22 July 2009
Dubai's homegrown retailer Aswaaq's expansion plans remain on schedule despite the economic slowdown, said its chief executive. In an interview with Emirates Business, Abdul Baset Al Janahi, CEO of Aswaaq, said the company offers a "different-type" of retail experience in Dubai and believes its new concept of community-oriented shopping, which fuses elements of the traditional UAE marketplace, is being accepted well by consumers in Dubai and the UAE. Despite the slowdown, Al Janahi believes community-oriented businesses such as Aswaaq will be able to maintain their success and growth, since their prosperity depends on a long-term mutual relationship between the business and the consumer.
Where does Aswaaq stand today amid the current financial crisis, a year after its establishment and the launch of its retail outlets?
We started in a very tough and challenging time. By the end of this year, though, we will open four permanent locations and six leased ones. Are we affected? Yes, but only in terms of speed: We have been slowing down. And as soon things come back to normal, we will speed up.
How slow do you mean when you say "slowing down"? And what does speeding up entail?
When we launched our activities last summer, we had plans for more locations this year. But we had to re-schedule things due to the financial crisis that has been felt in almost every corner of the world, even though the effect has varied from place to place. But slowdowns and crises can be good times as well. We are taking the opportunity to negotiate better rates on buildings and deals. As for the construction of new retail outlets, these are proceeding as planned for the year.
Don't you think the speeding that you mentioned might have contributed to where things are in the business environment today?
It is human nature. If there is an opportunity, people will run to it. This is a collective decision to do so. If we look at the situation today and what is expected a year from now, we are one of the best-prepared countries to bring in the next wave because we have infrastructure. Yes, we were speeding in the past, but we were speeding in the right time and the right place.
What is the lesson from the past few years that can be utilised in the future?
We have been opportunistic in the past four years. In terms of project management and execution, we have learnt a lot. And in these times of difficult economic trends, the learning cannot really be quantified.
How many retail outlets will Aswaaq have by the end of the year and what is the budget for the expansion?
We will have four community shopping centres, one each in Nad Al Hamaar, Miz-her, Umm Suqueim and Al Warqa. Then we will have another six. Our budget is Dh260 million.
A recent report has placed Dubai among the top 10 retail destinations worldwide. Also, His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, recently announced the city would bid for the 2020 Olympics. What impact will this have on your type of business?
Of course, this is great news. There is no city in the region that has what it takes to host an Olympics other than Dubai, and no country other than the UAE. We have the infrastructure, service facilities, travel conveniences, the roads, the hotels, safety and security, harmony between a unique mosaic of nationalities and more. Many events have taken place in other GCC cities where the visitors stayed in Dubai. Aswaaq is the first homegrown retail concept that was developed totally in the UAE and Dubai.
How does Aswaaq differ from its competitors?
We adopted a concept called a "street market" where the average consumer or shopper can have an old-fashioned shopping experience, such as what used to happen in the traditional neighbourhoods where there was close interaction between the buyer and the seller. I would like to highlight that the concept is different from other traditional ones used in America -- such as the Flea Market. Looking around us, we find we have imported many foreign concepts, cultures, and ways of life and doing business. We also focus on quality at reasonable prices. We have obtained an HACCP certification for health and safety to meet certain high standards, despite its high cost.
But why did you have to go for the HACCP (Hazard Analysis and Critical Control Points) certificate? Other outlets claim they meet very high standards simply by obeying the municipality's rules?
Before we started Aswaaq, we saw a practice in the market where many outlets were bent on cost saving and did not care about high levels of service and amenities. Many retailers pursue shortcuts to cut cost and only do the bare minimum required of them -sometimes not even that. But not us. Because of the relationship between Aswaaq and the community, we are not only about retailing but about engaging the community by creating loyalty, encouraging employment and giving access to retail outlets.
The Consumer Protection Department has introduced many measures to protect consumers and a consumer court has been set as well. Do you see this affecting profitability in the retail sector?
Such measures are always welcome. They also protect the good retailers, apart from the consumers. As I always say, the emphasis should be on quality, loyalty and shopping for less. We believe such measures help to maintain these three important elements.
PROFILE: Abdul Baset Al Janahi CEO of Aswaaq
Abdul Baset Al Janahi is a member of the founding committee of Aswaaq. He had a significant role in finalising co-operation agreements with a number of leading public and private sector institutions and organisations as part of his passion to offer exclusive privileges to members of the Mohammed bin Rashid Al Maktoum Establishment for Young Business Leaders.
Al Janahi has a degree from MIT's Sloan School of Management in the US.
