Hypermarket spending set to rise in 2009 - research

RETAIL SPENDING: The likes of Hyperpanda in the UAE could benefit from the economic gloom.

The global economic slowdown could be good news for hypermarkets in the UAE as shoppers search for more bargains, according to the results of new research.

The Neilsen Company's 2008 Shopper Trends Report predicted that the financial crisis would curb the number of new superstores in the region in 2009 but more budget-conscious consumers will shop more at hypermarkets.

The report also showed that spending in UAE hypermarkets increased during 2008 when compared with 2006 at the expense of supermarkets.

About 38 per cent of shoppers now go to hypermarkets, compared to 33 per cent in 2006, UAE daily Gulf News reported on Saturday.

Shoppers at supermarkets, however, dropped from 33 per cent in 2006 to 24 per cent in 2008.

"Hypermarkets, as the preferred shopping destination, continue to grow as consumers see them providing value for money by offering cheaper prices and promotions on goods. So they might be only three per cent of total outlets but (they) contribute to about 49 per cent of sales in the food category," Him-anshu Vashishtha, UAE managing director of The Nielsen Company, told the paper.

The UAE has the highest density of superstores in the region, with 61 hypermarkets and supermarkets per one million people, the report added.

Between 2005 and 2007, at least 36 supermarkets and hypermarkets opened in the UAE.

In Saudi Arabia, there are only 27 hypermarkets and supermarkets per one million people, while Kuwait has 31.

"The current economic climate might slow the growth, but the increase in the number of shoppers at hypermarkets is likely to continue. The current economic pressure will make consumers more conscious of value for money," Vashishtha said.

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