The Standard Group Plc is a multi-media organization with investments in media platforms spanning newspaper print operations, television, radio broadcasting, digital and online services. The Standard Group is recognized as a leading multi-media house in Kenya with a key influence in matters of national and international interest.
  • Standard Group Plc HQ Office,
  • The Standard Group Center,Mombasa Road.
  • P.O Box 30080-00100,Nairobi, Kenya.
  • Telephone number: 0203222111, 0719012111
  • Email: [email protected]

Retail, insurance singled out for topping suppliers' list of shame

 Shoppers at Carrefour Mega store along Uhuru Highway, Nairobi. [Wilberforce Okwiri, Standard]

Retail and insurance sectors have been singled out as key areas of concern over unpaid bills to suppliers running into billions of shillings. This is as the competition watchdog detailed how their interventions have saved consumers over Sh8.4 billion.

The two sectors, as explained by the Competition Authority of Kenya (CAK)  acting Director General Dr Adano Roba, are on their radar due to abuse of buyer power.

The revelation comes even as CAK Board Chair Shaka Kariuki revealed that efforts by the authority have realised big wins - resulting in savings in terms of livelihood and what would have been overcharging by businesses.

Addressing participants during the ongoing 2024 International Competition Network Advocacy Workshop in Nairobi, Mr Kariuki detailed how the authority’s efforts have saved consumers over Sh8.4 billion.

“Following the sanctioning of a cartel that involved four major paint manufacturers in the country, consumers registered savings of Sh830 million in four years to 2022,” he said.

“Another Sh4.6 billion was realised in consumer savings between 2016 and 2021 by consumers of cement products.”

He said CAK has continued to protect Small and Medium Enterprises (SMEs) from predator competitors who abuse their buyer power by imposing contractual terms that are detrimental to the survival of small businesses.

“In this regard, we have facilitated the recovery of over Sh3 billion over the past five years, thereby securing the livelihoods of thousands of Kenyans,” said Mr Kariuki.

Speaking at the sidelines of the workshop, Dr Roba revealed that three retailers are under investigation as well as 10 insurance firms.

“Particularly for insurance firms is that there are a number of complaints about one company. We are not looking at the number of insurance companies but the number of complaints, so that is substantial,” said Dr Roba.

He said some insurance firms would engage suppliers and then fail to pay them - giving an example of automobiles that repair vehicles on contract with the insurer.

“Also post Covid, there are several insurance companies which have not been doing very well; so there are a lot of issues in terms of the performance of the company for them to be able to pay the firms they have engaged,” said Roba. He said if there are cases of insurance firms blatantly refusing to pay for services rendered, then it is a matter under investigation.  

The same scenarios are being replicated in the retail sector, where frost relationships between suppliers and buyers lead to complaints. The huge number of suppliers in this sector, he said, contributes to how critical it is.

Some of the issues, he said, involve delayed payments despite the stipulated time.

This is even as he noted that some of the contracts signed are informal. “The contractual terms between the retailer and supplier don’t go well all the time and they have to bring their complaints to us. A buyer promises to pay a supplier 20 days or 60 days whatever time they agree but they don’t comply,” said Dr Roba.

The 2024 International Competition Network Advocacy Workshop is being held in Kenya for the first time. It is themed Bouncing Back: Competition Advocacy and Resilience to global shocks. The workshop attracted 36 competition agencies. ICN is an opt-in member body to which CAK belongs.

Philippines Competition Commission Executive Director Dr Kenneth Tanate said the event is aimed at improving the effectiveness of ICN members in the dissemination of competition principles and promoting competition.

Related Topics


Trending Now


Popular this week