BY MTHANDAZO NYONI
INGWEBU Breweries plans to franchise all its beer retailing outlets and focus on manufacturing and distribution of traditional beer, a development which could increase the company’s revenue by at least 10%, NewsDay has established.
Ingwebu, which was run under Bulawayo Municipal Commercial Undertaking — an entity wholly-owned by the Bulawayo City Council since 1996, was unbundled in 2017.
Ever since, the company has incurred successive losses and, as a turnaround strategy, management has resolved to franchise all its beer retailing outlets and focus on manufacturing and distribution.
“Yes, it is true. We want to franchise all our beer retailing outlets and focus on our core business, which is manufacturing and distribution. We do not want to continue making losses. The total number of beer retailing outlets targeted to be franchised is five,” an official, who declined to be identified, said.
Last week Ingwebu flighted an advert in the local newspaper, inviting interested businesses to take over the outlets.
“City of Bulawayo commercialised entities, trading as Ingwebu Breweries, is a commercialised business entity owned by the City of Bulawayo. The undertaking is made up of the brewery and the retail or franchise business. City of Bulawayo Commercial Entities wishes to franchise some of its beer retailing outlets located in the high-density suburbs of the City of Bulawayo…,” the advert read in part.
According to the latest minutes from a confidential business committee meeting held on October 17, 2018, the Ingwebu Breweries board passed a resolution in August 2018 to franchise two of its properties, Makhumalo and Madlodlo beer gardens.
In the period May 2017 to June 2018, Makhumalo and Madlodlo beer gardens made losses of $85 633,26 and $49 506,77, respectively, according the minutes.
The report noted that to fully implement the franchise of the two outlets, 26 staff members would be retained to replace contract workers and 12 employees, who are 55 years and above, would be retrenched at a total cost of $83 984.
By franchising these outlets, the report said Ingwebu would achieve savings of
$228 630 per year, rental income of $2 400 per year and a projected increase in business of 10% per year.