The modern retail sector, encompassing organized and structured retail formats like supermarkets, hypermarkets, and department stores, presents a significant, yet largely untapped, opportunity for Nigeria’s economic growth. Ade Sun-Basorun, the CEO of FoodCo Nigeria, a diversified consumer goods company, emphasizes the sector’s potential to address critical economic challenges, including job creation, inflation control, and revenue generation. He calls upon the Federal Government to implement targeted policy interventions to unlock this potential and transform the sector into a key driver of national economic progress.
Sun-Basorun’s appeal comes in the wake of recent data from the National Bureau of Statistics revealing a marginal decrease in Nigeria’s inflation rate. He argues that a well-structured modern retail sector, supported by strategic government initiatives, can significantly amplify this downward trend and contribute to greater macroeconomic stability. The inherent efficiencies of modern retail operations, he explains, translate into lower consumer prices and increased household savings, directly impacting the cost of living and overall economic well-being.
One key advantage of modern retail lies in its utilization of digital payment systems. Unlike informal trade, where prices are often rounded up due to cash-based transactions, modern retail allows for precise pricing, leading to substantial cumulative savings for consumers across millions of daily purchases. This precision, coupled with streamlined supply chains and optimized logistics, contributes to the sector’s ability to mitigate inflationary pressures and enhance affordability for consumers.
Furthermore, Sun-Basorun highlights the job creation potential of the modern retail sector. As the sector expands and formalizes, it generates employment opportunities across various skill levels, from entry-level positions to managerial roles. This job creation not only reduces unemployment but also stimulates economic activity by increasing consumer spending power and fostering a more vibrant marketplace. Additionally, the growth of modern retail benefits small businesses within the value chain, such as suppliers and logistics providers, creating a ripple effect of economic growth throughout the economy.
While acknowledging the government’s ongoing efforts in forex market reforms and digitalization, Sun-Basorun stresses the need for complementary structural support to enhance the competitiveness and sustainability of the modern retail ecosystem. He advocates for specific interventions, including facilitating access to concessionary financing for retail operators, streamlining business registration and expansion processes through one-stop regulatory desks, and implementing tax incentives to encourage local sourcing, particularly from rural farmers. These measures, he asserts, will create a more conducive environment for modern retail to flourish and maximize its contributions to the national economy.
Sun-Basorun underscores the importance of learning from international examples, citing the significant role of retail in driving economic growth in numerous countries. He urges Nigeria to adopt a proactive approach, implementing deliberate policies to harness the sector’s potential and transform it into a major engine of economic development. A robust modern retail sector, he concludes, will generate a multitude of benefits, from increased employment and lower consumer prices to improved incomes for small businesses and enhanced tax revenue for the government, enabling investments in critical infrastructure such as roads, schools, and hospitals, ultimately contributing to improved living standards and overall national prosperity.
