McDonald’s Nigeria: Expansion into African Market
From Roswell to Guantanamo Bay, wherever you are in the world, the famous Golden Arches are often not far away. McDonald’s Africa, however, is not yet fully established.
There are 36,899 McDonald’s worldwide, spread across 120 countries. When you map out where McDonald’s are notHowever, it shows that there is one continent where the Big Mac is missing: Africa.
The biggest obstacle holding McDonald’s back from Nigeria is a lack of adequate supply chains. Geographically, Nigeria is too far from South Africa, Egypt or Morocco to simply extend existing supply chains.
Countries where there are no McDonald’s locations yet are marked in red here.
Although Africa is home to more than 1.2 billion people, McDonald’s is only present in four African countries: Morocco, Egypt, South Africa and Mauritius.
Combined, these markets contain a meager 387 McDonald’s. To give a better perspective, there are 393 McDonald’s locations in Mexico alone.
As key Western markets continue to stagnate, fast food companies should turn their attention to Africa’s largely unsaturated markets, and where better than in economic powerhouse Nigeria.
In 2015, McDonald’s South Africa CEO Greg Solomon claimed that “it wasn’t a matter of if, but when” the brand would enter Nigeria. Since then, news on the subject has virtually dried up.
According to a recent report by PwC, more than half of the world’s population growth between now and 2050 will occur in Africa. Nigeria’s population alone is expected to reach 400 million people by 2050, making it the third-largest country in the world.
Economically too, the Nigerian market is becoming increasingly attractive for fast food chains.
According to a recent survey by GlobalData, Nigeria’s GDP per capita increased from $379.12 at the turn of the century to $2,177.99 in 2016, while 46 percent of people in Nigeria report that their disposable income is increasing.
The World Bank’s 2018 Ease of Doing Business Index also saw the country rise to 145th place, up from 169th place in 2017.
McDonald’s — being an American brand — would likely be viewed positively compared to domestic fast food chains. Research by GlobalData found that 48 percent of Nigerian consumers associate the US with high-quality food and drink, higher than both Europe (34 percent) and Nigeria itself (30 percent).
“Are Africa and Nigeria Finally Ready for McDonald’s?” was originally created and published by Pronunciationa brand of GlobalData.
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