Are mall owners honest in their brutal expulsion of Nakumatt?

By Lee Mwiti | Published Tue, January 9th 2018 at 09:39, Updated January 9th 2018 at 09:50 GMT +3
Nakumatt Thika Road Mall branch closed

A week ago, ailing retailer Nakumatt Supermarkets experienced the most embarrassing ejection from one of its outlets in the country.

Owners of Nanyuki Mall came in the wee hours of the morning and crudely kicked out the troubled retailer, physically taking up their goods and throwing them into the streets.

The owners claimed that Nakumatt was in rent arrears totaling Sh36 million and it was high time the retailer was shown the door given that its weak liquidity position could not guarantee payments. The owners also claimed that some other retailer was eyeing the space and promising to pay more.

The Nanyuki Mall is not the only one that Nakumatt has faced embarrassing eviction from.

It has been kicked out from its core branches at the Junction and The Garden City Mall. There have also been similar evictions from its branches in Tanzania and Uganda.

But as a longtime Nakumatt associate Sunil Aggarwal contends most of these malls are not being truly honest in exposing the initial lease agreements with the troubled retailer.

He wonders why on the spur of the moment, people are only highlighting Nakumatt’s recent negatives but entirely ignore the many positives that the brand has given to the Kenyan business landscape.

“If we want to be intellectually honest and check how Nakumatt has dwelt with these malls historically, you will realise that many of these landlords have made huge profits on account of Nakumatt signing long leases with them and being anchor tenants. Some leases have been as long as 25 years,” says Mr Aggarwal.

He also claims that most of the agreements were made by word of mouth and the mall owners were happy to keep lawyers and courts at bay when they were enjoying Nakumatt’s prestige.

But what Aggarwal should know is that infamous fallouts from the relentless pursuit of monetary gain demonstrate that the end does not always justify the means.

Businesses should therefore be careful not to engage in practices that harm individuals, partners, customers or the environment. Not only will the business eventually have to account for its actions or lack thereof, but damage control can be expensive or even impossible.

Therefore, the many ejections and crises faced by Nakumatt, where its doors were sealed off and its vehicles clamped after court orders, mirrored the embarrassing situation it has to deal with which tends to mask the many past positives.

Though it is true that Nakumatt offered many constructive contributions to the economy and in the process benefited the players that are now taking it to court, the unexplained current position can hardly save it from the severe backlash. Aggarwal must know that these negative pieces overshadow the many past positives. This is a fact.