Retail is on the rise in Africa’s most populated country, with Lagos-based Hubmart broadening its horizons thanks to a fresh, customer-centric offering.
NIGERIA’S NEW FRONTIER
The trading of goods has been the backbone of commerce throughout the development of human civilization.
From ancient markets and bazaars through to out of town shopping centres and ecommerce, the retail trade has evolved enormously as time has elapsed.
In Nigeria, this is no different. “The retail industry in Nigeria is historically, and arguably, the oldest alongside agriculture, both of which have existed for centuries though evolving with the times,” explains Anthony Atuche, Acting CEO of Lagos-based retail chain Hubmart.
“Nigeria was the major hub for the exchange and distribution of goods in West Africa, first among the empires and then between the colonials as far back as the 15th century because of its seaports and inland waterways which made it conducive for trade.”
What many would see as modern retail, however, is a relatively new construct.
“There was a brief stint in the 80s with the emergence of iconic departmental stores like Kingsway, UTC and Leventis which diminished due to the unfavourable economic clime of that era, but it is flourishing again this decade with the introduction of more retail brands annually,” Atuche continues.
“This is evident in the growth in the market size nowadays which has almost doubled, reaching a rate of 3.5 percent from two percent a couple of years ago.
“This growth signals opportunities as retailers are becoming more creative in their offerings, and customers are enjoying the best of both worlds in terms of competitive pricing of the open markets and a wide range of products and categories choices.”
Hubmart signifies this new era of retail in Nigeria.
Operating three stores in Lagos, the 100 percent Nigerian-invested company is set to open a fourth in May 2019 in Omele, on the mainland of the city.
Spanning 1,250 square metres, the new site will be a timely addition to what is a very densely populated residential area, and is proof that the company’s multi-format concept has been a hit with consumers so far.
Boasting a wide selection of fresh produce that is competitively priced, Atuche points to the company’s sub-brands as a key differentiator in what is an exciting, vibrant retail market.
“Hubmart shouts out our fresh offers which emphasises the total customer experience,” he says.
“Our HubDeli and bakery stand out with alluring and addictive recipes. This is combined with high quality and fresh proteins from our butchery department, along with our grocery and non-grocery offers, all of which are simply unrivalled. Our consistency in all we do is a virtue by itself.”
Hubmart’s sub-brands will soon include HubCafe, designed to celebrate Africa’s coffee heritage, while HubCare caters to customers’ health and beauty needs.
Atuche’s ambitions are bold, the company striving to one day become the leading retailer in Nigeria.
“We have over 500 employees who strive to create the ultimate shopping experience through quality customer service and a conducive shopping atmosphere which emphasises value at the best price,” he says.
Indeed, Hubmart operates under the motto ‘happy to help…always’.
“This is our guiding principle and biggest differentiator in the market,” Atuche adds. “Through every decision to every action, from top management to the sales representatives on the shop floor, we strive for the total customer experience.
“This is only achievable through regular and consistent customer insight collation and analysis. Data accrued from the process has helped us stay on top of our game – we are different to and ahead of the rest.”
Such an approach is in response to the ever-changing lifestyles of Nigerian consumers, who are leading increasingly busy lives and demand simplicity, speed and value for money when it comes to their shopping activities.
NIGERIA’S NEXT BIG INDUSTRY?
The changing dynamics of Nigerian retail in response to consumer demand is also opening up enormous potential for further growth.
The sector already accounts for 16 percent of the country’s entire GDP, with research by McKinsey forecasting a $40 billion opportunity for food and consumer goods by 2020.
Another, perhaps more illuminating demonstration of this uplift can be seen in terms of floor coverage.
In 2005, Nigeria had just two shopping malls (the Palms Lekki Mall in Lagos and Ceddi Plaza in Abuja) and 30,000 square metres of retail space. In 2017, retail space was measured at 326,958 square metres, representing a tenfold growth in just 12 years. The country is also home to several more shopping malls in cities such as Port Harcourt, Ilorin, Owerri, and Onitsha.
Many factors are contributing to this, not least Nigeria’s growing middle class, which currently makes up around 24 percent of the nation’s population. This rise in spending power, coupled with ongoing urbanisation, points towards a retail market on the up.
And the opportunity for this growth to accelerate is clear for all to see. Despite the rapid escalation of retail space, Nigeria is still some way behind other markets like South Africa, which is still the continent’s most developed retail economy.
Atuche is thus an ardent optimist for the future of both Hubmart and the country’s retail sector.
He concludes: “Nigeria, as the biggest economy in Africa, is bursting with opportunities in industry, trade and commerce.
“Retail is one of the drivers of the economy in the country and the growing demand for more convenient and consistent shopping experiences with more variety puts modern, organised retail in the focus of investors (both local and foreign).
“This rising demand is evident in the increase in investments in the retail industry, resulting in the astronomical rise in the opening of retail stores in major cities around the country. This cake is growing rapidly.”