Naivas supermarket expands footprints in Kenya’s capital

KENYA – Kenyan retail chain Naivas Supermarket has announced the opening of two more stores before the end of the month.

The first outlet by the IFC backed supermarket is set to open its doors at Nairobi’s Hazina Trade Centre where Nakumatt Lifestyle used to be.

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The second store, according to Business Daily report will be situated in Rongai town, targeting the growing middle class and working-class market.

The upcoming stores which comes months after the opening of its 66th outlet at the Waterfront Mall in Karen, will raise the retailer’s branch network across the country to 68.

“The two stores will be opened next week. The Lifestyle Mall branch will be operational in the week starting November 23. We expect the other branch in Rongai to be opened the same week,” said Naivas’ chief commercial officer Willy Kimani.

He said the two outlets will offer packed foods, fresh vegetables and fast-moving consumer goods such as beverages. It will also create employment opportunities to about 240 workers.

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As part of its expansion plan, the retailer is targeting to have 70 stores before the year end, following its acquisition of equity financing from a consortium of investors including the International Finance Corporation (IFC).

“The Lifestyle Mall branch will be operational in the week starting November 23. We expect the other branch in Rongai to be opened the same week.”

Naivas’ Chief Commercial Officer – Willy Kimani

Payment defaulting retailers to be blacklisted by suppliers

Meanwhile, manufacturers and suppliers plan to start blacklisting supermarkets which default on payment for deliveries in a bid to prevent a repeat of losses recently witnessed after collapse of three giant retailers.

Nakumatt, Uchumi and Tuskys have gone down with nearly Ksh30 billion (US$274.6m) owed to suppliers in under five years, pushing some of small traders on the verge of collapse, indicates Business Daily.

The Kenya Association of Manufacturers (KAM) says the credit information sharing mechanism between factories and suppliers, signed a fortnight ago, aims to put to an end a trend where retail stores have been rushing to the next supplier after defaulting on payment to one trader.

The Industry Credit Group (ICG) to be managed by Veri-Credit will enable members of KAM and Association of Kenya Suppliers (AKS) to unanimously share payment history of different supermarkets, helping shape their decision on supplies.

It is modelled on the credit reference bureaus that offer lenders borrowers’ loan repayment information, including defaulters.

Banks in Kenya say lack of credit reference information is a major contributing factor to soaring costs of credit due to incomplete borrowers’ information.

“We found, overtime, that there are notorious bad payers who will take (stock) from one manufacturer, spoil that credit then move to another and repeat the same, and because of competition pressures people keep giving merchandise,” KAM chairman Mucai Kunyiha said.

“In some sectors, especially in retail segment, what we have seen is that when they go bad, a lot of money has already been put in because people thought they were gaining market share and didn’t know what was going on at the background.”

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