OK Zim seeks closer cooperation with monetary authorities on forex

OK Zimbabwe Limited has expressed its commitment to working closely with monetary authorities to improve the availability of foreign exchange on the formal market.

According to the grocery retailer Government should work on averting the scarcity of foreign currency in formal channels given its likelihood of impacting exchange rate dynamics, pricing, consumer behaviour, and long-term financial planning.

Shortage of foreign currency in the formal banking sector continues to put pressure on the exchange rate, prompting some traders to insist on US Dollar payments for products and services.

This comes as the group witnessed positive growth in volume recovery, in the first quarter, as customers responded favourably to the company’s commitment to fair pricing practices since the introduction of the ZiG in April.

The introduction of ZiG brought about relative stability in the economy, although currency risk remained a key risk during the period.

“OK Zimbabwe Limited looks forward to continued engagements with the monetary authorities to enhance strategies to improve the availability of foreign exchange on the formal market.

“The shortage of foreign currency in the formal channels continues to exert pressure on exchange rate dynamics, with significant impact on pricing, consumer behaviour and long-term financial planning,” said OK Zimbabwe in its first quarter trading update for the four months to June 30, 2024.

According to OK Zim, its fortunes are tied to the stability of the foreign exchange rate, compounded by the fair price movement campaign, which is focused on promoting price stability and volume growth.

In the FY2025 first quarter period, OK Zimbabwe Limited volumes grew by 20 percent while its basket size grew by 28 percent.

Business performance improvement was attributed to the effective implementation of the Group’s volume recovery strategies, which resulted in the enhanced performance of the group’s premier promotion, the OK Grand Challenge.

Going forward, OK Zimbabwe Limited said it will focus on optimising the product mix to enhance profitability while maintaining volume growth.

OK Zimbabwe Limited also highlighted that it will implement targeted promotions and marketing strategies to boost sales in high-margin categories.

Additionally, developing contingency plans to mitigate risks associated with supply disruptions while in-store merchandising strategies will be executed to improve product visibility and accessibility.

Recently OK Zimbabwe indicated that the pricing stability during the four months to June 30, 2024, contributed positively to volume recovery, as customers responded favourably to the group’s commitment to fair pricing practices.

However, OK Zimbabwe commended the fiscal and monetary measures being implemented by the government. The group remains committed to delivering value to its shareholders.-ebsinessweekl