Shopsmart

1. Which market should Shopsmart enter? Use a SWOT analysis to compare India and Nigeria and to justify the market choice which Shopsmart, in your opinion, should select.

It is a little hard to make a decision. Based on my analysis, I prefer to choose India.

First, it is the strength. For Nigeria, Shopsmart has the successful experience in African. So, it is relatively easy for them to get success. For India, A large young working population with median age of 25 years, nuclear families in urban areas, along with increasing working women population and emerging opportunities in the service sector are going to be the key growth drivers of the organized retail sector in India. Also, Customers will have access to greater variety of international quality branded goods. Employment opportunities both direct and indirect have been increased. Farmers get better prices for their products through improvement of value added food chain. Increase in disposal income and customer aspirations are important factors; increase too in expenditure for luxury items. It has also contributed to large scale investments in the real estate sector. India has large domestic market with an increasing middle class and potential customers with purchasing power. The consumer gets a better product at cheaper price, so consumers get value for their money. Based the strength, I will choose India.

Second, it is weakness. For India, Will mainly cater to high-end consumers placed in metros and will not deliver mass consumption goods for customers in villages and small towns. Retail chain are yet to settled down with proper merchandise mix for the mall outlets. Small size outlets are also one of the weaknesses in the Indian retailing, 96% of the outlets are lesser than 500 sq. ft. The rapid development of retail sector is the sharp improvement in the availability of retail space. But the current rally in property prices, retail real estate rentals have increased remarkably, which may render a few retailing business houses unavailable> Retail companies have to pay high rentals which are blockage in the turn of profits. The volume of sales in Indian retailing is also very low. For Nigeria, middle class people are many. However, shopsmart can not just focus on this group of people. Compared with India, the market does not have different levels enough.

Third, it is opportunities. For India, Once the concept picks up, due to demonstration effect, there will be an overall up-gradation of domestic retail trade. Global retail giant take India as key market. It's rated fifth most attractive retail market. The organized retail sector is expected to grow stronger than GDP growth in the next five years driven by changing lifestyle, increase in income and favorable demographic outline. Food and apparel retailing are key drivers of growth .It can become one of the largest industries in terms of numbers of employees and establishments. Rural retailing is still unexploited Indian market. For Nigeria, the high oil prices in recent years have boosted the Nigeria economy and GDP growth, which in turn, heightened consumer confidence and no-essential spending on food items. Also, Nigeria’s dynamic economic growth coupled with its large population will stimulate demand for the opening of new grocery outlets across the country. On the other hand, depending on  Shopsmart focusing on middle class, the retailer is easy to take advantage of the opportunities in Nigeria. The firm’s proven record of hard work to establish its brand, to build solid customer loyalty and to extend store numbers appears to be a good fit for Nigerian markets. The retail food sector in Nigeria has been described as fragmented and underserved. Supermarkets only command about 2 percent share of total food sales, while traditional wet markets and small convenient stores.