Furnmart , the Botswana Stock Exchange (BSE) listed company which also trades in Zambia as Home Corp has announced that it is closing its loss making businesses in Zambia, a move that will see around 350 Zambians losing their jobs.
Furnmart has decided to close down its operations in Zambia following poor performance in that country.
The Zambian economy has been under duress following the fall in commodity prices, which affected the price of copper, its principal export.
The decision by management of Furnmart to close down the Zambian operations comes as little surprise as the Botswana based company has had concerns about its future in Zambia.
“Management would like to bring to the attention of shareholders that the publication of abridged audited consolidated financial statements will be delayed in view of the decision to wind up operations in Zambia which is having an impact on the finalisation of the results. The Company commenced the winding up of the Zambian operations on the 1st November 2016.
Management is confident that this will have a positive impact on future profitability,” said Tobias Louis John Mynhardt, the group’s deputy chairman and also the Managing Director of Cash Bazaar Holdings.
Furthermore, the group’s performance for the financial year ended 31 July 2015 recorded profit before tax which was 18.6% lower than the prior year mainly as a result of lower gross profit margins and higher operating expenses.
“The difficult trading conditions in the region and the currency fluctuations have had an impact on these results. However, management believes that the fundamentals of our respective business units are sound and that these businesses are well positioned to take advantage of future economic improvement. The Zambian business unit remains a challenge. The Group’s Home Corp model in South Africa also requires refinement,” the group said in a management analysis accompanying the interim results.
Furnmart Limited retails domestic furniture and electrical appliances through its network of stores in Botswana, South Africa, Namibia and Zambia.
And some of the workers interviewed have expressed concern that management at the entities have not given them any guarantee of receiving their terminal benefits.
One of the affected employees complained that the company has since engaged external security at the premises at Manda Hill and the sister company Furnmart operating as Home Corps in other towns across the country.
“They have said they will give us our terminal benefits by November month end, but our fear is that Home Corp have already put external security at their premises including the warehouse, which means they could be leaving anytime, maybe even before they pay us our dues,” he said.
He said the company management have complained of high rentals paid in US dollars which have become too high for the business with the soaring exchange rate against the Kwacha.
iyee, dununa reverse
Fact is those charged with the responsibility to take care of this economy are failing. There is no clear road map on how to end load shedding ( and this is a PF baby). After 5 years in power the Reverse guys are yet to learn that you can generate power from the sun. They are still singing the old tired song of low water levels.
When it was clear the current govt would not help our economy still some people resorted to dine with it. Dont resort to anger because hunger is in the pipeline. You reap what you sow and there you have it. Maybe next time you will learn to do act responsibly!
Dununa reverse due toss of employment though compensated with more business for Chisokone, Nakadoli & Matero local furniture makers.
Dununa reverse cos International furniture quality standards have flown away throw the window.
We are back to the days of sofas with polythene sacks behind & underneath!
In 5 years how many companies will have closed? How long can you continue to rule on borrowed time & money & rely on citizens’ patience? Did PF come to create or destroy employment? Social implosion is looming!
KK was not simply hated but overstayed & failed to manage economy & these are signs that trigger social implosion.
It is typical of these companies to do this just to come back as another company. We had Supreme furnishers and Bannets who did a similar thing just to come back using other names. Clothing companies have been doing the same with companies like Smart centre and Dunns among them.
Mulusa’ attack on investors has to do with this. I think they misunderstood him in south Africa.
@Nostradamus!
It’s looks like mulusa and mwamba did not do a good job at their business conference,,,,, they did dununa instead,,kekekkekekeje
Rent in Zambia is just ridiculously high. They peg at prices as equal or similar to USA or Australia. The high prices do not correlate to the sales the businesses make.
In hindsight, this will create room for local manufacturing capacity
Competition is always good in a liberal economy. Local manufacturing needs to improve their quality to be able to compete not only on the international market, but the local one first.
These are not manufacturing companies. They are retailers. If local manufacturers have not been manufacturing, it is not because of these companies.
Making losses…i don’t think so, but unstable economic environment..yes. We know these tactics, in less than 6 months another ‘big furniture’ company will open its doors to the Zambian market. We need proper taxation and labour policies in Zambia. The laws might be there but the policies to interpret these laws are failing the Zambian citizens. Boma iloleshepo mukwai.
Let them go so that we can have better companies for our people. Also its ok than having a tribalist president in state house with fat dull gbv as vice. God is great.
Let the 350 employees eat your Bemba tribe.
Let the unemployed miners and the 350 who are about to loose their employment drink Jameson and eat dununa reverse for the next 5 years of the Chipanga family party and the Vodka Chakolwa Rungu…
This is what I call power to the people but Zambians wont see this opportunity. They will complain about job loses.
