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Kenya: Kenya’s Retail Economy More Formalised Than Nigeria’s, Says Nielsen

2015/03/05

Kenya is the second most formalised retail economy in Africa next South Africa, a survey carried out by the New York Stock Exchange-listed research company, Nielsen has revealed.

The consumer statement focusing on five sub-Saharan Africa economies, which was released on Monday, indicates that 30 % of Kenyans shop in proper retail outlets compared to 60 % in South Africa.

The commercial powerhouse of East Africa is ranked ahead of Ghana which has only four % of its people patronising retail shops. It as well tops Cameroon and Nigeria, both of which have two % of shoppers visiting supermarkets.

“Even in Kenya, regarded as one of Africa’s most developed retail markets, traditional trade still accounts for 70 % of sales,” noted the Nielsen statement. The 41 % who visit formal retail outlets do so to explore the wide variety offered by these outlets.

The majority widely spread shops in Kenya are table tops, kiosks, market stalls, cosmetic outlets, telecom kiosks, drugs (pharmacists) and catering and leisure shops. 20 % of traditional stores in Kenya are convenience outlets while 33 % are groceries. In Cameroon, however, convenience outlets account for 48 % of the informal trade shops.

Although the level of patronage is impressive, these supermarkets offer competitive prices and are not necessarily located within close distances from most buyers. Nielsen noted that traditional markets are still very relevant in the modern day African society.

“It is authentic that large African and international retailers such as Shoprite, Woolworths, and Carrefour are making investments in modern trade formats. But traditional outlets will continue to be a significant channel for reaching consumers for some considerable time approaching,” read the statement.

According to a Kenyan business news platform Business Daily, small retailers such as Mulleys & Sons, GreenMart, QuickMart, Maathai Supermarket, EastMatt and CleanShelf are expanding rapidly.

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