By Nyasha Chingono
ELECTRICAL retailer, Powerspeed, is lobbying for the reversal of Statutory Instrument (SI) 122 that requires licences for the importation of cable, saying it had adversely affected supply of the product on the local market.
Revenue accruing from cable sales took a dip in the five months to February 2017 due to the statutory instrument.
“The issuing of SI 122 last year placed cable on import licensing. Subsequent to its introduction, we had been struggling to get an import licence for cable,” said Powerspeed managing director Hilton Macklin.
The legislation, introduced at the request of Cafca, Zimbabwe’s largest cable manufacturer, has drastically reduced the supply on the market.
Macklin said Cafca was unable to supply cable to the retail chain, resulting in a dip in the company’s revenue.
“There have been shortages of cable. I do hope that sense will prevail. Consumers should not be penalised to protect a company’s monopoly,” said Macklin.
Macklin said the company would continue to lobby government to scrap the statutory instrument.
Powerspeed has continued with its expansion drive since the last trading period, increasing its retail space from 10 000 to 12 000 square metres.
The latest acquisition is the Borrowdale branch that was opened last week following the opening of the Pomona branch earlier.
Powerspeed has 10 branches in Harare and has a presence in major cities and towns around the country.
“We continued with the growth trajectory we witnessed last year and throughput increased, with the additional branch in the Pomona area in Harare becoming profitable within the first two months,” said Macklin.
Macklin said he was hopeful of an improved financial year and that the company would continue on its expansion drive.
He said the company’s debt had increased to about $11,59 million after borrowing to finance the purchase of the Pomona building.
Macklin also said the company had, in the meantime, suspended plans to dispose of its building in Ruwa which it inherited from Mashonaland Holdings when the two separated.
The property, which is currently being leased to Innscor, was earmarked for disposal at a market value of just below $1 million.
“The returns from the building are poor, but we can’t sell it now as we are using it to hedge our borrowings from the banks which, in most cases, require immovable property as guarantees,” he said.