OK Zimbabwe Faces Collapse Amid Mounting Losses and Informal Sector Pressure

OK Zimbabwe faces a potential collapse after a US$25 million loss and a 52% revenue drop, as informal traders dominate urban markets and economic instability deepens pressure on formal retailers (image source)

HARARE – November 11, 2025 — OK Zimbabwe Limited, one of the country’s largest retail chains, is teetering on the brink of collapse following a reported US$25 million loss and a 52% drop in revenue for the financial year ending March 31, 2025. The company’s chairman, Herbert Nkala, acknowledged the severity of the crisis, stating that recovery “will take some time to return to normal operations.”

The group’s revenue fell to US$245 million, down sharply from the previous year despite an average inflation rate of 15.21%. Analysts say the figures reflect deeper structural issues in Zimbabwe’s formal retail sector, which is increasingly being outpaced by informal traders offering lower prices and more flexible payment options. “The informal sector is eating into our margins. We simply can’t compete on price or agility,” said a senior OK store manager in Harare, speaking on condition of anonymity.

The rise of informal cross-border traders — especially active at Beitbridge and Chirundu — has reshaped consumer purchasing habits. These traders import goods from South Africa and Zambia, often bypassing formal customs processes, enabling them to sell products cheaply. According to the Confederation of Zimbabwe Retailers (CZR), informal trade now accounts for over 60% of consumer goods transactions in urban centers. “Formal retailers are being squeezed out,” said CZR president Denford Mutashu. “We need policy reform that levels the playing field.”

OK Zimbabwe’s challenges are intensified by supply chain disruptions, exchange rate instability, and persistent liquidity shortages. The fluctuating Zimbabwe dollar continues to complicate inventory planning for retailers dependent on imported goods. “We’ve had to close several stores due to unsustainable operating costs,” Nkala confirmed. “The market has shifted, and we must adapt or perish.”

The Ministry of Industry and Commerce has not yet announced any formal rescue package, though insiders suggest that discussions are underway to provide tax relief and foreign currency access to struggling retailers. Economist Dr. Prosper Chitambara says the crisis signals wider macroeconomic fragility. “Retail is a bellwether for consumer confidence. OK’s collapse signals distress in household incomes and purchasing power.”

With the festive season approaching, OK Zimbabwe faces a crucial test. Failure to stabilize operations could see the company lose what remains of its market share to fast-moving informal competitors.