France’s retail giant to open in Kampala

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By Nelson Wesonga

Kampala. France’s retailer giant, Carrefour will start operating in Uganda in just or over three months.
It will operate from Oasis Mall in Kampala in the same building that once housed Kenya’s Nakumatt Supermarket.
The retail chain has already put up posters indicating it will open next year. However, emails to the company’s press office were yet to be answered by press time.

The retailer, according to people familiar with the operation, will first operate a single store before expanding into other shopping centres.
The supermarket industry has in the last five years experienced a lot of volatility with large retailers such as Nakumatt and Uchumi – both from Kenya – closing shop.
Currently the market has a number of local and foreign retailers such as South Africa’s Shoprite and Game and Kenya’s Tuskys. Others are Quality and Mega Standard, among others.

According to a report titled: Uganda’s emerging middle class and its potential economic opportunities authored by Milton Ayoki, growth in the supermarket industry will benefit Uganda’s agricultural sector.
“Most of the farmers participating as direct suppliers to supermarket channels currently are a group of commercial farms managed by well-educated farmers,” the report said.
Of particular interest to Kampala’s shoppers though is that Carrefour will provide variety, offering migratory shoppers considerable latitude. It will also heighten competition between or among retailers, which will influence not only price models but service delivery.

However, Carrefour comes at a time when a number of retail stores have failed in a market that largely relies on retail shops.
Nakumatt quit Uganda in 2016 due to financial disingenuity and high overhead costs that cancelled out its margins, thus impacting on its ability to pay rent, clear arrears to suppliers and clear tax arrears.
Its suppliers rerouted supplies to other supermarkets prompting the shoppers to go to the supermarket’s competitors.
Uchumi went on an expansionist drive, extending to areas whose middle-class was small and rent high.

Monitor.co.ug

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