Nipate
Forum => Kenya Discussion => Topic started by: RV Pundit on May 18, 2016, 05:30:07 PM
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http://www.businessdailyafrica.com/Corporate-News/Carrefour-targets-500-jobs-in-Kenya-by-end-of-the-year/-/539550/3207682/-/rdigf2z/-/index.html
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Pundit
Unless there is a significant drop in the cost of doing business, the next ten years you'll see businesses slowly moving to greener pastures. China is where it is because the cost of doing business was low. Businesses, especially manufacturing will always follow cheap labor, infrastructure, etc.
http://www.standardmedia.co.ke/business/article/2000202289/why-kenya-lost-oil-export-pipeline-deal-to-dar
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Agreed and I think the last 3 yrs we've seen cost of doing business dropping. Thanks to both internal (better roads, cheap and more reliable electricity,etc) and external factors (oil). Once wea roll out SGR -then cost of transport will come down --once we connect more and more kenyans to more reliable and cheaper power (like Lamu and Kitui coal)--we will be there. Of course competition helps and here we have a vibrant private sector. We might not have cheap labour but a kenyan worker is definitely one of Africa's most productive.
We are not there...but we are heading there.
Pundit
Unless there is a significant drop in the cost of doing business, the next ten years you'll see businesses slowly moving to grrreeener pastures. China is where it is because the cost of doing business was low. Businesses, especially manufacturing will always follow cheap labor, infrastructure, etc.
http://www.standardmedia.co.ke/business/article/2000202289/why-kenya-lost-oil-export-pipeline-deal-to-dar
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They are buying from a local small producer I work with, who has been struggling to push his somewhat quality coffee products through existing market structures.
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It easier now to get into manufacturing if you can make a deal with the major stores....these are the building blocks for manufacturing...the more formal our retail become...from little dukas..to conglomerates supermarket....that handle the supply chain...then we would be on our way to being a developed country.
They are buying from a local small producer I work with, who has been struggling to push his somewhat quality coffee products through existing market structures.
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Thats nice!
They are buying from a local small producer I work with, who has been struggling to push his somewhat quality coffee products through existing market structures.
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They are buying from a local small producer I work with, who has been struggling to push his somewhat quality coffee products through existing market structures.
So they finally dropped their fees for suppliers?
Carrefour sparks supplier unease with Sh1.4m fee
In Summary
- French retailer Carrefour enters Kenya with conditions they say will keep small traders out of lucrative sector.
- The retailer wants suppliers to pay a non-refundable fee of Sh1.4 million to do business with it.
- Other stiff rules touch on merchandising, partial deliveries and the use of refrigerators in the retail chain’s stores – requirements that even the country’s leading retailer Nakumatt describes as restrictive.
- These guidelines now threaten to derail Carrefour’s smooth entry into the East African market as several potential suppliers have so far refused to sign on the dotted line.
http://www.businessdailyafrica.com/Corporate-News/Carrefour-sparks-supplier-unease-with-Sh1-4m-fee/-/539550/2818592/-/frvm0v/-/index.html
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I am a small manufacturer and a supplier to carrefour. I don't mind the listing fees which is a one time thing deducted from my invoice. What I love about them is its a contract where I have to hit a sales target annually and in return they pay after 45 days and I am given ideal shelf space. Getting a product listed at nakumatt is a nightmare and don't even try tuskys. Bottomline carrefour is giving us small manufacturers a chance not only to sell our products but also a chance to meet multinational standards so going forward one can for example sell their products to middle east via carrefour since the franchisee is from middle east with operations all over middle east.
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Cartels are being broken.
I am a small manufacturer and a supplier to carrefour. I don't mind the listing fees which is a one time thing deducted from my invoice. What I love about them is its a contract where I have to hit a sales target annually and in return they pay after 45 days and I am given ideal shelf space. Getting a product listed at nakumatt is a nightmare and don't even try tuskys. Bottomline carrefour is giving us small manufacturers a chance not only to sell our products but also a chance to meet multinational standards so going forward one can for example sell their products to middle east via carrefour since the franchisee is from middle east with operations all over middle east.
