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Jewellers are less optimistic of recording good Ramadan sales with the high prices of gold and the lack of summer tourists. Jeff Topping / The National
Jewellers are less optimistic of recording good Ramadan sales with the high prices of gold and the lack of summer tourists. Jeff Topping / The National

Retailers relish booming Ramadan

The majority of UAE retailers expect a boost in sales during Ramadan, according to a poll of executives by The National.

Most UAE retailers are forecasting greater sales during Ramadan, despite the annual lull in tourism because of the scorching August heat.

In a poll by The National, eight of 12 retail executives and analysts said revenues would be higher this year, with many predicting an increase in visitors to malls during the holy month.

Several mall owners and food retailers said they expect greater sales, partly on the back of special promotions and higher demand for groceries. But those in the jewellery and electronics business are less optimistic, blaming high gold prices and the annual decline in tourists during the summer.

Neelesh Bhatnagar, the director of Oasis Centre in Dubai, said he expected more visitors this month.

"We expect to be up by at least 10 per cent on last Ramadan, in terms of sales as well as footfalls," said Mr Bhatnagar.

Oasis Centre is home to retail outlets including Carrefour, Home Centre and Splash. Mr Bhatnagar said several initiatives were under way to attract shoppers during Ramadan. "We have created a set of activities that are very relevant to the local Emirati population who live in our catchment areas.

"Our tenants will also be offering several discounts and incentives, especially towards the second half of the month."

Mr Bhatnagar said the timing of Ramadan meant there would be a focus on "back to school" shopping. "As a mall, we see a lot of spending concentrated in the children's stores, followed by home retailers."

The UAE's retail industry was valued at almost US$20 billion (Dh73.46bn) last year.

Ramadan is one of the most important periods for local retailers, said Karima Berkani, a research analyst at Euromonitor International.

"It is likely that sales will be slightly higher this year over last as the economy recovers and with it consumer confidence," she said.

The Arab Spring has also prompted an increase in "shopping tourism" in the UAE, she added.

Drivers of retail growth during Ramadan include greater expenditure on groceries and gifts, and extended opening hours in the evening, said Ms Berkani. Stewart Hutcheon, the head of retail for the mall developer Majid Al Futtaim, said late-night visitors account for a greater spending on food and drinks.

"Our [food and beverages] outlets enjoy increased business for iftar and suhoor, and overall shopper spend increases towards the end of Ramadan, in the lead up to the traditional gift-giving period of Eid Al Fitr and Eid Al Adha."

The appetite for food to break the traditional fast is behind demand for grocery shopping, say executives of two supermarkets with operations in the UAE.

"People normally tend to up the consumption during this holy month of giving as they take more time and effort to celebrate," said Fred Watts, the operations director at Al Maya supermarket.

However, the LuLu supermarket chain's predicted growth this month of 15 to 20 per centwould be slightly lower than earlier in the year, when there were 18 to 20 per cent gains, said VNandakumar, a company spokesman.



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