Planet Retail 25 April 2007

The manufacturing sector should prepare to become more innovative in quality, packaging and volumes of its products, Nakumatt has said as Kenya's leading retailer embarks on an aggressive expansion plan. Mr Thiagarajan Ramamurthy, COO of Nakumatt, said the company's KES840 million (USD12.1 million) expansion plan would see it open new markets for locally-made goods. In addition to planning new outlets in Meru, Nairobi and Nyeri, Nakumatt is opening up flagship stores in the capital cities of Uganda, Tanzania and Rwanda.. Mr Ramamurthy said the expansion plan would see this grow to 50%, and that more than 1,500 new jobs would be created over the next two years. While the growth of retail chains normally happens in proportion to the general population and gross domestic product (GDP) growth, formal retail sector growth in Kenya has been held back by the fact that established chains are found only in major towns, thus not reaching the 80% of Kenyans living in rural areas. According to Mr Ramamurthy, the predicted retail sector will grow rapidly in the next three years before stabilising around 10% per year. "(The) manufacturing sector should prepare in terms of product innovation, changes in packaging and volume production while they economise their operation," said Mr Ramamurthy.

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