KENYA – Naivas Supermarket has opened its first store in Kisumu in a move expected to up the battle for consumers’ wallets in the lakeside town that already hosts three major retail chains.

The retailer yesterday opened the doors to its new outlet on Jomo Kenyatta Road, bringing its branch network to 34. Naivas is set to compete with Nakumatt, Tuskys, Uchumi and Ukwala supermarkets for customers.

“The opening of a branch in Kisumu is in line with our plan to have a nationwide presence,” said Willy Kimani, Naivas business development and marketing manager.

The Kisumu store comes four months after supermarket chain became the first major retailer to open shop in Garissa. Kisumu has seen unprecedented growth of supermarkets over the past years, and big names such as Nakumatt now face stiff competition from new entrants.

Uchumi Supermarket launched operations in the town five months ago while Ukwala recently launched a new store, pushing its branches to four. Nakumatt has two branches

Establishment of shopping malls and expanding road networks have also spurred the rapid growth of retail stores, raising the town’s profile as an attractive investment hub.

“We think Kisumu has potential for growth despite the presence of the four other retailers,” said Mr Kimani. “The size of our branch and its location give us an advantage.”

The expansion drive by major retailers comes on the back of a Citigroup study showing that Kenya’s 30 per cent retail penetration is the highest in the region and only second to South Africa’s 60 per cent.

Naivas, a family-owned business, last year overtook listed retailer Uchumi as the third-largest store by revenue behind Nakumatt and Tuskys respectively.

The High Court on Friday ruled that Newton Kagiri Mukuha, the eldest of three brothers who have been fighting a bruising legal battle for control of Naivas, did not have a stake in the retail chain having run down all the stores he inherited from his father.

The court made the ruling in the case in which Mr Kagiri had objected to the sale of a 50 per cent stake in Naivas to South African retail chain Massmart. He claimed that he was entitled to 20 per cent of the sales proceeds as part of his inheritance.

November 5, 2014;