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Malls in Kenya
Rank: Veteran Joined: 4/16/2010 Posts: 906 Location: Nairobi
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from my experience, I think that malls in Kenya are shockingly poor in terms of generating business. When I went to Britain, the malls were constantly full of middle and upper class people shopping in stores like their lives depended on it! It struck me that THIS IS THE POINT with malls. However, back in Kenya, mall stores are deserted places and the halls of malls are full of youthful window shoppers who buy absolutely nothing! Only places that do good business in malls are supermarkets. Question now is, are malls suitable for business in Kenya, and by extension, 3rd world countries
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Rank: Member Joined: 9/2/2010 Posts: 563 Location: Embakasi
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The difference is that in developed countries even so called working/lower class people still earn more than some middle class people in Kenya. While at uni in the UK, I worked three nights a week for 5 hours as a bar supervisor and was earning the equivalent of 51,200/- a month. With that I could pay for my accommodation and still had money left for shopping and entertainment. If everyone was earning at least 30,000/- a month in Kenya, maybe malls would have more buyers and fewer window shoppers. Until then, our malls should have more low price shops. In a place where thought is abandoned, freedom can become a curse.
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Rank: Member Joined: 8/29/2008 Posts: 571
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What about the "Nyayo Market" mall or the "Gikomba" mall? That's where kenyans shop.The problem is that those are in the informal or underground economy sector...ripping KRA of coffers,say for implementing the constitution?However,one man's poison is another ones delicacy.Westlands mall are deserted because the shoppers are in Gikomba!
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Rank: Member Joined: 8/29/2008 Posts: 571
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What about the "Nyayo Market" mall or the "Gikomba" mall? That's where kenyans shop.The problem is that those are in the informal or underground economy sector...ripping KRA of coffers,say for implementing the constitution?However,one man's poison is another ones delicacy.Westlands mall is deserted because the shoppers are in Gikomba!
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Rank: Veteran Joined: 4/16/2010 Posts: 906 Location: Nairobi
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You're right, the barrier to entry is simply the buying power of Kenyans being too low for us to afford. However, bado watu wanalipa rent ya Westgate, Village Market na Sarit Centre without seeing much business. What do you think can be done to adjust the malls in Kenya to be the lucrative shopping destinations that they ought to be?
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Rank: Member Joined: 1/22/2011 Posts: 322 Location: Chicago, IL, USA
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How much does an interior-accessed mall shop at a large indoor shopping mall cost at say, Sarit Center? Here in the US a mall shop usually costs about two to three million Ksh per month, and they want long leases (7 year, 13 year) so it is out of reach for most businesses. They also usually want a percentage of the monthly earnings of the business, which I think is the worse thing ever. "Mini-malls", or "strip-malls", which are the smaller, outdoor variety are about 100,000 to 300,000 Ksh per month, but can grow to ten times that in say, New York City or in a posh area of LA or DC.
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Rank: Elder Joined: 9/23/2009 Posts: 8,083 Location: Enk are Nyirobi
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@alibaba.chief.of.the.forty.thieves since i discovered the eistleigh malls, i shop nowhere else for suits... Same suit that goes for 8k in town goes for 3k there. Life is short. Live passionately.
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Rank: Member Joined: 1/22/2011 Posts: 193 Location: nairobi
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The malls in Eastleigh are usually packed and i bet they make lots of profits judging by the number of customers.
Most of the stuff sold in the malls in town can also be bought in Eastleigh at half or a third of the price so you window shop in town then head to Eastleigh to buy.
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Rank: Veteran Joined: 5/24/2010 Posts: 846 Location: KENYA
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Rank: Veteran Joined: 5/7/2009 Posts: 1,032 Location: Sea of Transquility
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jasonhill wrote:How much does an interior-accessed mall shop at a large indoor shopping mall cost at say, Sarit Center? Here in the US a mall shop usually costs about two to three million Ksh per month, and they want long leases (7 year, 13 year) so it is out of reach for most businesses. They also usually want a percentage of the monthly earnings of the business, which I think is the worse thing ever. "Mini-malls", or "strip-malls", which are the smaller, outdoor variety are about 100,000 to 300,000 Ksh per month, but can grow to ten times that in say, New York City or in a posh area of LA or DC. In Nairobi CBD, price for premises vary depending on the street, age of the building thoroughfare and efficiency of the property management.Generally u will be looking @ Kshs 200 to 300 per square feet for ground floor shops/malls (bigger spaces will usually be discounted, on the other hand exibitions( I think what should be an equivalent to ur strip/mini malls) tends to be overpriced and prices approach or exceed Kshs.300 psf. The 'profit sharing' crap (which I think is uncouth) is also creeping in Nairobi in the form of good will. This is where the landlord asks new tenants to part with hefty sums say 10 M for a supermarket or 200 K for an exhibition, only that here the payment is one-off. “small step for man”
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Rank: Member Joined: 11/17/2009 Posts: 398 Location: Where everyone knows you
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@ALL.
I think the problem with the upmarket malls in Nairobi ( Junction, Village market, Sarit, Yaya, Wesstgate etc ) is that some tenants have not done their homework. In all these malls, the supermarkets, coffee shops like Java & Dormans do well. In most of these malls the food courts also do good business. The problem is with people who open shops in these malls to sell stuff that you can buy at half the price outside the malls.
By the way, in my experience, Malls in most countries that I frequently visit ( USA, UK, Europe, Far East )are always teaming with young people to hang out and meet / wait for their mates before they plan their next adventure.
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Rank: Member Joined: 1/22/2011 Posts: 322 Location: Chicago, IL, USA
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@Ceinz thanks for the info. Profit Sharing... lol. People don't understand- it's all the same worldwide. Everyone wants their cut. Corruption is everywhere. It seems to be one-off payments there, but here, it is constant. It's just dressed up and formal, but make no mistake, wheels must always be greased.
@MatataMingi - I don't know about in Kenya, but in the US, young people at malls = lots of theft. They usually don't have the money to buy anything except food from the food court, yet they cause trouble and steal, and then you have to pay Police to watch your stores... that's right... PAY POLICE. Here they say it's "off-shift work" or "special assignment", and it is ongoing. It can easily cost you 20,000 Ksh PER NIGHT. Same with a bash... pay police. And, if you have kids in your store, you need special slip-and-fall insurance coverage which can cost you a couple million Ksh a year. You usually have to be as big as Nakumatt or Tusky's here in the US, or your business will likely either fail or not make any real money - barriers to entry are too high. Big Corporate has all but crushed the "little guy" and banks and their usury are killing the "middle guy". That's why I'm looking forward to doing business in Kenya.
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