Former President Olusegun Obasanjo, leaders of the Manufacturers Association of Nigeria (MAN), Timothy Olawale, the Nigeria Employers’ Consultative Association (NECA), and the Nigerian Association of Small and Medium Enterprises (NASME) met in Lagos Monday to relaunch the Retail Council of Nigeria (RCN) and pledge their support towards the attainment of its laudable objectives.
The RCN was first set up in 2011 to formalise the retail market with the goal to attract new investments, boost economic growth, create jobs and improve government revenue.
The private sector leaders met in Lagos to reflect on the potential of the retail sector in fostering inclusive economic growth at a time when the Nigerian economy has not grown in per capita terms since 2015.
Others who joined the former head of state at the meeting included Taiwo Adeniyi, president of NECA and head of the organised private sector, Timothy Olawale, DG of NECA, as well as Degun Agboade, president of NASME, Ayoola Olukanni, DG, Nigerian Association of Chambers of Commerce and the DG of MAN, as well as Chidi Okoro, former CEO of GSK, and Kemi Pinheiro, a senior advocate.
In his presentation, Haresh Keswani, CEO of Artee Group and a member of the RCN, talked about the benefits of creating an enabling environment for retailers in the country to thrive.
Keswani also highlighted how the success of the retail sector was in the interest of just about every other sector, from agriculture to real estate and especially manufacturing.
More importantly, Keswani talked about how the sector could provide relevant data that could help attract investment and create jobs in a country where unemployment was the second highest globally.
“Modern retail is your last mile that connects you with the consumer and provides context to understand consumer behaviour.
“Formal retail can provide information on consumption patterns to enable planning, investment and new product launches in manufacturing sector,” Keswani said.
The retail sector has however faced a number of challenges in recent times -from the disruption of supply chains to harsh government policies and unattractive labour laws that are stifling profitability.
Two-time Nigerian President Obasanjo, who led proceedings at the meeting, said the challenges the sector faced could be resolved through better collaboration between the government and the private sector.
“There’s the need for engagement and collaboration with the government especially the ministry of trade, investment and industry to understand the potential of the retail industry and how it can contribute to economic growth and increase revenue for government,” Obasanjo said.
Obasanjo called for a relaunch of the Council, this time with the need to engage more with the government in mind.
“There should be a platform that brings various actors together and ensure that the presentations that have been made here also get to those in government,” Obasanjo said.
The contribution of the retail market to the Gross Domestic Product (GDP) is expected to increase, with the relaunch of the Retail Council of Nigeria.
In developed economies, the composition of organised retail is much larger than the unorganised. Therefore, it would be safe to presume that economic growth has a direct correlation to increase in organised retail in Nigeria, where 80 percent of the volume of good sold by organised retail is manufactured in the country.
The RCN seeks to make the retail business more organised in line with global best practices – making the marketplace organised.
Asides promoting modern retailing in Nigeria, the RCN also wants to provide a platform for networking and disseminating useful information and knowledge to members and the public.
It will also create a database of members and encourage members to adopt the right values, imbibe international best practices, wholesome practices, and good corporate governance in the conduct of their business.
According to the promoters of the Council, the banks are not left out in all of these, they are also interested in supporting the retail business, but they cannot do so if it is not organised.
There are Nigerian banks that are excited to be part of this movement. Such banks have promised to also encourage their customers to become members of the council and have their businesses organised.
The initiators of the council are legacy minded people who are ready to show their knowledge to the young and upcoming.
Retail market is not about shops only, but every company that has relationship with consumers, including banks, telecommunications, manufacturing, tourism and consultancy firms.
The boom in the retail market would give an impetus to the Information Technology (IT) industry, tourism and banking.
Globally, retail employs 17.1 percent of the workable population and in the United States, it accounts for 14 percent.
Organised retailing supports the development of various sectors and assists to conserve foreign exchange.
In Nigeria, it would increase the revenue base for the government, ensure compliance with international standards, and generate employment.
In the past, governments at the Federal and states levels had challenges collecting taxes from the unorganised retail market, but with the organised retail market this would not be a problem.
According to Solomon Onafowokan, president of trustees of the RCN, the body has the target to formulate, facilitate and propagate practices and processes in line with international best practices. This, he believes, would lead to increased consumption, a boost in production, employment generation, and, ultimately, the growth of the economy.
In Japan and India, the organised retail market contributes about 66 per cent and 10 per cent to economic growth but Nigeria receives only three per cent due to unorganised retail market.