By Soren Billing
EXCLUSIVE: Luxury retailer says number of tourists visiting stores has fallen since Oct.
Jewellery and watch retailer Damas has said the number of tourists visiting its UAE stores is falling in a sign that next year will be challenging for local retailers.
Damas, the largest retailer of its kind in the Middle East by number of stores, said the number of tourists in its UAE stores began to decline in October, but that its full year performance would be unaffected thanks to slightly higher spend per head.
“There has been a slight drop in the number of tourists but this has been compensated for by higher expenditure by the remaining tourists,” deputy managing director Tamjid Abdullah told Arabian Business.
“The first quarter of next year is going to be the real indicator for the rest of the year, but we’re still very positive within the UAE and the Middle East in general.”
Anecdotal evidence suggests that luxury retailers in the UAE, who derive a significant part of their income from tourists from Europe and Russia, have experienced a slowdown in sales over the past few months.
Consumer confidence in the UK, one of the UAE’s key tourist markets, improved slightly but stayed near a three decade-low in November amid fears over a protracted recession, according to the monthly GfK NOP survey.
Stock markets in Russia, home to many of the country's wealthiest visitors, have been hit harder than in many other emerging economies, with energy giant Gazprom losing more than two thirds of its value since May.
DIFX-listed Damas operates more than 450 outlets through three different store formats.
“Les Exclusives” stores cater to high net worth consumers; “Semi-Exclusives” stores target upper-middle income consumers such as tourists and expatriate professionals; and the Damas 22K stores cater mostly to middle income and working class immigrant populations of South Asian origin.