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Cartels are being broken.
About time!
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Carrefour is really shaking up the other supermarkets:
Carrefour entry in Kenya spells doom for Nakumatt
(http://www.businesstoday.co.ke/wp-content/uploads/2016/05/carrefour-in-Kenya-660x330.jpg)
French retail giant Carrefour today opens its first store in Kenya, stepping up competition for high-end retailers in the market.
Carrefour —ranked the world’s second-largest supermarket chain after Wal-Mart Stores —open its maiden Kenyan outlet at The Hub, a new shopping mall located in Nairobi’s upmarket Karen suburb.
It will set up 6,000 square feet of retail space, taking up a fifth of the 30,000 square-feet of the Sh4 billion shopping mall located in Nairobi’s affluent Karen district.
Carrefour’s entry is expected to pose new competition especially to the market leader Nakumatt, which targets similar clientele.
“The supermarket space has been dominated by local indigenous players with some small exceptions. The arrival of Groupe Carrefour signals that this cosy market is set to come under pressure. Carrefour is surely targeting the top slice spend and in that regard I think they will be well received,” said the Rich Management CEO Aly Khan Satchu.
Kenya’s formal retail market is dominated by privately-held and family-owned businesses such as Nakumatt, Tuskys and Naivas with only one listed supermarket chain Uchumi.
According to London-based consultancy Oxford Business Group, Kenya is second to South Africa and doubles Nigeria, Africa’s largest economy, in the level of development of formal retail shopping stores.
The growth in shopping malls, says the firm, has been fuelled by demand as the expenditure level for the average Kenyan consumer has risen by as much as 67 per cent in recent years, making Kenya Africa’s fastest-growing retail market.
But while dedicated retail properties and formal retailers are on the rise, the market remains dominated by the traditional, informal sector where 70 per cent of Kenyans do their daily shopping, according to consumer research firm Nielsen.
In the steps of Massmart
Carrefour’s two retail stores in Kenya will be operated by Dubai-based Majid Al Futtaim Retail, the exclusive franchise holders for Carrefour in the region. The Middle East firm is part of the Majid Al Futtaim Group, the family-owned business that acquired troubled motor dealer CMC Holdings in a Sh7.5 billion cash offer in 2014.
The Paris-based supermarket chain is set to become the second global supermarket chain in Kenya’s retail industry after South Africa’s Massmart which opened its Game store last year at the Garden City Mall along the Thika Superhighway.
Carrefour is also eyeing a 100,000-square feet store at Two Rivers, a shopping complex owned by the Nairobi bourse-listed investment firm Centum, this year. Carrefour has a total of 10,105 stores in 34 countries across Europe, the Middle East, Central Asia, Russia and Africa.
http://www.businesstoday.co.ke/carrefour-entry-in-kenya-spells-doom-for-nakumatt/
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There's a trouble brewing in retail land http://www.businessdailyafrica.com/Supermarkets-in-turmoil-as-heavy-debt-load-weighs/539552-3432754-juj5h4z/index.html . Suppliers are complaining of non payments and even some have started withdrawing supplies. Nakumatt I think instead of investing in smaller stores in neighbourhoods it went for big outlets in malls. Now I think they're reeling from expensive leases.
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They are all growing so fast so soon - they might burn out - if they don't recapitalize.
There's a trouble brewing in retail land http://www.businessdailyafrica.com/Supermarkets-in-turmoil-as-heavy-debt-load-weighs/539552-3432754-juj5h4z/index.html . Suppliers are complaining of non payments and even some have started withdrawing supplies. Nakumatt I think instead of investing in smaller stores in neighbourhoods it went for big outlets in malls. Now I think they're reeling from expensive leases.
