STREETWISE MARKETING
RETAIL IN
TROUBLE
By Evans Majeni
F
or some time now, there has
been a disquiet in the retail
sector in Kenya. Like all things
buoyant, the period that heralded the
unprecedented growth from the year
2005 eventually started showing signs
of fatigue.
Uchumi, the trailblazing supermarket
in Kenya, synonymous with self
service store in the country was the
first to show signs of duress blamed
largely on high level mismanagement
and staff pillage. It stumbled for a
while propped up by government
subsidies before going into limbo.
Next was Tuskys that hit the
headlines for all the wrong reasons - a
disagreement amongst the brothers.
The court battle that followed exposed
the soft underbelly of family owned
enterprises and attendant ego fights. To
date, Tuskys have closed several prime
branches within the city giving what
would easily pass more as excuses than
actual reasons for the closures.
As Tuskys was embroiled in court
battles, Naivas, the new kid on
‘‘While many theories are being advanced
as to the reasons why our supermarkets are
struggling, from a marketing perspective,
it is imperative to look at the the drop in
value per basket for every shopper as the
main driver of this catastrophe. The rise in
inflation, fall in general income levels with
a consequent drop in basket values is the
immediate trigger of supermarket struggles.
We must therefore trace and confront the
factors that are driving this falling income.
10 MAL 19/17 ISSUE
the block was having a free run
conquering new markets. Until a
suitor from SA came to the scene with
a juicy offer to purchase the chain
store. Expectedly, sibling rivalry in
the nature of shareholding dispute
once again reared its ugly head to
frustrate this bid. Around the same
time, Ukwala, which had been on an
expansion craze also appeared to hit a
rock somewhere. They quickly made
a deal to sell to a South African chain
store - Choppies.
Amidst all this turmoil, Nakumatt
remained the poster boy of a model
chain store. They continued their
expansion foray into the region going
all the way to Uganda, Tanzania and
Rwanda.
On the sidelines, grapevine was ripe
about its internal challenges key
among them being staff disaffection
and supplier frustration with slow
payments. This however did not dent
their enthusiasm. Nakumatt still led
on all fronts.
They pioneered the mega stores
with in-house coffee houses. Led in
in-store promotions and stocking
by independent suppliers expanding