After 80 years in Zimbabwe, British multinational company, Unilever, is exiting the country and will use local distributors instead.
The move continues Unilever’s broader strategy to scale back operations in some African markets.
According to newZWire, Unilever’s exit casts new light on the decline of formal retail in Zimbabwe, and the pressures that investors face trying to navigate the country’s perennial currency changes. Unilever said in an internal memo:
Unilever will move to a new model that serves Zimbabwean consumers through a network of Zimbabwean distribution firms rather than through Unilever-owned operations by the end of the year.
This new and more efficient business model will stimulate the growth of the business, better serve Zimbabwean consumers with the brands they love, and create jobs in sales, logistics and merchandising firms locally.
The new strategic direction regrettably involves the close of Unilever Zimbabwe’s current operations.
Unilever’s exit from Zimbabwe has looked inevitable for years. It has significantly scaled back local production since the 2000s.
Unilever already relies on Distributed Group Africa (DGA), a unit of listed Axia, to distribute products made elsewhere.
Some of Unilever’s products under its US$12.5 billion beauty and wellbeing division include hair and skincare brands such as Dove, Sunsilk, and Vaseline.
Several prominent companies, both local and multinational, have closed or exited Zimbabwe over the years. These include well-known names such as Anglo American Plc, Lonmin Plc, HJ Heinz, BP, Shell, Harven Manufacturing, and Rio Tinto.
Airlines like British Airways, Lufthansa, and Qantas, as well as banks such as Barclays and Standard Chartered, have also withdrawn from the market.
These companies left or closed due to a challenging operating environment marked by policy contradictions and inconsistencies, including issues related to land reform and indigenisation, as well as mismanagement and corruption.
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