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Nakumatt's Mlimani City branch in Dar shut over unpaid rent, empty shelves

Nakumatt's Mlimani City store in Dar es Salaam was on Monday closed after failing to comply with contractual requirements, including the failure to pay rent. PHOTO | THE CITIZEN | NMG
Nakumatt's Mlimani City store in Dar es Salaam was on Monday closed after failing to comply with contractual requirements, including the failure to pay rent. PHOTO | THE CITIZEN | NMG 

Dar es Salaam

Nakumatt's Mlimani City store in Dar es Salaam was on Monday closed after failing to comply with contractual requirements, including the failure to pay rent.

The Kenyan retail chain has not paid rents to Mlimani Holding Ltd – the owner of Mlimani City Mall – for three months, according to Mlimani City general manager Mr Pastory Mrosso.

“In three months, Nakumatt should have paid a total of Sh300 million (Sh13.8 million) but it has not yet done so,” Mr Mrosso told The Citizen on telephone on Monday.

Besides, said Mr Mrosso, the Kenyan retail chain has also been operating below standards – with almost empty shelves - even as it enjoys privileges of being an anchor tenant in Dar es Salaam’s most popular mall.

“As anchor tenant, Nakumatt enjoys some privileges including lower rents because such occupants are expected to attract visitors and benefit other business operators within the mall.

"However, they are operating below average…their shelves are almost empty and at the same time, they are not paying rents,” said Mr Mrosso.

Nakumatt challenges

This comes almost a month since senior government officials from Tanzania and Kenya agreed to work together to iron out Nakumatt’s challenges.

The meeting, which was held in Dar es Salaam early last month was co-chaired by the Permanent Secretary in the Ministry of Industry, Trade and Investment, Prof Adolf Mkenda and the Principal Secretary in Kenya’s Department of Trade, Ministry of Industry, Trade and Cooperatives, Dr Chris Kiptoo.

During the meeting, Dr Kiptoo is on record as having assured his Tanzanian counterpart that Kenya would do everything to ensure that Nakumatt and Uchumi supermarkets flourished.

He said the Kenyan government had asked the two companies to provide it with a detailed analysis of the debts by October so that it (the government) could see how to help.

Figures produced by Prof Mkenda showed that the retail chain has not paid a total of TSh1.6 billion (Sh73.6 million) to its suppliers for a couple of months.

According to Mr Mrosso, the decision to close the retail chain’s outlet was not surprising.

Not surprising

“Our decision is not surprising because we earlier met Nakumatt, together with Prof Mkenda [and] the supermarket promised to sort out its problems with suppliers including at Mlimani City.

"However, nothing has happened so far. Even when we served Nakumatt with a 10-day notice, they didn’t show up,” he said, noting that the ultimate goal is that they should be able to sit down and discuss the way forward.

Apart from Mlimani City, Nakumatt’s other outlets are running dry and suppliers claim they have not been paid for the services rendered to the supermarket for almost one year now.

Prior to the closure on Monday, the Mlimani City outlet had virtually no products to the extent that in places where one would expect to see cooking equipment, detergents, bathing soaps and body oils among others, there were only biscuits.

Even the section that would contain multiple rows of biscuits has them spread in only one row.

Most of the shelves are empty except those having clothes, television sets, books and home equipment.

Speaking to The Citizen on Monday, Mr Joseph Mlay, who chaired a task force for suppliers who used to supply goods to Uchumi Supermarket (another Kenya-based retail chain that closed shop in Tanzania and Uganda in 2015), said the Nakumatt situation was worrying.

Same suppliers

“I have just been informed about the closure and currently, I am on my way to Prof Mkenda’s office so we are able to know the way forward. What is happening now is contrary to what we had agreed upon last month (September),” he said.

He said it was disheartening to note that the losses affected the same suppliers.

“Those of us who were supplying to Uchumi are the same people who supply Nakumatt [who] might also go with our money….this is discouraging,” he said.

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