How UAE’s LuLu Group plans to keep food prices in check across the Gulf

Dubai: As food prices remain under pressure globally, LuLu Group is expanding its sourcing network, private labels and direct-from-farm strategy to keep everyday groceries affordable across the Gulf.

Speaking to the media at the sidelines of Gulfood 2026, MA Yusuf Ali, Chairman and Managing Director of Lulu Group International, said that geopolitical tensions, shipping disruptions, and inflation have made supply chain control critical for large retailers.

“Geopolitical issues going on, a lot of uncertainties going on, lot of price fluctuation… shipping issues, food scale, sometimes the only way we can better that is to establish our own food services," he told Gulf News.

He added that the group’s long-term strategy is to reduce dependence on intermediaries.

“The only way we can combat all these things is to ensure that you have a key stakeholding in almost all aspects of food chain, right from manufacturing or producing.”

LuLu is increasingly sourcing produce directly from farms, cutting out middlemen and shortening supply routes — a move it says helps stabilise prices and ensure consistent quality.

“There’s no middleman. So we straightly ship it from the producing country to our countries here, and then we take it over and we supplied our stores. There’s minimal people involved, straight from farm to store.”

The retailer is expanding contract farming in India, while also exploring similar models in Sri Lanka and parts of Africa.

India remains a key sourcing market for LuLu. The group currently procures around ₹10,000 crore worth of products from India for the Middle East and plans to increase this to ₹15,000 crore within two years.

“The discussions happened today, where we have set a benchmark of going into 15,000 crores over the next two years, from India, from India to the Middle East.”

LuLu is also widening the range of Indian states it sources from, including Assam, Meghalaya and Himachal Pradesh, alongside traditional hubs such as Punjab, Maharashtra and Kerala.

“India has every state has unique products… People don't know that. We have apples from Meghalaya, which are very, very interesting product.”

LuLu has also signed new agreements with suppliers and government-backed bodies from Lithuania, the US and Saudi Arabia, while holding discussions with Canada and Australia to expand imports.

Ali said the group has built sourcing and logistics centres in 27 countries, allowing it to respond quickly to supply shocks.

“Our focus remains on serving our diverse, multi-ethnic customer base with high-quality, healthy, and sustainable products at the most affordable prices,” he said.

LuLu is also expanding its private label portfolio, which V Nandakumar, Director of Marketing & Communications at LuLu Group, said helps bring down prices for consumers without compromising on quality.

“Initially, we are beefing up our private label offering new branded products to bring down the price,” he explained.

By manufacturing and sourcing its own brands, LuLu aims to reduce exposure to global price swings affecting international labels.

While physical stores remain core to the business, LuLu expects e-commerce to play a much bigger role.

“Right now, it does around less than five, 10 per cent of our total business… Going forward, it will play a bigger role.”

The group is rolling out updated apps and websites and has partnered with platforms such as Amazon and Talabat to reach more customers.

In terms of geography, Saudi Arabia is set to be LuLu’s fastest-growing market, alongside continued expansion in the UAE, where the retailer currently operates 266 stores, with the 267th opening in Al Ain.

As global food systems face growing strain, LuLu’s message is clear: tighter control of supply is now essential to keep shelves stocked — and prices stable — for Gulf consumers.