Potential retail properties in East Africa: A preliminary analysis

Abstract

Purpose of this paper To characterize the major factors to be considered in the development of a strategy to enter the East African retail property market.Design/methodology/approach A preliminary selection of potential geographical markets in East Africa was made based upon size and political stability. Four countries were selected and major cities and towns in these countries were visited on two occasions, to obtain first hand knowledge of the current retail market as well as to identify possible investment opportunities. The four selected countries were ranked according to probable ease of market penetration. Shopping malls in the two most attractive countries were visited and characterized.Findings: The preliminary study shows that Kenya should be established as springboard for expansion into East Africa, with Uganda earmarked as the second country to invest in. Stores rollout should start in Nairobi with a rapid rollout to key rural cities and towns. Once the operation is stabilized a sales area team with logistics support should be established in Kampala with the focus to grow the footprint rapidly westward.Research limitations/implication: The research is a preliminary survey of factors to be considered in the establishment of a strategy to enter the East African retail property market. Sudan and Somalia were excluded from the study due to political turmoil currently present in these countries while Eritrea, Djibouti, Rwanda and Burundi were excluded due to size.Practical implications (if appli able): Understanding the factors required to enter the relevant markets will increase the potential success of an entrant.Originality/value of paper: Although specific markets in some of the countries in East Africa had been investigated in the past, this is the first systematic study of the strategy required to successfully enter the retail property market in East Africa.