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Suppliers of Kenyan supermarkets cry foul
The revelation comes after a Kampala trader threatened to sue Uchumi Supermarket for allegedly failing to pay for goods he supplied to the supermarket worth some Ushs 10 million and has not been paid for over a year.
Ediris Mugisha, a businessman in Kampala, says Uchumi have failed to pay for goods (general merchandise) he supplied to different stores of the supermarket chain over a year ago.
Mugisha showed this writer his letter of intent to sue, addressed to Uchumi’s Managing Director, in which he complained that his business was suffering as a result of excessive delay to get paid.
An investigation by The Sunrise reveals that Mugisha’s case is possibly a tip of a wider problem involving Kenyan supermarkets and local suppliers.
The Chief Executive Officer of Kampala City Traders Association (KACITA) Moses Kalule revealed that he has received a host of complaints particularly against Kenyan supermarkets for excessively delaying to pay their suppliers.
Kenneth Lugemwa, another local supplier said: “I supplied ground nuts worth Ushs 6,000,000 to Uchumi and Tusky’s in 2010 but I have since failed to recover that money. Now my business is suffering and may close because this was a big portion of my capital,” said Lugemwa
Lugemwa added pensively: “We don’t know why Kenyan supermarkets operating in Uganda have conspired to pay us back by cheating us out of business!”
But Kalule has vowed to support local suppliers in their pursuit of fairness, even if it means supporting them in courts of law.
“We are ready to offer every possible support to our Ugandan traders finding it difficult to recover their money from Kenyan supermarkets as per the information at our desk even if it will mean going to courts of law,” Kasule told The Sunrise.
KACITA’s Head of Legal department Eva Nabadda working with Mubiru and Kasozi Advocates urged local suppliers facing similar difficulties to launch their complaints with her office at Greenland towers on Kampala road.
“We shall only need to be furnished with the necessary details about the named offenders and the transactions in question to help us prompt the law to take its course in the interest of our clients,” Nabadda confirmed.
The Sunrise is also privy to discussions among local suppliers who regularly meet at the supermarkets to collect payments after delivering their goods. One such meeting revealed that a number of them were holding serious grudges of non-payment particularly against Kenyan supermarkets.
Kalule confirmed that he has received numerous complaints from the general public or from the media, seeking for KACITA’s help to recover monies owed to local suppliers by Nakumatt, Tuskys, and Uchumi.
Uchumi’s Country Director David Ngali, who is only three months old in the office, said he cannot answer for Uchumi’s alleged sins during a period prior to his coming into the office.
He however acknowledged existence of the problem and said: “I have however held two meetings with sections of our suppliers revisiting terms of payment and this is going to help us in clearing all outstanding debts.”
But Ngali denied there is no deliberate policy to delay payment of local suppliers.
“We have no deliberate policy to delay payment for Ugandans only but if there are any internal delays which are commonly due to hitches in reconciling document, they uniformly affect everyone,”said Ngali.
Vincent Kimuya, the Nakumatt Manager Garden city branch concurs with Ngali.
“It is not fair for Ugandans to generalize our payment behavior simply because one Kenyan company has breached terms with its suppliers,” Vicent said adding that “While it is true that we (Nakumatt) don’t pay cash to our suppliers, we always have clear terms spelled out between them and our purchasing officer and it is those very terms we endeavor to keep.”
But some KACITA officials were quick to point out that the development serves as a rude reminder of what they term as legendary lack of political will to defend the interests of its citizens in the face of unfair competition usually meted out by foreigners even on Uganda’s soil.
“Foreigners dealing with Ugandans have come to realise that Ugandans businessmen are like orphans whose interests have no one to defend unlike in other countries with which we do business,” a disgruntled Mugisha told The Sunrise.
Mugisha grieves that in 2006, he failed to secure government support in a case he single handedly filed against the Kenyan government following the theft of his US$ 280,000 worth of goods while transiting from Mombasa to Kampala.
“Fortunately, I was able to pay competent lawyers who have luckily won the case. But I may be the only fortunate one among hundreds of Ugandan businessmen facing similar injustices on a daily basis while doing business in Kenya, and Southern Sudan for example.”
The Ugandan government has also been accused of dragging its feet in disputes involving Ugandan businessmen whose debts have not been paid by government and private contractors in South Sudan.
Disgruntlement against Kenyan supermarkets may not be restricted to suppliers of goods, but also of service providers as well. According to Kalule, they have received numerous complaints from employees of Kenyan supermarkets over poor working conditions.
Citing the recent closure of Tuskys supermarket branch in Bwaise, Kalule said that it was an employee who blew the whistle that prompted Kampala Capital City Authority health officials to swing into action that ended with the discovery of rotten stinking chicken and other food stuffs.
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