UAE | General
Union Coop plans Dh200m expansion
Union Coop, the Dubai-based retail chain, is budgeting Dh200 million for a large-scale expansion, including a 500,000 square foot outlet which will be the "biggest hypermarket" in the Gulf, according to top officials.
- By Manoj Nair, Staff Reporter
- Published: 00:00 July 29, 2004
Union Coop, the Dubai-based retail chain, is budgeting Dh200 million for a large-scale expansion, including a 500,000 square foot outlet which will be the "biggest hypermarket" in the Gulf, according to top officials.
The outlet will come up in Muhaisnah just past Mirdiff. Another will be a 350,000 square foot store in Al Barsha.
"We have decided on the locations for adding another four or five stores in the next two years," said Marwan Ahmad Eisa Al Thani, general manager.
"At the same time, we will also be extensively revamping some of our existing seven stores. Union Coop has managed to compete successfully against international chains and grow its market base.
"We have decided on the expansion to keep in step with the explosive growth Dubai has had in the last two years. Our intention as a local company is to stay in step with the growth and not to be a follower."
Presently, Union Coop oversees a total retail area of 500,000 square feet in its seven stores.
The expansion strategy is part of a plan which targets a 30 per cent plus market share of Dubai's retail sales in the super/hypermarket category in five years.
It was two years ago that Union Coop went in for a major revamp of its organisational structure, bringing in "new blood" at senior management levels.
"In 2002, we realised that the environment had changed completely from the time Union Coop was established over 20 years ago. There was no point in catering to just one segment of the local population," said Ebrahim Abdullah Al Bahar, operations manager.
"This resulted in us bringing in stocks from all over the world, whereas two years ago the focus was essentially on internal sourcing.
Our outlets currently stock 65,000 items — which compares well when Wal-Mart, the world's biggest retailer, has 90,000 items or so."
The changes brought about over the last 24 months have resulted in a more eclectic mix of shoppers passing through its doors.
On average, the seven outlets get on average nearly 20,000 to 21,000 customers a day.
With the new openings in the next two years, the numbers could move to 30,000 and above, added officials.
On whether Union Coop would look to other emirates or GCC markets for expansion, the general manager said: "Other emirates have their own cooperatives. It is not our intention to compete there."
Cooperatives will stay independent
Supermarket co-operatives in the UAE have a unified structure when it comes to sharing information and developing strategies, according to a top official with Union Coop.
However, they will continue to maintain independence at the retail level, said Marwan Ahmad Eisa Al Thani, general manager.
"Each co-operative knows best the market where it operates, and there is no need to change the status quo," said Al Thani. "But on certain common issues which are important to the co-operative movement in the country, we have a unified structure to address these.
"The idea to develop an umbrella structure for the co-operatives is nothing new — it has been around for the last 10 to 15 years."
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