The combination of a buoyant economy and demographic shifts such as rapid population growth and rising urbanisation levels are driving new trends in the Ghanaian retail sector. International brands and mall developers are becoming increasingly present, and the scope for the expansion of modern retail is considerable, following a decade where GDP grew by between 2% and 14% in any given year.

Macro Upside

The retail market tends to be closely linked to a country’s overall macroeconomic performance, particularly GDP growth and changes in citizens’ spending power, but also inflation, which erodes real incomes when too high. Following a slowdown in the middle of the decade, GDP growth has recovered strongly, and Ghana is once again one of the fastest-growing economies in the world.

The economy clocked an expansion of 8.5% in 2017 and 6.2% in 2018, driven in part by recovering global oil prices, according to the African Development Bank (AfDB). Inflation, meanwhile, came back into single-digit territory in 2018, recording 9.8%, following a worrying spike between 2013 and 2017 that saw a high of 19%. Private consumption thus grew strongly in 2018, reflecting the positive overall environment. The AfDB expects GDP growth to rise in 2019 to 7.3%, before moderating to 5.4% in 2020, in line with expected oil production.

The administration of President Nana Akufo-Addo, who took office in January 2017, has implemented a tough policy of fiscal consolidation, partly under the guidance of the IMF. While this has led to a squeeze on some sectors, particularly those linked to public spending, it has also enhanced Ghana’s macroeconomic stability and helped to rein in inflation. At the same time, accelerated industrialisation has strengthened private sector growth and job creation, and this in turn has supported the retail environment.

The economy faces some constraints, however, including its dependence on volatile commodity prices and the high proportion of the workforce in agricultural jobs with varying incomes from month to month. Furthermore, government finances are still weighed down by external debt and the fiscal deficit, and there are concerns about the outlook after the IMF’s deal expires in spring of 2019. Nonetheless, retailers see the convergence of economic vibrancy with demographic change as likely to power retail and wider economic growth in the medium to long term.

Confidence & Spending

Consumer confidence tends to lag behind macroeconomic indicators, as it takes time for GDP growth to feed through to real incomes, and for cautious consumers to be sure that tougher financial times are over. This explains why some retailers found that Ghana’s strong economic performance in 2017 and early 2018 did not necessarily lead to lively growth in sales during that period. However, by the end of 2018 the signs of retail recovery were clearer. The consumer confidence index complied by the Bank of Ghana (BoG) rose by six percentage points in the last quarter of the year to 98.3. The index reflects households’ sentiment and their outlook for the months ahead, and has been matched by a rise in business confidence. While consumer confidence was actually marginally lower than in the last quarter of 2017 – due to a considerable dip in the first half of 2018 – BoG governor Ernest Addison said in January 2019 that inflation was well contained, suggesting a positive outlook for consumption.

“We are seeing purchasing patterns begin to change in Ghana. The expansion of supermarkets and shopping malls represents the growing value of retail space, and indicates an advancing middle class with increased discretionary spending power,” Richard Adjei, managing director of beverage company Kasapreko, told OBG. “That being said, we are also seeing growth from the informal retail sector, which often manifests itself as street-side trading.”

Not to be overlooked is the contribution of tourist spending. Ghana is now regularly attracting more than 1m tourists every year, with officials targeting 1.5m arrivals for 2018. Visitors for both leisure and business tend to be relatively affluent. “Tourism plays a fairly large part in the retail sector, as do expatriates,” Olympio Agbodza, general manager of Accra Mall, told OBG. “They are happy to spend.”

Marketing Factors

Market research company Nielsen ranks Ghana fourth out of eight countries in its “Africa’s Prospects: Macro, Business, Consumer and Retail Indicators” report for the second quarter of 2018. This is down from second place in the previous edition from the fourth quarter of 2017. Ghana is one of the African economies surveyed by the company in which retailers saw an increasing willingness by consumers to spend in store between 2014 and 2018, however, “despite easing inflationary pressures, Ghanaians are least open to trying new alternatives, with purchasing decisions rooted in familiarity, trust, availability and affordability.” When looking at a common basket of food items across African countries, Ghanaians spend the third-highest amount, at an average of $18. The report also lists the top-three priorities of business owners in 17 African markets. For Ghana, these are tracking consumer demand, coordinating distribution and routes to market, and marketing and media.

According to a country snapshot of Ghana published by Nielsen in 2014, packaged consumer goods accounted for 41% of citizens’ monthly household expenses, and were chiefly purchased through traditional channels such as market stalls and roadside kiosks. Basing its figures on local surveys, Nielsen found that only 11% of respondents used supermarkets and hypermarkets as their primary channel for grocery shopping. Nielsen says that more than twofifths of Ghanaians (44%) belong to demographic groups that are driving consumption of discretionary goods, including packaged fruit juices, processed dairy products and non-alcoholic beverages. The factors of affordability and trust have prevailed in recent years, as these were again noted as the two most important criteria for Ghanaian consumers when choosing products to purchase, with the market tending to lean towards well-advertised brands, promotions and attractively packaged goods.

Growing Dynamism

Macroeconomic, demographic and cultural factors mean there is considerable scope for the development of modern retailing and the growth of a broader range of consumer goods in Ghana, despite the current comfort of product and outlet familiarity. Significant segments of the population do not regularly use modern retail channels, including less-affluent people of all ages, more conservative segments of society and people without families. However, the growth of the economy and rising urbanisation are changing this fairly rapidly.

In order to reach a large swath of Ghanaian society, Nielsen suggests that retailers and consumer brands entering the market should invest in advertising and media coverage, due both to the brand-consciousness of consumers who like products they know and regularly see, and the high level of media consumption in Ghana, which exceeds that of most of its neighbouring countries.

