Amit Gandhi argues that the kiosk is still king when it comes to standing out in the competitive retail sector. Mr Gandhi, who discusses his company's strategy, is a co-founder and director of VIP Ventures, the franchisee for the Polish cosmetics brand Vipera in the Middle East, Africa and Asia.
Q: When did you start selling Vipera cosmetics in the UAE?
A: In 2010, we started retail operations in the UAE and wanted to bring a different business model because there are so many cosmetics brands. We wanted to be different. That's how we came up with the kiosk concept.
Q: Why go with a kiosk over a store?
A: The main benefit you get from the kiosk concept is the visibility. You are right in the middle of the mall and people can test the products as they walk by. It keeps overheads low and we can transfer those benefits to customers in the price. The mall culture is also very strong in this part of the world.
Q: Does Vipera have shops only in Poland?
A: In Poland, they have the kiosk concept as well, but there are also individual shops, shops-in-shops and a distribution arm for pharmacies and hypermarkets. But we think the brand presence is more visible when it's in the middle of the mall.
Q: You essentially sell to everyone and anyone, so are strong sales staff a must?
A: All our staff are highly trained by make-up artists and undergo customer service training. They come from experienced backgrounds in cosmetics field. It's very important, particularly in beauty, to have good trained people to sell the products. The brand is not famous in this part of the world, so the service is important.
Q: Are you more likely to get a sale on a kiosk than a store?
A: Absolutely. The chance of conversion is much higher. The key to retail is location. The conversion rate is much, much higher if you are in the major shopping malls such as Dubai Mall and Mall of the Emirates. You can have all the ingredients as a retailer, but if you are not visible, then it is difficult.
Q: Do you pay higher rents than a shop?
A: Normally the rents are a bit higher. But mall management usually charges based on sales. You are not paying so much in capital expenses up front and get more visibility and sales.
Q: If the spots are so coveted, is it hard to get into the malls?
A: It's very difficult. Malls are very choosy in terms of which brand they are using because they are trying to maintain a brand themselves. We are quite fortunate to get premium locations in premium shopping malls, but it is not easy. We are in Dubai Mall, Mall of the Emirates, Mega Mall in Sharjah, Ajman City Centre, Al Wahda in Abu Dhabi and Al Ain Mall.
Q: Have sales increased dramatically since you started?
A: We have seen growth of 60 to 70 per cent in the three months from June to September this year compared with the same period last year. There's a growing market for cosmetics in the UAE.
