Offering a discount of at least 30 per cent on consumer brands may make Dubai Outlet Mall appear to be something of a mirage in the middle of the desert.
But the outlet concept, situated in the desert, is becoming clearer to consumers, with the mall's footfall up 8 per cent in the first quarter compared with the same period last year, leading to a 15 per cent increase in sales, the mall's operator said.
Vishal Mahajan, the director of the Dubai Outlet Mall, said an increasing number of established retailers were looking at setting up shop in the mall. "There are expansions from existing retailers as well as new retailers," Mr Mahajan said. "The interest from the main brands is rising."
With an occupancy rate of 86 per cent and an average of 150,000 visitors per week, the mall has already attracted global brands such as Burberry, Diesel and adidas to set up stores. "People were not aware what an outlet concept was, they had their own whims and fancies that damaged and old products are being sold here," said Mr Mahajan. "It took a long time to educate people."
Opened in August 2007, the mall is not near the traditionally popular retail area off Dubai's Sheikh Zayed Road, but about 30 minutes from the city on the road to Al Ain.
"Back in 2007, we were in the middle of the desert, we are still in the middle of the desert," said Mr Mahajan. "The location does not help us but having said that, outlet malls are traditionally meant to be a little bit further from the retailer simply because if it is in the main shopping area it can cannibalise the retailer."
The mall operator now expects occupancy to reach 92 per cent by the end of this year, above the average for the sector in the UAE of about 84 per cent, Mr Mahajan said. Popularised in the US, outlet malls sell retail goods including fashion, sports and watches, which are all either last season or excess stock.
Retailers at Dubai Outlet Mall must agree to discount products by at least 30 per cent, but many go beyond this level.
Some of the brands in the mall are sold under the name of their local partner or under a different name altogether.
The Middle East retailer the Chalhoub Group sells fashion and accessories by companies such as Chanel and Louis Vuittonunder its Allied Enterprises brand, its UAE company.
Allied Enterprises is now increasing its store space from 12,000 square feet to 18,000 in the coming weeks, Mr Mahajan said.
Paris Gallery Group, the retail and distribution division of Al Fahim Holdings, brands as Annex in the mall and sells products by companies such as Hugo Boss and Gucci.
The mall's strong increase in footfall this quarter has been buoyed by a new shuttle bus that picks up tourists from more than 80 hotels around Dubai and transports them free to the mall.
Many of the mall's stores are the best-performing for retailers in Dubai, Mr Mahajan said.
"We don't fight with the malls, we complement them in a way that any consumer will go to the mall, but they will come to the outlet mall and spend time finding a bargain," he said.