Middle East retail veteran out to expand across the region
Jashanmal Group, one of the Middle East's oldest retailers, has embarked on an ambitious multimillion-dirham expansion plan to extend its footprint across the region.
The company, which is best known for its bookstores, has refurbished a number of shops, moved its flagship UAE department store and aims to launch six brands by early next year, spending up to Dh5 million (US$1.3m) in total.
"It's expansion that we as a company are comfortable with, it's careful, considered investment," said Narain Jashanmal, the general manager for print media and books stores. "We were quite prudent during the ups and downs. We are now able to take advantage of low rents and retail space in the UAE."
The company operates a network of more than 100 retail outlets across the Middle East, including department stores, bookshops and fashion and footwear brands.
It is about to sign deals with four US retail brands to launch stores across the UAE early next year and will open LK Bennett, a British woman's clothing and footwear brand, in Dubai's Mirdif City Centre next month. All the new brands will sit in the mid to higher-end segment of the fashion market. "There are a lot of mass-market brands in Dubai and there is almost every luxury brand, but there is space between them where we see an opportunity," said Mr Jashanmal. "It's good quality at a good price."
The company is also relaunching the Swiss shoe brand, Bally, in the UAE with a new store, also in Mirdif City Centre.
"For any brand to sell here, we want them to be established in their home markets and have an international presence," said Mr Jashanmal. "Startup brands tend not to have the systems and process to work with franchises."
Jashanmal moved its department store in Wafi Mall to Dubai Festival City this year and also took over eight bookstore outlets in Spinneys' stores from rival Magrudy's.
Management are not tapping banks to finance the group's expansion, but funding it from cash flow in the business.
The biggest outlay in bringing new brands to the region is the capital expenditure in fitting-out stores, acquiring the rights for brands and buying stock.
Many retailers have enjoyed strong growth so far this year as a flood of tourists has helped keep the tills ringing.
Jashanamal said it achieved single-digit growth in the business, which had been hampered slightly by print distribution and book store sales suffering declining consumer demand.
"We are seeing healthy growth, both top line and bottom line," said Mr Jashanmal. "The most challenging area is the print media, this market is facing the similar pressures of the rest of the world."
Published: August 11, 2011 04:00 AM