Loss-making retailer Uchumi Supermarkets has asked operators of specialty shops within its outlets to vacate by mid next month, putting at risk more than 100 medium-sized businesses which rely on the traffic associated with its brand to make sales.
In letters dispatched to all sub-tenants last week, Uchumi said the notice to vacate had been prompted by a change in its business strategy whose details it did not disclose.
“We are terminating your contract due to a change in business strategy,” the retail chain’s acting chief executive Owino Ayodo said in a letter to the retailers dated August 4. “Kindly note that your last day of operation will be on September 15, 2015.”
The retailer said the letter would serve as the 30-day notice specified in the contract with the businesses whose models are built on the store-within-a-store concept. People familiar with the matter told the Business Daily that Uchumi plans to bring in international brands to replace the current tenants who sell a wide variety of merchandise including clothes, electronics and food.
The move comes barely a month after the retailer kicked out its chief executive Jonathan Ciano and called in forensic auditors to review its operations.
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