Retail investment trends in sub-Saharan Africa.
In 2010, Nestle announced a 161-million-dollar investment to build three new factories and 13 distribution facilities in sub-Saharan Africa (SSA) as part of plans to capitalise on the continent's rising 'middle class'. Five years later, Nestle has announced that it plans to scale down operations in its equatorial Africa region, covering 21 countries. Nestle's change of strategy is a sign that while macroeconomic indicators look promising, foreign firms may struggle to capitalise on investments.
Nestle is one of several large foreign retailers to have scaled down operations, including Coca-Cola, Cadbury and Eveready.
Demand for local retailers will grow as consumer tastes diversify and income levels restrict access to imported products or brand names.
Food and alcoholic beverages are likely to show the strongest growth out of all retail sectors.
