Dubai’s retail market is forecast to surpass $52 billion in sales by 2020 with average annual growth of more than 8 percent, according to a new report.
Retail sales reached $35.4 billion, last year and are set to see a 7.7 percent expansion this year, according to an analysis by the Dubai Chamber of Commerce and Industry based on data from Euromonitor International, prepared ahead of the World Retail Congress.
The analysis said that store-based retailing was behind 98 percent of the total value of retailing in 2015, and its pace of growth has by large margin outpaced growth of the non-store retailing category since 2010.
“Growing economic prosperity, steady population growth, and rising incomes have all helped to increase consumers’ overall expenditure in Dubai," said Hamad Buamim, president and CEO, Dubai Chamber.
"In addition, the boom in tourist numbers have kept the wholesale and retail sector vibrant.”
Categorising Dubai’s store-based retailing into non-grocery retail and grocery retail, the Dubai Chamber analysis valued non-grocery retail at $22.3 billion in 2015, and grocery retail at $10.9 billion.
It added that non-grocery retail sales witnessed a strong compound annual growth rate (CAGR) of 7.1 percent, driven by growing demand which is backed by higher per capita incomes.
The analysis attributed Dubai’s trendy, youthful population as a major factor for this growth, with many keen to stay up to date with the latest trends in many retail product categories such as apparel, footwear, health and beauty products, as well as luxury products.
The analysis said that grocery retail saw a 6.8 percent CAGR in sales over the period 2010-2015, mainly due to strong demand for convenient shopping formats such as convenience stores and supermarkets.
It added that a growing number of residential projects being delivered on the outskirts of Dubai away from existing malls has attracted major supermarkets to open smaller outlets in those new areas to meet the increasing need for convenience shopping.
According to the report, apparel and footwear retail outlets are set to lead growth in the medium term at a forecast CAGR of 6.6 percent; which will keep it as the largest sub-segment under the non-grocery retailing category.For all the latest retail news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.