Dozens of Tuskys employees are set to lose their jobs after the supermarket announced a restructuring process aimed at helping it stay afloat.
Tuskys, citing a tough business environment that has seen its sales drop in the last two years, says an unspecified number of employees will be sent home by March 19.
In a letter to Boniface Kavuvi, the secretary-general of Kenya Union of Commercial, Food and Allied Workers, a labour union for retail workers, Tuskys said it had already informed affected employees of the impending decision.
“The company’s performance in the last two years has been on the decline. As such, the company has embarked on a process of restructuring its operations to ensure financial viability,” said Tuskys General Manager in charge of Human Resource, Francis Kimani.
Mr Kimani noted that the drop in sales and customer numbers was despite growth of the country’s retail sector, which has attracted multinational players.
“This is a business move aimed at restoring the company’s financial viability,” said Kimani in the letter dated February 18. Tuskys did not reveal the number of staff that had been affected by the purge. Our calls and text messages to Tuskys CEO Dan Githua went unanswered.
The Standard has seen a termination letter to one of the employees, most likely in the technical department, according to a source.
“We write to notify you that following the reorganisation of various departments in line with the new administration, Tusker Mattresses Limited has been constrained to lay off some members of its staff.
Regretfully, you are among the employees whom Tusker Mattresses Limited can no longer continue to offer employment and will terminate your employment contract with effect from March 19, 2020 on account of redundancy,” reads the letter.
Tuskys joins an increasing number of companies which, responding to policy changes and a tough business environment, have opted for this move to remain afloat.
The retail environment has especially been volatile, with giants such as Nakumatt being pushed into extinction after creditors voted for it to be wound up. Uchumi, another supermarket, is struggling.
For Tuskys, the writing has been on the wall, especially after the entry of global retail giants like French-based Carrefour, Walmart’s Game and South Africa’s Shoprite. However, the union does not think Tuskys is struggling, noting that the retail chain has opened around four new branches since October 2019.
Instead, a member of the union, who did not want his name disclosed as he is not cleared to speak to the media, told The Standard that Tuskys chain simply wants to scrap formal employment, given that they have an internship programme with the Government.
Tuskys, which boasts of over 63 retail stores in Kenya and Uganda, has also toyed with the idea of issuing its shares to the public as it seeks to raise funds to help it navigate a difficult economic terrain.
Reports of local retailers intending to list only to stay out is not new. Before it went down, Nakumatt had expressed its intention to float its shares.