Firm to open 15 stores across the UAE in 2012, in talks to launch new brands
UAE-based Cravia, the franchisee behind US brands Cinnabon and Seattle’s Best Coffee, has announced expansion plans that will see it hire 200 new staff in 20120.
The food and drinks retailer plans to open 15 new outlets across the UAE in a bid to bolster its share of the Gulf state’s booming ‘fast-casual’ sector, CEO Walid Hajj said on Monday.
The rollout represents an investment of up to AED30m ($8.17m), he told reporters in Dubai.
“For 2012, we are looking at opening about five outlets for each brand we have, so a total of about 15,” he said. “Then after that, 2015 and beyond, we will probably have about two from each brand going forward.”
Alongside its US brands, Cravia also holds the franchise for Lebanese restaurant chain Zaatar w Zeit.
“You can look at the existing market here and say it’s saturated, but there is a new category being floated [which] goes back to the freshness and better ingredients. I think there is huge value there and huge opportunity in the UAE, because it’s something people want,” he said.
The company has secured four locations for new outlets, including sites in Dubai Marina and Dubai Sports City for Zaatar w Zeit, and spots in Abu Dhabi and Al Ain for Cinnabon.
Cravia is also mulling the launch of delivery-only outlets for certain brands.
“For Zaatar w Zeit, there is a huge opportunity [for delivery]. Delivery represents about 20 percent of our business, and I think we can easily get it to 30 or 40 percent,” said Hajj.
The company is also in talks for expansion in other Gulf markets, including Saudi Arabia, Kuwait and Oman, but details of outlets and staffing numbers have not been finalised.
“There are certain markets that don’t have the some of the brands we have in the UAE, so that could be a way [in],” he said. “In Saudi Arabia [Zaatar w Zeit] doesn’t exist, so that’s a big opportunity.”
Saudi would be the biggest market “by far”, he said.
Cravia, which has 50 outlets and 700 staff across the UAE, plans to add a further two brands to its portfolio. The company is in talks with a US-based burger chain and hopes to close the franchise deal before the year-end Hajj said.
“If that [deal] happens, then we will be looking at another 300 people at least, just for that brand, [as] it is very labour intensive. In 2012 we would open about five outlets, and going forward, in total, you’re looking at about 50 outlets in the region over five years.”
The launch of a second, homegrown brand is expected in the first quarter of 2012, he said.
“We are working with a branding agency to position that brand and design the logo. You’re probably going to see it happening towards the beginning of next year,” he said. “We are being very cautious. We are looking at 12 outlets in the next two years, in the UAE alone. Basically we’re piloting, so we’re doing three or four first, and seeing how that goes.”