Retail is Everything in Kenya

Retail is everything in Kenya. This is seen in Nairobi, the country’s capital and in the sprawling shopping centers, multi-storied malls and huge complexes offering shopping, entertainment and food all under one roof.

‎Wambui Mbarire, Chief Executive Officer at Retail Trade Association of Kenya – ‎Retail Trade Association of Kenya says, ”Retail is everything.”

Speaking exclusively to SokoDirectory during the re-opening on Tuskys Mattress Hakati branch, Mbarire noted that the retail market’s potential has been explained well in the Economic Pillar of Vision 2030 that seeks to improve the prosperity of all regions of the country and all Kenyans by achieving a 10% Gross Domestic Product (GDP) growth rate by 2017.

According to the Vision 2030 Medium Term Plan 2013-2017, six priority sectors that make up the larger part of Kenya’s GDP (57%) and provide for nearly half of the country’s total formal employment have been targeted: Tourism, Agriculture, Livestock and Fisheries, Wholesale and retail trade, Manufacturing, IT enabled services (previously known as business process off-shoring), Financial services, Oil and Gas.

“Growth in Kenya’s retail has been driven by the country’s constant steady growth,” Robert Tashima, Managing editor: Africa, Oxford Business Group.

The Group ranks the sector as second-most formalized in Africa. This is due to the increasing urbanization with a rise in the levels of disposable income driving consumer’s preference for organized retail.

According to Euro monitor, ‘Retailing in Kenya Report’, “Local companies led the retail market in 2015, largely as a result of their strong brand heritage built over time through strong advertising and their long-term presence in the market. Also, the expansion of modern retail outlets to residential areas enabled a wider consumer reach. The roll-out of private label ranges allowed consumers to enjoy quality products at affordable prices, further fuelling the revenue growth of local companies.”

Going forward, the retailing market in Kenya is expected to record a stronger positive value performance over the forecast period when measured at constant 2015 prices.

Based on the positive trends with an expected Gross Domestic Product, (the quantitative measure of a nation’s total economic activity) expected to be 1.20 per cent by the end of this quarter as forecast by economist according to Trading Economics, a 2016 GDP growth to be between 5.5-6.0 percent according to Cytonn and a projected expansion 6.0 percent in 2016 and 6.5 percent in the medium term from the Treasury, opportunities are enormous for the retail sector.

The competitive retail sector to remain a driver for the economy amidst the rising of the middle class population, the sector will increase awareness of consumers about products and services, it will be more versatile to the changing consumer’s requirements and lifestyles, the manufactures will become more innovative in coming up with new product development.

However, local retail chains will continue to face stiff competition with the entry of international players in the Kenyan market, price competition among the retailers and the yet to be streamline government policies and regulations.