Once giant retailer, Tuskys, lost its tusks two decades after the death of founder Joram Kamau
Nakumatt on the other hand was liquidated in January 2020 after experiencing financial woes attributed to huge debts and mismanagement
Nine years after his death, Njenga Karume’s empire is in ruins with his children and trustees fighting to control his estate
PAY ATTENTION: Help us change more lives, join TUKO.co.ke’s Patreon programme
In Kenya, family businesses are big and are a source of employment for over 60% of the population. Tuskys staff at a past meeting before the retail chain collapsed. Photo: Tuskys Supermarket. Source: Facebook According to data by the Family Business Institute , however, only one-third of family-owned businesses last into a second generation of ownership, 12% to a third and just 3% to a fourth.
Another report by multinational professional services firm, PwC , released in May 2021, revealed family-owned businesses in Kenya lack clear succession plans.
PAY ATTENTION : Install our latest app for Android, read the best news on Kenya’s #1 news app
The report dubbed the East Africa Family Business Survey noted that troubles arise after the death of founders, with public feuds between relatives being the order of the day. “Within these businesses themselves, there are generally high levels of trust and communication. Yet very few of them have properly considered and documented governance and succession frameworks for their family and business,” Sunny Vikram, an associate director at PwC Kenya, said. TUKO.co.ke looked into Kenyan family business empires that crumbled and possible reasons behind their much publicised collapse. 1. Tuskys
Once giant retailer, Tuskys, lost its tusks two decades after the death of founder Joram Kamau.
At its peak, the Kenyan supermarket chain was one of the largest in the Great Lakes Area. It employed over 6,000 people in Kenya and 150 in Uganda .
In 2016, Tusky’s supermarket CEO Dan Githua was ejected from his office unceremoniously by the heirs to Tusky’s empire.The grandchildren reportedly stormed his office and ordered him to leave the premises. He was recalled two months later.Some of the reasons that contributed to the collapse of the multi-billion supermarket which had several branches in major towns include sibling rivalry, internal fraud, aggressive debt-fuelled expansion and fierce competition.By August 2020, it had accumulated debt worth KSh 6.2 billion owed to suppliers and creditors.Despite entering a KSh 2 billion agreement with a Mauritius […]