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Retailer Choppies Lays Off 583 Employees As Cash Crunch Bites

choppies
Choppies Supermarket. [Courtesy]

Choppies supermarket has fired a total of 583 workers in recent months as it struggles with strained cash flows.

In court documents, in the month of November 2019, 486 workers were declared redundant and 97 others had quit earlier.

This is following a dispute between the retailer and Kenya Union of Commercial Food and Allied Workers with concerns raised that the former is most likely to exit the Kenyan market without settling full dues for the laid-off staff.

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“486 employees were declared redundant by a notice dated November 15, 2019…51 employees were declared redundant at Nanyuki by notice dated October 31, 2019, while 46 employees exited employment for other reasons other than redundancy,” reads the documents.

According to Business Daily, the percentage of workers who left Choppies is accounted for by 72% of the retailers 799 unionisable workers.

Additionally, the percentage of the workers that left is a reflection of a struggling business.

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Last year, it was established that there were plans for the retailer supermarket to exit the Kenyan market over poor show.

The retailer that has roots in Botswana announced that it had planned to sell 15 of its stores amid struggles to exit the market.

Last year alone, the retailer closed its Kiambu, Nanyuki, and Bungoma outlets amid rising operational costs.

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“The group has decided to downscale the business in Kenya region by reducing the number of stores to nine from 15. Offers are already in place for two stores and initial discussions are happening for the other stores. This decision has been taken due to the ongoing distressed business in Kenya region,” Choppies said in a statement.

Choppies acquired Ukwala approximately four years ago at an estimated Sh1 billion. The 25 percent stake is held by the local subsidiary, Export Trading Group (ETG).

ETG recently offered a Sh400 million loan bail-out and a guaranteed Sh250 million overdraft from I&M Bank Limited.

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Written by Mercy Auma

Passionate about human interest stories and politics. Email news@kahawatungu.com

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