If you see the opportunity, why don’t you take advantage of it and provide employment to these Zambians?
Ubufi! 5 years yafika! Release the unabridged audited report tumone kabili!
Si business yaanyoko.
Dununa matuv***i in high gear nomba!
These companies are given tax rebates and when the time comes to pay they go,,,remember Supreme Furnishers….These guys will comeback with another name!!
Keep the stoopid myth.
It shocking to read comments from some bloggers. E.g this will qive an opportunity for local manufacturers or they will come back under another name etc. Which manufacturer makes world class home products in Zambia, please name them?. If you don’t understand the dynamics of our economy, please keep your unprofessional ideas to yourself. Zimbabwe was @ one time the envy of many African economies & when the companies started pulling out, all sorts of names where branded those companies. Our economy is going back to late 80’s & early 90’s scenario due to poor leadership, by KK that time took us down. Smell the coffee & prepare for the worst.
I agree with you. Even as investors disappear, Zambians cannot believe that somebody can leave and instead generate alk these crazy myths and stories about tax breaks. If you need tax breaks to survive or stay, then the business is not viable. The fact that there’s no single retailer from the 1960s still operating just shows how volatile the economy is. There’s nothing to celebrate here.
Let the workers contact the 3 disgruntled judges for their benefits…or maybe Tayali will give them. Bola naikosa…they go to labour office, no action, go to court worse to the highest office iyeeeee. We pay the price, we sacrificed but not enough, we had the chance to redeem ourselves but alas police brutality is the main business to silence everybody….pama fiiiiii has smeared it on everybody.
who can blame these companies from pulling out from a corrupt dictatorship. A country ruled by a president who has vendettas with business men and uses all state machinery to fix his opponents or those he percieves threats to his dictatorship. Zambia is really slowly going the zimbabwe route. It is very sad to see but soon zambians will be seeking asylum.
You shall suffer like no other. Foolish Zambians & Bembas along with their rat-eating scumbags – you had a chance for redemption – but you greedily & corruptly focused on tribal politics instead of looking at the economic prospects & potential future developments for the greater good of the nation! This is just the beginning of tougher times to come!!!
And the guys at homecorp celebrated when chakolwa was illegally declared winner,mwaona manje.and festive around the corner.kaya
you can see the comments from losers and himitwe hiabola. These companies are here to make money and once the tax kicks in they wind down. But Kalusa and his camp are excited. if anything Kalusa would like to see problems and if anything he will also create problems but he is going nowhere.
My Friend dont be emotional its just business…. 1. Rentals are high (its not the only company to close at the hill. Wimpy left as well and so did shakas 2. This company is into lending and interests rates are high and increase in repayment schedules will not be feasible especially when wages are not increasing 3. General inflation is also very high in Zambia of course which is a catalyst of high lending rates. 4. Central bank is mopping liquidity on the market & austerity measures are about to kick in (future prospects are near zilch) …. so I am not sure who the losers really are because I am not seeing this situation differentiating the so called losers and winners. Albeit from both sides jobs have been lost
This is not new at all, we have gone through this route before. It has nothing to with challenges or not making profits. The 5 years has elapsed for tax holiday. We just need to change the investment policy to encourage Zambians to own these shops. Actually, am encouraged to see a lot of Zambian entrepreneurs venturing into furniture. Lamasat has invested heavily and can meet the local demand.
Boss Tax incentives are long gone ask at Ministry of commerce what tax incentives these chaps were given?????
What a dumbass! Is Lamasat a Zambian company? Why are all the managers Lebanese then?
We have an opportunity for local investors to takeover.
350 jobs is nothing to write home about if we do our maths well.
Elections are over and we have a country to develop as those who have not accepted the results of the August election continue choking with anger and bitterness
Zambian made furniture, what a joke its all rubbish.
Why don’t you put the stolen Eurobonds into this business instead of leaving the money in Mauritian and Swiss bank accounts?
Tax fraudsters at best. Do not even think otherwise it’s simply tax payment dogging period. I have seen people buying furniture in these shops at such much K25000 cash so what loss!!. These are just thieves and every well meaning Zambian should not even bring in politics here. Their report is even saying they want to realign RSA operations
Why don’t you put the stolen Eurobonds into this business instead of leaving the money in Mauritian and Swiss bank accounts?
i dont mean to be political but on this one its loud and clear, look at the economy?
who on earth in his right senses would do business on a lose…………..
Election aftermath,,,,,,
that day..IMF DEMANDS SALE OF ZAMTEL
yesterday ???????? to increase water tarrif by 45%
today 2major companies pull out of zambia…
ABALEYA ZIMBABWE!!!!!!!!!!
Comment:mwebena zambia all u know doing best is finger pointing nd name calling insult why cant u behave and grow up especially in so called politics remember these re just earthly things
Small time contributors. We need big time investors not speculators out for a quick buck for poor input.
we need everyone, armchair-jackass.
