December 2025 Edition

Currency Devaluation and Retail Price Strategy in Nigeria

Sambo Ulumeh Isaac Sesay Daniel Kassim Okenyi Samuel Akgbokaode, Daniel Harold Elikwu

Abstract

The persistent devaluation of the Nigerian Naira raises concern among
policymakers, economists, and retailers of imported goods. As the
currency weakens, retailers face pressure to adjust pricing strategies in
response to exchange rate fluctuations, rising import duties, and
inflation. Despite the growing body of literature on currency
devaluation, there remains a contextual gap regarding how Naira
devaluation specifically influences the price-setting behaviors of small
scale retailers operating within contained ecosystems like university
campuses. This study, therefore, investigates the effect of naira
devaluation on the pricing strategy of imported goods in Nigerian retail
markets. This research adopted a quantitative approach utilizing a
descriptive survey design. The sample consisted of 213 retail shop
owners in Lagos State who engage in the sale or use of imported goods
or raw materials. Data were collected through structured, close-ended
questionnaires to ensure consistency and comparability. The results
revealed that naira devaluation significantly impacted pricing strategies
in Nigerian retail markets. Exchange rate fluctuations and inflation
directly influenced price adjustments, while all three factors, including
import duties, affected mark-up decisions and promotional pricing.
Currency devaluation profoundly shapes retailers’ pricing strategies for
imported goods in Nigeria. Retailers are advised to monitor exchange
rate trends, anticipate cost variations, and implement flexible pricing
mechanisms, including adaptive mark-ups and targeted promotions, to
sustain profitability and competitiveness amid economic volatility.

Keywords

Exchange rate fluctuations, import duties, imported goods, inflation, Nigerian economy, retail markets

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