Understandably, there are many small-scale retailers in the region/countries given that a significant portion of the population lives below the poverty line and that six of the West African countries are among the 20 poorest countries in the world.

The reasons for the existence of many small-scale retailers in Nigeria, and by extension, West Africa are explained below;

1. Lack of sufficient Capital: This is arguably the most common reason for a large number of small scale retailers.

Many small-scale merchants wish to expand into larger-scale retailing, but they do not have the necessary funds.

Therefore, they settle for small-scale retailing since it requires only small capital, which is very affordable for people with low incomes.

2. High rate of unemployment: To at least make ends meet, many Nigerians have turned to small-scale retailing as a result of the country's high unemployment rate.

The lack of white-collar work has led new graduates turn to small-scale retailing as a means of survival

3. Low savings: Rising inflation and low per capita income have all contributed to low savings cultures in Nigerian and west Africa.

The majority of Nigerians spend the majority of their monthly income, leaving little for savings.

Because they lack the savings to engage in large retail, many Nigerians create small retail businesses instead, which are more affordable.

4. Easy to set up: Small-scale retailing is very to set up, making them attractive to Nigerians/west African.

This is due to the fact that small businesses, as compared to large-scale retailing, require less capital, are very affordable to operate, and pose fewer business risks.

Since the majority of people in West Africa don't have much money to spend on business ventures, they found small-scale retailing to be both incredibly appealing and simple to set up.

5. Flexibility in the scope of operation: In small-scale retailing, the owner of the business can open and close business anytime he so wishes.

This is advantageous especially if the owner has two or more occupations in which he is involved.

Additionally, the company's working hours can be modified to accommodate shifting labor conditions in the nation, allowing for flexibility..

6. Lack of expertise: As they are high level of illiteracy in the region, most west Africans lack the expertise and education necessary to manage large-scale businesses.

Hence, they settle for small-scale retailing, where the expertise needed to run the business is very small.

7. Inflation: Inflation is an increase in the average prices of goods and services.

The rising rates of inflation witnessed in the most west African country has weakened the purchasing power of money, and reduced the number of goods and services that consumers can buy.


As a result, the majority of people in west Africa favor small-scale retailing to make up for the constrained number of goods that consumers can buy.

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