Sales of electronic consumer goods collapse by 10 per cent, with mobile phones taking the biggest hit.
Electronic goods sales drop
ABU DHABI // Sales of electrical consumer goods in the UAE have dropped by 10 per cent in the first quarter, with mobile phones taking the biggest hit, a report by a consultancy in Dubai says. GfK Retail and Technology's newest Temax report, which looks at sales of electrical goods ranging from laptops to washing machines and video game consoles, said total sales in the first three months of this year slipped to Dh2.43 billion (US$662 million), down from Dh2.7bn in the same period last year. Nadim Shaikh, the production and retail service manager for GfK in the UAE, said the steep drop in the first quarter was caused by the global downturn beginning to affect the Emirates. "The recession affected countries in Europe much earlier than the UAE," Mr Shaikh said. In the fourth quarter of last year, there were occasions such as Eid and Christmas that kept sales afloat, he said. Sales of telecommunications goods in the UAE, mainly mobile phones, dropped by 25.5 per cent to Dh747m in the first quarter, down from Dh1bn in the same quarter last year, according to GfK. Marina Turner, GfK's business group director for IT and telecoms, said people worldwide were replacing their mobile phones less often because of the economic downturn. However, one big contributing factor to the drop in sales value was falling prices of mobile phones, she said, as the number of units sold in the UAE in the first quarter dropped only 7 per cent compared with the same period last year. Of the 18 countries GfK analysed across the region, only five saw a decline in sales volume: the UAE, Saudi Arabia, Algeria, Morocco and Pakistan, she said. The UAE had the smallest decline among the five, but the fall was still a major blow to the industry because of the high penetration of mobile phones in the country, at 117 per cent, she said. "The UAE might not be suffering as much as countries like Saudi in terms of overall mobile phone sales, but it contributes a larger portion of the total Middle-Eastern market," she said. Sales of large domestic appliances fell by 4.1 per cent to Dh217m from Dh226m in the first quarter of last year, while sales of small domestic appliances dropped by 12.3 per cent to Dh211m, down from Dh240m previously. Mr Shaikh said the fall in sales of domestic appliances stemmed from uncertainty about job security, with people avoiding purchases that were difficult to ship home. However, there were a few bright spots for the electrical consumer goods industry. Sales of laptops grew by 12.1 per cent to Dh740m in the first quarter, from Dh660m in the same quarter last year. The biggest jump in sales was for video game consoles, which jumped 96 per cent in the first quarter to Dh19.6m. firstname.lastname@example.org