Mall Retail 

As seen in many other emerging markets, mall space in Ghana has proliferated from a near-zero base over the past decade. As well as increasing consumer spending power, social and cultural factors have supported this development. Malls offer desirable products in a clean and attractive environment, and often host leisure facilities that are either lacking or not found in one place elsewhere, acting as a meeting and relaxing spot for young adults and families.

The country’s first mall, Accra Mall, opened in 2008 and has 20,000 sq metres of retail space. It remains a popular facility with low vacancy rates, thanks to its marketing and branding efforts, location and ongoing upgrades. The South African retailers Shoprite and Game are the two anchor tenants. The mall was renovated in 2016 and brought in new food brands including Pizza Hut and Le Must, a family restaurant.

Accra Mall was joined in 2014 by the $94m West Hills Mall with 27,000 sq metres of space, making it the biggest mall in West Africa, according to international real estate company JLL, at 4000 sq metres larger than Lagos’ Ikeja City Mall. Other significant shopping centres include RMB Westport’s Junction Mall in the Nungua suburb of the capital, with 11,600 sq metres; AttAfrica’s Achimota Retail Centre, with 14,500 sq metres in the north of the city; and the Marina Mall near Kotoka International Airport, offering 9000 sq metres of gross leasable area (GLA). JLL estimates that overall Accra had 200,000-230,000 sq metres of investment-grade mall space as of late 2018, with rents at $400-600 per sq metre per year.

Mall retail has recently spread beyond Accra to Ghana’s burgeoning regional capitals. Takoradi Mall opened in December 2018, bringing nearly 20,000 sq metres of GLA to the port city, which is also the centre of the country’s oil and gas industry. The $95m Kumasi City Mall opened in April 2017, and it hosts 74 shops and GLA of 18,000 sq metres.

Brand Offerings

Supermarket chain Shoprite has become a primary anchor tenant in Ghanaian malls, and many other South African brands are found in various stores, alongside international labels and a number of local names. In Accra Mall, for example, the anchor tenants and other South African and international retailers hold around 60% of the GLA, with the remaining 40% secured by local retailers, Agbodza told OBG.

There has been a shift away from franchise models in recent years, which was in part due to the difficulties that international brands have faced with local franchisees that cannot always achieve the cash flow and capital raising needed to sustain financially intensive branded businesses. Small franchisees have also found it more difficult to absorb currency shocks, as many goods are imported and mall rents tend to be paid in dollars, while earnings are in cedis. The Ghanaian currency’s depreciation over the past decade has thus put a strain on local retailers of international brands.

Performance Indicators

In general, popular and well-established malls enjoy high occupancy rates of nearly 100%. However, following a wave of openings coinciding with Ghana’s economic slowdown in the middle of the decade, newer malls have seen vacancy rates of 20-25%, according to JLL. For older malls that are not as well maintained, this can rise to 50%. High vacancy rates have seen some mall owners improve terms for tenants, such as accepting shorter advance payment periods. Nonetheless, analysts see a steady outlook for the sector due to the improving economic environment, even with a further 30,000-40,000 sq metres of stock in the pipeline. Agbodza sees particular potential for smaller-scale community malls, which have become popular in the urban areas of other emerging markets. While standalone modern retail outlets have been eclipsed by malls, they still attract significant business, particularly from lower-income groups. “There is still a lot of international interest in Ghana, with a number of proposed retail developments coming up,” Joseph Amo-Mensah, CEO of real estate company Broll Ghana, which manages several malls, told OBG.


Amo-Mensah does warn, however, of a squeeze on the formal retail sector from the 3% value-added tax flat rate scheme that was introduced on July 1, 2017. While this was designed to simplify the tax system, a range of industry associations warned that as the tax is paid at every stage of the value chain, it would lead to prices for end consumers rising by between 6% and 15%. This could lead to shoppers migrating back to the informal sector, where taxes are more commonly avoided. Sector players hope the government will take into account their concerns and ease the burden in the medium term as its fiscal consolidation efforts are relaxed.


While its development in Ghana was held back for some time by relatively low internet and banking penetration, as well as difficulties in delivery caused by unclear addresses and informal housing, e-commerce is starting to take off. In addition, heavy traffic and sometimes crowded malls make shopping from home attractive to many.

In May 2018 a new online supermarket, Homeshoppa Ghana, launched in Accra. The business is looking to avoid pitfalls that have led to other grocery e-commerce businesses failing, and is working to ensure competitive pricing is in place. The primary goal is to offer convenient, affordable and quality food to all Ghanaians, with busy middle-class families expected to benefit the most.

Both internet and smartphone penetration have increased considerably in recent years, broadening the market for e-commerce services. As of December 2017, Ghana’s internet users were estimated at 10.1m, according to research engine Internet World Stats, which is roughly equal to 34% of the population. This should give rise to more entrepreneurs taking to internet-based businesses and launching additional e-commerce offerings, especially as logistical factors, such as the road network, are expected to improve over the medium to long term.


The growth of e-commerce is one of the trends to watch over the longer term, while more mall space is set to come onto the market in the coming years, particularly in Accra, sharpening competition for incumbents. The relatively low penetration rate of modern retail, combined with strong market fundamentals, means the outlook for increased consumption via new channels is positive. Likewise, despite a strong presence in malls, the range of international brands active in Ghana is still fairly small, but there is considerable scope for more to enter.

Although downside pressure from domestic and global macroeconomics and taxation may weigh on retail growth for periods in the coming years, overall retailers that are able to adapt to the market will be well-placed to reap the benefits in the longer term.