Marked by general economic development, expanding demographics, shifting customer behaviour, and the mushrooming of businesses, many countries in the African continent are poised to become some of the biggest retail markets of the decade.
By 2021, the average economic growth in the eastern and southern African countries is anticipated to do better than their central and western counterparts. There are more than 20 African countries that clocked a GDP growth rate of over 5% in 2019. With rising economic growth and activities, customer behaviour associated with the working population also tends to change because of lifestyle changes, rising income levels, and more spending power.
From the perspective of demographic and urbanisation trends, Africa is turning to be the new big destination for business and investment. Two primary drivers for accelerating urbanization in Africa are its fast-growing population and reclassification of areas. However, the rural-urban population stands at a balanced ratio hinting at a huge market potential for brick and mortar retail considering Africa’s population and population growth rate. And increasing life expectancy, TFR above the required level of 2.1%, and a median age of about 20 years put Africa on the tracks of healthy population growth.
Startup funding in Africa has experienced an astounding growth in the last half a decade indicating the optimism and confidence of the investors. And the entry of global retail giants like Carrefour and Wal-Mart itself speaks volumes of Africa’s retail potential.