Uchumi closes Freedom City outlet

A closed outlet of Uchumi Supermarket at Freedom City mall. The branch was closed due to its poor location and disagreement with landlord over certain improvements on the premises. Photo by Dominic Bukenya

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He said the company has already identified a new location where the former outlet will be relocated to as part of a wider plan to increase its footprint in Uganda

Retail chain Uchumi Supermarkets has closed down one of its branches in Uganda, as the retailer announced a 7.6 per cent growth in its 2014 after-tax earnings helped by a tax credit.
Uchumi said on Monday that the Uganda closure was due to its poor location and disagreement with landlord over certain improvements on the premises.
Chief executive officer Jonathan Ciano told Daily Monitor on Tuesday that the closed branch was Kampala’s Freedom City Mall outlet. Uchumi’s after-tax profit for the full-year ended June 30 rose to Ksh384 million from Kshs357 million last year. Total net sales increased one per cent toKshs14.45 billion fromKsh14.36 billion in 2013, with gross profit falling 6.8 per cent to Ksh453 million from Ksh486 million.

A closed branch of Uchumi Supermarket at Freedom City mall. The branch was closed due to its poor location and disagreement with landlord over certain improvements on the premises. Photo by Dominic Bukenya

Mr Ciano said Uchumi has been operating six outlets in Uganda and the 110 employees at the affected outlet have been moved to other branches.
“The location was not a prime area for doing business. Initially we thought it could be since few players operated in the area. But after numerous variations on the performance of the branch, we decided to pull out but this does not mean that we are reducing our presence in Uganda,” said Mr Ciano.
“Other (possibilities) included reducing the outlet from 5,000 square feet to 3,000 but the landlord became non-responsive and we had to leave,’’ said Ciano.
He said the company has already identified a new location where the former outlet will be relocated to as part of a wider plan to increase its footprint in Uganda.
“We have identified new location to set up our sixth branch. The new outlet is expected to employ 70 employees and will start operations by November this year. The building is nearly complete.”