Babyshop, the children’s apparel retailer, yesterday said it planned to spend Dh150 million to open 15 new outlets across the country over the next three years.
The expansion will primarily focus on Abu Dhabi and the Northern Emirates, the Landmark Group-owned retailer said.
“We believe that there are huge opportunities outside of Dubai, particularly in places like Abu Dhabi, Sharjah and the Northern Emirates,” said Ruban Shanmugarajah, the general manager of Babyshop UAE. “This expansion is the most aggressive we have been in the past three years. There has been a migration away from the centre of Abu Dhabi into suburbs like Mohammed Bin Zayed City, that has a population of just under 100,000, and we don’t have a store there. Our customers want a local Babyshop within 15-20 minutes drive and we have to offer that.”
Increasing consumer confidence and tourist arrivals have driven a retail bonanza triggering a wave of retail spending in malls across the country.
The move away from the city centres and high profile malls will avoid the increasing rents and allow a shop size that caters specifically to neighbourhood demand, analysts say.
“It’s something we have seen more and more of on the retail side in Dubai especially in Jumeirah and Al Wasl,” said Matthew Green, the head of research for UAE at CB Richard Ellis. “Babyshop is a brand that can move out to local neighbourhoods whereas bigger fashion brands may not. Higher end brands won’t move but the lower cost ones will, especially those that are focused on babies and infants that cater to mothers and carers.
“When one thinks of Babyshop, one thinks of large stores but it can easily scale the outlet to the population of the area it’s in.”
Analysts estimate GDP in Saudi Arabia, UAE, Kuwait and Qatar to grow at annual rates of about 3 per cent to 5 per cent, fuelled by high oil prices and heavy government spending.
Babyshop cites over 20 per cent growth every year for the past 25 years changing its strategy as the region develops.
“We have over 100 stores in Saudi Arabia and 40 stores in the UAE,” said Vinod Talreja, the chief executive of Babyshop. “We see the growth coming from secondary and tertiary towns in the region. We started with a shop in every city that had an airport, then every city with over 100,000 people, now we want a store in every town with 50,000 people.”
ascott@thenational.ae
