EXCLUSIVE: Luxury retailer's president expects to benefit from rise in number of tourists to Dubai
BinHendi Enterprises, which owns regional franchises rights for luxury brands Hugo Boss and Nicole Farhi, expects its business to increase as much as 23 percent this year amid a rise in the number of tourists shopping in Dubai, its president told Arabian Business.
The Dubai-based firm, one of the oldest retailers in the UAE, saw a 15-20 percent increase in its overall business last year as more tourists flocked to the emirate to purchase luxury goods, said Mohi-Din BinHendi.
“Overall we grew 15-20 percent [driven by] an increase in tourists from Russia, China, Saudi and the Middle East. Dubai is seen as a very attractive, desirable destination to come to,” he said.
“We’ll go an extra 5 to 7 percent [on top of last year] for 2013,” he added.
Dubai is enjoying a retail and tourism boom with passenger traffic passing through its airport rising 13.2 percent to 57.6m passengers last year, overtaking Hong Kong International Airport to become the third busiest airport in the world.
Many retailers have attributed the rise in retail to an increase in tourists from China, Russia and the Gulf.
Emaar, owner of the world’s biggest shopping mall, said the number of visitors to Dubai Mall in 2012 increased by almost half a million people to 5.2m while the number of brands sold in its stores increased 25 percent.
BinHendi, which has more than 50 brands in its franchise portfolio, plans to expand its women and children’s fashion ranges as well as its food and beverage arm. The firm also plans to go to the debt market to fund its expansion and refurbish existing stores.
“We are looking at more for the ladies and children. Our portfolio will be complete with all of the three sectors of the business; men, women and children,” he said. “We have to borrow to take our businesses forward… for the capex for the expansion and the refurbishment of stores because as the stores get old you need to refurbish them.”
BinHendi is in early talks with several luxury European and American brands but is being hampered by the availability of premium mall space, he added. “One of the biggest problems in our market today is [finding] locations; everybody wants the best locations and those locations are not available.”
BinHendi established 7Franchise Group last year in a bid to sell local food and beverage concepts to investors across the GCC and wider Middle East. The company, which operates Japengo Café and Havana Café, hopes to become the biggest franchiser in the Gulf through its own brands such as Extreme Shawarma and Khan Chai.
“This is going to be a very vital part of our business; I have no competitors here today. There are more and more families getting into the F&B business, whether on a small scale or a large scale… it will be a multimillion dirham business,” said BinHendi.