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Bianca Mlilo Business Reporter
THE retail sector in Zimbabwe has recorded significant growth over the past six years spurred by the rise in consumer patterns, according to the Confederation of Zimbabwe Retailers CZR). A majority of players in the sector nearly folded at the height of hyper inflation between 2007-2008 only to resurrect in 2009 when prices went down markedly due to the adoption of the multi- currency system.

CZR president Denford Mutashu said the growth recorded in the sector was as a result what he termed a “stage of plenty after a lengthy period of lack”.

“The growth of the retail sector can’t be looked at in isolation from the economy. The growth of the retail sector is directly linked to the growth of the economy,” he said.

“Inflation at the moment is less than one percent, which shows stability in industries. The retail industry shows that the market is there because at almost every street corner you’ll find a retail shop.”

Mutashu said the stagnation in furniture sales, for instance, was due to the fact that only a few people were renovating or buying houses, and people do not usually buy new furniture to put in old houses.

“I’m quite satisfied with the performance of the retail industry because the economy is hinged on it in terms of employment and the contribution of the sector to the national fiscus. You know that wherever you see a retail shop, it’s a source of income for someone,” he said.

Mutashu, however, lamented “gross” financial abuse and lack of financial discipline exhibited by some retailers, which he said has led to the collapse of some.

“Corporate governance is the key, which will ensure continuity and structures that will continue functioning. Out of revenue generated, 75 percent must go back to the suppliers and manufacturers and 25 percent should be used for salaries, recapitalisation and operations.

“So, now the issue is that companies are dipping their hands in the 75 percent and squandering it, where will the finance to continue operating come from?” he said.

Mutashu also spoke of cases where companies acquire shares in non-related fields, which puts a strain on the company coffers because the same amount of money will have to finance two ventures, like a retail shop getting into the mining industry at the expense of another.