Africa’s retail sector remains relatively under-developed at present, with most shopping being done at traditional shops. The formalisation of the sector will be a key trend underlying the sector’s expansion in the coming decade. The lack of physical infrastructure has been one of the main constraints to the entry of formal retailers, as there are simply not enough shopping centres available at present, while bureaucratic obstacles and land issues further complicate matters.
At present, most African consumers – especially south of the Sahara desert – remain extremely poor and spend most of their money on food and other necessities. This makes for a promising outlook for fast-moving consumer goods (FMCG) companies given the large market to cater for.