Shoprite said it will be closing down operations in Nigeria, which is Africa’s biggest market, with a population of over 200million. The shocking move which was announced on Monday 3rd August 2020, was due to the coronavirus pandemic which has disrupted major businesses globally.
Shoprite has been in operation in Nigeria for nearly 15-years. The Shoprite stores are widely spread across states in Nigeria and employ thousands of Nigerians in the process.
Shoprite in a statement released a few hours ago, said they have struggled to continue operations in the Nigerian market, and based on their financial reports, they will now focus more on the South African market.
In terms of closure, Shoprite said the results for the year do not reflect any of their operations in Nigeria as it will be classified as a discontinued operation.
International supermarkets (excluding Nigeria) contributed 11.6% to group sales and reported a 1.4% decline in sales from 2018. South African operations contributed 78% of overall sales and saw an 8.7% rise for the year.
As a result of lockdown, customer visits declined 7.4% but the average basket spends increased by 18.4%.
The statement brings to an end, a 15-years of relationship with the Nigerian people.
Since the news broke, Nigerians have been reacting, as they took to their social media handles to register their opinion on Shoprite leaving Nigeria. While some supported the move as it will give other local businesses the opportunity to take the market, others blame bad government policies and the lack of enabling business environment in Nigeria.
Here are some of those reactions from Nigerians and non-Nigerians on Shoprite leaving Nigeria:
when etisalat left and 9mobile took over. Shoprite can leave, ebeano will take over. It doesn’t really affect anything, the staffs can be retained.
peace ibe@willowothewisp Replying to
The problem isn’t shoprite leaving but the reason behind it and what it says about the adverse effect of government policies on businesses in the country (indigenous and non-indigenous) and economy at large.
@AyoBankoleThe Board of Africa’s biggest retailer, Shoprite, has announced plans to discontinue operations in Nigeria after 15 years in. While this may open up opportunities for local investors in that sector, it is a bad pointer to what Nigeria has become as an investment destination.
the Morris Monye factor
@Morris_Monye Cost of doing business is so high in Nigeria. You provide your own power, your own water etc… Costs just keeps getting higher and higher. The unfortunate thing about this Shoprite debacle is the huge loss to staff, contractors and supplier. An unfortunate domino effect.
There are other reactions, but the result released by the company in terms of profits, says 2018. So, given the increased rate of online shopping in Nigeria and how Nigerians have embraced this, it will definitely affect sales. Also, and most importantly, is the issue of coronavirus pandemic.
Since Nigeria has been on partial lockdown, especially Lagos and Abuja where you have the big spenders and those more likely to patronise these stores, it will definitely affect sales. The coronavirus effect on grocery shopping across the world has been a major one, with most of the like Walmart also closing down some of its stores.
Good or bad, we wait to see what happens next, as Walmart could be eyeing to take over these stores in Nigeria.