Shoprite’s Exit from Kano: Economic Factors and Legislative Intervention

Retail Supermarkets Nigeria Limited, the proprietors of the renowned Shoprite Mall, have recently declared their intention to cease operations in the Kano branch, situated in North West Nigeria, effective January 14, 2024. This decision, outlined in a circular by the supermarket’s management, cites the current financial condition of the mall and the challenging business environment in Nigeria.

Underlying Factors:

Daily Trust uncovered key factors influencing Shoprite’s planned relocation. Notably, the supermarket faces significant monthly expenses, including a hefty rent of N66 million to Ado Bayero Mall, separate electricity bills from Kano Electricity Distribution Company (KEDCO), and the costs of fueling and maintaining its standby generator. When combined with staff salaries and other operational expenses, this accumulates to over N1 billion annually.

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Business Climate and Customer Decline:

Sources within the mall attribute Shoprite’s decision to a decline in customer patronage over the last two years. Economic challenges have impacted the mall’s predominantly elite customer base, leading to reduced spending. Shop owners in the mall emphasize the shift from substantial purchases to more modest transactions, affecting the overall profitability of businesses.

Potential Impact on Surrounding Businesses:

The exit of Shoprite raises concerns about its impact on businesses in the vicinity, particularly those in plazas surrounding the mall. Some shop owners within the mall have reportedly relocated to these plazas. The fear is that the departure of Shoprite could negatively affect businesses that have benefited from additional foot traffic generated by the popular supermarket.

Legislative Intervention on Shoprites Plan Exit:

In response to Shoprite’s planned exit, the Deputy Senate President, Barau Jibrin, is taking proactive measures. The Office of the Deputy President of the Senate is set to engage with Shoprite’s management in Abuja to discuss and, hopefully, resolve the situation. While acknowledging the business nature of the issue, Senator Barau emphasizes the enormous business opportunities in Kano, underscoring the need to explore avenues to retain Shoprite in the commercial nerve center of northern Nigeria.

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