Amid Economic Strain & Closures, Shoprite Nigeria Says It’s ‘Rebuilding, Not Retreating’

Retail Supermarkets Nigeria Limited (RSNL), the operator of Shoprite stores in Nigeria, today dismissed widespread reports that it is preparing to exit the country. This follows recent observations of near-empty shelves and closures of several outlets, which had sparked speculation about the retailer’s imminent departure.

In an official statement, the company attributed the current state of some stores to a comprehensive operational reset and restructuring of its business model, not an impending shutdown. It confirmed that this restructuring is a strategic response to Nigeria’s challenging economic environment, which includes foreign exchange volatility, rising inflation, and liquidity constraints.

The company stated that the business model it inherited after its acquisition from the South African parent company in 2021 is no longer viable. That model relied heavily on large-format stores, a significant volume of imports, and incurred high overhead costs.

The reset strategy is built on several key pillars, notably a major shift toward local supply chains, with over 80% of products now sourced within Nigeria, as well a move toward smaller, more efficient store formats to reduce operational costs. The company is also weighing the introduction of private-label affordability options for price-sensitive consumers.

Bunmi Adeleye, Chief Strategy Officer of RSNL, characterised the period as a “rebuilding phase,” stating, “Yes, it has been a tough period, but this is not a collapse; it is a reset. The old model did not work for Nigeria. With new investors behind us, we are rebuilding Shoprite to be more local, culturally relevant, more affordable, and more resilient.”

Shoprite first entered the Nigerian market in 2005, opening its inaugural store at The Palms Mall in Lagos. It grew to become a household name and a dominant anchor tenant in major shopping malls across the country, at its peak operating 25 stores in 11 cities. At full strength, the retailer employed over 2,000 people directly and supported thousands more in local supply chains, including Nigerian farmers.

Its South African parent company, Shoprite Holdings, announced its exit from the Nigerian market in 2021, selling its operations to RSNL. Since then, the Nigerian franchisee has grappled with rising operational costs, intense competition from local supermarkets, and the same economic headwinds that now necessitate its restructuring.

The company acknowledged temporary closures of its stores in Ilorin and Ibadan. Customers at other locations, such as the Ikeja City Mall in Lagos, have reported scant product displays, particularly in groceries and drinks.

Reports suggest there is hope that operations could normalise by the end of September following the conclusion of its annual financial audit, with a restocking of shelves planned to coincide with the upcoming fourth-quarter shopping rush.