By Oluwaseyi Lawal

In recent years, the Nigerian economy has faced a number of issues, including a slump in the oil sector, rising inflation, and currency depreciation. These challenges have made it difficult for firms to operate, resulting in a wave of closures, notably among Nigerian brands.

A Glimpse into the Closure Trend

In the past few years, several prominent Nigerian brands have announced their closure, signaling the severity of the economic downturn. Here’s a look at five notable examples:

1. Mayor Biscuits Company Limited (MABISCO)

MABISCO, a long-standing biscuit producer in Ogun State, Nigeria, announced its closure in 2023. The company attributed its demise to rising input costs, particularly for raw materials, which had become unsustainable.

2. GlaxoSmithKline Nigeria (GSK)

GlaxoSmithKline Consumer Nigeria Plc, the country’s pharmaceutical giant, announced in August that it was ceasing operations. Because the company’s UK parent terminated exclusive marketing and distribution arrangements, this choice was made. GSK Plc, which holds a controlling ownership in the Nigerian company, said in a statement published on the Nigeria Exchange that it will select third-party distributors to distribute its prescription medications and vaccines in the country.

3. Tower Aluminium

Tower Aluminium, an aluminum product manufacturer, discontinued operations in 2022. The company cited the economic downturn, increased costs of production, and a drop in demand as causes for its demise.

4. Moak Enterprises

Once a leading bottled water company in Sango-Ota, Ogun State, Moak Enterprises succumbed to economic pressures and closed its doors in 2021. The company faced challenges in sourcing raw materials and dealing with rising inflation.

5. Bolt Food

On December 7th, Bolt Food will finally exit the Nigerian market. “At this time, we have made the difficult decision to discontinue our food delivery operations in Nigeria due to business reasons,” the company said in a statement. According to the company, it’s out of a need to “streamline its resources and maximise overall efficiency.”

Bolt, a well-known ride-sharing company, provides meal delivery services in 33 cities and 16 countries worldwide. In October 2021, Bolt Food was introduced in Nigeria. However, in the past two years, the market hasn’t exactly been kind to entrepreneurs in the logistics space. The nation’s delivery companies are dealing with difficult macroeconomic issues that have an impact on their daily operations. Startups such as Bolt have had to increase delivery fees by 20-50% due to rising gasoline prices.

Economic Factors Driving Closures

The closing of these Nigerian companies demonstrates the profound effect that the nation’s economic problems have had on enterprises. A combination of factors including declining consumer purchasing power, rising input costs, and currency devaluation have made it harder for firms to operate successfully.

In order to solve these economic issues, the Nigerian government has implemented measures including measures to lower inflation and encourage indigenous production. Nevertheless, many enterprises still have to overcome major obstacles, and the full impact of these policies is still not apparent.