Walking around Kuwaiti malls (Avenues in particular), you would see that many multinational retailers are represented in Kuwait. There was huge boom in terms of the number of retailers being represented in Kuwait, a boom that can be mainly attributed to Al Shaya Group. In the past year, we have seen the likes of P.F.Changs, American Eagle, Pottery Barn (soon), Pinkberry, among others arrive in Kuwait. The Kuwaiti consumer has a big appetite and a big spending power, making the Kuwaiti market an attractive one.
CB Richard Ellis published a report that discussed the retail business, and the destinations of retail giants’ expansions. The report pulled its data from 294 retail company in 69 countries. The result was that there has been a shift of focus from the developed markets (US, Europe) to emerging markets (Asia, Middle East), which is understandable as the countries are growing at much higher rates, and their population’s income is growing creating demand for retail outlets. Kuwait ranks as the 11th most important destination in the world, and Kuwait City ranks in the 18th spot in terms of cities. The rank is based on the percentage of the respondants that have presence in these countries/cities. What is notable as well is the jump in ranking among Middle Eastern cities, as Riyadh jumped from the 25th place to the 14th, Jeddah from the 26th to the 15th, and Kuwait City from the 28th to the 18th. The rankings of Kuwait City, Riyadh, and Jeddah all surpass that of Las Vegas, Barcelona, and Istanbul.
My question is are Middle Eastern cities more important than Las Vegas, Barcelona, and Istanbul (which attract millions of tourists annually) in the point of view of retailers, or do these cities have more domestic outlets and do not rely on big name retailers?
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Only two things to do in Kuwait, build malls or restaurants as they are the only two attractions in this country. Last thing I would ever do in Vegas is to go shopping
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Naser Reply:
June 9th, 2010 at 11:37 am
Actually a lot of people shop in Vegas. Their tax is lower than other cities, especially for luxury items. Plus many people use the proceeds of their “investments” to buy luxury items.
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“the result was that there has been a shift of focus from the developed markets”
we need to know what that “shift of focus” means. the studies need to explain that…maybe they are just building more shops in these countries or shutting off shops in the mature markets and opening up in the emerging ones…..I just hate these consulting jargon ….”shift of focus”
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[...] Link: The Retail Business in Kuwait and the Middle East « Alpha Dinar … [...]
Me as a consumer am vary of this boon in branded merchandise and the mall culture.. Malls are super convenient for consumers but for retailers they are expensive. Malls are the poster child of big name mass retailers who have big balance sheets to support these costs. For mom and pop stores malls are a place to dream about. The problem with the global retailer model is that the local demand supply metrics totally go for a toss (except during times of sale
). For example a GAP shirt will cost the same here as it would it in US or in Europe (where prices are much higher as cost of living is higher). What this translates in long term is that the cost of living in Kuwait will rise, as more and more malls come in rooting out mum and pop stores.
Moral of the story: Support local stores !!
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