Business
Neighbourhood markets, shops face bleak future
…as Nigerians flood malls, superstores for bargain prices
Big retail stores and malls operating in the country are currently witnessing huge patronage with many Nigerians now preferring them to neighbourhood shops, stalls, and markets for their daily needs, Business Hallmark’s findings have revealed.
According to findings, mega stores, such as Bokku Mart, Justrite, Shoprite, Jendor, Spar, Adidde, Best Choice and many other bargain shops have recorded growth in sales and profits in the last one year, as consumers flood to the stores in an effort to cut down on cost.
The mega shops are now daily besieged by consumers in need of groceries and household products, such as toiletries, clothing, soft drinks, provisions, frozen foods, snacks, beverages, kitchen equipment, foodstuffs, among others.
Branches of some of the supermarkets in Ikeja, Ogba, Agege, Ijaiye-Ojokoro and several parts of Lagos visited by BH from Tuesday, April 15 to Thursday, April 17, 2025, were bustling with commercial activities as buyers engaged in shopping activities.
BH findings unearth several factors driving the surge in traffic and sales for these retail outlets. All the sales outlets, it was discovered, have all embraced strategies aimed at boosting sales and revenue.
Bargain Prices
Some of the strategies employed include competitive pricing, backward integration, publicity blitz and many others.
For instance, our correspondent observed during visits to Bokku Mart branches at Estate Bus Stop on College Road, Ifako-Ijaiye; Jankara on Agbado Road; Agbe Road in New Oko Oba and Ijaiye/Stadium Road in Agege that prices of goods are relatively cheaper compared with that of neighbourhood shops, stalls and markets.
For example, a 900g loaf of bread at all the Bokku outlets goes for N1,300. Meanwhile, the same size is sold for between N1,500 and N1,800 in the open market.
In the same vein, a 60cl bottle (pet) of Mirinda and Pepsi Cola sells for N370, against N400 to N450 in the open market, while a 330ml can of Malta Guinness goes for N630 at Bokku, compared with N700 to N750 in the open market.
The same applies to other products. A 500g Golden Penny Spaghetti and Macaroni Twist at Bokku goes for N1,050 each. In the open market, the products sells for between N1,100 and N1,200.
Price differentials for other products in Bokku and the open market are: Indomie Noodles Onion Flavour (70g) N270/open market N300 -N350; Minimie (70g) N220 at Bokku/open market N250-N300; 2kg Golden Penny Semovita N3,630/open market N4,000 to N4,500; 3Ltr and 5Ltr Devon Kings Oil N11,000 and N18,000 respectively/open market N13,000 and N21,500 respectively; Titus Sardine N1,100/open market N1,200 to N1350, Maggi Star seasoning (100 cubes) N1,500/open market N1,800; 1kg All Purpose Golden Penny Flour N1,550/open market N2,400; Gino Tomato Paste (70g) N200 at Bokku and N250 in the open market; Nasco and Kellogs corn flakes (500g) N2,450 and N2,500/open market N2,700 to N3,050, and a medium size crate of eggs N208 = 1×30 = N6,240/open market N6,500 to N7,400.
Uniform Pricing of Malls
Though, prices of most goods in Bokku Mart are relatively low
errr than in other supermarkets, the differences are not that much.
For instance, Maggi Star seasoning (100 cubes), which sells for N1,500 at Bokku, goes for N1,570 at Shoprite. Also, a 60cl bottle of Pepsi Cola and Mirinda which sells for N370 at Bokku goes for N400 at Justrite Superstore, and from N450 and above in the open market. Molped Maxi Sanitary Pad for women (10 pad) sells for N850 at Bokku, while it goes for an average of N1,200 in the open market.
The BH survey also revealed that like in Bokku and Justrite, the price tags on several products at Best Choice, Spar and Adidde outlets are much lower than in neighbour shops.
The difference in prices applies to almost all consumables, except in the electronics division, where products are more expensive in the mega stores.
For the Rich Malls
There is, however, an exception to this trend. Checks revealed that prices of goods at high-end supermarkets in Lagos like Mega Plaza, Market Square, Hubmart and Royal Prince are quite on the high side.
For instance, a 158g Pringles Sour Cream & Onion, which has a price tag of N3,000 at Bokku is sold for N3,950 at Market Square and N4,450 at Royal Prince, a massive difference of between N950 and N1,450.
Also, 850g of Waw Detergent, which sells for N1,650 at Bokku Mart, goes for N2,050 in Market Square and N2,065 at Royal Prince.
However, these high-end marts are located in highbrow areas of Ikeja, Victoria Island, Ikoyi and Lekki, where they serve the wealthy and deep pockets Nigerians and foreigners, who are not too mindful of the prices they pay for quality goods.
Driven by Economy
The wide price disparity between superstores offering bargain prices and neighbourhood shops and markets, industry watchers, who spoke on the matter argued, is the most singular factor driving many Nigerian shoppers to their doors.
“Shoppers, especially the working class and low-income earners, are adjusting their lifestyles and tastes in order to survive the harsh economic situation in the country.
“They look for bargains, wherever they can get it. I know some Nigerians, who will trek for 30 minutes or more from their homes to distant stores just to save N30 to N300 on cheaper items like bread and beverages.
“You may think the gains are too small for the stress. But if you calculate the savings over one year, you will see that it makes sense.
