MENA: retailers focused on continued expansion

Date : 27 November 2014

As Fucom add a new supermarket, Circle K looks to grow in the UAE, LuLu sets out its plans to expand in both new and existing markets and Carrefour’s franchisee in Morocco, Label'Vie, discusses its short term investment strategy, we round up news from the Middle East and North Africa.

Label'Vie set out investment plans to 2016

Carrefour’s franchisee for Morocco, Label'Vie, has announced plans to invest MAD1.1 billion (US$124.1 million) in its store network to 2016 to grow its selling space by 59,000 sq. m, with 38% of this planned to be added in 2015 and the remainder in 2016. By format, the retailer said that it would add 15,000 sq. m to its Carrefour Market network, by investing MAD595 million (US$67.1 million), 20,000 sq. m to its hypermarkets (MAD258 million, US$29.1 million) and 24,000 sq. m at its Atacadão (MAD261 million, US$29.4 million).

Label'Vie said it was investing in expansion following a strong performance in 2014, where it was expecting to generate sales of MAD6.0 billion (US$676.8 million), and on the basis it was forecasting growth of 22% for 2016, when it believes it will generate sales worth MAD9.5 billion (US$1.1 billion).

LuLu to expand in new and existing markets

In an interview with Gulf News, LuLu’s product development manager, Shamim Sainulabdeen, has said that the retailer is planning to invest US$3 billion in growing its store presence, both in markets where it already operates, such as the UAE, India and Saudi Arabia, and into new countries, like Indonesia, Malaysia and Sri Lanka. In reference to Sri Lanka, Sainulabdeen said that ‘…within a span of three years, I can see three or four stores in Sri Lanka’, while elsewhere he said LuLu was aiming to open between 100 and 150 LuLu Xpress stores in the UAE and up to 15 outlets in India’s biggest cities over the course of the next three years.

Fucom grows Géant footprint, envisages further expansion

On the opening of a neighborhood supermarket under the Géant franchise in the UAE, Fucom has said that the new store is part of its plans to add more than 30 stores in the country over the next two years. Fresh is a key focus for the new store, with Fucom’s operations manager for supermarket development, Yasir Arfat, noting that the retailer has invested in shopper insight to take ‘the necessary steps to understand our customers and provide for their requirements accordingly’.

Circle K franchisee to grow brand in UAE

Convenience Arabia, Circle K’s partnership for the Middle East, has said that it will continue to expand its presence in the UAE, and is aiming to open four stores in Abu Dhabi before the end of 2014. Launched in 2010, Circle K has grown its store base in the UAE to 40, with 10 in Abu Dhabi alone. Commenting on the expansion programme, a spokesperson for Convenience Arabia said: “The opening of these new outlets in Abu Dhabi reflects the strong response for the growing demands of convenience stores that can cater to the demands and needs of customers in the emirate.”

Jon Wright is Europe, Middle East & Africa Region Manager at IGD and is responsible for conducting and shaping the research programme across these regions. Jon has been analysing global retailers and emerging markets for more than a decade.