Dr Ariel Ngnitedem (PhD), Economic Scholar, expert in Public Finance, Senior lecturer at the University of Yaoundé II-SOA.
What accounts for the growth of supermarkets owned and run by Cameroonians?
Many factors account for the growth of these companies. First, the raising of the middle class in Cameroon made up mostly of young and well educated people who have either studied or lived in foreign countries across the world and decided to return home. This class of citizens is at both ends of these businesses. They are owners or managers or both, but also customers or suppliers or both for these companies. Second, the consumption habits are evolving due in part to social media and consequently the customer base of these companies is growing faster, pretty much at the same pace as the urban population of Cameroon. This trend is good news for Cameroon economy provided that focus is placed on the improvement of the share of locally manufactured goods and commodities on the shelves of these companies.
What is their impact on the economy?
They have gone a long way but still have more to achieve. They impact is mostly felt on the consumption of urban dwellers as they make it easier for the later to buy manufactured goods and commodities locally made or imported. By consuming these goods they contribute to the boost economic activities that in turn contribute to the improvement of the job market and investments through a ripple effect. More goods consumed mean more goods produced locally or imported which means more jobs, more custom revenues for the State, more fiscal revenues notably through the value added tax for the State coffers, more domestic investments and sometimes more foreign direct investments. Their impact on the economy will be even better if they were carrying more locally manufactured goods and commodities that will go a long way to create more domestic jobs indirectly. This will improve tremendously the day they will start selling agricultural products and groceries from domestic farms.
What advice would you give these companies to enable them stay in the market?
In order to compete and stay in the market in the long run, they should choose a strategy that is most in line with their core competency and the environment surrounding their commercial outlets. In order to compete effectively, a company may choose between one of the three strategies namely low prices, product differentiation or niche market. The choice of a strategy depends on targeted market. For instance the low prices strategy is suitable for highly populated areas with low purchasing power; whereas product differentiation will succeed in areas where a good number of customers is made up of elites- people with a high purchasing power who are able to pay for high quality goods. The niche market strategy could be more suitable for a culture or community oriented group of customers anyway customers who will be willing and able to pay for goods accustomed or specific to them.