Dubai's homegrown retailer Aswaaq's expansion plans remain on schedule despite the economic slowdown, said its chief executive. In an interview with Emirates Business, Abdul Baset Al Janahi, CEO of Aswaaq, said the company offers a "different-type" of retail experience in Dubai and believes its new concept of community-oriented shopping, which fuses elements of the traditional UAE marketplace, is being accepted well by consumers in Dubai and the UAE. Despite the slowdown, Al Janahi believes community-oriented businesses such as Aswaaq will be able to maintain their success and growth, since their prosperity depends on a long-term mutual relationship between the business and the consumer.
Where does Aswaaq stand today amid the current financial crisis, a year after its establishment and the launch of its retail outlets?
We started in a very tough and challenging time. By the end of this year, though, we will open four permanent locations and six leased ones. Are we affected? Yes, but only in terms of speed: We have been slowing down. And as soon things come back to normal, we will speed up.
How slow do you mean when you say "slowing down"? And what does speeding up entail?
When we launched our activities last summer, we had plans for more locations this year. But we had to re-schedule things due to the financial crisis that has been felt in almost every corner of the world, even though the effect has varied from place to place. But slowdowns and crises can be good times as well. We are taking the opportunity to negotiate better rates on buildings and deals. As for the construction of new retail outlets, these are proceeding as planned for the year.
Don't you think the speeding that you mentioned might have contributed to where things are in the business environment today?
It is human nature. If there is an opportunity, people will run to it. This is a collective decision to do so. If we look at the situation today and what is expected a year from now, we are one of the best-prepared countries to bring in the next wave because we have infrastructure. Yes, we were speeding in the past, but we were speeding in the right time and the right place.
What is the lesson from the past few years that can be utilised in the future?
We have been opportunistic in the past four years. In terms of project management and execution, we have learnt a lot. And in these times of difficult economic trends, the learning cannot really be quantified.
How many retail outlets will Aswaaq have by the end of the year and what is the budget for the expansion?
We will have four community shopping centres, one each in Nad Al Hamaar, Miz-her, Umm Suqueim and Al Warqa. Then we will have another six. Our budget is Dh260 million.
A recent report has placed Dubai among the top 10 retail destinations worldwide. Also, His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, recently announced the city would bid for the 2020 Olympics. What impact will this have on your type of business?
Of course, this is great news. There is no city in the region that has what it takes to host an Olympics other than Dubai, and no country other than the UAE. We have the infrastructure, service facilities, travel conveniences, the roads, the hotels, safety and security, harmony between a unique mosaic of nationalities and more. Many events have taken place in other GCC cities where the visitors stayed in Dubai. Aswaaq is the first homegrown retail concept that was developed totally in the UAE and Dubai.
How does Aswaaq differ from its competitors?
We adopted a concept called a "street market" where the average consumer or shopper can have an old-fashioned shopping experience, such as what used to happen in the traditional neighbourhoods where there was close interaction between the buyer and the seller. I would like to highlight that the concept is different from other traditional ones used in America -- such as the Flea Market. Looking around us, we find we have imported many foreign concepts, cultures, and ways of life and doing business. We also focus on quality at reasonable prices. We have obtained an HACCP certification for health and safety to meet certain high standards, despite its high cost.
But why did you have to go for the HACCP (Hazard Analysis and Critical Control Points) certificate? Other outlets claim they meet very high standards simply by obeying the municipality's rules?
Before we started Aswaaq, we saw a practice in the market where many outlets were bent on cost saving and did not care about high levels of service and amenities. Many retailers pursue shortcuts to cut cost and only do the bare minimum required of them -sometimes not even that. But not us. Because of the relationship between Aswaaq and the community, we are not only about retailing but about engaging the community by creating loyalty, encouraging employment and giving access to retail outlets.
The Consumer Protection Department has introduced many measures to protect consumers and a consumer court has been set as well. Do you see this affecting profitability in the retail sector?
Such measures are always welcome. They also protect the good retailers, apart from the consumers. As I always say, the emphasis should be on quality, loyalty and shopping for less. We believe such measures help to maintain these three important elements.
PROFILE: Abdul Baset Al Janahi CEO of Aswaaq
Abdul Baset Al Janahi is a member of the founding committee of Aswaaq. He had a significant role in finalising co-operation agreements with a number of leading public and private sector institutions and organisations as part of his passion to offer exclusive privileges to members of the Mohammed bin Rashid Al Maktoum Establishment for Young Business Leaders.
Al Janahi has a degree from MIT's Sloan School of Management in the US.
By Rami Eljundi
© Emirates Business 24/7 2009
