Choppies supermarket.[photo/Standard]
It hardly looked plausible. That Kenya’s leading supermarket chain, Nakumatt, had come spectacularly unstuck. Nakumatt was many things to Kenya. It presented the face of Kenyan entrepreneurship having come of age and having the capacity to slug it out with global players.
Nakumatt’s rapid growth, especially its scooping up prime locations in malls within Nairobi and other towns, kept the advance of global supermarket chains in check. But 2017 was the year that Nakumatt unraveled, as the financial crisis in the company came to a head. Disintegration soon flowed. It has been closing branches, and those still open have empty shelves. It has lost many of its prime locations.
It is embroiled with huge battles with suppliers, some of whom have already attached its goods. It has lost its position as the pre-eminent supermarket chain in East Africa, closing its branches in Uganda and Tanzania. The company is now a pale shadow of its former self. Nakumatt’s rapid demise and the collapse of its position as the dominant retailer is a demonstration of how rapidly the landscape can change.
Nakumatt’s rapid expansion had provided a bulwark against foreign invasion of the exceedingly lucrative Kenyan retail market. These chains have been attempting to gain a foothold in the Kenya market for over a decade with minimal success.
The first international chain to enter the Kenya market was the South African chain, Metro. It never managed to make any inroads and soon left the country. In recent years, however, the increasing availability of space has given room for international chains to enter the market.
Botswana’s Choppies has bought out Ukwala chain of supermarkets, giving it a major footprint in the market with 10 stores in Nairobi. South African based Massmart failed in its entry bid through the buyout of Tuskys, before opening a store-branded Game at Garden City Mall.