A ray of sunshine in Angola’s gloomy grocery retail market

Amid a prolonged recession and persistent double-digit inflation, the Angolan market is in bad shape at the moment (just ask Shoprite). However, there is one domestic player that has bucked the downward trend, exhibiting strong growth over recent years.

The retailer in question is Mega Cash & Carry, which operates just two outlets – in Luanda and Lobito. In 2012, it launched a banner called Bem Me Quer that it franchises to independent traders.

In return for agreeing to source most of their stock from its outlets, Mega helps these entrepreneurs to make the leap from traditional to modern retail by facilitating access to credit so that they can improve the fit-out of their stores and purchase refrigeration and air conditioning equipment, among other things.

This formula has proven so successful that there are now around 250 Bem Me Quer outlets, and there has even been talk of exporting the banner to Congo Rep. and Mozambique.

The Sagaci Retail View: While the franchise model is hardly unique to Bem Me Quer (Ivorian chains Prosuma and CDCI are pursuing a similiar strategy, as is Kenyan chain Tuskys), its growth is almost unprecedented in Africa, with only Turkish hard discounter BİM (which opened more than 400 outlets in Morocco in a decade) in the same league.

In many African grocery retail markets, franchising may be the optimal strategy to drive growth because it is relatively low cost, facilitates access to areas where modern retail infrastructure is often lacking, offers convenience to consumers, and harnesses the local knowledge and work ethic of traditional retailers.

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