Shoprite Nigeria to Open Smaller Neighbourhood Stores in Recovery Push After Shutdown

Shoprite Nigeria plans to open smaller standalone neighbourhood supermarkets to cut operating costs and rebuild the business after a temporary shutdown, an investor in the retailer has said. Three outlets have already reopened following that shutdown, which the company used to negotiate with suppliers and settle outstanding obligations.

Adekunle Adebiyi, Executive Director of Investments at MBO Capital Management Limited, disclosed the plan during an interview on Nairametrics' Drinks and Mics on Friday, October 23, 2026.

Why the stores closed

"We took a very, very drastic decision to just shut everything down whilst we negotiated with suppliers. Now three stores are back open," Adebiyi said.

The retailer traced its financial difficulties to rising dollar-denominated rents, financing challenges and the costly replacement of its technology platform. Adebiyi said about 17 of the chain's 28 outlets had rental agreements priced in dollars when MBO Capital acquired the business. The naira's depreciation then pushed those rents sharply higher.

He said rent should normally take between 8% and 10% of a supermarket's revenue, but some Shoprite locations were carrying significantly higher costs.

Inventory management problems added to the pressure, as did the loss of access to the enterprise resource planning system that the former parent company had provided. Replacing that platform required billions of naira in fresh investment, money that could have gone into other parts of the business.

The neighbourhood store plan

Adebiyi said the shift to standalone neighbourhood stores was always part of the plan and is now the main route to expansion. The format avoids heavy dependence on large shopping malls and is expected to lower operating expenses.

It also lets the company concentrate its capital on supermarket operations rather than property development. Supermarkets typically rent their premises and invest in equipment such as shelves and refrigeration systems.

That asset-light model, however, makes bank borrowing hard in Nigeria. Adebiyi said lenders usually demand tangible assets as collateral, and MBO Capital struggled to finance the Shoprite Nigeria acquisition because the business lacked enough physical assets to meet conventional lending requirements, even though it was generating billions of naira in revenue.

Shoprite has not said how many neighbourhood outlets it plans to open, where they will be located or when the expansion will start.

Ownership and restructuring history

The recovery effort follows years of tough trading and a change of ownership. In June 2021, a consortium led by Persianas Investment Limited acquired the Nigerian business after South Africa's Shoprite Holdings decided to exit direct ownership. Operations continued under Retail Supermarkets Nigeria Limited through a franchise arrangement.

In March 2026, Shoprite told Nairametrics it was not leaving Nigeria but was running a phased restructuring programme that began in August 2025. The company also said it would reopen outlets at The Palms Shopping Mall and Circle Mall in Lagos while testing smaller store formats to reduce rent, electricity and diesel costs.

For Nigerian shoppers, the smaller format could mean shorter trips and stores closer to home. For the business, it is a bet that lower rent and lighter assets will make the numbers work where large mall outlets have not.