Lagos...Big City of Dreams

Time for a good old gripe.

I'll start with Swift Communications. My internet service provider. When we first started using them about 6 months ago, they were fantastic. Same speed as broadband abroad. To be fair their customers services are great, they call back when they say they will and they send out their engineers when needed.

BUT...a few months down the line and for the most part the internet service is a bit shite. I spend HOURS (no joke) trying to uplaod my pictures now which is why I might seem to not update so frequently. Trust me, its not from lack of trying. I've been tring to upload my last post "Full Length & Fabulous" since SUNDAY!

So what I want to know is how come all good things in Nigeria always seem to come to an early end? Why is it that so many businesses and entrepreneurs start out so full of promise with high expectations and even higher standards yet a few months/years down the line its usually a very different story.

Why is it so damn hard to maintain any sort of standards in Nigeria and why does it seem to be ten times as much work to keep things afloat.

Where to shop?
Our crap infrastructure that really doesn't help. Bearing in mind my knowledge and exposure is limited to the retail sector..The running costs of a business here are astronomical and yes, I think they're higher than the UK/USA. Think about it, you pay two years rent up front, a service charge, you'll need a generator, probably ahev to put in your own water system and that's before you start any refurb.

And I believe the set up costs are very similar too. The commercial rent is comparable to what would be paid abroad, and you're guaranteed to have a much lower footfall in Lagos than you would on a high street in London.

Too Many Chiefs, Not Enough Indians
One significantly lower cost is staff. But that's a false economy as you have to spend so much time micro-managing, checking, cross checking, correcting, training re-tarining, explaining re-explaining that you really don't get enough time to do much else. Why do staff in Nigeria seem so lazy? They start out great and before you know it they're not so good. I've heard too many stories of staff setting up side line businesses, shafting their boss, leaving to set up the same type of business.

I often wonder where the future of retail lies in Nigeria. For a country with so much money, we don't have any international retailers here. Even Swaziland do! We don't really have anywhere that offers a true shopping experience. before anybody says Mega or The Palms...what exactly is it apart from food or electronics are we supposed to be buying in there?

I'm always being told stories of oh so-and-so are planning on moving into Nigeria...Before people go getting overexcited, just check where else in Africa they have set up shop. If tehy're not in South Africa, they ain't comin g here. South Africa is a much easier market to analyse and predict with a more atble economy and better established retail sector so just why exactly would they bypass that for Nigeria first? I've heard Zara are moving here so many times. No. They're. Not. They have a couple of spots in Morocco yes, but I definitely believe they'll be moving into South Africa next and somehow not Nigeria.

I touched on ths topic of retail in Nigeria a few weeks ago, take a look.

The last comment which was posted this week got me thinking about the retail sector in Nigeria again.

But I want to know what you all think...where does the future of retail in Nigeria lie? And who do you all think will be the first proper (retail) international chain to set in Nigeria?

Cheap AND Cheerful? In Nigeria?

So a response from 'anon' to my last post got me thinking.

Her comment was…
”I'm interested in why you think retail a la Primark and F21 won't work in Lagos. Pray tell! Thanks :)”

I started my answer which turned into a bit of an essay so I decided to share. I’m certainly no expert on retail but I’ve been in the field for coming up to three years so I’ve learnt a few lessons about Nigerian shoppers along the way. The main one being they're a tough crowd but when they like something they love it so big up to the Tiger Tem massive!

I remain unconvinced you’d get the footfall needed of ready to spend shoppers. Primark and Forever 21 transcend many barriers such as age, class, status as they offer cheap, disposable versions of high end products a lot of people can’t afford. Yes they do basics but I suspect their main trade comes in from the more ‘fashion’ items…otherwise perhaps they wouldn’t be changing stock on an almost daily basis.

Prejudice is alive and kicking in Nigerian society. Go cheap, you exclude the people with money, almost instantly..the snob factor I call it. Go expensive, you exclude the people without money. In Nigeria, I don’t think we have that pride in ‘Oh my god you won’t believe how cheap this was!’ In the US and Europe, it’s a full on competitive sport.

Nigerians don’t have the obsession with celebrity, fashion, catwalks, fashion seasons the same way as Europe and America, where the demand is feed/created by numerous magazines, TV shows etc. So I don’t believe we’re as likely to gravitate towards cheaper versions of high fashion products. Our Local Celebritries usually wear some approximation of traditional....in which case cut out and keep the pic, and take it to your tailor.


Location would be another key factor. Do we have the equivalent of Oxford Street? Times Square? The cheap shops pick prime locations to maximise exposure and footfall abroad. So where would Primark go here? The Palms? The location already excludes a significant portion of its market. People with less cash would be intimidated by the location and would continue to shop at Tej market or Balogun market. Unless of course you’d want to put it in Tej…in which case, Primark you’re not, market trader you are. BIG difference.

I don’t have detailed knowledge of the true cost of living for the average Joe in Nigeria so I’ll tread a little carefully here. The difference in disposable cash in Nigeria and abroad is huge. The day to day costs of life in Nigeria are high and salaries are extremely low. So this limits the amount of disposable cash for people at the lower end of the salary scale. In Europe and America, the differences aren’t necessarily as huge.

Minimum wage in the UK just hit £5 I think, so if you work a 40 hour week that’s about £800 which is a pittance. Or 200 000N which is a damn good salary and definitely not anywhere near the bottom of the salary scale. I know in the UK at least, living can be heavily subsidised by the government and in the US as well, and that’s before we even get onto rent controlled apartments.

I’m aware that’s a big generalisation so any more informed readers feel free to correct me.

And lets look at South Africa. It’s the ‘easy’ Africa for most retail giants and they’re yet to get the really big European or American retailers in there (unless things have changed dramatically in the past year). I heard LV and someone else like Gucci just moved into Cape Town….but the cheap as chips shops….I suspect they’re dubious as to whether they’d get the footfall. And South Africa has a proper thriving retail culture. (by proper I mean a proper shopping experience).

When Topshop released the Baxter skinny jean, within weeks they were selling 18 000 a week. Let that marinate for a second. 18 000 women, who could find their size, liked the fit and had the £40 odd to drop on them. Or 10 000N.

I think its most unlikely such figures could be achieved here. And then add the hassle and undue expense of running a business in Nigeria and I go back to my starting point that a slightly more mid range store would probably do better. They sell less at a higher price and simple economics mean provided you can strike the right balance, you’ll probably make more money. And isn’t that what retail is all about? Just look at Sir Philip Green...the billionaire.