Al Sayegh to flex its retail muscle in GCC
Dubai-based Al Sayegh Brothers has revealed massive retail expansion plans for the Gulf region
Consumer electronics distributor and retailer Al Sayegh Brothers has revealed major retail expansion plans in a bid to triple its sales turnover by 2010.
The company will aggressively target new retail opportunities in the GCC while strengthening its core presence in the UAE, Shahzad Ahmed, Al Sayegh Brothers’ director of Marketing and Retail told ECN.
“Consumer electronics retailing is becoming a very serious business in the GCC,” he said. “By 2008, we expect 50% of GDP in the UAE will be generated by the retail sector. If you want to expand your business in this market you must boost your retail presence.”
Ahmed said that the company’s retail strategy would focus on two areas: increasing the number of outlets under its new multi-branded retail chain, E4U, and establishing flagship destination stores for LG and Olympus, whose products it exclusively distributes in the UAE.
“In less than a year we have expanded our retail presence from seven stores to 16 in the UAE and we have already negotiated 11 additional sites across the country,” he said.
“The average size of these stores is more than 1000 square feet. We are currently investigating the possibility of opening hyper-sized stores, while we are committed to establishing flagship destination stores showcasing the individual brands we represent in the region.We estimate that by 2008 we will have 40 to 50 retail outlets positioned across the UAE alone.”
Ahmed said that the company was committed to establishing an LG destination store in the forthcoming Dubai Mall, in addition to locations in Dubai, Sharjah and Abu Dhabi.
He said that LG was “very excited” by Al Sayegh’s retail plans.
“These destination stores represent a win-win situation for both parties, given that it provides LG with an additional point-of-sale for its digital product range,” he said.
Ahmed denied that the new stores would impact its existing LG retail channel partners.
“This is an additional business we are creating, and there will be no impact on the business we maintain with our resellers,” he said. “We will not be selling products in our destination stores at a lower price than our competitors, because we have to protect the interests of our resellers. We are committed to ‘value selling’, not ‘volume selling’.”
Ahmed said that the company harboured major ambitions for its E4U retail chain, which he claimed took a “unique approach to mall-based consumer electronics retailing”. He added that Al Sayegh planned a number of innovative marketing strategies to build consumer loyalty to the E4U concept.
“Young consumers hold major sway in the Middle East and we are targeting this demographic as our core market,” he said.
“We need to be unconventional in our approach: we plan to establish an online presence; we are looking at a loyalty card in conjunction with one of the banks; and we are establishing our own call centres.”
Ahmed also said the company was open to negotiating deals with vendor partners specialising in emerging consumer electronics product categories.
“We have long-standing relationships with our principal vendors and we are committed to showcasing their products in our E4U stores,” he said.
“However, when it comes to adding new product categories that do not compete with our primary vendor offerings, then we will look in to it. But our priority is to service our existing channel vendor partners.”