Edgars to expand footprint

CLOUDINE MATOLA

Edgars Stores Limited, a publicly traded clothes retailer, plans to open five more express outlets  before the end of this year, targeting low-income customers,  in an attempt to boost its business, Business Times can report.

The development was revealed by the

company chairman Themba Sibanda.

“The group seeks to expand its geographic footprint through the opening of new stores in strategic locations. In fulfilment of this drive, we opened a new Edgars store at Ascot Shopping Centre in Bulawayo in March 2024 and a new Jet Store in Harare, at Hogerty Hill Mall. To date, three Express Stores aimed at servicing the low-income segment of the market have been opened, selling only for cash. A further five are in the pipeline before close of year.

“The business will strengthen its store power back-up capabilities to safeguard customer experiences and contain generator costs in the light of

projected reduced electricity availability in the outlook period,” Sibanda said.

Sibanda stated that the organization will concentrate on strategic goods sourcing and optimal inventory planning to achieve the intended outcomes in order to guarantee profitability and quality requirements.

“Smart merchandise procurement and optimal inventory planning remain key focus areas to ensure an optimal merchandise cycle that yields targeted margins, without compromising the merchandise quality,” he said.

Due to severe pressure on disposable incomes, Edgars’ units sales fell 22.4% from 1.09m to 0.85m in the six months to July 7, 2024, compared to the previous comparable period.
Additionally, revenue for the period decreased from US$19.0m in 2023 to US$16.1m, a 15.4% decrease.

However, the period’s profit increased by 169.6% to US$0.16 million from the US$0.23 million recorded in the previous comparative period.

Finance costs for the period under review decreased by 52.4%.

On retail performance, the group’s total retail merchandise revenue dropped by 12.8% to US$13.2m.

Also, ZWG credit sales contributed 93.1% to credit sales while in 2023 it contributed 51.2%. While US dollar credit sales contributed 73% and in 2023 71% of US dollar sales.

He added: ”The Edgars chain recorded turnover of US$8.3m, down 5.3% from the prior half year. Units sold were down 15.37% from 0.44m. ZWL credit sales contributed 73% (2023: 66%) of ZWL sales, while US$ credit sales contributed 71% (2023: 73%) of US$ sales.

“Total sales for the Jet chain were US$6. 2m, down 17.0% from US$ 7.0m achieved in the prior half year. Units sold decreased by 18.69% from 0.58m. ZWL credit sales contribute 95.2% (2023: 56.9 %) to total ZWL sales, while the US$ credit sales contributed 73% (2023: 70.3%) of total USD sales.”

Additionally, he stated that Edgars could benefit from the rising dollarization of the economy by having better access to foreign exchange through domestic sales to meet import needs.