The Role of Retailing Business in the Development of Nigeria Economy
Objective of the study
The primary objectives of this study are to assess the role of the retailing business in the development of Nigeria’s economy, identify the challenges faced by the sector, and explore opportunities for its growth and positive impact on the economy. The specific objectives include:
- To examine the contribution of the retailing sector to Nigeria’s Gross Domestic Product (GDP) and its share in the overall economic growth over the past decade.
- To analyze the employment generated by the retailing industry and its impact on reducing unemployment rates in Nigeria.
- To assess the level of integration of formal and informal retail businesses in Nigeria and understand the implications of the informal sector on economic development.
REVIEWED OF RELATED LITERATURE
Available literature retailing businesses were reviewed from different scholars relating to this research area. For example, Ebitu, Basil and Ufot (2016) took a critical appraisal of the Micro, Small and Medium Enterprises (MSMEs) in Nigeria using employment strength and asset base criteria, the work revealed that SMEs contribute significantly to economic development in the provision of goods and services, creation of employment and contribute to a high standard of living The study also found some setbacks facing the over 17,284,671 Micro, Small and Medium Enterprises in Nigeria. These setbacks include; limited financing, lack of action plan to deal with eventualities, lack of managerial and marketing skill, and lack of research appreciation and technical expertise. Muneendra and Prakash (2016) carried out a study on the Consumer Buying Behaviour with Reference To Organised and Unorganised Retail Formats in Hyderabad using descriptive statistics and t-test statistics. Findings revealed that there is a significant difference in perception of consumer while choosing between Organized and Unorganized Outlet. Ramesh and Sethuraman (2016) examined Consumers buying behaviour towards organised retail stores in India- Literature Review. The study relied on secondary data from suitable literature. The study reveals that location and offers are the most important criteria to choose the outlet. The wide range of product attributes, ambience, fast billing process, customer service, parking facility, systematic display, attracts the consumers to buy from organized retail outlet. Ikon and Chukwu (2018) examined small and medium scale enterprises and industrial growth in Nigeria using secondary time series data covering the period 2002-2016, and regression analysis technique. Findings of the study revealed that manufacturing SMEs production has a statistical significant relationship with industrial growth in Nigeria. Chandrashekar (2016) carried out a Study on Organized Retail on Unorganized Retail Outlets in Mysore City using descriptive statistics. The study revealed that 31.2 percent of the consumers which are between the age group between 26 to 35 years visit to retail outlets for various reasons weather it may be organized or unorganized retail outlets. As consumers have wide range of choices most (54.6%) of the consumers prefer to go for both organize as well as unorganized retail formats according to need. Retail outlets are so connected, wither it may be organized or unorganized consumers like to prefer mostly nearest one until its necessary to travel long distance. All age group customers are shopping at organize retail outlets and majority (37.14%) of them belongs to high income group in the study area. All age groups of customers even prefer unorganized retail outlets but more numbers are between income groups between 30k to 40k in the study area. Out of 35 organized preferring customers, 34.29% Consumers like to prefer organized retail outlets for various reasons such as less price, Near to house, Everything at one place, Good offers, Faster process, Ambience and Self service. Out of 32 unorganized preferring customers, 34.78 % Consumers prefer unorganized retail outlets for various reasons such as Near to house, Long relationship, Home delivery, faster process, Credit, Small unit size. Out of 125 customers 81.6% of consumers showed excellent, very good and good responses towards Clean and organized environment, Availability of wide range of product, Employee attitude, Debit / Credit card acceptance and average, poor response towards Availability of required quantity of packed products, queue for payment, Toffee/ Candy on behalf of change in the study area. 35 consumers who prefer only organize, mostly shops vegetable on weekly bases, grocery, FMCG and oil on monthly bases, cloths/garments and utensils on monthly and requirement bases. 23 who prefer only unorganized, mostly shops vegetable on daily bases, grocery and oil on monthly bases, FMCG on weekly bases, cloths/garments and utensils on monthly and requirement bases. 67 consumers who prefer both organize and unorganized outlets showed good response towards verity, everything at place, offers and poor towards location, relationship, home delivery some toward price for organize retail outlets. 