South African retail giant Pick n Pay has announced plans to exit Nigeria, selling its 51% stake in a joint venture as part of a broader restructuring effort outside its home market. The decision follows a less than five-year run in Nigeria, where the retailer established two stores in partnership with A.G. Leventis Nigeria.
Sean Summers, CEO of Pick n Pay, noted that this move aligns with the company’s strategy to refocus on its core market in South Africa, where it faces ongoing economic challenges and increasing competition. “The decision is part of our restructuring plan and a realignment of priorities outside our home market,” Summers stated, as reported by Reuters.
Pick n Pay’s exit highlights a broader trend among multinational companies reevaluating their investments in Nigeria, often citing the country’s complex business climate and economic instability.
Earlier this year, fellow South African retailer Shoprite closed its Abuja store after an extensive financial review, following the closure of its Kano store in January. In a statement, Shoprite said the decision was based on the financial pressures of sustaining its business in Nigeria amid the country’s current economic conditions.
Similarly, in December 2023, Jumia, a major e-commerce platform, closed its Nigerian food delivery business, Jumia Food, after concluding that market conditions made the service unsustainable.
Other prominent multinationals, including GlaxoSmithKline (GSK) Consumer Nigeria, Procter & Gamble, Sanofi, and Kimberly-Clark, have also exited Nigeria, pointing to the challenges of maintaining profitability amid high operational costs, fluctuating currency values, and regulatory hurdles.
The exits of these companies underscore Nigeria’s current economic landscape, which has strained both local and foreign businesses. Industry analysts suggest that for Nigeria to retain international investment, it must address issues like inflation, currency instability, and policy inconsistency, all of which impact the sustainability of businesses operating within the country.