[ad_1]
It’s no secret that the Gulf has a penchant for luxury goods – despite the region’s economic challenges, the market remains resilient.
The luxury goods market in the Middle East and Africa is expected to experience the fastest growth in the world between 2014 and 2019 at a CAGR of 7.2%, despite conservative shopping behavior in oil exporters due to lower crude prices, according to a GlobalData report. reports.
The firm found that while the UAE is the largest luxury market in the region, Saudi Arabia is the fastest growing.
But despite such opportunities, a Euromonitor report released in January showed that the UAE’s luxury sector is still dominated by international brands.
That’s what prompted Emirati entrepreneur Khalid Basaeed to launch what he calls Feathers, the UAE’s first luxury brand. Founded in 2010 with just one store in Abu Dhabi, the brand sells a variety of fashion accessories and currently has four stores in three emirates with multi-million dollar revenue.
But Basaeed admits that getting where he is now has not been easy.
“The first challenge is funding and financial,” he said.
“We’re financing the project ourselves, for the first two years we don’t aim for any profit, but we want businesses to start financing themselves.
“We had a lot of support from the media, and once people got to know us and started buying from us — we were able to fund the project.” The following year, we approached the Khalifa Fund [for Enterprise Development] To help expand our business in Dubai, we got their support of AED 500,000. We broke even in our third year of operation. “
Another big challenge is convincing mall operators to let the company lease a location, Basaeed said.
“We see ourselves as an affordable luxury brand. So when we approach malls to find a spot, they don’t know us and worry that we might fail, which (in turn) will affect their reputation. So, in Finding the right location in the right mall was a challenge because we were newbies and didn’t have anything on hand, everything was just on paper.”
Another problem they faced was convincing customers to accept the brand, he admits: “Women in this area like to have a well-known brand – why Feathers? Convincing them that we are a luxury brand and not just a local business is A challenge.”
A big part of gaining customer buy-in comes down to marketing and advertising, Barsade believes.
“When people see your ad with other international brands on Sheikh Zayed Road, it increases your popularity and people start to recognize your brand.
“Then when people see your store, your decor, the quality of your work, they start to see your brand differently,” he added.
The company has spent up to Dh1 million a year on marketing and advertising over the past two years, although it will cut that amount this year and focus more on social media.
There are no other major cost-cutting plans, but Basaeed admits the company is considering tweaking its product range to make it more relevant.
The entrepreneur believes that increased competition could have a bigger impact on business than the current economic situation.
“The first two years [2014, 2015] better than last year.I don’t know if it’s because it affects people [by the economic scenario] Or because competition is getting tougher. We see a lot of other companies going our way – a lot of local brands are established, a lot of people are trying to have the same idea,” he explained.
But the brand hopes to differentiate itself from competitors by focusing on quality.
“Some local brands are not as good as they should be. We strive for quality, and any supplier who is not at the level we require – we will stop dealing with them. We even moved most of our production to Europe because we Want quality,” he said.
Currently, the brand is producing its next collection of men’s and women’s handbags, belts, sunglasses and shoes in Italy. Watches are made in Switzerland, pens in Germany, scarves and mobile phone accessories in Turkey.
The fragrances are packaged locally, but the essential oils come from Europe. Feathers also has a small collection of small accessories made in the UAE.
In terms of prices, handbags start from Dhs950 to Dhs5,000, watches from Dhs1,000 and sunglasses from Dhs950. Small accessories such as mugs and key chains cost between Dhs85 and Dhs350.
Not surprisingly, the brand’s main clientele (about 65%) are Emirati, with GCC nationals making up 30%. The other 5% includes expats and tourists.
“We are Emirati and we know what the people of the UAE and the GCC want. So we try to design something that people like and that’s what sets us apart [international] brand,” Basaeed said.
To meet growing demand, the brand opened a store in Al Ain last year and opened its first store in Doha, Qatar, in March. A new store will open in Sharjah next year. It already has two stores in Abu Dhabi and Dubai.
Feathers is also eyeing expansion in Saudi Arabia, with a particular focus on Riyadh and Jeddah. “We have investors who are interested in Saudi Arabia, but we haven’t closed the deal yet,” Basaeed said.
Meanwhile, from an e-commerce perspective, the company will launch its new website within two months, which will allow it to ship products to customers around the world.
In addition to geographic expansion, the company is also considering entering new verticals using its existing brands.
“We are considering expanding into other areas such as childrenswear, which includes clothes and some baby accessories. We have just started talking to factories and it is still in the early stages – we may launch in 2018,” revealed Basaeed.
“We are also considering opening stand-alone shoe and jewelry stores as these are our best-selling items and we cannot afford more in our current storefront.
“Our plans on paper also include going into the restaurant business – maybe a Feathers café. But we’ll try to do something unique with it,” he added.
In the end, Basaeed said his vision was simple: “My dream is to elevate the name of my country with something I’m proud of.”
[ad_2]
Source link