67 consumers who prefer both organize and unorganized outlets showed good response towards location, relationship, home delivery, faster process and poor towards range of verities, offers, ambiance towards unorganized retail outlets. Consumers are facing the problems of expiry date products, parking problems, knowledge of employee towards different brands, queue for billing. Unorganized retail outlets are facing problems such as consumer highly changing preference toward organized, infrastructure facilities, attractive offers and other services. Afolabi (2015) examined the effect of entrepreneurship on economy growth and development in Nigeria using narrative-textual case study (NTCS) method, simple percentages, graph and chart. The study found that Nigeria’s economy has continued to grow over the last decade- with the real GDP growth rate hovering around 7%. It also found that entrepreneurship can enhance economic growth and development primarily by generating employment and foster the growth of micro, small and medium enterprises in Nigeria. Chandramana (2015) carried out an empirical analysis on consumer attitude towards organized retailing and unorganized retailing in India. The study made use of descriptive statistics. Findings revealed both modern and traditional retailers are likely to co-exist in India for some more time to come, as both of them have their own set of competitive advantages. Modern retail offers product width and depth and a better shopping experience whereas the kirana shops have a low- cost structure, convenient location, and customer intimacy whereas. The study revealed that convenience of buy and proximity to the shop were major comparative advantages of organized outlets. However, unorganized retailers are having advantage because of their ability to sell loose items, bargaining and home delivery facilities and provision of credit. The organized retailers are having a greater advantage because of the store image, variety of product availability, and discounts and offers. It also revealed that there is no significant difference between the choices of retailers‟ formats across different age groups. Babu and Babu (2015) examined the changing consumer preferences from unorganized retailing towards organized retailing: A Study in Kanchipuram Town using descriptive statistics. Findings revealed that people who are below metric prefer to visit unorganized retail outlet whereas undergraduate and graduate feel the importance of both types of retail outlets but post graduated prefer to make their purchasing mostly from organized retail outlet due to factors listed in the table. There does not seem to be a significant relation between occupation and type of store visited as consumers prefer both for their shopping. The family size increases the preference for unorganized retail outlet also increases. In joint family system is still preferred and most of the day to day purchases are made by the elder members which have an inclination towards traditional shopping areas like Reliance and More for bulk purchase and Big bazar stores for petty household needs. However, nuclear families appear to prefer visit to organized retail outlets. Singh (2014) examined retail sector in India: present scenario, emerging opportunities and challenges using descriptive statistics findings revealed that the Indian retail sector is highly fragmented with more than ninety per cent of its business being run by the unorganized retailers like the traditional family run stores and corner stores. During 2005-07 and 2007- 10, the share of organized retail increased by 13.9 percent and 21.9 percent respectively. However thereafter organized retail is penetrating the market at a more rapid pace. During the period 2010-12 share of organized retail rose by 60 percent and is expected to increase by 2.6 times during 2012-15. Clothing/Apparel segment is the biggest contributor in organised retailing in India in both the years of study. In 2012 it alone accounted for 33 percent of organized retail followed by Food & Grocery and Mobile and telecom with each having 11 percent share in organized retail.
In this chapter, we described the research procedure for this study. A research methodology is a research process adopted or employed to systematically and scientifically present the results of a study to the research audience viz. a vis, the study beneficiaries.
Research designs are perceived to be an overall strategy adopted by the researcher whereby different components of the study are integrated in a logical manner to effectively address a research problem. In this study, the researcher employed the survey research design. This is due to the nature of the study whereby the opinion and views of people are sampled. According to Singleton & Straits, (2009), Survey research can use quantitative research strategies (e.g., using questionnaires with numerically rated items), qualitative research strategies (e.g., using open-ended questions), or both strategies (i.e., mixed methods). As it is often used to describe and explore human behaviour, surveys are therefore frequently used in social and psychological research.
POPULATION OF THE STUDY
According to Udoyen (2019), a study population is a group of elements or individuals as the case may be, who share similar characteristics. These similar features can include location, gender, age, sex or specific interest. The emphasis on study population is that it constitutes of individuals or elements that are homogeneous in description.
This study was carried to examine The role of retailing business in the development of Nigeria Economy. Selected SMEs in Uyo, Akwa Ibom state form the population of the study.
