Did You Know? Nigeria’s ₦250 Billion Fast Food Industry

A couple of decades ago, Nigerians had only a handful of fast food chains to have their outings at. Perhaps we weren’t as keen on french fries and spicy oriental dishes as we are today, but it was probably also because potential investors didn’t think the market was big enough to prop up more than a couple hundred snack and ice cream joints.

Whatever the reason for the initial slow growth in the sector was, it’s clear that we have sped past that era. Today, there are numerous local fast food stores and quick service restaurants on the major streets of our towns and cities, with more springing up every other fortnight. And they’re doing battle with an incoming wave of foreign brands which appear to have spotted a new landscape teeming with willing consumers in a country they barely glanced at in the past.

In 2016, the Association of Fast Food and Confectionery of Nigeria (AFFCON) estimated that Nigeria’s fast food industry was worth ₦250 billion. That amounted to a quarter of the country’s food sector, which was valued at over ₦1 trillion. Analysts are quick to point out how these figures are evidence of the tremendous growth that’s taken place in the industry. Interestingly, these figures were from a period of recession, in which the economy was supposed to be struggling. It’s safe to assume that the fast food industry has since taken strides (even if limited) beyond that point.

An Enthusiastic Consumer Class

At the turn of the century, Nigeria was in difficult straits. Average incomes had begun to plunge more than a decade before, following a collapse in oil prices and a biting economic adjustment plan. But the early 2000s were the beginnings of an upward swing in the country’s commercial fortunes. The economic recovery that followed helped put more money in people’s hands. There was more cash to spend.

The optimistic air of those times fanned the flames of a new entrepreneurial epoch. The small businesses which started off in the 1990s grew into formidable companies, and the fairly sizable ones became giants. Fast food brands partook in this resurgence. New local favourites such as Tantalizers and Tasty Fried Chicken rose to challenge the dominance of the already established Mr Biggs.

The growing number of shopping malls in the major cities has helped fast food outlets with the exact sort of environments in which they could thrive. Shoppers, tempted by the shiny display cases, the neat contemporary layouts and an implicit demand on them to splash their cash, are more open to buying pricey dishes. It’s no surprise that the newer quick service franchises and snacking points have set up shop in these large temples of consumerism.

Hickups of A Swinging Industry

For all its thriving, Nigeria’s fast food industry still faces considerable challenges. It suffered a hit in the economic downturn of 2016; several chains closed down outlets in locations across the country, and many smaller restaurants went out of business. The industry has since recovered, but its players are treading the landscape with greater caution.

It’s also possible that a more health-conscious public could begin to cut back on its visits to fast food restaurants. We haven’t seen any significant signs of this in Nigeria thus far (and not in much of the world either), but it’s always possible that the tide could turn in this direction over time. The widely believed connection between so-called fast foods and such modern pandemics as obesity and cardiovascular troubles could well weigh more heavily on consumers’ minds as our society gets more concerned with relatively modern personal health issues.

In 2014, the Oxford Business Group reported that fast food businesses employed half a million people nationwide. We can hazard a guess that a greater fraction of them are young (below 35). It’s also true that a significant proportion of consumers belong to this demographic group. Given these facts, it’s not hard to see that the future of the business is heavily dependent on how this section of the country’s population fares in the coming years and decades. Unless there’s a rise in average incomes for this age bracket, we may well witness a gradual slowdown in the sector’s growth.

In the end, a growing love for fast food in our corner of the world could do more than keep the industry alive. But it’s up to the consumer to strike a balance between the enticements of its shiny outlets and mouth-watering treats, and staying fit and healthy.

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ikenna-nwachukwu

Ikenna Nwachukwu holds a bachelor's degree in Economics from the University of Nigeria, Nsukka. He loves to look at the world through multiple lenses- economic, political, religious and philosophical- and to write about what he observes in a witty, yet reflective style.

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