Deacons is targeting a revenue raise of Sh6 billion in the next four years by opening shops in large towns outside Nairobi. The fashion retail chain is targeting middle class Kenyans and other clients across East Africa.
Currently, the retailers have one outlet outside of Nairobi — the Mr. Price shop at Nyali Plaza in Mombasa.
According to Business Daily, The retailer has set a target to have 60 outlets across East Africa by 2020 from the 38 it operates currently in order to hit the revenue target, with the chief executive officer Muchiri Wahome saying they will look to open four or five new stores per year.
“We have only got one store in Mombasa, we think that city can take two more brands or branches,” said Mr. Wahome.
“There is also opportunity within the other bigger county headquarters that are showing aggressive commercial interest both from a property development and consumerisation perspective, such as Kisumu, Nakuru, Eldoret, Meru, and Kisii. We are in negotiations with various parties in these towns.”
Deacons has three stores in Uganda and two in Rwanda and their new malls will be targeting new malls in urban centres for its branches, which include Mr. Price, Mr. Price Home, Truworths, Adidas, Angelo, 4u2, Identity and Bossini.
The expansion is to be financed mainly through debt, which as a result of the 2015 expansion had ballooned to Sh655 million at the end of the year. It has paid down the debt this year cutting it to Sh300 million.
Deacons stocks contemporary international fashion brands of male and female clothes, footwear and accessories, home textiles, kitchenware, sports apparel, fitness equipment and baby products.
Last year, rising sales in new outlets helped Deacons record revenue of Sh2.83 billion in 2015, which resulted in a net profit increase of 73 per cent to Sh100.5 million compared to Sh58 million in 2014.