Editor's Review

Tuskys will allow private retailers to operate stores across the country under their brand at a fee in a franchising project.

Wounded supermarket chain Tuskys is seeking a nod from the Competition Authority of Kenya (CAK) to lease its brand to individual retailers in a bid to keep the name afloat.

The retailer went under after it failed to pay debts owed to landlords of its nationwide premises and suppliers.

Tuskys stated that it will permit private retailers to operate stores across the country under their brand at a fee following delays in the conclusion of a Ksh2.1 billion deal with an unknown foreign investor.

CAK made the announcement yesterday, May 31, revealing that the retailer also sought the regulator's guidance on how to franchise the Tuskys brand.

The franchising deal will allow Tuskys to keep the brand alive while generating revenue from the partnerships and also a chance at revival should they get an investor in future. The retailer's branches have shrunk from 60 to 7.

Tuskys will follow in the footsteps of cash-strapped Uchumi Supermarkets which also entered into a franchising deal.

The retailer earlier in the year rejected a creditors court petition to make public the foreign investor it announced a deal with. 

"The authority received an advisory request from Tusker Matresses Limited regarding a franchising project. Specifically, Tuskys sought advice on the necessary legal steps and requirements that they should put into consideration to enable the project become a success," CAK stated.

"Tuskys was requested to furnish the authority with the final draft of the franchising agreement once prepared and before execution for its review," the regulator noted.

The retailer hopes that the brand is big enough to attract investors to rent the stores, pay employees and keep the brand alive.