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Nakumatt: Another ailing Kenyan company
KulaRaha
#1 Posted : Friday, October 28, 2016 7:58:48 AM
Rank: Elder


Joined: 7/26/2007
Posts: 5,751
So the story started on Monday on whatsapp, rumours that a bunch of suppliers had gotten together and decided to put Nakumatt into receivership.

Again, rumours of a follow up meeting yesterday, and suddenly Nakumatt issues a statement.

What's your take?
Business opportunities are like buses,there's always another one coming
littledove
#2 Posted : Friday, October 28, 2016 8:20:17 AM
Rank: Member


Joined: 7/1/2014
Posts: 510
Location: sky
KulaRaha wrote:
So the story started on Monday on whatsapp, rumours that a bunch of suppliers had gotten together and decided to put Nakumatt into receivership.

Again, rumours of a follow up meeting yesterday, and suddenly Nakumatt issues a statement.

What's your take?


signs are very clear the economy is not doing well.
The other day i just noticed something else, many big billboards without adverts for months now, three years back we were looking for a big billboard to put a company advert,we had to wait for seven months and it was not as strategic as we wanted.Companies are retrenching on daily basis and downsizing instead of expanding.
There are only two emotions in the stock market, fear and hope. The problem is, you hope when you should fear and fear when you should hope
Ericsson
#3 Posted : Friday, October 28, 2016 8:39:47 AM
Rank: Elder


Joined: 12/4/2009
Posts: 3,022
Location: NAIROBI
Choices have consequences.
Jubilee manifesto ndio hiyo
maka
#4 Posted : Friday, October 28, 2016 8:43:37 AM
Rank: Elder


Joined: 4/22/2010
Posts: 9,706
Location: Nairobi
Ericsson wrote:
Choices have consequences.
Jubilee manifesto ndio hiyo


Word...
possunt quia posse videntur
hardwood
#5 Posted : Friday, October 28, 2016 8:57:04 AM
Rank: Elder


Joined: 7/28/2015
Posts: 3,826
Nakumatt collapsing?

Sasa where will the middo class shop?

http://www.the-star.co.k...to-stay-afloat_c1445570

Quote:
In a statement on Thursday, Nakumatt Holdings managing director Atul Shah admitted that the chain was facing financial challenges that had affected its cash flow.

“These challenges range from a depressed economy, higher operating costs and extraneous factors including enhanced risk management due to prevailing security threats,” he said.

Shah further revealed that the retail chain is currently engaging a number of local and international partners for possible capital injection to subvert further turbulence.

It is estimated that Nakumatt Holdings requires an estimated Sh5 billion shillings to regain its market stability.
August 9, 2017: Ohuru 65%, baba 35%. And yes Iam the same guy who predicted the Trump win.
hardwood
#6 Posted : Friday, October 28, 2016 9:06:27 AM
Rank: Elder


Joined: 7/28/2015
Posts: 3,826
Nakumatt has admitted challenges in paying suppliers. Suppliers say they are now paid after 6-9 months instead of the usual 3 months.

http://www.businessdaily...32754-juj5h4z/index.html
August 9, 2017: Ohuru 65%, baba 35%. And yes Iam the same guy who predicted the Trump win.
kaka2za
#7 Posted : Friday, October 28, 2016 9:09:02 AM
Rank: Elder


Joined: 10/3/2008
Posts: 2,531
Location: Gwitu
All major supermarkets are in red
watesh
#8 Posted : Friday, October 28, 2016 9:15:26 AM
Rank: Member


Joined: 8/10/2014
Posts: 547
Location: Kenya
KulaRaha wrote:
So the story started on Monday on whatsapp, rumours that a bunch of suppliers had gotten together and decided to put Nakumatt into receivership.

Again, rumours of a follow up meeting yesterday, and suddenly Nakumatt issues a statement.

What's your take?

Waaah! Is it because of those blue label products they keep putting up EVERYWHERE? On Twitter I saw some supplier complaining of losing shelf space because of the blue labels.
Then I also saw a rumor that Unilever, Cocacola & Pepsi have suspended supplies into Nakumatt.
If Nakumatt is getting into trouble, what about these other guys like Uchumi and Tuskys which constantly have issues?
maka
#9 Posted : Friday, October 28, 2016 9:28:02 AM
Rank: Elder


Joined: 4/22/2010
Posts: 9,706
Location: Nairobi
watesh wrote:
KulaRaha wrote:
So the story started on Monday on whatsapp, rumours that a bunch of suppliers had gotten together and decided to put Nakumatt into receivership.

Again, rumours of a follow up meeting yesterday, and suddenly Nakumatt issues a statement.

What's your take?

Waaah! Is it because of those blue label products they keep putting up EVERYWHERE? On Twitter I saw some supplier complaining of losing shelf space because of the blue labels.
Then I also saw a rumor that Unilever, Cocacola & Pepsi have suspended supplies into Nakumatt.
If Nakumatt is getting into trouble, what about these other guys like Uchumi and Tuskys which constantly have issues?


