How e-commerce is reshaping the fashion industry in Nigeria

Following its boom at the height of the COVID-19 pandemic, the e-commerce sector is transforming many other industries. In Nigeria, for example, one of Africa's most fashion-forward countries, e-commerce is causing a shift in the textiles, apparel, and footwear market. The sector's Gross Domestic Product (GDP) reached an impressive USD (US Dollars) 477 billion in 2022, and the first half of 2023 continued this upward trend with e-commerce as a formidable ally. In 2022, fashion accounted for nearly 20% of total B2C e-commerce in the West African nation.

To begin, e-commerce platforms enable apparel manufacturers and retailers to reach out to a young, tech-savvy demographic and broaden their market reach. Furthermore, the proliferation of digital technologies that power e-commerce brings international fashion styles right to the buyers' doorsteps. This results in a fusion of traditional styles and modern imports within a paradigm that is emblematic of a nation whose youth embrace their future without abandoning their roots. This plethora of options, combined with ease of access, significantly drives the growth and development of the textiles, apparel, and footwear market.

However, while urban areas such as Lagos and Abuja have been quick to adapt, rural areas and more remote regions have been slower to embrace e-commerce shopping. While there is a desire for digital shopping, several barriers, such as limited internet access, financial inclusion barriers, and logistical hurdles, pose significant challenges.

What strategies can propel Nigeria's Fashion Industry?

1. Bridging the digital divide

   Several projects are being implemented by the government and private sector to bridge the digital divide. Initiatives such as e-commerce training programs for local entrepreneurs are proving to positively impact the supply and demand sides.

   Furthermore, to address the issue of limited financial inclusion, payment solutions such as USSD-based transactions have been developed to help those who do not have access to smartphones, allowing more people to conduct digital transactions.

2. Improving logistics

   So far, Nigerian businesses have shown ingenuity in addressing the lack of logistical capacities to support e-commerce, particularly in peri-urban areas. Where postal systems are unreliable, entrepreneurs are stepping up to establish micro-delivery networks that leverage community ties and local knowledge to provide last-mile delivery services.

   While this may work in the short term, it will significantly impede the development of large-scale e-commerce by limiting critical logistical considerations. A more efficient solution will involve the adoption of digitalization and integrated logistics, which will leverage community ties and local knowledge to drive faster and more reliable logistics that can be scaled up across the country.

Integrated logistics, which includes utilizing existing knowledge resources, will provide e-commerce companies and their partners with greater visibility throughout their supply chain, improved market access, and more opportunities for demand forecasting.

Nigeria has an opportunity to build faster by improving the logistical aspects of digital commerce as it looks to scale up its financial and physical infrastructure, nurture talent, and expand the fashion segment within e-commerce.

As the continent strengthens its regional trade under the Africa Continental Free Trade Area (AfCFTA), a vibrant system will eventually influence the proliferation of Nigerian-made textiles, apparel, and footwear into the African market. Nigeria is poised to establish itself as a significant force in both the global digital and apparel markets as a result of sustained investments in technological infrastructure and strategic planning.