Bakers fall on hard times

HARARE - Zimbabwean bakers are financially distressed with most of them producing at way below capacity, the National Bakers Association of Zimbabwe (NBAZ) says.

Givemore Mesoemvura, the association’s president, said while the bread price has remained unchanged at $1 per loaf since dollarisation in 2009, the bakers have been facing escalating operating costs, particularly of locally-sourced raw materials.

He said out of the 257 operational bakers’ installed capacity of two million loaves per day, just above a million were being produced.

“...(baking) industry is struggling financially and technically to make ends meet,” Mesoemvura said at the ‘Buy Zimbabwe’ baking industry stakeholders’ conference last week, adding that suppliers also had to avail credit terms to bail out the confectioners.

Innscor, one of the leading players in the baking industry through its Bakers Inn chain, recently announced that it was scaling down its bakeries network due to depressed demand, among other challenges.

Apart from the costs, this comes as most players in the baking industry have of late been facing challenges such as quality inconsistency in local flour quality, yeast and gristing ratios.

Last week, Innscor — a leader in the baking industry through its Bakers Inn chain — announced that it was scaling down its bakeries’ network due to depressed demand, among other challenges.

Mesoemvura added that there was great need for bakers to retool to reduce inefficiencies and also re-introduce supply depots countrywide.

“We also need consistency in product quality and efficiency of supply of locally sourced inputs,” he said.

Meanwhile, Lobel’s Bread Holdings (Lobel’s) — one of the key bakers and emerging from a financial crisis — said at the same event that it plans to ramp up production to surpass

400 000 loaves a day.

This comes as five local banks, FBC Bank, CBZ Bank, NMB Bank, Metbank and Capital Bank, who were owed an estimated $14 million by the bread-maker, took over the company in 2012 to settle their debts and save it from collapse.

Ngoni Mazango, Lobel’s chief executive, told businessdaily: “We are continuously gaining our market position.

“We are actually growing and we haven’t achieved what we want. At the moment we are at between 35 to 40 percent market.”

Without divulging specific details, he said they had a lot of plans lined up, including retooling and restructuring operations.

At its peak, Lobel’s produced about 300 000 loaves daily.

But, there was a sharp decline in production due to inadequate funding for retooling and supporting operations with competition worsening the situation.

Before its closure, its Harare factory was producing 95 000 loaves while Bulawayo produced 45 000 loaves per day.

Mazango believes his company has the capacity to retain lost market share, although the closure gave other bread manufacturers the opportunity to consolidate their position.

Lobels used to enjoy a 30 percent share of Zimbabwe’s then 1,2 million loaves daily market.

Comments (2)

mvura yakanaya gore rino tiri kunwa tea nemanhanga ne mbambaira chimbogarai nechingwa chenyu chinodhurrisa.

rmunemo - 11 March 2014

Depressed sales volumes the order of the day in most industries.The economy itself is at a stand still.

Roland R J Ncube - 12 March 2014

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