Middle East and North Africa turmoils boost Dubai luxury sales

Luxury UAE based retailer Chalhoub Group has posted a 21 percent growth in fashion sales in the first quarter in comparison to the same period a year earlier, helped by rising consumer confidence and higher tourist numbers into the country. “In 2011, we had initially planned for a normal year of growth, so five to six percent,” Allied Enterprises (UAE tradiing name of Chalhoub) managing director Mansour Hajjar told Arabian Business. “We have been surprised by two aspects; the first was that the results were much better and the second was that the influx of tourism into Dubai was way beyond expectations.

The official said that the firm continued to see strong sales up until the end of April, but that the summer period would see lower growth. “However, we expect that September onwards we’ll continue this growth level,” Hajjar said. “So most probably we’ll have to revise our growth forecasts upwards for the end of the year.”

In terms of the various malls, Hajjar described sales results at Dubai Mall (which saw a 17 percent rise in footfall last year to 47m) as “fantastic”. However, he admitted that the success of the Emaar-owned property had affected sales at Wafi and BurJuman.

The BurJuman is currently undergoing renovation and expansion, adding a cinema and more food and beverage outlets as it tries to attract consumers away from the larger malls. “As a matter of fact, we haven’t seen major decline [in the BurJuman] – we’ve seen some declines obviously – in all of our stores,” said Hajjar. “But for very high-end brands that are part of the Chalhoub Group we’ve seen declines that are reasonable.

The Chalhoub Group sells around 280 brands in over 370 stores across 14 countries in the region. Apart from home-grown brands such as Tanagra and Faces, the group also has retail joint ventures with Louis Vuitton, Christian Dior and Christian Louboutin. It has more than 6,000 employees.