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BUSINESS STRATEGY

Egyptian discount grocery retailer thinks big in Morocco and Saudi

By our African Marketing Confederation News Team | 2024

Kazyon’s ambitious business strategy is to have a network of over 5,000 stores in three countries in the next five years.

Kazyon, the Egyptian-based discount grocery retailer, is continuing with its ambitious store expansion strategy in North Africa and the Middle East. 

 

Photo credit: Development Partners International

It opened its first outlet in Morocco in October last year, and already has 12 stores, mostly in Casablanca. The aim is to have 200 outlets in Morocco by the end of next year and 600 stores by the end of 2027. 

 

This week, Kazyon took another step in its business strategy by acquiring a stake in Dukan, a grocery discount retailer operating in Saudi Arabia.  

 

Saudi is regarded as one of the most attractive grocery retail markets in the region, given that the modern trade channel penetration is only around 50%, presenting ample room for growth. 

 

“This acquisition marks an important milestone for Kazyon as it accelerates its growth and expands into Saudi Arabia. We are excited by the prospects for the business in the Kingdom,” says Hassan Heikal, Chairman and founder of Kazyon. 

 

The retail chain now has more than 1,000 stores across Egypt, Morocco and Saudi Arabia, and is expected to have a network of over 5,000 stores in the three countries in the next five years. 

 

In entering Morocco, Kazyon goes head-to-head with arch-rival BIM, a Turkish-based discount grocery retailer that has a strong presence there and in Egypt. In Morocco, BIM has close to 700 stores. 

 

Must open two new stores every week 

 

“In Egypt, Kazyon’s pace of growth has effectively reached one new store per day for the past three months. In order for it to open 200 outlets in Morocco by the end of 2025 it needs to open two new stores every week,” comments Trendtype, the London-based emerging markets consultancy. 

 

According to Trendtype, if Kazyon can build a large and sustainable store network store network quickly in Morocco, it will offer a considerable challenge to BIM. 

 

“Already we can see stores in Casablanca sited close to one another, which they (Kazyon) will continue to do, given the concentration of BIM stores in major cities like Casablanca and Rabat,” the consultancy states. 

 

“The firm winner should be Moroccan consumers, who get their choice of everyday low prices and what promises to be a robust competition to win custom.” 

 

The expectation is that Kazyon will initially focus its effort on a few big cities, before allowing the competition for customers to target smaller Moroccan towns and cities. 

 

BIM has been facing headwinds in Morocco, with the government complaining that too much of its stock base was being sourced from Turkey.  

 

BIM has now changed tack and is sourcing extensively from within Morocco, giving a boost to local manufacturers and, according to Trendtype, giving them impetus to reach into expansion markets such as francophone West Africa. 

 

Founded in 2014 in Egypt by Hassan Heikal, Kazyon claims to be the largest discount retailer in the Arab world and Africa, and currently employs around 7,000 people. Its business strategy is to provide customers with access to affordable, high-quality products, delivered through a network of consistent, recognisable neighbourhood stores.

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    Dr. Kin Kariisa is an extraordinary force at the helm of Next Media Services, a conglomerate encompassing NBS TV, Nile Post, Sanyuka TV, Next Radio, Salam TV, Next Communication, Next Productions, and an array of other influential enterprises. His dynamic role as Chief Executive Officer exemplifies his unwavering commitment to shaping media, business, and community landscapes.
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