Nigeria's true worth

Clothing chain Truworths says it is committed to Nigeria and won't follow Woolworths out of Africa's most populous nation.

The growth potential of the continent's biggest economy outweighs high rental costs and difficulties in obtaining supplies, CEO Michael Mark said in an interview from Cape Town.

"We were making losses, but I don't think we will in the future," Mark said about Nigeria.

The retailer plans to reduce the size of its four stores in Nigeria to cut costs and will reconsider the clothes for sale to appeal more to customers, he said.

Woolworths said in November that it would probably close its three Nigerian outlets but other South African retailers are expanding in sub-Saharan Africa to offset tougher competition and shrinking household incomes in their domestic market.

Nigeria's population of about 170million and economic growth of 6.4% last year make it a target destination.

Truworths has two stores in Lagos, the commercial capital, and two in the inland city of Enugu.

The retailer, which also sells jewellery and cellphones across 600 South African outlets, in February reported first-half profit that was little changed on the previous year.

Mark said he plans to restrict the pace of store openings in South Africa. The target is to increase store numbers by about 6% next year and 3% to 4% in 2016, he said.

Though Truworths is focused on getting the shop size and product-mix right in existing Nigerian stores, it may also look to expand into new cities.

The company, which has more than 40 shops in Africa outside of South Africa, plans to have about 10 stores in each African country in which it operates over the next five or six years, Mark said.

The growth will come in countries such as Zambia, Ghana, Mauritius and Kenya.

"We would go to a new city if the logistics are logical and there is a big enough population, and if other big retailers are going there.

"We don't see ourselves as standalone attractions. We want to be in the pack and then out-trade the others."