BULAWAYO textile giant, Archer Clothing Manufacturers, says it is struggling to process orders owing to a shortage of foreign currency for importation of inputs, machinery and equipment.
BY MTHANDAZO NYONI
The company escaped liquidation in 2015 after creditors approved its takeover by Harare-based Paramount Garments, but never regained its financing footing as the foreign currency crisis constrained production and eroded its export competitiveness.
The challenges have seen local and export orders dropping.
Managing director Jeremy Youmans told NewsDay that the company required at least $5 million in new capital including $1 million for the acquisition of new machinery to support long-term plans.
“Archer continues to grow, but the growth has been cut back as the finance sector was unable to provide sufficient support for raw materials to fuel the growth, even though at least half of it was in exports,” Youmans said.
“This has restricted growth due to the inability to supply and it is doubtful whether we can recover these orders later. We are continuing to train and set up infrastructure in case there is a change in fortunes, but for now we can only operate within these constraints.
Youmans said foreign currency challenges had forced the company to adopt a phased approach to recapitalisation, acquiring machinery required to expand operations with the limited resources available.
“Again this will have to be done in stages as we do not have the resources to develop all the opportunities at once,” he said.
The company currently employs about 1 000 people, up from 500 in 2015.
Youmans revealed that the company planned to add 600 people to its workforce, subject to securing the foreign currency it needed to expand.
The firm initially it projected to employ 850 workers by year 2016 when it came under Paramount Garments in 2015.
On the contrary, the company downsized and retrenched 400 in 2016. The remaining workers were put on a short-time working schedule, which reduced the number of hours worked from five to four days a week.