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an incentive for foreign retailers , according to Oxford Business Group .
The increased mall space in the country has significantly grown . Nairobi ’ s mall space supply has a market shares of 59.4 per cent . The supply is expected to grow over the next 3 years at a compounded annual growth rate ( CAGR ) of 7.3 % to 6.90Mn square feet in 2020 from 5.6Mn square feet in 2017 , according to Kenya ’ s Retail Sector report by Cytonn Investments .
Destination malls are the best performing with an average rental yield of 10.3per cent , compared to a market average rental yield for the retail sector of 8.3 percen , t hence the reason for global retailers taking interest in the market .
Kenya ’ s high population growth of 2.6 % per annum against world ’ s 1.2 % has created demand for retail goods and services . The rising middle-class purchasing power has increased , accompanied with changing lifestyles . Their appetite for convenient shopping has the middle class consumer interested in the global entrants with well stocked shelves and variety of goods and services to match this need .
Kenya ’ s urbanization rate at 4.4 %, which is relatively high compared to the world ’ s 2.1 %, has resulted in a need for retail stores and entertainment spots for the youths ’ varying tastes and preferences for different goods and services . African millennials are changing their consumer spending patterns , from markets to malls , where they can eat , drink and socialize as well as shop ,” says Forbes .
The Family Debacles at Tuskys and Naivas
Tuskys and Naivas are family owned retail giants and with family members at the top of the chain , comes with it a fair share of disagreements and drama . The Knight and Frank Global Wealth Report confirmed the biggest worry for billionaires is how to transfer their wealth to the next generation . Most of them expressed their fear that their children are not ready to take up the mantle of running the family business . Failure to draw and have proper succession plans has seen a number of relatives turn on each other for their ‘ piece of cake ’.
Tuskys has been on the radar quite a lot when it comes to family disagreements . Two brothers and co-owners of Tuskys Supermarkets Stephen Mukuha and George Gachwe were last year charged with theft of KSh 1.64Bn from the retail chain between 2002 and 2012
In May 2016 , Tuskys Chief Executive Daniel Githua was humiliated in a forced eviction by the grandchildren of Joram Kamau founder of Tuskys Supermarkets . Githua
30 | THINK BUSINESS • NOVEMBER 2017