Source: Simbisa bets big on deliveries, solar push as fuel shock squeezes margins – herald
Tapiwanashe Mangwiro
Fast-food giant Simbisa Brands Limited is accelerating its delivery business, expanding its store network and doubling down on solar energy investments as regional fuel price shocks and inflationary pressures reshape the economics of the restaurant industry across southern Africa.
Group chief executive officer, Mr Basil Dionisio, said the business had continued to attract customers despite a difficult operating environment marked by rising fuel costs linked to geopolitical tensions in the Middle East.
“Consumer demand remained resilient during the quarter, supported by currency stability, favourable weather conditions and strong commodity prices across key operating markets,” Mr Dionisio said in the group’s third quarter trading update.
While many consumer-facing businesses across the region have struggled with slowing discretionary spending, Simbisa, which operates brands including Chicken Inn, Pizza Inn and Bakers Inn, appears to be benefiting from aggressive value promotions and changing eating habits increasingly driven by convenience and delivery culture.
The company reported that delivery volumes in Zimbabwe surged 83 percent during the quarter, while Kenya recorded a 71 percent jump in deliveries compared to the same period last year.
The sharp rise highlights how digital ordering and home delivery are becoming central to fast-food growth strategies in African cities, where younger consumers increasingly favour app-based convenience.
“Performance in the delivery segment remained particularly strong, with delivery volumes increasing by 83 percent in Q3 full year 2026 compared to the prior year, supported by a growing delivery fleet and improved zoning efficiencies,” Mr Dionisio said.
The delivery boom comes as urban consumption patterns continue to evolve across the region, with businesses racing to capture demand from digitally connected consumers seeking affordability and convenience.
Simbisa said delivery operations in Kenya were now averaging approximately 6 000 per day, with delivery contribution in key brands nearing the group’s long-term target of 30 percent of total market turnover.
But behind the strong customer growth story lies mounting pressure on profitability.
The company warned, “The quarter had been characterised by heightened cost pressures following significant increases in fuel prices from February 2026.”
Those increases, according to the company, were triggered by global oil supply disruptions associated with ongoing Middle East tensions.
The rising fuel bill is proving particularly painful for restaurant operators that depend heavily on logistics, refrigeration, transportation and backup power systems.
“In addition to increasing operating costs, these developments have also negatively impacted gross profit margins as suppliers adjusted pricing in response to inflationary pressures,” Mr Dionisio said.
Zimbabwe operations also faced additional pressure from the Fast Food Tax, which the group said was squeezing margins at a time when operators were already battling higher input costs.
Rather than aggressively hiking menu prices, Simbisa appears to be pursuing a volume-driven strategy centred on promotions and product innovation.
The company said, “Significant quality improvements, day-specific promotional initiatives and value offering campaigns have helped drive customer traffic growth without increases to menu pricing”.
That approach helped customer volumes in Zimbabwe rise 12 percent to 12,6 million during the quarter.
At the same time, the company is rapidly expanding its physical footprint despite broader economic uncertainty.
Simbisa added a net 29 counters across its regional operations over the past year, taking its total network to 751 outlets spread across Zimbabwe, Kenya and Eswatini.
The company plans to open 17 more stores in the current quarter alone.
“The group continues to expand its footprint, with 17 new stores currently in the pipeline for Q4 full year 2026,” Mr Dionisio said.
One of the more significant long-term strategic shifts, however, is happening behind the scenes through the company’s energy transition programme.
With electricity reliability and energy costs remaining major concerns for Zimbabwean businesses, Simbisa is increasingly investing in solar infrastructure to reduce dependence on generators and unstable utility supplies.
“The solarisation programme in Zimbabwe remains a strategic priority as the Group seeks to enhance energy security, reduce generator and utility costs and future-proof operations against rising energy costs,” Mr Dionisio said.
The programme is being rolled out through partnerships under a “no capex Power Purchase Agreement structure”, allowing the company to scale renewable energy adoption without heavy upfront capital expenditure.
Analysts say the strategy reflects how large corporates in Zimbabwe are increasingly treating energy security as a core operational issue rather than a peripheral sustainability initiative.
The company also launched the Pastino brand into the Zimbabwean market during the period as it seeks to diversify its product offering and capture new consumer segments.
In Kenya, meanwhile, Simbisa’s expansion drive continued to gain traction, with customer volumes rising 21 percent year-on-year to 3,5 million during the quarter.
Although promotional campaigns and value meals reduced average spend per customer, the company said the strategy had succeeded in driving overall revenue and customer growth.
“Promotional activity and the introduction of additional value meal offerings impacted average spend; however, the resulting growth in customer counts and overall revenue validated the pricing strategy,” Mr Dionisio said.
As inflationary pressures, fuel volatility and shifting consumer behaviour continue to redefine Africa’s fast-food industry, Simbisa is effectively placing its bet on scale, digital convenience and energy resilience to defend profitability and maintain growth momentum.
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