Choppies to retrench staff
Pauline Dikuelo | Friday January 31, 2020 15:20
Mmegi has been reliably informed that Choppies met with the Commissioner of Labour this week to discuss the developments. Even though the retail outlet has not laid out how many jobs will be cut, this publication has established that some of the shops will be closed.
Choppies currently employs more than 7,000 people.
“They informed the Commissioner of Labour on Wednesday of the intended retrenchment of workers in Botswana. It is also closing some non-profitable stores.
One already closed is in Mogoditshane inside a building belonging to former Cabinet Minister, Patrick Masimolole. It is expected to reevaluate its stores in Botswana and to close the ones that are loss-making in an effect to reduce its financial burden.
Stores likely to be affected are those operating in villages that have no economic activity. These are likely to be served from the main villages close to these villages,” the source disclosed.
He continued: “Mmathethe and Shoshong shops will be closed as they believe that there is no economic activity within those areas”. Choppies CEO, Ramachandran Ottapathu noted that they are just restructuring.
“No, we are not retrenching but restructuring, as we are also embracing technology. The machinery will replace some of the jobs. I can neither tell you how is it going to affect our employees nor if we will cut down some,” Ram said.
The country’s single biggest private sector employer recently posted long awaited financial results showing a P444.5 million loss for the year ended June 30, 2018. This was shareholders and ordinary citizen’s first glimpse into the books of the troubled retail giant since April 28, 2018.
An accounting and governance crisis then surfaced at Choppies, wiping nearly P2 billion in value on the Botswana Stock Exchange before its suspension in November 2018 and leading to very public and bitter boardroom battles.
The latest results also show that Choppies owes its suppliers P1.3 billion, up from P1.02 billion the previous corresponding year. Again a significant number of these suppliers are based in Botswana and include citizen SMEs with deals to supply the grocer’s chain of stores.
Botswana Federation of Trade Unions (BFTU) Secretary General Thusang Butale said the developments are quite disturbing as it means a lot of jobs are on the line.
“We saw it coming after all what has been happening to Choppies last year. Despite the fact that Choppies had issues with its employees, they contribute a lot to job creation as they absorb a lot of unqualified people, and even people with disability,” he said.
According to Butale, they have not received any statement from Choppies at the moment but will see how they act once they receive one.
The unemployment rate locally has ballooned from 17.9% to 18.19% as thousands of the graduates join the streets every year. The local retailer, in which the Botswana Public Officers Pension Fund holds more than 20% shares, has stores in seven other African countries.