“Nigerians have been living a fake and largely subsidized life for long. It is in this country that you’ll see a civil servant on a monthly salary of N70,000 blowing away his earnings as if there is no tomorrow.
“They patronize neighbourhood shops and markets, which normally do retail trading, instead of going to major or weekly markets to stock up on provisions like our parents used to do.
“But the recent economic crisis seemed to have reset our brains. Since we no longer have excess money to throw around, we now think like average Europeans and Americans, who draw up budgets and visit bargain stores to be able to survive on their wages before the next one comes.
“A large percentage of Nigerians in the UK and America patronize bargain stores like Tesco, Sainsbury, TJ Maxx, Walmart, Dollar General and Marshalls for their needs.
“So, I am not surprised that Nigerian at home are being flogged to order. They either adjust or go bankrupt”, said Dr. Peju Beckley, an economist based in Lagos.
Meanwhile, BH findings revealed that unlike traders in neighbourhood markets, superstores have been able to crash the prices of their products by deploying several measures.
Backward Integration
One of such strategies is the adoption of backward integration in an effort to drive down prices owing to the high exchange rate of foreign currencies against the naira.
BH reliably gathered that big retailers operating in the country like Justrite, Shoprite, Bokku, Best Choice, Spar and Jendor have all embraced the ‘Made in Naija’ drive by stockpiling more locally made products on their shelves.
According to a sales supervisor in one of the mega stores, who spoke on the condition of anonymity because he didn’t have the permission to speak on the matter, the shift to made in Nigeria products had helped to mitigate some of the challenges the company encountered with forex volatility.
“We have been able to overcome the foreign currency volatility in Nigeria with the adoption of the backward integration strategy. As a result, we have managed to keep our shelves fully stocked with much cheaper products unlike other sellers.
“Most Nigerian’s now patronize us because of our low prices. The price of most of our products are between 25 to 40% cheaper than others in the open market”, the supervisor stated.
Another major factor driving shoppers to mega stores is the massive discount and bonuses gotten from their suppliers (manufactures) for all bulk purchases.
Economy of Scale
With the discount and bonuses spread over the products, prices are further pushed down, thus making them more attractive to buyers.
For example, our correspondent learnt that for every 10 satchets of 25g Cowbell Coffee Milk purchased directly from its producer, Promasidor Nigeria, 1 extra satchet is earned as bonus.
Meanwhile, a pack of the product contains 12 satchets. That means a wholesale buyer get 1.2 extra satchets on every pack, or 12 extra satchets on every 120 sachets purchased.
For big stores like Bokku, Shoprite, Spar and Justrite that purchase the product in millions at a go, the immediate profit is huge.
Apart from the already mentioned bonus, wholesale buyers also get massive discounts on bulk purchases.
“That’s why we can sell our products even cheaper than the price we get it from producers. The bonuses we get alone on purchases, which is about 12 percent is enough to break even,” the source added.
Street Shops threatened
While the wide disparity in prices has both helped superstores to grow their bottom line and shoppers save money for other use, it is threatening the continued existence of neighbourhood shops and markets owing to a massive drop in patronage.
A provisions trader in the Ijaiye-Ojokoro area of Lagos, Binta Mogaji, who spoke to our correspondent on the matter, lamented that there has been a significant drop in the volume of sales since some superstores established branches in her area.
“I have never experienced this kind of bad sales I am presently experiencing in my life. Buyers, even old customers, rarely patronize my shop again except for their minor needs or things they forgot to get from outside the community.
“I now see most of my customers at Bokku, where I used to shop for goods. Big sellers like Bokku, Adidde and Best Choice are now linking up directly with consumers by setting up outlets in every neighbourhood.
“Like before, I used to go as far as Fagba in Ifako-Ijaiye to buy bread at N1,300 to sell to buyers at N1,500. But now, Bokku has established a branch at Jankara, just two to three minutes walk from my place.
“So, why would a buyer in the same neighbourhood come to my shop to buy the same quantity and quality of bread they can easily get at Bokku a stone throw away for N1,300 at a higher price?”, Mogaji asked rhetorically.
Some customers, who spoke to our correspondent at Jendor, Shoprite, Justrite and Spar outlets, also revealed that apart from switching over to superstores in order to get cheaper products, they also patronize them because of the believe that they will get original products and satisfaction patronizing them.
“Since Shoprite came to Alausa, I don’t think I have tried to buy any important commodity around my house. I prefer coming here with the belief that the products are original.
“Now, the high prices of every day goods in the neighbourhood have made Shoprite a must go for me. I once stopped at a roadside stall in Agindigbi, Ikeja to buy banana and the seller told me to pay N3,500 for one bunch.
“I was shocked by the price. Thinking he was joking, I told him to collect N1,000 per bunch, which I believe was a rational price and since I intended buying plenty.
“He (seller) just looked at me with disdain and said: ‘You surely don’t belong here (Ikeja). You better go back to your Amukoko where you can get this kind of banana for N500.
“I was so embarrassed that I zoomed off without uttering a word. Meanwhile, I could get the same quantity and quality of banana at a much lower rate of N850 then at Shoprite.
“Since that time, I stopped buying things on the road or from neighbourhood stores and I have never looked back or regretted it”, said a banker, Nkechi Orji.