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Uchumi plans several branches in Rwanda

Friday October 18 2013
uchumi

Shoppers at Uchumi Supermarkets in Nairobi. The retail chain plans to open branches in Rwanda. Photo/FILE

Uchumi Supermarkets is expected to open at least three branches in Kigali and upcountry towns as the Kenyan retail chain seeks to consolidate its position in the region.

This will be the second regional supermarket to open shop in Rwanda after Nakumatt (also from Kenya), which has two branches — one at Union Trade Centre and another at the Kigali City Tower.

READ: Kenya biggest EAC investor in Rwanda

Uchumi has entered the Rwandan market in the wake of growing competition following a proliferation of supermarkets in Kigali’s central business district and its suburbs.

The retail chain is expected to face stiff competition from Nakumatt, the first Kenyan retail chain to open shop in Rwanda; Simba which is owned by a local investor and the Chinese T-2000 supermarkets.

Major supermarkets in the market are all concentrated in the central business district within a radius of 300 metres and stock similar items.

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Uchumi is expected to open a branch in Musanze, a strategic town thriving on proceeds from gorilla tracking tourism.

The second branch is likely to be at Muhanga, a town located at intersections of roads to the southern, western regions and Kigali, which makes the area attractive for the supermarket.

Uchumi chief executive officer Jonathan Ciano said venturing into upcountry towns is partly informed by government’s development strategy of decongesting the city by encouraging developments of rural areas.

Dr Ciano said good infrastructure upcountry and a growing purchasing power of rural populations supports opening of a branch in Musanze town in the north and Muhanga town in the south. He said the supermarket intends to tap into opportunities brought about by improved incomes in rural areas.

While Dr Ciano did not reveal details of the cost involved in the planned investment, he said the Uchumi board had been encouraged by potential in the Rwandan market.

He added that the board was keen to see the emergence of regional institutions that would support East African economic integration.

“As our drive towards regional growth gains momentum, so has our desire to make Uchumi shares accessible to more stakeholders across the region,” said Dr Ciano.

“It is, therefore, timely and ideal that as we plan to set up Uchumi branches in this market; that we also empower investors here to stake a claim on the ownership of Uchumi.”

READ: Uchumi Supermarkets becomes third to cross-list on Kigali bourse

A piece of Uchumi

“All our East African citizens should be proud of owning a piece of the supermarkets.” Kelvin Odoobo, a Ugandan working in Kigali who had also lived in Nairobi where the supermarket started its operations is optimistic that Uchumi has entered the Rwandan market stronger, thanks to sound capitalisation after posting profits for the past five consecutive years and good corporate governance.