Customers doing shopping in major supermarkets.[Photo/businessdaily]For the retail sector, 2017 has been a year of mixed fortunes, with long-established supermarkets struggling to be profitable and stay afloat in an ever-changing business environment.
While mounting debt aggravated financial positions of once vibrant supermarket chains like Uchumi and Nakumatt, new entrants such as Choppies, Carrefour and the increasingly popular online retailers like Jumia and Kilimall gained a foothold in the lucrative sector.
A study released by Proctor & Gamble in February indicates that the retail sector expanded by 13 percent last year hitting an all-time high spending of Sh1.8 trillion. Apart from the mega-retailers, the retail market was dominated by traditional Dukas (small local shops in market places and estates) where 70 percent of Kenyans do their daily shopping.
The year started with revelations by Cytonn Investments that retail sector in Kenya experienced an increased supply of retail space, which grew by 41.6 percent on a year-to-year basis in Nairobi alone from 3.9 million square feet (SQFT) in 2016 to 5.6 million SQFT this year, which allowed the entry of retailers like Two Rivers, which opened its doors in February.
There was also an upturn for other mega stores like Tuskys and Naivas and other upcoming retailers operating in estates and major urban centers like Tumaini, Mulleys & Sons, GreenMart, QuickMart, Maathai Supermarket, EastMatt, and CleanShelf.
The presence of foreign retailers like Choppies from Botswana, which acquired Ukwala Supermarkets in 2015 and France’s Carrefour that opened two new mega stores at The Hub Karen and the Two Rivers Mall continued the keep the sector afloat. Carrefour opened its first outlet in Kenya in May last year. Game store, which was opened in 2015 by South Africa’s Massmart partnered a number of suppliers this year.