downward spiral of the ZWG against the USD on the parallel market.
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