Forex shortages: Boon for button manufacturer

Foreign currency shortages have been a challenge  for many local manufacturers

Foreign currency shortages have been a challenge for many local manufacturers

Oliver Kazunga Senior Business Reporter
ZIMBABWE’S sole button manufacturer, Life Gear, has seen its production levels increase to 40 percent driven by local clothing manufacturers who currently do not have the foreign currency to import buttons. Formerly Coronet Buttons, the Bulawayo-based company was operating at 10 percent capacity utilisation before the persistent foreign currency shortages.

Life Gear managing director Mzingaye Mdlauzo said as a result of improved capacity utilisation his organisation was now generating between $14 000 and $15 000 per month in revenue from $8 000.

“Those companies who used to import buttons from outside the country are now limited due to foreign currency shortages being experienced in the country. This has seen them turn to us for the small but important element in clothes manufacturing. Consequently, this has had a positive impact on our capacity levels that have since risen to 40 percent from an average of 10 percent before the foreign currency crisis,” he told our sister publication Business Chronicle. The button manufacturer has, in the past, appealed to Government to impose a ban on the importation of buttons saying it had the capacity to meet local demand.

“We cannot say the improved capacity utilisation we have experienced is due to Government support, but there has been an automatic correction of our situation owing to foreign currency shortages,” said Mr Mdlauzo. He said his organisation was also not spared from the adverse effects of foreign currency shortages as they also import plant equipment spare parts and critical raw materials such as chemicals from South Africa and Italy respectively.

He said although capacity utilisation has improved, Life Gear, which presently employs 31 workers cannot create new job opportunities as the current workforce still matches with the operational performance of the company. The firm, which produces all sorts of buttons that match with customer specifications needs $150 000 working capital for expanding its operations as well as procuring state of the art technology in line with fashion trends.

“We have not been able to secure any funding from local financial institutions and that has deterred our expansion plans in line with global trends,” said Mr Mdlauzo. At its peak, Life Gear was one of the key industries in Bulawayo employing close to 500 people.

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  • nelson moyo

    Is the mabondi note classed as a foreign currency as it is also in short supply ?