Dima Nigeria Limited was the largest shopping mall in the city of Enugu in 2006/2007. They specialized in the sales of groceries and frozen foods. The company was known for carrying complete stock, high quality, and the choicest foreign brands. Unfortunately, the store had been running at a loss and had little or no profit at the end of the day. This record of losses has robbed the executives of a good night’s rest. They even considered closing shop permanently, it was that bad. In this analysis, I will be giving my two cents, by identifying what I consider the problems, how the problems should be solved, changes needed to combat these losses, and all these and more in no particular order.
First off, I believe they are running at a loss because of too many expenses, both direct and indirect expenses that can be cut off or avoided completely. Even though the executives thought up a very brilliant plan of introducing the frozen food line in 2006, with the hope that it would attract shoppers who would buy groceries too, trying to uphold this culture that Dima should keep its sales at a minimum, avoiding direct price competition and concentrating instead on specialty groceries of high quality (and in this case, foreign products), is limiting. I would rather they also include the regular local brands/products that everyone is familiar with, the most heavily advertised, national brands. This way, they save costs on publicity and advertisement since these companies already do these on their own. They need to include products like fresh produce, sugar, salt, flour, evaporated milk, and dry cereal because they are not only fast-moving consumer goods (FMCGs), but are also everyday essentials in a typical Nigerian home.
Not many people are familiar with foreign brands/products- even though they could be of better quality, most if not all of them will not be affordable because if you factor in the cost of shipping, clearing and every process it has to go through before it gets on the shelf, you would find that the regular person would not be able to comfortably afford to purchase it. Chances of the products staying on the shelves and expiring and being thrown away or being sold less than the cost price when near expiry, would also cause a huge strain on the business and a great loss. I would still advise if my opinion was sought that the executives of Dima include local brands and even go further and become wholesalers or distributors/partners with a lot of these already known local brands especially because they have capital at their disposal unlike the mini-stores around them. That way, there is almost no competition as their price will be subsidized and even attract these mini-stores to patronize them in full force, profit will also be made from their already existing delivery service because delivering bulk goods to stores, homes and even offices will attract a fee and that’s good for business.
I would not advise Dima Nigeria Limited to close shop. They just need to include local brands that everyone is familiar with to what they already have in existence, cut down on importation of these foreign brands, throw their weight on becoming major distributors of local brands that are cheaper and easier to source, concentrate on their frozen food business as well because it is great bait to attract customers, I would say add a bakery as well since white bread is a staple breakfast in most Nigerian homes but that would just be me giving my personal opinion, turn their delivery service into another line of business as well, save cost on travel, publicity, and adverts, invest in self-service options and lay off some members of staff.
Like I stated earlier, this is my two cents but I’m certain, if some or all of it is taken into consideration, Dima Nigeria Ltd will bounce back again.
Listen to yourself first