In early 2012, Shoprite, the largest supermarket chain on the continent, believed it could expand its footprint in Nigeria up to 700 outlets. But eight years later, that outlook is very different as the South Africa-owned retail giant is discontinuing operations in Nigeria as it considers reducing or selling its entire stake in the Nigerian division.
The company says the move is part of a “re-evaluation” of its operating model in Nigeria. It represents a major turnaround in plans since the supermarket opened in its first Nigerian store in Lagos in December 2005.
Shoprite’s impending exit is a telling marker of the state of Nigeria’s consumer economy. Despite being home to over 200 million people and Africa’s largest economy, the actual size of Nigeria’s addressable middle-class market remains in question, especially in the backdrop of the reality that nearly half of the country lives in extreme poverty.