(MENAFN - Khaleej Times) Increased spending economic growth seen across the sector
shoppers at carrefour at deira city centre in dubai. — kt photo
annual retail sales in the uae rose five per cent to hit an all-time high of dh240.5 billion in 2013 to catapult the vibrant domestic market to the fourth position on a global developing market index.
a booming construction and infrastructure sector growing young population and strong economic growth coupled with mounting consumer confidence and increased spending helped the retail sector to claim its highest position ever on the widely respected a.t. kearney global retail development index or grdi.
with several landmark international and regional events including the expo 2020 under way the uae has several mega development projects in the pipeline. the country is also geared up for an exponential growth in tourism and a sustained surge in per capita consumer spending key factors expected to give a big boost to the retail sector. a.t. kearney said in a report that changing consumer demands had a positive effect on retail development in the uae. “on the one hand consumers are seeking greater proximity of outlets leading to more community formats like majid al futtaim’s my city centre in sharjah which caters to local community residents with retail and lifestyle-orientated store and on the other hand retail saturation has led to innovative concepts like the beach the outdoor cinema and beachfront mall at jumeirah beach residence in dubai” the report said.
“the gcc retail sector continues to be considered among the leading markets globally. the uae has a growing need for more sophisticated formats to cater to changing consumer needs. consumers are demanding more proximity and retail saturation has brought about some interesting and innovative concepts including increased use of social media to communicate with increasingly tech-savvy consumers in the uae” said dr. martin fabel partner and head of consumer industry and retail practice at a.t. kearney middle east.he said given the trends and statistics the uae would continue its upswing. “continued year-on-year increases in gdp per capita retail spending per capita and retail sales outlets in conjunction with a significant retailer entry and expansion from local retailers signal a bright prospects for the uae retail sector” said fabel.
with several major global brands establishing outlets in the uae and others expanding their presence the uae retail market is already on a roll. new entrants in the market include the uk-based toy retailer the entertainer which is launching its first store in dubai and prominent uk department store house of fraser establishing a branch in abu dhabi. the luxury retailer chalhoub group is leading the growth from a local brand perspective with 50 new stores planned.
regional retailers are also becoming important players in emerging markets by using their proximity as a competitive advantage to secure a share of neighbouring markets. the uae-based retail giants lulu hypermarkets and majid al futtaim are already on an expansion mode in the gulf region. other gcc markets also performed strongly with kuwait climbing one spot to rank eighth on the index. saudi arabia remained fundamentally attractive to retailers looking to expand and maintains 16th spot on the grdi and oman underpinned by strong growth in the grocery sector in particular ranks 17th on the index.
published since 2001 the grdi ranks the top 30 developing countries for retail investment worldwide. the index in its 14th year analyses 25 macro-economic and retail-specific variables to help retailers devise successful global strategies to identify emerging market investment opportunities