Dubai: US-based women’s apparel brand Bebe will focus on expanding in Saudi Arabia and Qatar in the Middle East and looks to enter Iran once economic sanctions imposed on the country are lifted, according to a top company executive.
“Sales in Saudi Arabia are good. Same-store sales are increasing by 15 per cent this year,” Richard Pierson, Bebe’s senior vice president of international operations, told Gulf News in an interview on Wednesday.
Saudi Arabia’s retail market is expected to grow from $124.3 billion in 2015 to $185.4 billion in 2019, according to data from consultancy Euromonitor International. Consumer demand in the kingdom is growing, encouraging retailers to open new outlets, the consultancy said in a report published last February.
Bebe operates five stores in Saudi Arabia, but plans to add up to 13 in the next two years. In Qatar, where it has one outlet, it plans to open up to four more during the same period.
“Qatar is a lucrative market, a wealthy country,” Pierson said. He declined to give an investment figure for the expansion.
Also, Bebe looks to enter Iran, a nation of 80 million people, once economic sanctions imposed on the country are lifted, which is expected to be in early 2016.
“We’ve already started investigating the market. I think we can open three to five locations in the market over a three to four year period,” Pierson said.
The value of Iran’s retail market is expected to grow from $133.58 billion this year to $156.5 billion in 2019, according to Euromonitor International.
Bebe operates 165 stores globally, with the UAE and Mexico being its biggest markets, Pierson said. The UAE, where it has nine stores, accounts for 7 per cent of its global sales, he added. The Middle East is expected to account for around 12 per cent of Bebe’s total sales this year, he said.
Bebe aims to open an outlet in Dubai Outlet Mall in December and another in BurJuman in 2017, but there are no plans to expand beyond that, Pierson said. “We’re mature in the UAE. We’re already mature in [Bahrain, Lebanon, Kuwait and Jordan ]. Now is not the time to look for expansion in those markets,” he said. Bebe expects its UAE same-store sales to grow by 15-20 per cent this year, from 4 per cent in the previous year, helped by store renovations, a new marketing message that presents Bebe as a lifestyle brand, and a 30 per cent increase in its global marketing budget, according to Pierson.
“The upgrades that we are doing to the stores and the products, as well as the marketing message that we are giving out to the customers, is where we see us being able to grow … we feel that we overemphasised on being too sexy and too provocative [in the marketing message],” he said.
Expansion into China
Also, Bebe plans to enter China within the coming year, with 60-100 stores over the next five years, Pierson said.
“Shanghai and Beijing will be the key markets that we’ll be opening in,” he said. “China is the largest global market that we can expand into.”
Bebe also aims to expand into Hong Kong and Taiwan.
