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Franchising and the Retail Industry in the Middle East

Steve McAteer, CEO at ArabBCo, started his career in Birmingham, England more than 30 years ago. He moved to Bahrain/Qatar where he spent 2 years, then Saudi Arabia for 7 years and the past 5 years in the UAE. During his time here he has launched many Brands and opened hundreds of locations across the region.

STEVE MCATEER

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RETAIL BUSINESS MANAGEMENT ARABBCO

Most of you reading this will know all about franchising and the impact it has had on retail in the Middle East. During the pandemic, the majority of the industry suffered, and talks were still ongoing with international brands and their potential of entering the market here.

The growth of local homegrown Halal Brands from across the region has been impressive and for sure there will be more that will penetrate the market over the coming years. With this, malls and governments need to give them more priority and support. In fact, we are in the process of securing contracts for local brands to become franchisors themselves and expand beyond the Middle East with interest from all continents. Since January, we are seeing many of these talks come to fruition.

During my daily and weekly chats with Franchisors, Franchisees, Investors, Operators, Mall Management and other colleagues that also offer Franchise Services in the industry, it is clear that we are all similarly busy and the current level of interest from both sides of the scale is exciting. At the moment, one of the key issues seems to be the lack of quality locations within malls that would be acceptable to a brand or partner, particularly luxury brands. With new shopping malls now open and footfall rising along with new malls to open over the coming years, and further mall extensions planned, then this may appease such brands. Pop-Up locations are becoming more popular where brands, particularly local ones, can test the market.

Another issue seems to be from a customer point of view; they are becoming hungry for alternative brands rather than the copy-paste variety that is available in most key malls. Therefore, operators are looking to bring new exciting brands to the market. Those brands that have something unique (USP) about them, with the best terms, the best support, marketing, history and home performance, etc. will be the ones to make the biggest impact. Gone are the days when any old Coffee Shop, Burger Bar or discounted clothing store will suffice. International brands are always keen to come to the Middle East as it is a natural next step for them to expand beyond the traditional mature markets they are familiar with in the East and West. This along with a fast-growing young population, a thirst for technology, the climate, the low tax lifestyle and a good level of disposable income makes the Middle East an attractive region to expand into. All these points are a good sign for the future of the retail market here in the Middle East and now is a perfect time to secure some great brands from across the globe and help local brands grow further. I will be happy to discuss any points with anyone who may be interested at the Arab Franchise Expo taking place on the 7th of December at the Pullman Hotel next to Deira City Centre where myself and other Franchise organizations will be offering their services with over 100 new International and Local Brands including a dedicated area for Local Home-Grown Halal Brands on show and in 2023 this event will be arriving to other GCC major cities. For more info, visit www.arabbco.com.

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