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Nakumatt admits to be having some problems:
Nakumatt admits financial crisis, seeks aid to stay afloat (http://www.the-star.co.ke/news/2016/10/27/nakumatt-admits-financial-crisis-seeks-aid-to-stay-afloat_c1445570)
Nakumatt Holdings has assured the public that its business is stable despite it facing financial difficulties occasioned by a harsh operating environment.
In a statement on Thursday, Nakumatt Holdings managing director Atul Shah admitted that the chain was facing financial challenges that had affected its cash flow.
“These challenges range from a depressed economy, higher operating costs and extraneous factors including enhanced risk management due to prevailing security threats,” he said.
The MD said the factors have impacted negatively on the business although support from staffers, suppliers and customers has helped it to remain operational.
To this end, he said that they have embarked on a re-organizational strategy, including renegotiating contractual agreements with suppliers, to enable the retailer to safely wade through the turmoil.
“We have been actively engaging our suppliers to review current supply terms. We are also undertaking a management enhancement programme that involves recruiting and retaining management personnel to handle specialized units including commercial, supply chain, finance and marketing,” said Shah.
According to the MD, the company has also integrated an advanced warehouse management system that will allow the business to hold optimum stocks based on daily demands of individual branches to cut on losses.
“Such a system allows us to streamline supplier payment system by ordering stocks based on actual consumption trends while reducing on shrinkage,” he said.
Shah further revealed that the retail chain is currently engaging a number of local and international partners for possible capital injection to subvert further turbulence.
He said that the financial aid, which is expected to be concluded in the coming days, will help offload existing debts like bank loans and other related funding tools.
“We are confident that the process will allow us to gain our footing with full supplier settlement and sustainably continue the aggressive expansion plan we have set in our five-year business plan,” said Shah.
Customers at the retail chain have over the recent months raised concerns over missing items from shelves, pointing to a possible financial crisis at the family-run business that boasts of 65 branches in the region.
It is estimated that Nakumatt Holdings requires an estimated Sh5 billion shillings to regain its market stability.
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It's the normal business cycle. More players more competition.
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Are the rents retailers paying for floor space sustainable?
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Are the rents retailers paying for floor space sustainable?
Nope.
Most, if not all, of the shopping malls in Nairobi were not built with financial considerations as the number one priority. After 9/11, when laundering money internationally became much more difficult, our thieving elite turned to the local real estate market, in this case shopping malls using the Yaya Centre as the benchmark. This, in turn, explains why our real estate "boom" took off starting 2002. So in effect, the shopping malls were built to launder corruption proceeds.
Looking at the very high turnover of tenants (if they any, that is) in Kenyan malls reveals the underlying problem, especially along the Thika Superhighway (note that not all malls were built using corruption money but by investors joining the Ponzi train).
The 46-km superhighway has six malls: Garden City, TRM, Juja City, Spur Mall, Uni City and Mountain Mall. A seventh mall is under construction at Roasters, just next to Mountain Mall.
But apart from TRM, Garden City and Mountain Mall, the rest are virtually ghost malls with very low occupancy levels.
Uni City, which is owned by Kenyatta University (KU), was completed early last year but is yet to get an anchor tenant. Uchumi Supermarkets, which had expressed interest, pulled out over alleged cash-flow problems.
Naivas has shown commitment but is yet to open shop. Without an anchor tenant, KU will find it difficult to convince other clients, according to Arc Consultants.
“The anchor tenant occupies large retail areas for a small rent but generates the most customer traffic, while preferential tenants — who fall in the second category — represent brand names around which the shopping centre is built,” says the company which offers real estate advisory services.
“The tenant mix is what causes customers to visit the shopping centre. It must fit the targeted income group,” it says.
http://www.nation.co.ke/business/Malls-outdo-each-other-to-attract-clients--shoppers/996-3369046-3qmych/
Another interesting article from The Business Daily: Booming malls entice retailers despite glut fears (http://www.businessdailyafrica.com/Booming-malls-entice-retailers-despite-glut-fears/-/539552/3154930/-/uckw7p/-/index.html)
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Are the rents retailers paying for floor space sustainable?
