South Africa retailer Shoprite will fully end Kenya's expansion barely two years after it launched operations.
The exit, Shoprite said, was a result of underperformance of its retail stores in the country, noting it will close or dispose of its two remaining stores before December.
Shoprite which is retreating in countries outside South Africa has been closing some stores in Kenya, citing a reduction in shoppers.
"Most likely we will be out Kenya by the end of the year, meaning December, either by closing or disposing," said Shoprite CEO Pieter Englebrecht
"Kenya, with three stores at the year-end, has continued to underperform relative to our return requirements. Post year end, one store has been closed given the ensuing encomic impact of Covid-19,'' Shoprite ECO added.
A month later, the supermarket chain announced it would lay off 115 workers and close its second branch at City Mall in Nyali, Mombasa, citing reduced flow of shoppers.
The South African retailer is now left with two stores in Nairobi at Garden City and Westgate malls which it plans to be close, exiting the Kenyan market.
Shoprite, with more than 2,300 stores across Africa, reported a 6.4 percent rise in sales for the year ended June 28, with like-for-like sales up by 4.4 percent as customers spent more on groceries at its discount Usave and mid-to-upper end Checkers stores.
Shoprite's will exit from Kenya comes amid increased competition from retailers such as Naivias, Quickmarket, and carrefour in a sector where local retailers such as Tuckys are struggling with low sales and mounting debts.