An overview of the Kenyan retail market

Kenya is the economic, commercial, financial and logistics hub of the East African region. Its strategic positioning between the Indian ocean port and its neighbouring countries has made the country a focal point of the East African economies. With a population of around 55 million people (2021), and 79 per cent of the population being under the age of 35, the country offers a huge human capital base as well as an all-encompassing consumer market for products and services. The retail sector contributed seven per cent to the GDP in 2020. The sector is among the six key sectors expected to drive GDP growth and increase formal employment significantly under Kenya’s vision 2030. Entry into the market by established international retailers such as Carrefour, LC Waikiki, Mr. Price and others has significantly raised the profile of the retail industry in the country.

Oxford business group ranked the Kenyan retail sector as the second most developed in Africa with a 35 per cent penetration rate, the country’s retail penetration levels are second in Africa after South Africa’s 60 per cent, beating Africa’s largest economy, Nigeria.

customers return to entertaining. “Compared with 2020 and 2021 where customers spent most of their time indoors, we saw customers returning to offices and wanting to spend time outdoors in restaurants so that part of the business was a good growth point.”

Vituzote’s customer base is upwardly mobile, Aaron tells us. He is attracting Kenya’s professionals –they are quality conscious, they’ve been exposed to global trends, they are the typical middle-class customer. With that in mind, Vituzote’s product offering spans kitchen, dining, bedroom and bath along with textiles, storage, décor and gardening.

“Kitchen and dining is our leading category by virtue of the range and depth as well as being our first category. We also have well established and a strong supplier relationship with Lifetime Brands and others as suppliers. Kitchen gadgets particularly are consistently leading but other categories like appliances show very promising growth by virtue of the quality product we source, sell and support.”

In terms of growth in the Kenyan homewares market, Aaron says he feels they have “only just started to scratch the surface on the immense possibilities in the homeware space”.

He adds: “Our ambitions continue to be double digit growth in almost all metrics of the business”.

With a background in ecommerce, Aaron is well-versed to guide the company through the pandemic-assisted “massive positive upswing towards ecommerce”. In fact, he says the company has seen online shopping growth continue post pandemic.

“Close to 30 per cent of our sales are online and a good number of our overall customers discover and research product online. The majority of our investments continue to take place in technology and systems to complement a hybrid and seamless click and brick environment to continue to give customer choice and convenience to shop however they like.”

Aaron points towards Kenya having a “highly adaptable and tech savvy” population. He adds: “Kenya is the world’s first mobile money country, the platform named MPESA is used by 96 per cent of Kenyan households. With over 70 per cent of the population under the age of 35, these customers have come of age with mobile money and the internet as a way of life. We estimate between 20 and 30 per cent of trade is taking place nationally online based on retail sector and industry regulator published data.”

As for 2023, Aaron predicts growth, telling Kitchenware International “bolstered by a strong holiday shopping season and despite the global shocks post pandemic including the Ukraine crisis, price increases and others, we expect a solid year of growth in 2023”.