Nope.
Most, if not all, of the shopping malls in Nairobi were not built with financial considerations as the number one priority. After 9/11, when laundering money internationally became much more difficult, our thieving elite turned to the local real estate market, in this case shopping malls using the Yaya Centre as the benchmark. This, in turn, explains why our real estate "boom" took off starting 2002. So in effect, the shopping malls were built to launder corruption proceeds.
Looking at the very high turnover of tenants (if they any, that is) in Kenyan malls reveals the underlying problem, especially along the Thika Superhighway (note that not all malls were built using corruption money but by investors joining the Ponzi train).
The 46-km superhighway has six malls: Garden City, TRM, Juja City, Spur Mall, Uni City and Mountain Mall. A seventh mall is under construction at Roasters, just next to Mountain Mall.
But apart from TRM, Garden City and Mountain Mall, the rest are virtually ghost malls with very low occupancy levels.
Uni City, which is owned by Kenyatta University (KU), was completed early last year but is yet to get an anchor tenant. Uchumi Supermarkets, which had expressed interest, pulled out over alleged cash-flow problems.
Naivas has shown commitment but is yet to open shop. Without an anchor tenant, KU will find it difficult to convince other clients, according to Arc Consultants.
“The anchor tenant occupies large retail areas for a small rent but generates the most customer traffic, while preferential tenants — who fall in the second category — represent brand names around which the shopping centre is built,” says the company which offers real estate advisory services.
“The tenant mix is what causes customers to visit the shopping centre. It must fit the targeted income group,” it says.
http://www.nation.co.ke/business/Malls-outdo-each-other-to-attract-clients--shoppers/996-3369046-3qmych/
Another interesting article from The Business Daily: Booming malls entice retailers despite glut fears (http://www.businessdailyafrica.com/Booming-malls-entice-retailers-despite-glut-fears/-/539552/3154930/-/uckw7p/-/index.html)
Nakumatt has two problems. One its the anchor tenant of most malls with expensive leases of malls that have little traffic except on the weekends. Second they introduced blue label basically their own label of products that they're paying cash and not moving fast enough. This label ranges from milk to furniture. This is affecting their cashflow.
Actually Thika superhighway has the most profitable Mall TRM mall reason being it has alot of traffic from nearby neighbourhoods. Garden city on the other hand not doing so well. The KU shopping centre is a bust. The only other mall is juja mall which I think opened a week ago.
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With the introduction of interest rate caps, the reorganization is continuing. Inflation rate is down, so pple are dont have as much money as they used to. Businesses need to reorganize.
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With the introduction of interest rate caps, the reorganization is continuing. Inflation rate is down, so pple are dont have as much money as they used to. Businesses need to reorganize.
Actually inflation isnt down it has risen from 6.26% August to 6.34% in September. The capping of interest should spur more borrowing thus more money in circulation. Because interest payments are lower leaving citizens with more money in their pockets. The capping of interest rates should lead to more inflation which is what's happening.
So that's not the problem.Unless the argument is capping of rates have reduced credit availability and I haven't seen data to indicate that.
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Do we have any figures on the demand and supply of private credit post-rate capping? I guess CBK should be able to track those figures in their monthly economic report and so maybe that is the place too look for. I think for me the supermarkets are growing too fast too soon. Nakumatt have been expanding locally and regionally - they bought some supermarket in western kenya recently - and they've been expanding using debt financing - and so interest payments must be killing them.
They all simply need to sell their stake to international players - kenya's retail is now too big for family based homegrown supermarkets.
Actually inflation isnt down it has risen from 6.26% August to 6.34% in September. The capping of interest should spur more borrowing thus more money in circulation. Because interest payments are lower leaving citizens with more money in their pockets. The capping of interest rates should lead to more inflation which is what's happening.
