Nigeria: How consumer demand is spurring retail sector growth

The Nigerian retail sector has faced significant challenges over the past year, navigating the disruptions caused by the COVID-19 pandemic. Ade Sun-Basorun, CEO of FoodCo Nigeria, discussed the resilience of the organized retail sector amidst job losses, stagnant wages, and rising inflation. The sector had to adapt to new financial planning, supply chain management, and health and safety protocols to ensure continued operations. Despite the ongoing supply chain challenges, FoodCo Nigeria has managed to return to growth and invest in the business, thanks to its essential status and strong consumer relationships. While global players have exited the market, local retailers like FoodCo Nigeria remain optimistic about the growth potential of the sector. Nigeria is projected to drive consumption growth in Africa, with significant opportunities for modern retail expansion. Sun-Basorun highlighted the underpenetration of modern retail in Nigeria compared to other markets like Kenya and South Africa, indicating ample room for growth. Consumer demand remains a key driver for retailers, particularly in sectors like food and beverage, where demand has remained resilient. Despite challenges like stagnant wage growth and high inflation, Sun-Basorun is bullish about the sector's future, citing double-digit sales growth fueled by strong consumer spending in key categories. While individual consumers may experience varying degrees of economic contraction, Nigeria's growing population presents an opportunity for retailers to innovate and adapt to changing consumer preferences in order to unlock further growth in the retail sector.