Dubai: When French hypermarket chain Carrefour (then Continent) started operations in the Deira City Centre in the mid-1990s, it triggered a shift in the retail landscape of the UAE. It signalled a silent retail war in which supermarkets were to become the biggest victim.
Then Yousuf Ali MA, the non-resident Indian businessman from Abu Dhabi, quietly began expanding his Lulu-branded hypermarket chain, which took the competition to a different level, along with the Cooperatives. In the next 17 years, Yousuf Ali ran against time to develop 100 hypermarkets across the GCC to take a leadership role of his brand Lulu in the region’s retail business.
He was the first expatriate to be elected to Board of Abu Dhabi Chamber of Commerce and Industry.
Today, he owns 104 hypermarkets, employing 31,000 people that collectively deliver an annual turnover of $4.7 billion annually. In an interview with the Gulf News, he elaborated his views. Excerpts:
Gulf News: How was business during the formative years of the UAE? What were the challenges and how did you overcome those, then?
Yousuf Ali: Obviously Abu Dhabi was a far cry from what it is today. There were no basic infrastructure available in those days, electricity was a rarity, sewerage system were still to be implemented, ACs were unheard of, we used to sleep on the terrace of our home during summers after pouring buckets of water around to make it cooler. Still those were the days which I cherish the most.
Those hard days, I think have played a key role in making me more determined and bold enough to face the future challenges. Those were the days of excitement as well as anxiety.
What was the most memorable event in your business carrier over the last four decades?
We used to have a small trading business and used to do almost all work ourselves right from loading and unloading to driving around and selling them. Slowly we got into import and distribution of frozen food products from Europe and the US. I started to distribute the supplies not only in and around Abu Dhabi but also to farther interior areas of the emirate. Slowly the business started to pick up and we expanded to include bigger range of products in both food & non-food categories.
We went on to start cold stores, meat and food processing plants, large-scale import and distribution to big hotel groups, catering companies, ships chandleries, etc. By the 1980s we had sizeable share of the wholesale and retail food market with operations that covered the entire UAE.
As business grew and the environment changed, how did you change your organisation and business to adopt to the changes?
After the success in the wholesale and distribution market we ventured into the retail sector with the opening of our first supermarket in Abu Dhabi. By this time I was independently handling the affairs of Emke Group and I saw great potential in the organised retail sector.
The economy had started to boom with the oil revenue taking the centre stage. The visionary founder of the UAE, Shaikh Zayed, was spearheading the ‘march to future’ of this great country with many significant projects and initiatives, lots of people from all over the world had started to come in. The time was right to enter into the supermarket business.
Then we diversified into department stores. This actually happened in the height of the Gulf War and people were bit sceptical of investing into new business here. I was clear in my thinking and strong determination made sure that I went ahead with my plans and by God’s grace, we never had to look back.
What are the major contributing factors to the success of your business? How did the UAE’s overall progress compliment your business’ growth?
After firmly establishing ourselves in the supermarkets and department store segment, we were quite keen to venture into the bigger format of hypermarkets and in 2000 we opened our first Lulu Hypermarket in Ghusais, Dubai.
This really was the turning point for the group and we soon expanded into new markets with bigger and better hypermarkets in all major cities of the GCC. Today we have 104 stores of different sizes catering to more than 415,000 people every day.
Now that the UAE has achieved such a huge success, do did your business – how do you see the country’s overall progress in economy?
First and paramount is the location and easy accessibility. If you get these two aspects right, half the battle is won. Of course today’s shopper is very savvy and demands much for his spend… so store layout, parking, product range, service, hygiene, promotions, etc also play a significant role in the success of business. One reason I attribute for the success of our brand of hypermarket is our eagerness to listen and learn, this helps us bring in new changes and adapt newer technologies to meet the market requirements.
Though our stores across the region have unified business model, still we try to bring in changes in some location to cater to the local demand. This approach has helped us gain instant success and customer loyalty in whichever market we have entered. One thing I keep stressing in all my staff meetings is to continuously find newer ways to add more value for both our customers as well as other stakeholders.
Where does the challenges and opportunities lie?
I have never based my plans and projection on short term goals and I have always found swimming against the tide to be more rewarding. So, now a days when people around me talk of recession and slowdown and gloom in the market, I have a very different and positive take on the present economic scenario.
These current market trends are temporary and were necessary for market correction, but the corporate houses with strong fundamentals will always emerge stronger. We have not slowed down any of our projects, not fired a single staff as part of re-alignment, in fact we are hiring new staff as ours is a high manpower requirement business with each hypermarket taking in more than 300 employees.
This year itself we will be opening 6 more stores and 5 shopping malls in the UAE and elsewhere. Our current staff strength of 31,000 plus is sure to reach around 35,000 by the end of next year.