Nakumatt automates warehouse management system to improve cash flow

Nakumatt has begun installing a new warehouse management system as part of efforts to better manage its supply chain.

This after the regional retailer sank into a deep financial hole, with management pointing to a flawed supply chain system, that saw some of its 64 branches not adequately stocked with goods.

At the height of its financial woes in October, Nakumatt had indicated that it would audit its warehouse management system to ensure the retailer is able to hold the required stocks based on individual branch demand.

Nakumatt Holdings Managing Director Atul Shah on Tuesday said the new system would be automated, enabling the retailer to monitor movement of goods.

“At its optimum performance level and with added features including an auto replenish system, we hope to enjoy maximum savings on our average dispatch value per day while managing shrinkage risk more effectively,” Mr Shah said.

“This world-class system provides us with a clear dash board to track our stocks from supplier delivery to customer pick up on the shelves allowing for proper business planning,” he added.

Nakumatt has previously relied on a manual system that did not adequately inform management of stores that needed to be restocked.

The retailer has also begun engaging its suppliers over delayed payments that has seen some goods go missing from the shelves.

Nakumatt said with the new warehouse management system supplies to the central warehouse will be electronically scanned, verified, loaded and shipped to the respective branches.

The system will also manage supply deliveries to its stores in Uganda, Tanzania and Rwanda.

Nakumatt recently announced it was working on increasing the amount of locally produced goods inn its subsidiaries.

Mr Shah expressed confidence the new warehousing system would cut costs and ensure Nakumatt was able to generate revenue.

Optimum stock holding is expected to enable Nakumatt avoid unnecessary holding of capital which will ultimately assists the business to grow.

“This helps the organization to significantly raise its operational efficiencies and reduce stock out incidences at all our 64 branches and central warehouses across the region, for the customers benefit,” he said.

The restructuring comes as Nakumatt is closing in on a securing Sh7.7 billion from a strategic investor as part of its turnaround plan.

The turnaround has seen Nakumatt hire three senior managers to bolster its management team.