News / National
Edgars turns to mass market and local supply
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Edgars Stores Limited has effectively become Zimbabwe's sole listed clothing retailer after Truworths Zimbabwe entered corporate rescue in 2024, following a prolonged period of financial distress and insolvency. This leaves Edgars as the last publicly traded clothing-focused entity - albeit now listed on the Victoria Falls Stock Exchange (VFEX), having migrated from the Zimbabwe Stock Exchange (ZSE) on April 8, 2024.
The strategic move to the VFEX, aimed at accessing hard currency capital, has not immediately paid off for Edgars. The company's market capitalisation has fallen by 30%, dropping from US$12 million in early May 2024 to US$8 million as of mid-June 2025. This decline underscores the difficult terrain formal retailers face in Zimbabwe's dollarised but fragile economy.
Like many in the formal sector, Edgars has struggled under the weight of competition from the growing informal market, which now controls more than 60% of the clothing retail space. These unregulated players offer cheaper alternatives and operate without the tax and compliance burdens borne by formal entities, drawing price-sensitive consumers away from traditional retail stores.
Edgars' 2024 financial year, which ended on January 7, was marked by an 11% decline in unit sales to 2.55 million units, with trading losses attributed to high operating costs - including wages, utilities, fuel, and backup power - that squeezed already narrow margins. For the six months ending July 7, 2024, the company continued to suffer from low consumer spending, with unit sales falling by 22.4% to 0.85 million and revenue dropping 15.4% to US$16.1 million, down from US$19 million in the previous comparable period.
The full-year results to February 28, 2025, showed a further 22% decline in sales volumes and reinforced the trend of eroding market share. Total revenue dropped 9.1% to US$36.9 million. According to company financials, the Edgars chain contributed 47% of this figure, Jet stores 36%, and the Carousel factory and Express Stores combined just 0.5%, with the remainder stemming from microfinance and credit operations.
To combat declining sales and diversify income streams, Edgars opened six Express Stores during the final quarter of FY2024, aimed at the low-income market with products priced between US$1 and US$10. The group also expanded its footprint with new Edgars and Jet stores in Bulawayo and Borrowdale, respectively.
However, the company appears to be rethinking its heavy focus on rolling out Express Stores, recognising the need to maintain strong performance in its core brands. While Edgars and Jet stores contribute the bulk of revenue, over 70% of their sales are credit-based - a precarious strategy in a high-risk economic environment.
The group's debtors book closed the year at US$11.6 million, a 7.4% decrease from the previous year. While improved receivables turnover provides some short-term liquidity, continued reliance on credit sales echoes the downfall of Truworths. That company's credit-heavy model - with 85% of sales on account - led to liquidity challenges, salary backlogs of over a year, and ultimately, its collapse into corporate rescue, with creditors expected to recover just 12 cents on the dollar.
Despite the turbulence, Edgars has made strategic investments aimed at improving efficiency. The company injected US$1 million into expanding production capacity at its Carousel manufacturing arm, financed through internal funds and borrowings. This resulted in a 58% rise in output, helping to improve margin control and reduce dependency on imported apparel.
Additionally, Edgars' partnership with David Whitehead Textiles to secure local fabric supplies is a vital step toward cutting input costs and insulating the business from forex fluctuations. The company has also pursued sustainability measures, rolling out solar systems at 32 stores last year, with plans to extend the initiative across the entire network.
In a retail landscape increasingly defined by informality and economic unpredictability, Edgars' success may hinge on balancing its traditional credit model with high-volume, cash-based channels like Express Stores, while maintaining cost discipline and operational efficiency.
The company's survival - and potential resurgence - will depend on its ability to adapt to changing consumer behaviour, compete with the informal sector, and leverage its manufacturing capabilities to offer affordable, locally produced alternatives.
The strategic move to the VFEX, aimed at accessing hard currency capital, has not immediately paid off for Edgars. The company's market capitalisation has fallen by 30%, dropping from US$12 million in early May 2024 to US$8 million as of mid-June 2025. This decline underscores the difficult terrain formal retailers face in Zimbabwe's dollarised but fragile economy.
Like many in the formal sector, Edgars has struggled under the weight of competition from the growing informal market, which now controls more than 60% of the clothing retail space. These unregulated players offer cheaper alternatives and operate without the tax and compliance burdens borne by formal entities, drawing price-sensitive consumers away from traditional retail stores.
Edgars' 2024 financial year, which ended on January 7, was marked by an 11% decline in unit sales to 2.55 million units, with trading losses attributed to high operating costs - including wages, utilities, fuel, and backup power - that squeezed already narrow margins. For the six months ending July 7, 2024, the company continued to suffer from low consumer spending, with unit sales falling by 22.4% to 0.85 million and revenue dropping 15.4% to US$16.1 million, down from US$19 million in the previous comparable period.
The full-year results to February 28, 2025, showed a further 22% decline in sales volumes and reinforced the trend of eroding market share. Total revenue dropped 9.1% to US$36.9 million. According to company financials, the Edgars chain contributed 47% of this figure, Jet stores 36%, and the Carousel factory and Express Stores combined just 0.5%, with the remainder stemming from microfinance and credit operations.
To combat declining sales and diversify income streams, Edgars opened six Express Stores during the final quarter of FY2024, aimed at the low-income market with products priced between US$1 and US$10. The group also expanded its footprint with new Edgars and Jet stores in Bulawayo and Borrowdale, respectively.
However, the company appears to be rethinking its heavy focus on rolling out Express Stores, recognising the need to maintain strong performance in its core brands. While Edgars and Jet stores contribute the bulk of revenue, over 70% of their sales are credit-based - a precarious strategy in a high-risk economic environment.
The group's debtors book closed the year at US$11.6 million, a 7.4% decrease from the previous year. While improved receivables turnover provides some short-term liquidity, continued reliance on credit sales echoes the downfall of Truworths. That company's credit-heavy model - with 85% of sales on account - led to liquidity challenges, salary backlogs of over a year, and ultimately, its collapse into corporate rescue, with creditors expected to recover just 12 cents on the dollar.
Despite the turbulence, Edgars has made strategic investments aimed at improving efficiency. The company injected US$1 million into expanding production capacity at its Carousel manufacturing arm, financed through internal funds and borrowings. This resulted in a 58% rise in output, helping to improve margin control and reduce dependency on imported apparel.
Additionally, Edgars' partnership with David Whitehead Textiles to secure local fabric supplies is a vital step toward cutting input costs and insulating the business from forex fluctuations. The company has also pursued sustainability measures, rolling out solar systems at 32 stores last year, with plans to extend the initiative across the entire network.
In a retail landscape increasingly defined by informality and economic unpredictability, Edgars' success may hinge on balancing its traditional credit model with high-volume, cash-based channels like Express Stores, while maintaining cost discipline and operational efficiency.
The company's survival - and potential resurgence - will depend on its ability to adapt to changing consumer behaviour, compete with the informal sector, and leverage its manufacturing capabilities to offer affordable, locally produced alternatives.
Source - Zimbabwe Independent