So that's not the problem.Unless the argument is capping of rates have reduced credit availability and I haven't seen data to indicate that.
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There's a great opportunity for a serious online/mobile retailer to emerge. All the necessary infrastructure is in place. The formal retail sector is ripe for disruption. The reason being the suppliers are really tired of non payments or delayed payments from almost all major supermarkets. To survive most manufacturers are relying on the informal market, especially the kadogo economy. Alternatively some manufacturers will opt for their own distribution channel to reach customers directly. Its already happening in the milk industry where established companies are setting up their own milk atm.
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What are margins in retail? Lack of payment of suppliers to me seems to be a cash flow problem within retail. Inflation in Kenya is a serious problem. The funny thing is that capping interest rates takes away one of the tools cbk has to reign in inflation.
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There's a great opportunity for a serious online/mobile retailer to emerge. All the necessary infrastructure is in place. The formal retail sector is ripe for disruption. The reason being the suppliers are really tired of non payments or delayed payments from almost all major supermarkets. To survive most manufacturers are relying on the informal market, especially the kadogo economy. Alternatively some manufacturers will opt for their own distribution channel to reach customers directly. Its already happening in the milk industry where established companies are setting up their own milk atm.
Kilimall (http://kilimall.co.ke)
Jumia (http://jumia.co.ke)
These two are growing pretty well. I bought a couple of phones from Jumia and it worked very well. Piki delivered them, I checked them and then paid via mpesa.
Some supplier's, especially mobile phones, are exclusively selling through them.
P.S. Went to Nakumatt Karen on Sunday for the first time in about 5 months. Stock is way down and they've brought stuff (mostly kitchenware) from upstairs to downstairs in a bid to fill the empty shelves.
Mwau exits Nakumatt with sale of 7.7pc stake (http://www.businessdailyafrica.com/Corporate-News/Mwau-exits-Nakumatt-with-sale-of-7pc-stake/539550-3445640-8408b1z/index.html)
Businessman John Harun Mwau has sold his 7.7 per cent minority stake in Nakumatt Supermarkets ahead of the retail chain’s plan to take on board a new shareholder with deep pockets to pull it out of a bourgeoning debt crisis.
It was not immediately possible to establish the price at which Mr Mwau sold his shares, but the deal is estimated to be worth billions of shillings going by recent valuations of the retail chain.
Nakumatt managing director Atul Shah said three years ago that the retail chain was valued at $400 million (Sh40.7 billion) – meaning Mr Mwau has pocketed more than Sh3.19 billion for the stake.
Sources familiar with the transaction said the shares bought from Mr Mwau are part of the 25 per cent stake that the retail chain is selling to a strategic partner expected to come on board before the end of the year.
Mr Mwau’s exit comes at a time when Nakumatt has been sailing in turbulent waters, partly arising from a more than tripling of its debt to Sh15 billion in February 2015 from Sh4.2 billion in 2011, piling pressure on operations and resulting in long payment delays to suppliers.
With 42 outlets in Kenya, the retailer is majority owned by the Shah family (92.3 per cent) and Hotnet Ltd — a company associated with Mr Mwau.
Nakumatt, which is Kenya’s biggest retail chain with 61 stores across East Africa, announced that talks with the potential partner were at an “advanced stage” and would be finalised in a matter of weeks.
South African rating agency GCR said in a note dated December 17, 2015 that the deal would see substantial capital injected into the business, a feat that would markedly ease funding pressure and facilitate the planned rollout of new branches.
Nakumatt’s plan to sell a large stake to a strategic investor was first mooted in 2009 when a consortium of investors led by London based private equity fund Satya Capital — associated with Sudanese billionaire Mo Ibrahim — expressed interest in retail chain, but the deal fell through.
