NAIROBI, Aug. 6 (Xinhua) -- The fight for customers between local and foreign supermarkets in Kenya has intensified, with the former seeking to protect its turf as the latter carves a niche for itself as East African nation's spending power surges.
Both the local and foreign retail chains are opening new branches in the capital Nairobi and other parts of Nairobi as the rivalry hits a new high.
Kenya has some 20 indigenous retail outlets but only four are major, namely Naivas, Tuskys, Eastmatt and Nakumatt, whose fortunes have, however, been on a downward trend.
On the other hand, the foreign retail chains are Carrefour (French), Choppies (Zimbabwe) and the Game (South African).
The foreign supermarkets have in the last three years penetrated the East African nation's market, with Carrefour and Game cementing position in the niche market.
Choppies, which acquired a local supermarket to enter the market, has however made inroads in the low and middle segment markets.
The indigenous supermarkets, on the other hand, are in firm control of the low and middle income clusters of the market.
The last few months have seen both the local and foreign supermarkets open new branches in various locations in Nairobi and other parts of the country, and they have further announced plans to open more.
Naivas, an indigenous supermarket, has opened at least three branches in Nairobi, including in the central business district, and other parts of the country in the last six months.
Last week, the company announced plans to open a fourth outlet in Mombasa at Mwembe Tayari.
Tuskys, on the other hand, opened new branches in Kisumu and Kisii in Western Kenya and in Kericho and Eldoret in the Rift Valley. The supermarket now has two branches in each of the towns as it tightens grip on the market.
Equally fighting it out are the foreign outlets, with Carrefour set to open new branches in Nairobi at Village Market and Galleria Mall for the top and middle-income markets respectively.
Choppies, which has 11 branches, is this week expected to open its 12th branch in Mlolongo, on the outskirts of Nairobi, targeting the middle-income market.
Cytonn, a Nairobi-based investment firm, said that Kenyans are increasingly appreciating international brands, giving them the impetus to open more outlets and expand.
"If I want electronics, I go to a foreign supermarket because there I am assured of buying quality items since they ship them directly from their countries and prices are much affordable," said Brenda Awour, who bought a fridge last week from a foreign supermarket in Nairobi.
According to the Kenya National Bureau of Statistics, the number of Kenyans spending between 300 and 2,000 US dollars a month, who make the middleclass, is on the rise.
Henry Wandera, an economics lecturer in Nairobi, attributed the stiff competition in the sector and growth of profits to rise in incomes among Kenyans and rapid development of malls.
"The middle-class has expanded significantly in Kenya in the last years making the spending power rise and thus attracting the supermarket to cash in. On the other hand, there has been rapid development of malls making expansion of supermarkets possible," he said.
