Saturday, February 26, 2011

Supermarket shopping hurricane to spread in Nigeria

From all indications, Nigerians growing preference for shopping in supermarkets is set to grow in coming years especially in the cities. With an expanding middle class, increasing number of repatriates and a rapidly growing number of foreigners living and working in the country, this hurricane would not abate soon.

Uzochukwuamaka Otoh of the Nigerian Guardian Newspapers (http://www.ngrguardiannews.com) threw more light on this emerging trend in a report on the implications of supermarket consumption on Nigerians. Read on ...

A walk into the Shoprite Supermarket at Surulere presents one with a steady stream of shoppers, who seem to have shunned the open market for the luxury of mega supermarkets. The long winding queue of people at the bakery section tells of Nigerian’s love and growing appreciation for the unique pastries, which can only be found in these mega supermarkets. The French Baget and German flat bread have come to be accepted as an especial variety and departure from the regular bread, which Nigerians are used to.

Supermarket, as it known today, was initially a phenomenon of independent and small regional chains. Eventually, large chains caught on as well, and they refined the concept, adding a level of refinement that had been lacking from the austere stores of the early 1930s. In the late 1930s, A&P began merging its thousands of small service stores into larger supermarkets, often replacing as many as five or six stores with one large new one. The result was a reduction in the number of stores and increased sales resulting in the success of the supermarket phenomenon.

In Nigeria, the 70s and 80s presented us with supermarkets of international repute; the Leventis, UAC and Kingsway are testimonial to Nigeria’s blooming and flourishing economy. Today, most of these stores have become extinct and have come to be replaced by foreign franchise. The Shoprite Stores of South African origin have come to assume a place of importance in the city of Lagos; other international mega supermarkets like Harrods and Walmart are said be considering penetrating the Nigerian market.

A survey of mega supermarkets in Nigeria show that the mega supermarkets all tend to have little points of differentiation and also seem to be concentrated in the city of Lagos, thereby excluding other major cities like Calabar, Port Harcourt and Abuja. This phenomenon, itself is a disadvantage, considering that Nigeria is still a virgin land for mega supermarkets.

Also, putting into consideration the business unfriendly environment, which the Nigerian terrain presents, the prospects for managing a mega supermarket seem daunting especially. This is more so considering the rising appreciation for leisure, which seems to be more profitable for an investor in the hospitality industry than in the retail supermarket industry.

The need for constant power and water, security considerations, steady supply of goods and political considerations associated with establishing a mega supermarket in Nigeria also stand as impediments. From the consumers’ perspective, mega supermarkets are here to stay and will definitely constitute a strong competition to the open market.

The way and manner by which Nigerians have accepted influx of mega supermarkets, especially in Lagos, is an indication that the attitude of supermarket has come to stay, and is a force to be reckoned with as far as retailing in Nigeria is concerned. These mega supermarkets will increase the standard of retail business in Nigeria and also define today’s business environment and consumers in Nigeria as time goes on.

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