Tati, the French value chain, opens in Dubai today with most of its items on sale for less than Dh30.
“The average price of our product is Dh25. We have 3,000 square metres in Mirdif City Centre, and you will see many products that you can pick up elsewhere. The question is not why are we so cheap, but why are [our competitors] so expensive,” said Emanuel Deroude, chairman and chief executive of Tati.
A second outlet in Yas Mall will open in March.
The growing number of low- to middle-income earners in the country is driving demand for the value segment of the retail sector.
“With value brands such as Asda’s [George budget clothing brand] launching as well as F&F stores, this has encouraged competition to do the same, which will drive a lot of impulse buying following attractive price points,” said Nikola Kosutic, research manager for Euromonitor.
F&F, UK retailer Tesco’s value fashion brand, has a five-year plan to open as many as 40 shops across the GCC.
In France Tati has reinvented itself over the past four years, growing to 140 shops from 25 on the back of its strategy of low margins and high volumes.
“We have millions of products – the average store in France sells 1 million products a year,” said Mr Deroude. “It is a volume business and that drives down prices and drives quality up. We do not spend on marketing, we do not spend on Beyonce to be a brand ambassador, all of that is paid for by the customer and we just want the customer to pay for the product.”
The UAE’s retail sales grew 5 per cent last year to US$66 billion in the UAE, consultants AT Kearney said in June.
ascott@thenational.ae
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