Shoprite will cease operations in Kano in January

Retail Giants; Shoprite has announced plans to cease operations and close its branch in Kano.

In a significant move echoing the challenges faced by retailers in Nigeria, Shoprite has announced it will cease operations in the Kano State branch. The announcement will take effect on January 14, 2024. But the decision comes amid the rising economic and supply chain challenges that businesses are encountering in the country.

In the announcement, the company cited financial difficulties from poor sales, high operating, and supply chain costs as the driving factors.

This development comes after Jumia recently announced that it will cease operating Jumia Foods in Nigeria and other African countries. Again, citing the similar challenges mentioned by Shoprite: high operating costs and poor sales.

Shoprite’s circular expressed regret over the closure of its Kano branch, acknowledging the potential impact on employees and the local community. The company plans to lay off employees at the Kano store but encourages them to explore opportunities within the organization by applying for vacant positions in other stores across the country.

What’s next for Shoprite and its operations across Nigeria

But it’s not all bad news for the company. In the same circular, the company hinted at plans to open new branches in other parts of Nigeria. A pointer that despite the economic and supply chain challenges, opportunities abound across the country.

The broader context reveals that profitability remains a substantial challenge for retail industry players operating chains of supermarkets, grocery stores, and food delivery services in Nigeria. Escalating operating costs coupled with rising inflation has made things difficult.

Despite the closures, Shoprite is still enthusiastic about the future of the business.

In conclusion, the decisions by Shoprite and other businesses highlight the need for adaptability and strategic ways to reduce costs. As Nigeria continues to battle economic challenges, businesses will continue to be tested and unfortunately many will continue to shut down operations and leave the country.

To survive these businesses will need to realign their models for sustainable growth amid the evolving market.