- 22nd September 2020
- Posted by: damian.shore
- Categories: Supermarkets, Retail, SagaRetail News, Carrefour, Naivas
Having opened eight Carrefour stores in Nairobi since it entered the Kenyan market in 2016, Majid al Futtaim (MAF), the banner’s East African franchisee, has now revealed plans to expand beyond the capital, with two branches set to open in Mombasa during November.
These will be located in City Mall Nyali and Diani Centre Point Plaza. The former, which will have a sales area of 2,150m2, will replace a Shoprite supermarket that closed in August (before that, it hosted a Nakumatt store). The latter will be located in Diani Centre Point Plaza and have a sales area of 1,800m2. Both will carry around 20,000 food and non-food SKUs. The third store will be located in Shanzu Mall, which is currently under construction.
The Sagaci Research View: With both Shoprite and Choppies quitting the Kenyan market over the past 12 months, former market leader Tuskys fighting to remain afloat, and landlords struggling to attract and retain tenants in the wake of Covid-19, MAF has timed its move beyond the capital well.
However, the fact that it remains wedded to the traditional supermarket/hypermarket format and shopping mall locations at a time when retailers in other markets (including CFAO, Carrefour’s franchisee in francophone West Africa) are experimenting with hard discounting, hybrid cash-and-carry, and stores in residential areas, is a cause for concern. MAF’s strategic rigidity may eventually come back to haunt it.
But for the moment, it remains, alongside Naivas (due to open its 66th store in the Waterfront Mall Karen – another former Shoprite location – during October) and Quickmart (both of which are now backed by private equity), one of the most dynamic players in the Kenyan grocery retail market.