Experts reveal real causes of retail giants woes

Industry experts have emphasized that Zimbabwe's retail giants, including OK Zimbabwe, are not struggling because of the government's ongoing anti-smuggling crackdown, but due to their over-reliance on illicit goods and operational inefficiencies.

The Zimbabwe Revenue Authority (ZIMRA) has intensified efforts to combat smuggling along borders with South Africa and Mozambique, targeting syndicates using buses and trucks to transport groceries and beverages illegally.

Some reports claimed the operation disrupted stock levels for major retailers, but ZIMRA has dismissed these allegations. In a statement ZIMRA Commissioner General, Regina Chinamasa dismissed claims that suggested the crackdown had disrupted supply chains, causing challenges in the retail sector.

"Smuggling distorts the economy, and our operations are aimed at ensuring a level playing field for all businesses. The challenges faced by some retailers are due to other operational issues, not the anti-smuggling efforts," Chinamasa said While 'imported' products, such as beverages have disappeared from the market, ZIMRA insists the operations are necessary for protecting revenue and creating a sustainable economic environment.

"Anti-smuggling operations are about protecting our economy. Businesses must operate within the confines of the law to avoid disruptions," Chinamasa added.

The crackdown has significantly reduced the flow of smuggled goods into both formal and informal markets. Denford Mutashu, President of the Confederation of Zimbabwe Retailers (CZR), emphasized that compliant businesses have not been affected.

"The retail giants are not struggling because of the crackdown. They are struggling because they were over-reliant on smuggled goods to remain competitive. Compliant businesses are doing well because the crackdown promotes fairness and rewards those who follow the rules," Mutashu said.

Mutashu urged retailers to focus on compliance and sustainable sourcing practices. "This is an opportunity for the retail industry to rebuild on a foundation of compliance and sustainability. The notion that poverty or the informal sector alone is driving these challenges is misleading," he said.

Government has called on all businesses to align with trade regulations, reiterating that the crackdown is fostering fairness and strengthening the formal retail sector for long-term growth.