South African retailer Builders Warehouse has announce plans to close in Nairobi, its only store in Kenya. The only Builders Warehouse Massmart had op
South African retailer Builders Warehouse has announce plans to close in Nairobi, its only store in Kenya. The only Builders Warehouse Massmart had opened in East (or West Africa), at Nairobi’s upmarket Karen Waterfront Mall.
The store covered almost 10,000m2 of sales area including its garden centre and brought the successful South African model of good quality home improvement, hardware and building materials to the Kenyan market. It only opened in August 2020.
Challenges
Its inventory would cover building materials and home improvement requirements for floors, paints, sanitaryware, kitchens, lighting, electrical, and appliances. This was viewed as an attempt to bring formal retail experience to the local building and construction sector, which is dominated by small hardware shops and manufacturers selling directly to large clients.
The retailer attributed the planned exit from the country to persistent losses and poor performance due to factors such as the inability to import stock timeously and tough importation rules that have undermined its competitiveness.
Massmart was hit by the ongoing supply chain disruption of the pandemic, the sharp rise in the cost of building materials, the soaring cost of container freight through 2021 and much of 2022, the depreciation of the Kenyan shilling and the squeeze on consumer incomes, and moves by the Kenyan government to squeeze more revenues from importers of goods.
“As a result, the business has had to consider closing Builders Warehouse Karen Waterfront in Nairobi, Kenya. We have initiated the process required for potential closure,” the company said in a notice.