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What are margins in retail? Lack of payment of suppliers to me seems to be a cash flow problem within retail. Inflation in Kenya is a serious problem. The funny thing is that capping interest rates takes away one of the tools cbk has to reign in inflation.
Interest rates spread is what was capped not actual interest rates. The CBK still sets the CBR, it can mop money or inflate at will. And inflation has been within the CBK range. The only thing to watch is credit availability which is decreasing.
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There's a great opportunity for a serious online/mobile retailer to emerge. All the necessary infrastructure is in place. The formal retail sector is ripe for disruption. The reason being the suppliers are really tired of non payments or delayed payments from almost all major supermarkets. To survive most manufacturers are relying on the informal market, especially the kadogo economy. Alternatively some manufacturers will opt for their own distribution channel to reach customers directly. Its already happening in the milk industry where established companies are setting up their own milk atm.
Kilimall (http://kilimall.co.ke)
Jumia (http://jumia.co.ke)
These two are growing pretty well. I bought a couple of phones from Jumia and it worked very well. Piki delivered them, I checked them and then paid via mpesa.
Some supplier's, especially mobile phones, are exclusively selling through them.
P.S. Went to Nakumatt Karen on Sunday for the first time in about 5 months. Stock is way down and they've brought stuff (mostly kitchenware) from upstairs to downstairs in a bid to fill the empty shelves.
Mwau exits Nakumatt with sale of 7.7pc stake (http://www.businessdailyafrica.com/Corporate-News/Mwau-exits-Nakumatt-with-sale-of-7pc-stake/539550-3445640-8408b1z/index.html)
Businessman John Harun Mwau has sold his 7.7 per cent minority stake in Nakumatt Supermarkets ahead of the retail chain’s plan to take on board a new shareholder with deep pockets to pull it out of a bourgeoning debt crisis.
It was not immediately possible to establish the price at which Mr Mwau sold his shares, but the deal is estimated to be worth billions of shillings going by recent valuations of the retail chain.
Nakumatt managing director Atul Shah said three years ago that the retail chain was valued at $400 million (Sh40.7 billion) – meaning Mr Mwau has pocketed more than Sh3.19 billion for the stake.
Sources familiar with the transaction said the shares bought from Mr Mwau are part of the 25 per cent stake that the retail chain is selling to a strategic partner expected to come on board before the end of the year.
Mr Mwau’s exit comes at a time when Nakumatt has been sailing in turbulent waters, partly arising from a more than tripling of its debt to Sh15 billion in February 2015 from Sh4.2 billion in 2011, piling pressure on operations and resulting in long payment delays to suppliers.
With 42 outlets in Kenya, the retailer is majority owned by the Shah family (92.3 per cent) and Hotnet Ltd — a company associated with Mr Mwau.
Nakumatt, which is Kenya’s biggest retail chain with 61 stores across East Africa, announced that talks with the potential partner were at an “advanced stage” and would be finalised in a matter of weeks.
South African rating agency GCR said in a note dated December 17, 2015 that the deal would see substantial capital injected into the business, a feat that would markedly ease funding pressure and facilitate the planned rollout of new branches.
Nakumatt’s plan to sell a large stake to a strategic investor was first mooted in 2009 when a consortium of investors led by London based private equity fund Satya Capital — associated with Sudanese billionaire Mo Ibrahim — expressed interest in retail chain, but the deal fell through.
Jumia and kilimall are doing ok especially on electronics but not good in other categories. Mind you all the electronics are imported, so the manufacturers especially of light goods and food don't have another distribution channel. Nakumatt problem is expensive leases and loads of employees. Normal margins for retail in kenya is 20%.
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20% is good margin
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Jumia and kilimall are doing ok especially on electronics but not good in other categories. Mind you all the electronics are imported, so the manufacturers especially of light goods and food don't have another distribution channel. Nakumatt problem is expensive leases and loads of employees. Normal margins for retail in kenya is 20%.