DATA PRESENTATION AND ANALYSIS
This chapter presents the analysis of data derived through the questionnaire and key informant interview administered on the respondents in the study area. The analysis and interpretation were derived from the findings of the study. The data analysis depicts the simple frequency and percentage of the respondents as well as interpretation of the information gathered. A total of eighty (80) questionnaires were administered to respondents of which only seventy-seven (77) were returned and validated. This was due to irregular, incomplete and inappropriate responses to some questionnaire. For this study a total of 77 was validated for the analysis.
SUMMARY, CONCLUSION AND RECOMMENDATION
It is important to ascertain that the objective of this study was to ascertain the role of retailing business in the development of Nigeria Economy. In the preceding chapter, the relevant data collected for this study were presented, critically analyzed and appropriate interpretation given. In this chapter, certain recommendations made which in the opinion of the researcher will be of benefits in addressing the role of retailing business in the development of Nigeria Economy
This study was on the role of retailing business in the development of Nigeria Economy. Three objectives were raised which included: To examine the contribution of the retailing sector to Nigeria’s Gross Domestic Product (GDP) and its share in the overall economic growth over the past decade, to analyze the employment generated by the retailing industry and its impact on reducing unemployment rates in Nigeria and to assess the level of integration of formal and informal retail businesses in Nigeria and understand the implications of the informal sector on economic development. A total of 77 responses were received and validated from the enrolled participants where all respondents were drawn from selected SMEs in Uyo, Akwa Ibom state. Hypothesis was tested using Chi-Square statistical tool (SPSS).
In conclusion, the study has illuminated the indispensable role of the retailing business in the development of Nigeria’s economy. It highlights the need for collaborative efforts from policymakers, industry stakeholders, and the private sector to harness the full potential of the retail sector in driving economic growth, job creation, and overall prosperity. By addressing challenges and capitalizing on opportunities, the retailing business can continue to be a catalyst for inclusive economic development, contributing significantly to Nigeria’s journey towards a more prosperous and resilient future.
Based on the findings of the study on the role of retailing business in the development of Nigeria’s economy, the following recommendations are proposed to further enhance the sector’s positive impact on economic growth and overall development:
- Support Informal Retail Sector Formalization: The government should implement policies and programs aimed at formalizing the informal retail sector. This can include providing incentives for registration, offering training and capacity-building initiatives, and creating awareness about the benefits of formalization.
- Enhance Infrastructure Development: Investing in infrastructure, particularly in transportation, logistics, and warehousing facilities, will improve the efficiency of the retail supply chain. This will reduce operational costs, enhance product availability, and strengthen the sector’s ability to support economic growth.
- Foster SME Growth and Innovation: To support small and medium-sized retailers, the government should provide access to affordable finance, technology, and training opportunities. Encouraging innovation and modernization within SMEs will improve their competitiveness and contribute to job creation and economic diversification.
- Facilitate Market Access: Encourage public-private partnerships to improve market access for producers and retailers, particularly in remote and underserved areas. This can be achieved through the development of distribution networks, cold storage facilities, and improved transportation links.
- Afolabi, A. (2015). The effect of entrepreneurship on economy growth and development in Nigeria. International Journal of Development and Economic Sustainability, 3(2), 49-65.
- Agbonifoh, B. A. (2009). The business enterprise in Nigeria. Lagos: Longman.
- Babu, K. C., & Babu, R. R., (2015). “Changing Consumer Preferences from Unorganized Retailing towards Organized Retailing: A Study in Kanchipuram Town”. International Journal of Advanced Scientific Research & Development (IJASRD),02(02/I),205–213.
- Chandramana, S. (2015). An empirical analysis on consumer attitude towards organized retailing and unorganized retailing in India. Paper presented at the International Conference on Paradigm Shifts in Management, Technology and Social Sciences on 17th January, 2015 at Indian Academicians and Researchers Association, Udaipur, Rajastan.
- Chandrashekar, H. M. (2016). A Study on Organized Retail on Unorganized Retail Outlets in Mysore City. International Journal of Research in Business Studies and Management, 3(4), 11-22.
- Ebitu, E. T., Basil, G. & Ufot, J. A. (2016). An appraisal of Nigeria’s Micro, Small and Medium Enterprises (MSMES): Growth, challenges and prospects. International Journal of Small Business and Entrepreneurship Research, 4(4), 1-15.