KWEKWE — Zimbabwe’s largest chrome smelting company, Zimasco, faces collaspe owing to a serious financial crisis which has seen it struggle to meet its wage bill and pay suppliers.
Report by Blessed Mhlanga, Staff Reporter
According to information gathered from top Zimasco management officials, the company last month failed to meet salary and wage bills, forcing them to pay workers in tranches, with management receiving salaries way into October.
“We are facing serious challenges which have seen the company failing to pay wages and salaries on time. We might be forced to retrench workers to streamline our workforce and manage our costs,” said a top manager who requested anonymity.
Zimasco has already shut down the West plant owing to viability challenges, triggering panic among business partners who accuse the company of failing to service its debts on time.
Suppliers who spoke to NewsDay said Zimasco was now a bad debtor, failing to pay for goods, some supplied over a year ago.
“They have become a liability to the whole industry because they are failing to pay for supplies and as a result, small companies which do not have outside funding have gone under because of Zimasco’s failure to pay,” said a Kwekwe-based businessman.
Some suppliers are reportedly considering suing the company over the debts which reportedly run into millions of dollars, though others are said to be afraid of losing business if they litigate against the company.
“They are the biggest company around and they have a tendency of bullying small players if they fail to pay and if you take them to court, they will stop buying from you and that is why a lot of us are reluctant to sue,” said another source.
Zimasco is allegedly struggling to pay its electricity bill estimated to be over $10 million, forcing the power utility Zesa to pull the plug last month.
Zimasco marketing manager Clara Sadomba requested questions in writing last Thursday, but had not responded at the time of going to print last night.
“This is to confirm receipt of your email. As advised over the telephone earlier, we will discuss internally and get back to you with the company’s response as soon as possible,” wrote Sadomba in response.
Zimasco last week issued a statement saying it had scaled down operations.