The xenophobic attacks on Nigerians living in South Africa has sparked a controversy, leading to the call for the exit from business interests of the former apartheid country. Should this call be heeded, Shoprite, by far the biggest retail business from South Africa, may be the most hit. But stakeholders are concerned that given the influence of Shoprite in the mall sector, local retail business may not be the same again, writes TONIA ‘DIYAN.
When in 2005, Shoprite, a flagship retail outlet from South Africa, berthed in Lagos, the shopping mall sub-sector of the housing industry obviously did not bargain for the exponential growth that followed.
Twelve years after, from a lowly beginning, the departmental store has grown in leaps and bound, dominating the sector it operates in. Its coming also galvanised the building of state-of-the-art malls and stores across the country.
This is because across malls tastefully built today, Shoprite is usually the anchor tenant, controlling over 60 per cent space. This is one reason the brand name overshadows a mall’s original name once it moves in.
Checks conducted by The Nation revealed that most shoppers do not know the real names of malls once the brand is domiciled there. For instance, Ikeja Shopping Mall is usually referred to as Shoprite Ikeja; same applies to malls in Surulere, and others scattered across the country in which Shoprite is the anchor tenant. This name automatically steals the names of malls because of the life it adds to their ambience at various locations.
Findings have it that Shoprite drives other international brands to do business in Nigeria, hence, brands like Nike, Max, Mango, Tommy Hilfiger and others become tenants anywhere it is. This is why the brand is also a beautiful bride to developers, orchestrating a symbiotic relationship on either side, making the mall business to thrive even in the face of dwindling fortune of real estate in the country.
But the brand, along with other South African brands doing business in the country, are not having the best of times-politically. While their sales continue to be impressive, the development in their home country may be about to rub off on their fortune in Nigeria, negatively.
Angry Nigerians, while protesting the xenophobic attacks on Nigerians in South Africa, were prevented from launching a reprisal attack in Lagos by the police. They, however, issued an ultimatum to South African business interests to vacate the country.
But there are fears should this ultimatum be executed. This is because given the chunk of the retail business controlled by the brand, leaving the country at this time will not be palatable for either party.
The Chief Executive Officer of Golden Pearls Cake and Event, a tenant at The Adeniran Ogunsanya Shopping Executive Mall in Surulere, said should Shoprite leave the mall, he is willing to copy Shoprite style of doing business, adding that most people who visit the mall are there to patronise Shoprite, whereas a few people who decide to visit other stores do so to window-shop only.
If Shoprite quits, Oluwatayo, argued that sales might drop drastically and the hope of retaining customers who troop to Shoprite might be an illusion. “If Shoprite is no longer here, the little patronage I get might no longer come because Shoprite is bringing the people on a daily basis.” he said.
Checks by The Nation at the The Ikeja City Mall revealed that the management are not favourably disposed to any talk of Shoprite exiting the country. According to them, such steps will lead to a situation where the mall and every other mall housing the retail giant will experience great loss. Besides, foot traffic as well as patronage being experienced may become history should this happen, including loss of revenue from the tenancy fee they would hitherto have paid. This means even the mall business will be affected negatively.
According to one of the managers who spoke to The Nation on condition of anonymity, there are other shops in the mall but Shoprite being in the premises has a positive impact on the business. He added that the presence of the retailer enables visitors get more varied product and service offer. “We need Shoprite here to continue to grow our business, aside our Cinemas,” he said.
In her own view, Mrs Faderera Mogaji, another regular visitor to the store thinks more of such stores in the country will bring the consumer closer to the manufacturer price of goods, noting that it is important to embrace development like this rather than chase them away for any reason.
“Let us not forget that foreign investors are non-governmental organisations, they invest for profit but, the value remains here even if they take their profit back home. Huge stores like this are important economic segments of advanced countries. A very reliable source of measuring consumer spending index, GDP growth rate etc. Also, if Shoprite leaves the country today. It will increase the rate of unemployment in addition to what we are going through presently,” she said.
Few shoppers have divergent views on the issue. Mr. Makinde Shuaibu, a frequent customer to Shoprite Ikeja said if it happens that Shoprite is asked to leave the country, it will be an advantage to the Nigerian retail market. He thinks Nigeria has indigenous companies that can offer better services compared to Shoprite.
Thinking along Shauibu’s view, Mr. Aderenle Odewale agrees that the country has many indigenous companies that can provide employment opportunities and job creation. “There is no service or job space Shoprite provides that our indigenous companies can’t provide. But I am not sure if these companies can enjoy the kind of enabling environment Shoprite is given in a country that is not theirs.
Speaking on behalf of Shoprite, Ini Archibong the Public Relations Consultant to the brand, said that Shoprite is a brand that brings in the footfall to any mall and also promote made-in-Nigeria goods and products aside creating huge employment opportunities. Therefore, they need to be encouraged to stay in the country.
“We have only but a few indigenous brands who can attract the needed traffic to a mall so it’s high time new brands who can compete with the big players begin to spring forth and produce more made-in- Nigeria goods with a good packaging only then we can reduce unemployment rate, increase our IGR and opportunity to export becomes feasible.”
In a statement issued by the management of the retail chain on how Shoprite Nigeria, has joined many in condemning the act of Xenophobia, the retail giant has appealed to both countries to protect the human dignity and ensure the safety of all people living in South Africa and Nigeria. “We strongly condemn any kind of xenophobic violence and intimidation against the citizens of other countries, anywhere in the world.”
According to the statement, the retailer is concerned about the act of violence against foreign nationals that sporadically spread in South Africa and the resultant rhetoric of intolerance leveled against South Africans living in Nigeria. It stated, “As a company with deep African roots that employs thousands of African nationals and most importantly works to bring low prices to 14 countries outside of South Africa, we will like to see an end to xenophobia across the continent and therefore appeal to the general public in South Africa and Nigeria to protect the human dignity and safety of all people living in both countries.
“We remain committed to working with industry and the appropriate consumer groups so that decisive actions are taken against those involved in violent crimes and intimidation against foreign nationals as well as to convey our strong position against xenophobia”.
