Domino’s, Cold Stone exit CBD
Fast food chains Domino’s Pizza and Cold Stone Creamery have closed down their branches in the Central Business District.
In a message to customers, Cold Stone announced that it was moving its pioneer Mama Ngina Street branch to a yet to be disclosed location while Domino’s Koinange Street Branch remains closed under similar circumstances.
This is not the first set of franchises to relocate branches from the CBD.
Last month Subway and Pizza Hut moved their College House branches citing low foot traffic as a key factor in the relocation.
According to the franchises, it's normal for 10 percent to 15 percent of restaurants to relocate each year.
This is because retail is a local business, and local conditions in a trade area change over the lifespan of a restaurant.
Cold Stone Creamery opened its CBD branch in 2014 along with its Westlands branch, marking its entry into the Kenyan market before expanding in Karen and Gigiri with new branches.
When the American fast food chains began opening outlets in Nairobi it was seen as initial benefits of Kenya’s larger GDP as the country moved to the club of middle-income countries.
The continued expansion of the franchises is an acknowledgment of the rise in the number of people with disposable incomes. The increase in restaurant spend has also been mirrored in the hotel sector.
Most food chains have picked popular addresses in central Nairobi or malls located in high-end areas and leafy suburbs as the optimal locations for their investments.
The collapse of leading retailers in Kenya as well as changing infrastructure has however interfered with foot traffic in various areas, boosting some while depleting others, forcing re-evaluation of market strategies.
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