Carrefour sales up 30% year on year in Kenya

Majid al Futtaim (MAF), the Carrefour franchisee in the Middle East, Egypt and East Africa, has revealed that sales in Kenya rose by 30% in 2020. The year was marked by several new store openings, including taking over Shoprite’s former flagship store in Nairobi’s Westgate Mall. MAF has now also opened its second store in Uganda.

MAF opened 3 new Carrefour stores in Kenya in 2020 as its store network grew from 7 branches to 10. According to Trendtype’s retail tracker it is the second largest supermarket chain in the country, behind Naivas. During 2020 it also opened its first store outside Nairobi, at the City Mall in Nyali (Mombasa), where it took over a former Shoprite store.

In 2020, MAF recorded sales of Ksh25.3bn ($230.4m) in Kenya, an increase of 30.2% on sales of Ksh19.4bn ($176.6m) in 2019. Despite the challenges of COVID-19, MAF has continued to build strong sales growth even while rivals such as Massmart, Shoprite and (the now defunct) Tuskys have struggled.

The new Carrefour store in Uganda comes 13 months after the first (much delayed) Carrefour store opened in Kampala’s Oasis Mall. This second store, which has a sales areas of 2,050m², is sited in the Metroplex Shopping Mall in Kampala. It will carry 20,000 SKUs, including fresh meat, fish and cheese counters, an in-store bakery and a large non-food range. MAF claims that 90% of the products its stocks will be sourced locally (this includes imported products sourced through local distributors).

The new store also means there are now 12 Carrefour stores in Kenya and two in Uganda with two more stores planned to open in Uganda. MAF is directly taking on Shoprite, which has five stores in Uganda. It is Shoprite’s only market in East Africa following the finalization of its exit from Kenya in February 2021. Shoprite exited Tanzania in 2014 with the sale of its two branches in Dar es Salaam and one in Arusha.

It is not clear whether Shoprite will remain in Uganda in the long term. However, Shoprite has not indicated its intent to exit and Uganda and its survived the last closure round when Shoprite signalled its intent to exit Kenya and divest its majority shareholding in its Nigeria operations. We also do not believe that Shoprite will enter either Rwanda or Burundi, although it is expanding its store network in DRC.

Perhaps the big question is when MAF takes Carrefour into Rwanda. Rwanda’s market, while small, is fast developing. The Rwandan government is keen to promote its value added horticultural produce, and Majid al Futtaim does source produce for its Carrefour supermarkets in the UAE from Rwanda. We think that MAF may look to enter Rwanda in 2023/4.