Indian businessman M.A. Yousuf Ali, the Founder and Managing Director of the UAE's Emke Group, travels down memory lane with Stanley Carvalho to provide a few pointers to the group's future.
The UAE's Emke Group's story is a classic 'small to big' one. It is also the dream come true of an ambitious and enterprising Indian businessman who strove relentlessly to build his business brick by brick to what it is today a leading retail brand in the Gulf with an annual turnover of Dhs5 billion ($1.4 billion).
But despite the achievements and accolades, M.A. Yousuf Ali, the Founder and Managing Director of the group, exudes no airs of a high-flying businessman. Simple and modest to a fault, he continues to work like before, expanding and diversifying his business into new sectors and markets.
"I am an ordinary man," he says with nonchalant modesty. The group operates popular brands of retail chain stores that include the renowned Lulu chain of supermarkets, department stores, hypermarkets and now shopping malls. The Al Falah Plaza and Emirates General Market are two popular retail chains it manages. Emke Group's retail chain caters to over 200,000 customers every day and commands a 32 per cent retail market share within the GCC. With the planned opening of scores of stores and new malls in the short term, its market share could go up further.
Presently, Emke Group operates its retail chains in the UAE, Oman, Qatar, Kuwait and Yemen. Ambitious expansion plans are under way with malls coming up in Riyadh, Bahrain and India. Through its subsidiary companies and sourcing agents based in countries such as India, China, Kenya, Tanzania, Benin, Indonesia and Thailand, the group imports a wide range of products.
Besides retailing and related activities the group is active in the fields of IT, travel and tourism and has set up its own property development arm, Line Investment and Properties, to handle its present and future projects. Ranked as one of the biggest Indian-owned conglomerates in the Gulf, the Emke Group today employs over 15,000 people of 28 different nationalities.
In another rare achievement, Yousuf Ali became the first Indian (and the first expatriate, along with a Lebanese businessman) to be elected to the board of directors of the Abu Dhabi Chamber of Commerce and Industry in 2005. He was also awarded the Pravasi Bhartiya Samman by the government of India in 2005. The senior businessman talks to Gulf Business about the group's past, present and future.
For starters, it would be interesting to go back to the group's early days and how it has grown over the years...
Emke was started in 1966 as a small trading establishment in Abu Dhabi dealing primarily in foodstuff and commodities. Gradually, we moved on to importing frozen meat, poultry and food products from Europe, the US and India and then on to wholesale trading.
After establishing ourselves firmly in the trading business, wholesale and catering supplies, we ventured into the supermarket business in the early 1990s with the opening of the first one in Abu Dhabi. What looked like a small step went on to become the flagship of the group with the launch of the Lulu brand of supermarkets and department stores across the GCC.
In 2000, the Emke Group opened its first hypermarket in Dubai and close on the heels of its massive success went on to open bigger and better ones in other parts of the UAE and the GCC. Today, the group has 64 stores in almost all major cities in the Gulf including Yemen, and has nine more hypermarkets due to open by the end of 2008.
What made you open your first supermarket around the time the Gulf War broke out, when other businessmen were pulling out their investments from the region?
It was a time of great insecurity, but the Emke Group opened its first supermarket at that crucial time. People wondered if there was something wrong with me. But they must be forgiven. And now when they rush into the many supermarkets of the group, they forget about our brave vision. That small step has led to so many supermarkets and hypermarkets today. What is most satisfying to me is not how many stores we have today, but how many thousands of people of different nationalities these very stores are capable of employing.
What factors have contributed to the growth of the Emke Group in the UAE and indeed the region?
The simple philosophy of quality products at affordable prices with a friendly service has been the hallmark of the group's growth. The strong brand equity among its loyal shoppers has always stood the group in good stead in all markets where it is in operation. Other USPs are adaptability, product and staff mix to appeal to a larger target segment, and vantage locations.
What made you establish an investment arm?
The group, after firmly establishing [itself] in the hypermarkets sector, ventured into the bigger market of shopping malls and a separate division Line Investment and Property LLC was launched to tap the potential retail and real estate projects. In a short span, Line Investments secured the managing rights of three prestigious projects in Abu Dhabi namely, Al Wahda Mall, Al Raha Mall and the Madinat Zayed Shopping and Gold Centre.
The soon to open Khalidiyah Mall will add another feather in our group's cap. Recently, the company was also awarded the Central Fish Market project, a unique project that will blend a state-of-the-art fish and vegetable market with the luxury of an international standard shopping mall. Other projects include shopping facilities in Oman, Qatar, Bahrain and Saudi Arabia.
What is the group's current turnover, profitability and market share? What are your projections, say over the next five years in terms of these key figures?
The group, which enjoys a market share of 32 per cent in the organised grocery retail sector, reported an annual turnover of $1.4 billion in 2006. We have been growing at a steady pace and expect to further boost our market share with the launch of nine more hypermarkets by the end of 2008. The investment for our current announced projects is close to Dhs2 billion [$545 million] in different markets. The group has already made significant investments over the years in the ongoing businesses.
How do you see the retail sector in the UAE and the Gulf developing in the coming five to 10 years?
The retail sector might look cluttered, but with the massive expansion taking place here [in the region] especially in the tourism, aviation and real estate sectors, we see great potential for quality players and we are very positive about our contribution in this regard, though we may diversify into related sectors, but not onto completely new fields.
How does Emke perceive competition in the region's retail sector, especially with the growing presence of big boys such as Carrefour? In terms of pricing, how competitive is Emke?
We have always believed in fair play and healthy competition and welcome any new player into the market. At the end of the day, the consumer is king and he should have the option to choose and decide. The very fact that we have been growing despite the entry of many foreign players shows the loyalty we enjoy from our shoppers and we do not see it changing in the future either.
To tackle the pricing issue, we have launched our own Lulu brand of products in almost all categories with a focus on providing good quality products produced by top companies at substantially reduced prices.
Being in the foods, consumer, packaging sector, how sensitive is Emke towards health and environment issues?
Health and environment issues have always been on our radar and a special team of experts with international exposure are in the field to conduct training and awareness programmes for both existing and new staff and our efforts have always been praised by the authorities concerned.
Do you have any plans of going public or merging with any other retail group?
Plans to go public or mergers and acquisitions are not a high priority for the group right now.
What's your business philosophy?
In a nutshell, it is faith and trust. It is the faith in the system and the country like what we did during the Gulf War by opening our first supermarket. It is faith that has seen us through the ups and downs. We do not follow what others do. If we believe in something, we go ahead and implement it with full faith that it will succeed.
© Gulf Business 2007