Comment:Zambian u like cheap things,u are one of the reason y they are pulling out because u don’t buy from them.
UPND cadres and their leaders are shocking!!upnd feel happy whenever negative things happen in Zambia-amazing!!!is this the first time these small firms are pulling out?Big No!!PLEASE TAKE NOTE THAT SUCH SAD NEWS WILL NEVER MAKE US LOVE HH-NEVER!!!YOU BANTUSTANS WILL CONTINUE VOTING FOR HH WHILE US FOR PF TOO!!
Lets dance…..Music pleas…..dununa reverseeeeeeeee…..
The moment I accepted that UPND is full of donkeys, I stopped being amazed with what they say and how they think. Surely one does not need to be a rocket scientist to see that that there are too many furniture shops targetting our small market. Of course this is coupled with the general economic downturn which only donkey refuse to.understand. But perhaps more importantly, from a marketing point of view, how many sofas, fridges, TV sets, dining chairs, beds etc does a household change in a year or two or three or even five years? If you are not a UPND donkey I am confident that you know the answer to this simple question. But of course if you are a donkey you will probably insult me like GBM does, I mean the running mate of HH in the forthcoming general elections to be held on 11 August…
Let’s dance…..music pleas….dununa reverseeeeeeeee…..ye eeeeeeee.
Contd…. But of course if you are a donkey you will probably insult me like GBM does, I mean the running mate of HH in the forthcoming general elections to be held on 11 August 2016…..kikikikikiki….sorry I meant hiho hiho hiho hiho hiho hiho.
Let’s dance…..music pleas….dununa reverseeeeeeeee…..ye eeeeeeee.
these people how are saying let them go, are you going to feed those family who loses job, how are they going to survived? don’t u think if we start loosing companies the economy also will start going high?. I can see Zambians are still sleeping, I can advise those people who are talking about zambians investors, can u go please and invest that shops and take those people are going to loose there job before they start suffering, stop talking rubbish, awake people of Zambia from your deep sleep that you are before you die.
How long will it take for some pipo to know that Zambia is headed for doom? What is happening today some of us saw it a long time ago. PF guys stop calling pipo bad name when they highlight how hard the situation is in our country. Just get to work instead of witch hunting.
Comment:what will happen to UA who owe home corp money for the furniture we got on cradit? am sure thy will for get about the ngongole..yeyeyeeyeppeeee…!!!!!
Just buy these companies don’t let them close they don’t have 178m USD in debt they can be sustained
No they will not forget their ngongole that has been bought by a local Zambia company which will collect every cent you owe plus interest of you default
Comment: lovely Zambia where ar u going?
PF economy means company closures ,job losses,IMF bailouts and worsening flight of foreign investors.May God save Zambia from PF mismanagement.
In the meantime lungu is liquidating a viable company like the post with lose of thousands of jobs……Let’s dance…..music pleas….dununa reverseeeeeeeee…..ye eeeeeeee.
Zambia has many competitors in furniture selling. We trained many carpenters at trade schools and national service
Home have out priced themselves out of business. Their prices are ridiculously high. Let’s hope its not another ploy of running away from paying taxes after 5 year tax holiday.
These companies depend on the purchasing power of the citizens. And what is our purchasing power as at now? Almost zero. Everything will be reversing for the next five years. We are in the reverse era.Twafwa!!
Each one takes care of their own economy to start with and look forward to the state there after. The company in question overpriced their goods to an extent where they priced themselves out of business. Even on promotion days their reduced prices were far higher compared to normal prices in other multinational outlets. When you aim to apply maximum pricing know that you can also price yourself out of business.
Let them go, Edward Lungu will take care of the jobless families who voted for him. If he doesn’t, at least by the end of 5 years, they would have learnt to vote wisely.
it is not about them learning how to vote wisely after 5 years, it’s about their welfare during this 5 years
Yes let them go. Lungu promised to make 1 million jobs in this 5 years.
While we wait can we dance pleas….then we will have national prayers……music mwebantu…..dununa…
…..
mwalenda ati Chinkonko mwikate uyooooo………… dis is Jx da beginning. ??????
mwalenda ati Chinkonko mwikate uyooooo………… dis is Jx da beginning. ??????
Towards the later days of MMD leadership I had some disposable income to splash on luxuries to make furnmart tick, under PF and Chagwa, I have tightened the belt and with interest rates very high am not buying anything on hire purchase soon! Good luck to those who will lose jobs!
@1.4 Zebige this what Upnd wants pretend doesn’t happen. It happened during Mwanawasa ‘s time with Supreme furnishers, Smart Center etc. They left but we know they came back under different names. Tax evasion at its best.