Expanded too fast?To your list add Del monte
possunt quia posse videntur
KulaRaha
#10 Posted : Friday, October 28, 2016 9:32:01 AM
Rank: Elder


Joined: 7/26/2007
Posts: 5,751
Is it a case of expansion really? Or more a case of diversion of cash offshore?
Business opportunities are like buses,there's always another one coming
Lolest!
#11 Posted : Friday, October 28, 2016 10:42:52 AM
Rank: Elder


Joined: 3/18/2011
Posts: 9,741
Location: Kianjokoma
[quote=hardwood]Nakumatt has admitted challenges in paying suppliers. Suppliers say they are now paid after 6-9 months instead of the usual 3 months.

http://www.businessdaily...2754-juj5h4z/index.html[/quote]
I don't gerrit

How do retail chains which make money from keeping suppliers' money end up in financial mess??
Laughing out loudly smile Applause d'oh! Sad Drool Liar Shame on you Pray
FRM2011
#12 Posted : Friday, October 28, 2016 10:43:14 AM
Rank: Veteran


Joined: 11/5/2010
Posts: 1,358
KulaRaha wrote:
Is it a case of expansion really? Or more a case of diversion of cash offshore?


I think this is the closest theory to explain nakumatt's predicament.
Lolest!
#13 Posted : Friday, October 28, 2016 10:56:58 AM
Rank: Elder


Joined: 3/18/2011
Posts: 9,741
Location: Kianjokoma
FRM2011 wrote:
KulaRaha wrote:
Is it a case of expansion really? Or more a case of diversion of cash offshore?


I think this is the closest theory to explain nakumatt's predicament.

Something's terribly amiss

These guys will receive cash payments from customers on the spot when making a sale but will only pay suppliers 3 months down the line.

They make money not just from selling but withholding supplier's payments

Sasa ni 6 months
http://www.businessdaily...2754-juj5h4z/index.html[
Laughing out loudly smile Applause d'oh! Sad Drool Liar Shame on you Pray
streetwise
#14 Posted : Friday, October 28, 2016 11:07:37 AM
Rank: Veteran


Joined: 6/23/2011
Posts: 1,736
Location: Nairobi
Or avoiding taxation
wukan
#15 Posted : Friday, October 28, 2016 11:14:59 AM
Rank: Member


Joined: 11/13/2015
Posts: 268
A turnover of 51.6 billion giving you a profit of 350 million. Better off buying the infrastructure bonds >13% stress free
Bigchick
#16 Posted : Friday, October 28, 2016 11:25:09 AM
Rank: Elder


Joined: 2/8/2013
Posts: 2,521
Location: At Large.
Lolest! wrote:
hardwood wrote:
Nakumatt has admitted challenges in paying suppliers. Suppliers say they are now paid after 6-9 months instead of the usual 3 months.

http://www.businessdaily...2754-juj5h4z/index.html

I don't gerrit

How do retail chains which make money from keeping suppliers' money end up in financial mess??



They have overstock and end up with alot of dead stock.

Am also thinking the changes in the banking sector are beginning to bite.Banks have become tight with their overdrafts.Both to the supermarket and the suppliers.Banks have lines called Invoice Discounting which are now dying since the margins are low.The banks are also keen on who the Principle is on the Invoice and are not accepting some.That effectively grounds the supplier who is not paid by the Principle on delivery nor the bank advancing them working capital.

We clapped at Interest rates capping but me thinks kunaanza kuharibika.
Love is beautiful and so are those who share it.With Love, Marriage is an amazing event in ones life time, the foundation of joy, happiness and success.
maka
#17 Posted : Friday, October 28, 2016 11:32:29 AM
Rank: Elder


Joined: 4/22/2010
Posts: 9,706
Location: Nairobi
Bigchick wrote:
Lolest! wrote:
hardwood wrote:
Nakumatt has admitted challenges in paying suppliers. Suppliers say they are now paid after 6-9 months instead of the usual 3 months.

http://www.businessdaily...2754-juj5h4z/index.html

I don't gerrit

How do retail chains which make money from keeping suppliers' money end up in financial mess??



They have overstock and end up with alot of dead stock.

Am also thinking the changes in the banking sector are beginning to bite.Banks have become tight with their overdrafts.Both to the supermarket and the suppliers.Banks have lines called Invoice Discounting which are now dying since the margins are low.The banks are also keen on who the Principle is on the Invoice and are not accepting some.That effectively grounds the supplier who is not paid by the Principle on delivery nor the bank advancing them working capital.

We clapped at Interest rates capping but me thinks kunaanza kuharibika.


@BC but their problems started way back....or the interest rate caps has compounded their mashidas
possunt quia posse videntur
KulaRaha
#18 Posted : Friday, October 28, 2016 11:32:30 AM
Rank: Elder


Joined: 7/26/2007
Posts: 5,751
Bigchick wrote:


They have overstock and end up with alot of dead stock.

.


Really? How is that when all goods they buy are on consignment? They pay once sold...there is no cost to Nakumatt for holding stocks, the cost is on the supplier?


Business opportunities are like buses,there's always another one coming
Lolest!
#19 Posted : Friday, October 28, 2016 11:46:17 AM
Rank: Elder


Joined: 3/18/2011
Posts: 9,741
Location: Kianjokoma
KulaRaha wrote:
Bigchick wrote:


They have overstock and end up with alot of dead stock.

.


Really? How is that when all goods they buy are on consignment? They pay once sold...there is no cost to Nakumatt for holding stocks, the cost is on the supplier?



I know a few suppliers who complain about this arrangement
Laughing out loudly smile Applause d'oh! Sad Drool Liar Shame on you Pray
KulaRaha
#20 Posted : Friday, October 28, 2016 11:49:22 AM
Rank: Elder


Joined: 7/26/2007
Posts: 5,751
So obviously its not cost of holding stock...its not overheads either because a company like Nakumatt with such a huge positive cashflow (sell on cash, buy on credit) can easily pay overheads.

So why ailing? Where is the cash going?

If it looks like a duck, swims like a duck, and quacks like a duck, then it probably is a duck.
Business opportunities are like buses,there's always another one coming
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