Pick n Pay, a well-known grocery store from South Africa, has decided to leave Nigeria. They want to sell their 51% part in a business they started with A.G. Leventis. This was shared by their leader, Sean Summers, on Monday, according to Reuters.
Pick n Pay began doing business in Nigeria less than five years ago. They partnered up with A.G. Leventis and have two stores there.
Even when other big stores were leaving Nigeria four years ago, Pick n Pay decided to join the Nigerian market and face the challenges.
Now, while the Nigerian government tries to bring in more money from other countries, Pick n Pay plans to leave.
Challenges for Grocery Companies Lately
Companies that sell things people use every day face problems like higher prices, making it hard for Nigerians to buy things because the value of their money, the Naira, has dropped a lot.
- In June 2024, another South African store called Shoprite closed down its shop in Abuja because it was too hard to do business there. Shoprite also closed another shop in Kano earlier in January 2024.
- Making money is hard for many stores that sell food and other things in Nigeria.
- The cost to keep a business running is going up, and more and more companies, even small ones, are closing because of rising prices.
- Jumia, a company known for delivering food, also stopped its food service in Nigeria because it couldn’t make enough money.
International Companies Leaving Nigeria
Not long ago, a company named Diageo sold its part in Guinness Nigeria Plc, meaning it left Nigeria.
- Many big companies like GSK, Procter & Gamble, Sanofi, and recently Kimberly-Clark have left Nigeria. They found it tough because of things like trouble getting foreign money, high energy costs, and lower buying power due to high prices.
- In the last 18 months, prices increased a lot from about 24% to over 34.19%. This is a 28-year high because of expensive food and travel costs.
- Also, the Nigerian Naira lost more than half its value in just one year, going from about N462 for 1 dollar to over N1,500 for 1 dollar. This happened because changes in how the Nigerian bank handles money exchange were needed to make things more balanced.