The impact of shopping centre development on informal and small businesses in Lagos, Nigeria

Abstract

Purpose of the research: This study investigated the impact of formal shopping centre development on informal and small businesses in Lagos, Nigeria. Methodology: Semi-structured interviews with the business owners as well as shoppers were conducted. The population size included 15 informal and 15 small business equally distributed between five different shopping areas including the areas around the two major shopping centres in Lagos. Interviews were also done with a hundred shoppers around these two centres. The collected data were analysed using content analysis method. Findings: Most of the informal and small businesses are struggling to survive. Different strategies have, however, been developed for competing against the giant retailers in the shopping malls. The different types of goods sold in shopping centres and in informal traders were characterised and the reasons for the support of these respective businesses were identified. Practical implications and Conclusions: While the development of shopping centres may be of benefit to the community it serves, the valuable role of informal trading in developing countries should not be ignored. Introduction Prior to 2005, there were only a handful of shopping centres in Nigeria, all smaller than 3048m 2 (10,000 ft 2). In 2019 Nigeria boasted of more than 18 shopping centres larger than 3048m 2 (10,000 ft 2). This development has changed the landscape of several cities in Nigeria. The retail market in Nigeria is gradually moving towards a more formal and organised arrangement. The development of formal shopping centres in Nigeria had a major impact on existing small and informal businesses. The informal business is a popular part of the Nigerian economy and is thoroughly embedded in the trading and retailing activities of the Nigerian economy. Most of the Nigerian cities are characterised by these informal businesses and trading activities. The informal markets and small businesses are very lucrative in Nigeria and this has contributed socially and economically to the livelihood of those that are involved in it. The objectives of this research were to determine the effect of formal shopping centre development on informal and small businesses in Nigeria. This was done by, firstly, investigating how formal retailing has affected the income and livelihood of informal and small businesses in the areas where shopping centres had been developed and, secondly, how the informal and small businesses responded to the pressure being exerted by the big retailers.