Edgars to inject nearly US$1m in fresh Carousel investment

CLOUDINE MATOLA AND SAMANTHA MADE

Edgars Stores Limited, Zimbabwe’s largest publicly traded clothing retailer, is set to inject nearly US$1m into the retooling of its Carousel manufacturing plant in Bulawayo during the current financial year, Business Times can report.

The strategic move is part of an intensified effort to boost production capacity, enhance operational efficiency, and increase resilience in the face of market volatility.

The latest investment brings Edgars’ total spend on Carousel’s retooling over the past two years to approximately US$2m, reflecting the group’s renewed confidence in domestic manufacturing and its broader ambitions for regional competitiveness.

Speaking at the company’s analyst briefing last week, Carousel Managing Director Menfree Tanyanyiwa said the new capital will be directed towards acquiring state-of-the-art machinery and systems, with a particular focus on scaling up denim production.

“We hope to revamp our laundry machinery and embroidery equipment this year. Those are immediate priorities,” Tanyanyiwa said.

“We want to go big on denim. Some of the machinery we’ve already imported will go towards that plant. The laundry machinery is the final piece of the jigsaw puzzle. We are targeting an investment of about US$800,000 between this year and next.”

This fresh capital injection will build on the US$1.2 million invested in FY2024 as part of Edgars’ broader industrial revival programme.

Tanyanyiwa said the earlier investment phase covered key areas such as sewing machines, fusing machines, and industrial printers.

He revealed that the company has secured support from the Reserve Bank of Zimbabwe under the Targeted Finance Facility (TFF) to fund a cutting-edge cutting-room automation system.

 “We received tremendous support via the banks through the TFF—approximately ZWG$10m—and that’s going towards the cutting-room solution. It will dramatically enhance our production efficiency,” he said.

Tanyanyiwa stressed that retooling is essential to preparing Edgars for the African Continental Free Trade Area (AfCFTA) and ensuring it can compete effectively across borders.

 “With AfCFTA coming, it’s critical we prepare. Retooling puts us in a position to compete with top manufacturers across Africa and beyond,” he said.

Edgars Chairman Themba Sibanda, in commentary accompanying the group’s financial results for the 52 weeks ending January 5, 2025, reaffirmed the board’s full backing of the retooling initiative and broader modernization strategy.

“The segmented retail propositions of the group are being continually reviewed to ensure they meet customer needs. We are identifying opportunities to enhance merchandise execution and also exploring new growth avenues,” Sibanda said.

He emphasised that Edgars would maintain flexible credit options to stimulate consumer spending, while continuing to align overheads with prevailing demand conditions.

“Management will continue to retool Carousel to underpin increased production and operational efficiencies. That is fundamental to supporting our retail chains and delivering value to customers,” Sibanda added.

As part of its geographic expansion strategy, Edgars plans to open four new Express Stores across Zimbabwe before the end of the financial year.

“We will continue expanding into strategic locations. Four additional Express Stores are targeted before the close of FY2025,” Sibanda confirmed.

To further bolster operational resilience, Edgars will also invest in backup solar power systems across its retail footprint. This move is intended to reduce dependency on costly generators and the country’s unostable power grid.

“We’re making additional investments in backup solar infrastructure to maintain system uptime, reduce electricity costs, and improve customer experience in-store, especially given the projected power shortages,” Sibanda said.

Edgars CEO Savious Mushosho acknowledged that the 2024 financial year was fraught with challenges, particularly for discretionary spending.

“It was a tough year. Currency issues distorted pricing and demand was severely constrained. If someone has US$100, their first thought is food, not clothing,” Mushosho said.

He highlighted that liquidity constraints and supply chain disruptions were the most pressing challenges.

 “The supply chain was chaotic—pricing distortions, liquidity to pay suppliers, it was crazy. That’s why we leaned heavily on our own manufacturing capacity. It (Bulawayo manufacturing plant) became critical in navigating those issues,” Mushosho explained.

Despite the turbulent environment, Edgars has remained resilient by investing in its own production capabilities, reinforcing Carousel’s central role in the company’s value chain and long-term strategy.