Shoprite’s Nigerian franchisee plans to change its business model

According to news reports within Nigeria, there have been questions around empty shelves and temporary closures at some outlets. 

“Yes, it has been a tough period, but this is not a collapse; it is a reset. The old model did not work for Nigeria,” The Punch newspaper quotes Bunmi Cynthia Adeleye, Chief Strategy Officer at Retail Supermarkets Nigeria Limited, as saying. 

“With new investors behind us, we are rebuilding Shoprite to be more local, culturally relevant, more affordable, and more resilient. We are coming back bigger and stronger to serve Nigerian customers better than ever before.” 

Long-term growth plan 

According to The Punch, the retailer stressed that it remains committed to Nigeria and would continue to serve its customers and suppliers as part of its long-term growth plan. 

The news platform This Day Live says the business model inherited by Retail Supermarkets Nigeria Limited when it acquired the business from Shoprite has relied heavily on large store formats, imports and high overheads. 

“But this model, according to the company, is no longer viable in the face of Nigeria’s current economic climate, which include[s] exchange rate volatility, rising inflation and constrained liquidity,” This Day Live reports. 

“Other pillars include smaller but more efficient formats that serve both everyday shoppers and bulk buyers; affordability at the core through private labels and value pricing; smarter liquidity management through supplier guarantees, phased payments, and stock clearance; and efficiency improvements, including energy optimisation and cost-saving measures across its stores.” 

Shoprite sold its Nigerian business interests in mid-2021 after almost 16 years in the country.