NAIROBI, Kenya — The economists predict that the next trade and business prospectus after Asia is hidden in Africa. 

In the furnishing fabrics segment, Africa which is largely dependent on imports, expensive high end furnishing fabrics are imported regularly to satisfy many rich homes who still prefer the classic western colonial, style. “The markets are growing at 15% a year but margins are treading lower and the Chinese are making a positive entry”, said Nishit Shah, owner, Nishit Shah & Company Ltd., Nairobi. The 25 year old company caters to high end homes and is active in the contract sector for new build as well as refurbishing hotels in East Africa.  Nishit Shah

Shah started his business by buying cheap stock-lots and supplying to markets. Shah’s visit to Heimtextil in 1986 changed his activities. “In those days there were no sample books and we had to order rolls and convert them to our own sample books to approach the market”, he recalled. Encouraged by market response Shah started ordering container loads from US and European weavers, a very risky step those days, he remembers. Importing large quantities was a gamble but these were well marketed, the company grew and currently employs four designers with 50 staff. 

He said that curtains sell more and upholstery follows. He admits that the market is yet to mature to western standards but the choice of colors and designs by affluent consumers are classy. “Things are changing in terms of price competition that was never faced earlier,” he said. 

According to the best available information many African countries including Kenya are always in need of foreign financial aid. China,  always quick to make such deals has obtained thousands of business visas. In turn Chinese have set shops not for B2B transactions alone but for B2C trade. “ The popular Bishara Street in Nairobi city once run by Kenyans & Indian origin Kenyans are giving  way to Chinese families who have opened up retail outlets offering low prices. This is a big concern for other importers”, added Shah. Chinese nationals are now in joint operations with other Chinese importers of a variety of goods. These operators get direct ship loads  as opposed to container shipments are the cheapest way to ship. This has given a further edge to the Chinese fabric merchants as transportation cost to Africa has always been expensive to all other importers.

The Kenya economy is the largest in Central Asia and major activities are agriculture, Tea, Coffee and fresh flowers to Europe. Kenya’s economy is market-based, and maintains a liberalized external trade system and has 5% GDP. Tourism expansion, growth in telecommunication & construction is aiding commercial activities. Home building activity has seen the real estate prices sky rocketing and money has become expensive to borrow at 24% a year; so the retail margins are fat.

“In this growing market there is a huge gap in terms of professional marketing.  By offering total services from basic concept to execution of decorating homes by in-house designers we expect to strengthen our standing further”, Shah said. Most of his imports are from Europe and a little from America, which was once a major source for us, he said.