The Sunday News
Gabriel Masvora Business Editor
BREADMAKER Lobels Bread is in the process of installing a new plant at its Bulawayo factory which will see production rise from 80 000 to 100 000 loaves per day.
The company has been running on two lines but increased demand has seen shareholders seeking funds to improve capacity by installing a new efficient line.Lobels Bread chief executive officer, Mr Ngoni Mazango, however, declined to divulge how much the project would cost.
“This new line will produce 100 000 loaves per day and it will be more efficient meaning it will be running on just one line,” he said
“We will commission the plant very soon,” said Mr Mazango.
Mr Mazango said the new line was also likely to see the company expanding its confectionery product range to suit the growing market appetite.
However, the process triggered a shortage of the company’s product range last week with some outlets reportedly failing to meet customer demands.
Sources at the company said the company was likely to commission the new plant by the end of this week.
“Unfortunately the line which is running now is the old one and this has resulted in shortages. We know there is a shortage of the bread but we are trying to make sure that the market is catered for,” said an official at the Bulawayo factory.
The official said some of the bread was now coming from the Harare plant to fill the void.
However, Mr Mazango said although there was a shortage, it was temporary and the company was not transporting bread from Harare to Bulawayo.
“This is just a short-term problem. Our customers must bear with us.”
At the beginning of the year, the group saw production at its Harare plant going up by 20 percent.
It is now producing 250 000 loaves a day after the successful installation of a $5,8 million semi-automated machinery in the last quarter of last year.
The company almost sank under a burden of a $14 million debt but since it was taken over by a consortium of bankers it has managed to find its way back into the market although competition from other bakeries has been stiff.
The company is now owned by banks NMB, FBC, CBZ, Capital Bank and Metbank under the vehicle Altiwave. The banks took over the bakery as previous shareholders had failed to settle the more than $14 million advanced by the financial institutions.
Economists said the banks were the likely sources of capital which has put the company back on course.
The move by Lobels Bread to expand operations in Bulawayo also comes at an opportune time when the city is battling to lure back investors after a decade of industrial decline.
The decline has seen a number of companies closing but some investors have started taking a keen interest in the city as Government has announced that it would soon be declared a Special Economic Zone.
However, Government has urged investors that they do not necessarily have to wait for the declaration of SEZs to pump in money as there were many other incentives on offer.
Industry and Commerce Minister, Cde Mike Bimha, told captains of industry during the Zimbabwe National Chamber of Commerce annual congress at the beginning of this month that Government would support any investments at any time.
