ANTICIPATION

Retailers bank on festive season to make hay

The Retail Trade Association of Kenya hopes sales will increase this month.

In Summary

•The sales will be driven by Christmas festivity and back to school shopping.

•The sector has suffered low business since measures to mitigate the spread of the coronavirus were put in place in March.

Customers shop at a Naivas Supermarket/FILE
Supermarket Customers shop at a Naivas Supermarket/FILE
Image: Reuters

Major retailers across the country are stocking up banking on the festive season for increased sales after a long revenue drought occasioned by the Covid-19 pandemic.

A spot check by the Star over the weekend established massive stock ups in major retailers in the capital, with a similar trend being witnessed in branches in other parts of the country.

 

Retail chains such as Naivas, Carrefour and Quickmart are among entities eyeing increased business this festive season.

The retail sector has suffered low business since measures to mitigate the spread of the coronavirus were put in place in March, among them the night curfew which reduced operating hours, with a tough operating environment pushing stores like Shoprite out of the market.

Toward the end of April this year, 25 major retailers came under the radar of the Competition Authority of Kenya over delays in paying suppliers, signalling at tough business environment.

“At the beginning we registered an upsurge as people rushed to stock up their homes for the fear of the unknown after which people stopped buying. We had a bad second quarter but there has been an improvement in quarter three and four,” said Wambui Mbarire, CEO Retail Trade Association of Kenya((RETRAK).

In a telephone interview,  Mbarire said the sector expects an “uplift” this month as households and corporates shop for the Christmas season and parents undertake early back to school shopping.

“It will not be a normal December but we hope for a slight improvement,” Mbarire said.

Though a section of the retail and supply chain are struggling with cash flow, good relationship between retailers and suppliers has ensured continued supply of goods,RETRAK notes.

 

Naivas which recently took over space left by Nakumatt Lifestyle,at Hazina Towers in Nairobi and opened a branch at Ananas Mall in Thika is expected to open another branch in Rongai this Thursday, with management projecting growth in the sector post Covid.

 

“We are not worried about reduced spend. The main concern is the congestion towards the D-day. We therefore encouraging people to shop earlier,” chief commercial officer Willy Kimani told the Star yesterday, as the firm drives its sales through its Christmas promotion campaign.

Kimani said business has seen resilient and currently stable apart from covid legacy related departments like stationery and gifting items for weddings.

“I have a positive outlook and believe we shall have a season that Kenyans can still enjoy,” he said.

Carrefour which expanded to Mombasa last week has also expressed confidence in the country's retail space, with Country Manager Franck Moreau counting on digital innovation in grocery retail to grow business.

The retailer has partnered with Jumia Food and Glovo for home delivery of   groceries.

The sector is expected to capitalise on eCommerce to grow sales, according to real estate firm–Knight Frank.

Retailers such as Tuskys and Naivas supermarkets have invested in online platforms in a bid to boost their offering to customers, the firm notes in its latest sector report.

E-commerce platforms Jumia reported a spike in both consumer and seller uptake, resulting in gross profit increasing by 38 per cent in the year to quarter two 2020.

“There is no doubt that the pandemic has accelerated a change in consumer attitudes towards online retail, resulting in the adoption of online retail platforms by retailers across the continent,” Knight Frank Kenya Retail Portfolio Manager Ashmi Shah said.