By Emmanuella Opara | October 25th 2026
KEY POINTS
- Shoprite Nigeria plans to expand through standalone neighbourhood stores following a period of financial difficulties and restructuring.
- Three outlets have reopened after a temporary shutdown to negotiate with suppliers and address outstanding obligations.
- Foreign exchange volatility, dollar-denominated rents and operational challenges contributed to the retailer’s financial strain.
- The company has not announced the number, locations or opening dates of the planned neighbourhood stores.
MAIN STORY
Shoprite Nigeria plans to open standalone neighbourhood stores as part of its recovery strategy following financial difficulties that led to a restructuring of its operations.
Adekunle Adebiyi, Executive Director of Investments at MBO Capital Management Limited, an investor in the business, disclosed the plan during an interview on Nairametrics’ Drinks and Mics programme on Friday.
Adebiyi said three outlets had reopened after the company temporarily shut its operations to negotiate with suppliers and settle outstanding financial obligations.
“We took a very, very drastic decision to just shut everything down whilst we negotiated with suppliers. Now three stores are back open,” Adebiyi said.
He explained that the company intended to expand through smaller standalone stores in residential areas rather than depend mainly on large shopping malls.
“We’re going to be opening standalone neighbourhood stores, which was always the plan,” he said.
The strategy is expected to reduce the capital tied up in property development and allow the retailer to concentrate its resources on supermarket operations. Adebiyi noted that supermarkets generally lease their premises and invest in equipment such as shelves and refrigeration systems.
However, he said the model could make it difficult to secure conventional bank financing in Nigeria, where lenders often require physical assets as collateral.
According to Adebiyi, MBO Capital faced financing challenges during the acquisition of Shoprite Nigeria because the business did not have enough tangible assets to satisfy lenders, despite generating billions of naira in revenue. The investors consequently had to explore alternative funding arrangements.
Foreign exchange volatility also placed pressure on the retailer’s finances. Adebiyi disclosed that about 17 of its 28 stores had rental agreements denominated in dollars when the acquisition took place. The depreciation of the naira subsequently increased the cost of those leases.
He said rent should typically account for between eight and 10 per cent of a supermarket’s revenue, but some Shoprite outlets faced considerably higher rental costs.
The retailer also encountered operational difficulties, including weaknesses in inventory management and the loss of access to the enterprise resource planning system used by its former parent company. Adebiyi said replacing the system required billions of naira, diverting funds that could otherwise have supported the business.
Shoprite Nigeria’s recovery efforts follow changes in ownership and a prolonged period of pressure from rising operating costs and difficult trading conditions.
In June 2021, a consortium led by Persianas Investment Limited completed the acquisition of Shoprite Nigeria after South African retailer Shoprite Holdings decided to exit direct ownership of its Nigerian operations. The business subsequently operated through Retail Supermarkets Nigeria Limited under a franchise arrangement.
The retailer later shut some outlets, including its store at Novare Wuse Central Mall in Abuja, whose closure was reported in June 2024.
In March 2026, Shoprite told Nairametrics that it was not leaving Nigeria but was implementing a phased restructuring programme that began in August 2025.
Bunmi Adeleye, Chief Strategy Officer at Retail Supermarkets Nigeria Limited, had also disclosed plans to reopen outlets at The Palms Shopping Mall and Circle Mall in Lagos. The company was exploring smaller neighbourhood stores as a way to reduce expenses on rent, electricity and diesel.
Shoprite has yet to disclose how many neighbourhood outlets it intends to open, where they will be located or when the expansion will begin.
THE ISSUES
Shoprite’s experience highlights the financial pressures facing large retailers operating in Nigeria. Dollar-denominated leases expose businesses to higher costs when the naira weakens, while expensive infrastructure and technology requirements can limit the funds available for daily operations.
The company’s planned neighbourhood format could help reduce some property-related expenses, although its financial impact will depend on the locations selected, operating costs and customer demand.
WHAT’S BEING SAID
“We took a very, very drastic decision to just shut everything down whilst we negotiated with suppliers. Now three stores are back open,” Adekunle Adebiyi, Executive Director of Investments at MBO Capital Management Limited, said.
“We’re going to be opening standalone neighbourhood stores, which was always the plan,” Adekunle Adebiyi, Executive Director of Investments at MBO Capital Management Limited, said.
WHAT’S NEXT
Shoprite’s next steps include expanding its neighbourhood-store format and continuing its operational recovery. However, the company has not provided a timetable or disclosed the number and locations of the proposed outlets.
BOTTOM LINE
Shoprite Nigeria is seeking to rebuild its operations through smaller neighbourhood stores after financial and operational difficulties forced it to restructure. Its recovery will depend on managing rental and operating costs while restoring the financial and operational capacity needed to sustain its business.
