Sunday 9 June 2013

NIGERIA;RETAIL LAND OF OPPORTUNITY.PART 2; MUSHIN LEATHER MARKET

A rainy and cooler day in Lagos in contrast to the weather on the day i visited Balogun Market. It is the day before Good Friday. My family have traveled for Easter. I am dressed ready to tackle Mushin leather market; Converse trainers, shorts and a one piece body suit. But the weather is putting me completely off.   Mushin leather market is on the other side of Lagos (I'm in Lekki) and i'm wondering if i should abandon the mission. The thought of navigating Lagos roads alone to get to this area unknown to me seems tasking...

As the hours passed, the rain persisted, I was about to lose all hope. Then at around midday my friend, the one i mentioned who had joined me at Balogun market, called me to resolve my plight. He sent his cousin to meet me in Lekki, who would then accompany me to Mushin. By the time the cousin arrived the rain had stopped also. I was very thankful! Not only that i will be sticking to the itinerary i had made for my Lagos trip but also i knew that my friends cousin would have more bargaining power regarding taxi fares and be able to negotiate better prices for what i required at the market.(see previous blog post on Balogun market)

 A two and a half hours "cheapish" taxi journey later (We set off at around 1pm. This is not advised by the way. Leave for markets early morning!) we arrived in a built up area swarming with market traders, hustlers, beggars, customers.  Advanced planning had enabled me to develop a contact at this destination through a friend who makes custom handbags from leather goods in Lagos. I understood the relevance of this once i arrived at the market because it is absurdly large, you could easily get lost and caught up with excitement at all the stalls selling leather, suede and the like.He also offered me invaluable advice on understanding how market traders price leather and how i will  be able to identify real leather from the fakes. 

My friends cousin did a stellar job trying to navigate the taxi to my leather contact. He jumped in and out of the taxi more than ten times asking locals if they had heard of the road we had been advised the stall was located on. We sent the taxi driver the wrong way a number of times often getting caught up in a traffic of market customers. We even phoned my contact several times but he was quite useless in directing us. The Igbo to Igbo conversation between my friends cousin and the leather contact still led to confusion. (I imagined if i had gone alone like i intended to initially..what a joke that would have been).

After half an hour of navigating Mushin leather market by car we eventually located the contact. He was just about packing away so i was thankful i had arrived just in time. A little more face to face Igbo conversation and the contact was soon throwing all his colourful leathers on a wooden table in front of me. And they were amazing! Red, yellow, mock croc skin, mock snake skin or whatever, an array of leather...i was certainly impressed. Out of the millions of skins he offered to me I narrowed it down to five and then studied the fabric for its dyed colour, holes in the fabric, size and then cost. Eventually i chose only one, (i know, stingy right!) slightly large piece of fabric, one side dyed navy blue, the other side dyed black with gold flecks (main picture). It is a stunning piece of leather and i started my negotiations, eventually purchasing it for what i felt was a bargain!

I could have easily stayed at the market for an entire day if i had arrived earlier. Beautiful suede fabrics, synthetic leather, raw leather hides; stalls were busy and lots of (informal) money was changing hands. Leather, an apparently $43.4 billion export industry in Nigeria, is crying out for investors (click here for more info). So yet again, another area for private investors to splurge their cash in. Also another area for the government to stop neglecting and start investing in. 

Believe it or not, footwear is prohibited from import into Nigeria, (Exactly. Click here if you don't believe me) so investing in the leather industry will aid in boosting manufacturing industries in Nigeria such as shoes, handbags, jackets and furniture, potentially spilling over to other parts of West Africa, wider countries in the  continent and internationally, thus producing jobs, boosting the market etc etc.

Yes Olusegun Aganga...i'm talking to you!

Friday 7 June 2013

WHY A LITTLE LAS VEGAS COULD CONQUER RETAIL IN CONTINENTAL AFRICA

If you have followed my blog you will know  by now that one of my focuses has been on the lack of international standard shopping malls on the continent resulting in the lack of potential growth for international retail brands being able to invest in the continent which has a lot of knock on effects for other gripes i have. Returning from a recent trip to Las Vegas, it was amazing/fascinating/incredible to see that hotels along the "strip" have international standard shopping malls within their resorts! And they are fabulously designed! (see picture above).

 So why is it that the continent of Africa is getting it so wrong?

Stumbling upon the Sagachireserach.com website (they focus on Market intelligence across the African continent) via the website HowwemadeitinAfrica.com (as the website title suggests), Sagaci researchers have put together a categorisation and ranking of malls in Africa according to their overall attractiveness to leading "international tenants". At the top, "AAA" ranking relate to malls among the worlds best properties. At the bottom, a 'D'  ranking means it is among the least attractive properties.

Upon reading the rankings i could do nothing other than sigh, roll my eyes and shake my head. I should not really be shocked... but i am, because a continent as rich as Africa should really be able to rival a city such as Las Vegas.

Ok, so here are the rankings;

AAA:4 malls
AA:8 malls
A:13 malls
B:16 malls
C:44 malls
D:126 malls

Now you see why i was shaking my head...

So what does this mean? It means that D's figures need to become AAA figures asap!
Developers who have mentioned or who are planning to build malls need to take the breaks off, stop discussing and start doing! Those with the type of wealth i am striving to accumulate (*cough,cough*) should form consortium's to build or invest in the development of shopping malls or better still, while building hotels build them with shopping complexes like Las Vegas!

Not to sound completely negative... there is also a ranking, provided by Sagaci, of the top 5 shopping centres in Sub-Saharan Africa, albeit that South Africa is not included in the ranking because undoubtedly they are the market leaders on the continent in international standard built malls. Nigeria rank twice among the 5(!) along with Ivory Coast, Kenya and Senegal;

Name of mallCountryCityGross leasable area (sqm)Ranking
Sea PlazaSenegalDakar14,000AA
Cap SudIvory CoastAbidjan6,500A
Ikeja City MallNigeriaLagos22,650A
Polo Park MallNigeriaEnugu20,000A
The JunctionKenyaNairobi26,000A


Sagaci's research outlines that there are plans for mall expansion pan-continent, with the aim to try and lure new brands to co-exist with the pioneers who have already made the brave move to invest in the continent (KFC, Mango, Etam,Shoprite),

“In the coming years, boosted by the emergence of a middle class and by the expansion of international brands, the total shopping centre surface should double… with 129 new shopping centres in project across the continent (including 17 in Egypt, 15 in Ghana, 14 in Zambia, 12 in Angola, 12 in Nigeria, 12 in Morocco). Beyond these projects, some countries such as Nigeria, Angola, Tanzania and Ethiopia remain very attractive for developers with an unmet demand of five to 20 shopping centres in each country between now and 2017,” Sagaci noted.
Hmmm...let's see what happens shall we...