Wholesale and Retail Trade Sector in Kenya

Retail services make up a large portion of Kenya’s service sector; According to KNBS 1, the
wholesale and retail sub-sector contributed about 7.7% to Kenya’s GDP in 2019, and it was the
4th largest contributor to Kenya’s GDP. The sector is also the 5 th largest contributor to private
sector employment2: in 2019 the sector employed 269,201 people. The sector, however, has
witnessed declining growth rates from 2010 to 2016 according to the graph below, but the
sector has slowly resumed its upward trajectory from 2017.

11.0%

10.0%9.6%

9.0% 8.4%
8.3%
8.0%
7.0% 6.9% 6.9%
7.0% 6.6%
5.9% 5.8%
6.0%

5.0%

4.0% 3.7%

3.0%
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Wholesale & retail trade sector growth

Source: KNBS

According to Nielsen3, 53% of shoppers go to supermarkets, but the frequency of visiting a kiosk
and grocery shops is very high (around 20 trips per month) and this makes traditional trade in
Kenya so important. The high number of trips to kiosks and grocery stores is because most
Kenyans are spending their money on household goods, particularly food.

1
Kenya National Bureau of Statistics. (2020). Quarterly gross domestic product report: Second quarter, 2020
2
Kenya National Bureau of Statistics. (2020). Statistical Abstract 2020
3 https://www.instore.co.ke/navigating-the-kenyan-retail-landscape/
Source: Nielsen

Source: Nielsen

Retailers in Kenya

In the recent past, retailing was dominated by two supermarket chains: Nakumatt and Tuskys.
Both chains owned flagship stores in Nairobi, Mombasa and Kisumu’s and served as the largest
distributors for local consumer goods manufacturers. Over the years, a series of unfortunate
events led to the collapse of the retailers. Their decline was attributed to a multitude of factors
such as gross mismanagement, increased competition, poor financial decisions (high
indebtedness) and poor strategic decisions. Their collapse, however, led to the entry of several
international supermarket brands such as Carrefour and Game. Nakumatt and Tuskys demise
has also been filled up with local chains such as Naivas and Quickmart.

His t o r y Timelin e

Founded: 1964 Branches: 20

Branches: 67 Founded: 1990

Founded: 2006 Branches: 32

Branches: 9 Founded: 2016

Chandarana

The firm opened its first grocery store at Highridge Shopping Centre in Nairobi’s Parklands area
in 1964. It has since grown into a formidable supermarket chain with three brothers Anil Thakkar
and Sanjay and Dipan at the helm. Chandarana s has steadily grown from one branch in 1964
to 20 countrywide. The branches are located at Highbridge shopping centre, Diamond Plaza,
Karen, Muthaiga, Yaya Centre, ABC Place, Lavington Mall and, Ad life Plaza. Others are Cedar
Mall in Nanyuki, Rupa Mall in Eldoret, Diani, Mombasa’s South Coast, Rosslyn Riviera and
Eldoret. The retailer hopes to continue to augment its offerings and raise the bar of its core
competence of being a food-oriented supermarket. Continuous refinement of the on-line
shopping is another growth driver aimed not only at the tech savvy demographic but also the
wider audience.

Naivas

The retailer started as a small family business serving the village of Rongai in the outskirts of
Nakuru town in 1992. The business was started by Peter Mukuha Kago who later transferred
the business to his four children: David Mukuha, Simon Mukuha, Grace Wambui and Linet
Wairimu. At the outset, the retailer traded as Rongai Self Service Stores then Naivasha Self
Service Stores before rebranding to Naivas in 2007. The retailer has 67 branches scattered
across the country for example in Nairobi the retailer has a branch at Capital Centre and
Prestige Plaza along Mombasa Road and along Ngong Road, respectively. Outside Nairobi, the
retailer has presence in Nakuru, Kisii, Mombasa, Nyeri, Kisumu, Machakos and Embu. The
retailer anticipated to grow its branch network to 70 by end of 2020 which will likely be revised
upwards in the new year. To fund this growth, Naivas sold 30% ownership in its business to
Amethis alongside its partners DEG, MCB Equity and IFC. Naivas is in pole position to cement
its market leadership position in Kenya.

Quick Mart

Incorporated in 2006 by the late John Kinuthia in Nakuru in 2006, Quick Mart has grown to
operate 32 branches in Kenya courtesy of the stewardship of Duncan Kinuthia, the son of the
founder. The business experienced its rapid growth in part due to its merger with Tumaini Self
Service. The merger was orchestrated by Adenia Partners through its company Sokoni Retail
Kenya. The retailer has also set its footprint in other towns in Kenya such as Kisumu and
Nakuru.

Carrefour

French chain Carrefour, operated by the UAE’s Majid Al Futtaim in Africa, entered Kenya in
2016, and it now leads the high-end market. The retailer has been expanding its presence in
Kenya taking over spaces previously occupied by struggling supermarket chains, including
Nakumatt and Uchumi, as well as opening new outlets to cash in on the underserved market.
The retailer has 9 stores: 8 in Nairobi and 1 in Mombasa. Some of its locations in Nairobi are in
The Village Market, Galleria Shopping Mall, Sarit Centre, The Junction Mall, and the Thika Road
Mall. Its store in Mombasa is in City Mall, Nyali. In 2018, the retailer reported that it generated
sales worth KShs 13.87 billion, a jump of 71% from KShs 8.11 billion reported in 2017.