Opinion: The economics of Shoprite in Abia

by Vincent Amolo

nigeria

In an era of more sophisticated Nigerian consumers, the development also comes as a relief to residents of Abia, a state notorious for counterfeiting of high-target brands.

The recent foundation laying ceremony of the Abia Mall, at the old Garki area of Umuahia, has led to appreciable excitement among residents of the state; especially as Africa’s biggest retailer, ShopRite, is touted as one of the partners of the project.

The state government entered a strategic partnership with Pall Mall which involves a joint funding of the project to achieve its set objectives. In a recent interview, Governor Theodore Orji confirmed that the state government has paid its own part of the funding. “ShopRite is coming to Abia State,” he said. “We have completed everything, paid our own counterpart funding to them and it is left for them to come on-board.”

This development, according to analysts, is a major significant socio-economic gain for the hitherto under-developed state. In terms of direct and indirect employment, this project when completed stands to significantly depopulate the labour market in Abia State and convince hesitant investors to take the plunge.

Samuel Eke, a financial analyst, commends the state government for proactively engaging the retail giant and fast-tracking talks to get to this stage. “Last year, ShopRite announced that it would be investing N32 billion on property developments in Nigeria to overcome lack of infrastructure and capitalise on rising consumer spending,” he said. “Responsible state governments took note of this and began to put in place incentives to attract the retail giant.

For Abia, it is indeed a coup to have secured this partnership as apart from Enugu, the retail giant is not present in any other South-Eastern state in the country. I must commend Governor Theodore Orji for taking this step and ensuring that speed is of importance. If this tempo is sustained, we may see the mall commissioned soon. The benefits of this development to residents of Umuahia and indeed surrounding towns cannot be over-emphasised.”

ShopRite operates a policy of augmenting dependence on international suppliers by sourcing, promoting and procuring local products. In Abia, local industries thrive and have gained increased visibility in recent times. Some of the entrepreneurs are looking forward to possible partnerships with the retail giant.

Ndidi Achonu operates a small factory inside the Aba Leather Cluster zone where African-themed shoes and handbags are produced. “I relocated to Abia from China with my husband in 2009 to start this and I can sincerely say that there are no regrets,” she said. “Things were tough initially but I am gradually making an impact here and can now boast of seven employees. If ShopRite comes to this state, I will certainly explore ways of taking this business to the next level because I am confident that my products will make their shelves.”

A survey of 700 consumers conducted by Business Day Nigeria during October 2012 found that while price was still crucial to the Nigerian consumer, health considerations were becoming more important. 50% of respondents said that they read the labels of packaged food and beverage products before purchasing them. 39% said that they would like to see more nutritional information, including calorie counts, on restaurant menus.

In an era of more sophisticated Nigerian consumers, the development also comes as a relief to residents of Abia, a state notorious for counterfeiting of high-target brands. “For me, I consider this one of the state government’s recent economic initiatives that has really tricked down to the people,” said Ifeyinwa Obodo, a civil servant in the state. “To be able to go to a shop where you have the peace of mind that everything there is guaranteed and you have the luxury of options is a very welcome development. I urge the state government to hasten work on the site so that this can be opened soon. I thank Governor Theodore Orji for making this dream come true.”

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Op-ed pieces and contributions are the opinions of the writers only and do not represent the opinions of Y!/YNaija.

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