Retail News Monthly Update - 9th October 2005

Whether or not Panda’s decision to move into the UAE is a surprise for its rivals, it certainly gives them something to think about.

  • E-Mail
By  David Ingham Published  October 9, 2005

Panda's big move impresses|~||~||~|Whether or not Panda’s decision to move into the UAE (see this month’s lead story) is a surprise for its rivals, it certainly gives them something to think about. At a time when MAF Investments, the regional Carrefour franchisee, is trying to muscle in on its domestic turf in Saudi Arabia, Panda has gone and attacked it right in its own backyard. Its future plans include opening up hypermarkets right across the Gulf, markets that Carrefour also has its eye on. For Geant, the move could be even more threatening. Carrefour was always unlikely to secure the site that Panda has landed in Dubai Festival City, but Geant must surely have fancied its chances. Dubai Festival City was looking for a big name to operate what will be one of the development’s two anchor stores. UAE brands probably lacked the size, business model and prestige that Dubai Festival City was looking for. Geant has already proven that it can run a hypermarket in the UAE with its outlet at Ibn Battuta and it is looking to develop more stores in the UAE. Missing out on Dubai Festival City is surely a big disappointment. Local brands like Spinneys and Union Co-Op were also probably never in with a chance of winning the Dubai Festival City pitch, and Spinneys can argue that a giant hypermarket is not the kind of thing it is interested in. Union Co-Op must be particularly alarmed by Panda’s move though. It has recently set out plans to become a hypermarket operator, a move that puts it right up against Geant and Carrefour. The entry of Panda means the need to reinvent itself by achieving greater economies of scale and overhauling its drab stores has become even more urgent. The other major player in the UAE’s supermarket landscape may come out of all this the best. The entry of Panda gives Carrefour and Geant a major new rival to think about. Whilst they slug it out to land the big sites and compete to be ‘the cheapest’, Spinneys can quietly carry on doing what it does best: catering to more affluent clients through smaller outlets. It may also be able to pick up some promising new sites that may not be big enough for the major players and their economies of scale. Whatever happens, the Gulf’s supermarket sector is certainly going to become livelier in the next few years.||**||

Add a Comment

Your display name This field is mandatory

Your e-mail address This field is mandatory (Your e-mail address won't be published)

Security code