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By Anna Chibamu
MEGA MARKET, markers of a range of wheat products have hailed the warm hospitality they have received from government ever since establishing their manufacturing plant in Mutare, Manicaland province.
However, despite having a lucrative market for their wheat products in Zimbabwe, the company is facing a liquidity crunch that has affected its business operations.
Mega Market managing director, Shiraan Ahmed told government officials and journalists during a provincial tour of its premises last Thursday that the company supports government’s path, but high production costs and the liquidity crunch issues must be reviewed.
“I think it is important that government must try to level the playing field between the informal and the formal sector. I think the formal sector’s costs are very high at the moment.
“The cost of power, labour and various statutory costs. It is critical that we grow the base. And once we grow the formal base, the tax revenues will grow automatically.
“So, I think it is important at this moment in time to level the playing field, reduce taxes, reduce compliance costs, make compliance easy, so we can grow the formal market for the future of the economy,” Ahmed said.
The company is producing 300 tonnes of wheat products per day and prefers to supply direct to huge retailers, avoiding the middleman in order to avoid counterfeit products on the market.
“We have always been very strong with our big retailers, your Pick and Pay, your OK, your N. Richards and Gain. That has always been our traditional route to markets.
“We enjoy that market because it gives us a good shelf presence, we ensure that the products that we produce actually get to the retailer. It avoids counterfeit products. So, we’re very pro the formal market,”
The managing director highlighted that the market had shifted forcing most companies to cover every segment of the consumer.
“We are forced to be both in the informal and formal market. Generally, the liquidity in the country is tight.
“The formal retailers are struggling at the moment. I think the informal sector has become very strong. And given the overhead structure that’s in the formal sector, they are struggling. And this is translating into cash flow which has an impact in our ability to supply the retailers.,” added Ahmed.
However, he said the milling company, one of the largest in Africa, will not tire but adjust to current business environment.
“We are navigating, we are looking for solutions with them, looking for payment solutions that are flexible.
“We take local currency, we take ZIG, we take US dollars, we take Rand. We’re trying to make it as easy as possible for the retailers. From our point of view, it is important that the retail sector survives in the country for the future of the economy, for the benefit of the fiscus, and for the general economic growth, he added.”
Ahmed projected a high demand for Mega Market products.
” If you produce a good quality product and you have availability of product, I think there is demand out there.
“So, we’re continuing to grow. We’re continuing to go at full speed. We’re looking at various projects of value addition and beneficiation.
“We are looking at setting up a noodles line. We’re looking at cereal lines, pasta lines, and various other projects that are currently in the feasibility stage. We’ve all focus on the economy, and we continue to grow as a business.”
High production costs have led to closure of many companies in Zimbabwe.
This post was originally published on here