Reminds me of a funny story when I first came back to live in Kenya. Went after about a year back to Europe for a couple of weeks holiday. Decided to go shopping in the neighborhood supermarket. Line up to pay, the lady finishes and we end up staring at each other. Her wondering why the heck I'm just standing there. Me wondering why nobody's packing my stuff.
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There's something about kenya retail sector that I don't understand. There's consolidation going on in the pharmacy retail sector. Haltons and Good life are busy acquiring independent pharmacies . However the two upcoming pharmacy giants products are more expensive than independents stores. I'd have thought with economy of scale their products would be cheaper. Someone needs to start an online pharmacy store and give the brick and mortal guys a run for their money.
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Do regulations allow for online store? I think we would have to adopt US kind of laws with possibility that people will order all sort of dangerous drugs online. The problem with most of our companies is trying to grow organically - from their own profits & revenue- rather than by attracting new capital esp from foreign fund managers awash with cash to invest.That is very dangerous way to grow fast. It make sense if you growing slowly over the years - but the supersonic growth speed that supermakets and those pharmacies are trying - they definitely need to get some fdi - or they'll burn out.
There's something about kenya retail sector that I don't understand. There's consolidation going on in the pharmacy retail sector. Haltons and Good life are busy acquiring independent pharmacies . However the two upcoming pharmacy giants products are more expensive than independents stores. I'd have thought with economy of scale their products would be cheaper. Someone needs to start an online pharmacy store and give the brick and mortal guys a run for their money.
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There's something about kenya retail sector that I don't understand. There's consolidation going on in the pharmacy retail sector. Haltons and Good life are busy acquiring independent pharmacies . However the two upcoming pharmacy giants products are more expensive than independents stores. I'd have thought with economy of scale their products would be cheaper. Someone needs to start an online pharmacy store and give the brick and mortal guys a run for their money.
Kenyan retail prices never make sense in comparison to established western markets. For example, Brookside milk costs more per L if you buy the 2L container than if you buy 4 triangular packets of 1/2L. :o
We do have an online pharmacies with pikipiki delivery: http://www.epharmacy.co.ke/ and www.kenyaonlinepharmacy.com, among others.
No clue on how they're doing. Never tried them and probably wouldn't.
The problem we have with pharmacies is the sheer amount of counterfeit medicines flooding the country, massively distorting the price perception of wanainchi suffering under extremely tight budgets. I have a friend who owns a pharmacy and the stories she tells me about the returns in importing and selling counterfeits, in a country where wealth guarantees 99.99998% immunity (Chris Murungaru of Anglo-Leasing fame, a veterinary doctor, is rumored to be a major player), are absolutely staggering:
Mr Wilfred Roge, the director of studies at the Institute of Research against Counterfeit Medicines, said “If you, for instance, invest $1,000 (Sh100,000) in cocaine, you earn $20,000 (Sh2 million) but if the same money is invested in counterfeit medicine, the returns can exceed $200,000 (Sh20 million),” he said.
Not a bad investment. Then, of course, the penalties are laughably outdated:
The penalty in Kenya for those dealing in counterfeit medicine is, for instance, a jail term of six months and a fine of about Sh20,000, which is not deterrent enough, said Mr Athman Hemed, an inspector at the Kenya Pharmacy and Poisons Board.
But then of course the next elections are always more important.
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http://www.businessdailyafrica.com/Corporate-News/PE-firm-Leapfrog-acquires-local-pharmacy-chain-in-Sh2-2b-deal/539550-3462078-shx44cz/index.html
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http://www.businessdailyafrica.com/Corporate-News/PE-firm-Leapfrog-acquires-local-pharmacy-chain-in-Sh2-2b-deal/539550-3462078-shx44cz/index.html
Its funny that a drug manufacturer http://www.businessdailyafrica.com/Indian-firm-to-buy-Sh1bn-stake-in-Universal-Corp/539552-3076566-qngnkmz/index.html was bought at half the price the Leapfrog paid for a drug distributor.