Plug-ins, the retail electronics arm of Al Futtaim Group will grow to at least 50 outlets by 2005, ahead of the WTO regime, from a mere three at present.

As part of a rebranding exercise, Al Futtaim Electronics' retail stores will also be known as Plug-ins ElectroniX, Raman Pandya, group managing director for the electronics wing, announced yesterday.

"We are also upbeat about the UAE - and regional - retail electronics market. We estimate the domestic market itself is annually worth Dh5.6 billion, and growing."

Year to date, the group's retail electronics business has surged an average 20 per cent, with some product categories even notching up 100 per cent growth, he estimated.

He was speaking at the inauguration of the third outlet at Sahara Centre, marking the maiden entry of Plug-ins ElectroniX into Sharjah.

The official noted the development forms part of a strategic expansion plan, embarked upon on the basis of comprehensive market research conducted earlier. The plan includes incorporating a 'Select Store' concept for the Plug-ins ElectroniX outlets.

"The customer has changed," opined Pandya, explaining the need for the brand repositioning, and the group's own market success, which runs counter to the experience of most other retailers.

"Today, they no longer want the cheapest product, but the one that offers them the best value."

He pointed out the group was early to recognise retailers could no longer rely on customer loyalty to a brand or price positioning, and that a new approach was required for what had become a saturated market.

"Our market research showed customers are overwhelmed by the choice of electronics products available today. Further, they have limited knowledge of a product's full scope. Our Select Store approach essentially sifts through the varieties of brands and products, and we select the best cross-section available that best meet our customers' needs and requirements," he explained.

Other value additions include enabling the buyer optimise product features, and more efficient aftersales servicing.

Pandya asserted the UAE electronics market continues to grow, with the consumer electronics and air-conditioning sector today worth Dh3.3 billion, computers Dh1.6 billion, and accessories and peripherals another Dh0.7 billion.

Market growth is being spearheaded by new consumer electronics products, and by the IT sector. He attributed the growth to three factors: the country's GDP growth, the wealth distribution being widespread, and the high tourist traffic, particularly in transit passenger numbers, placed last year at 14 million.

On foreign exchange fluctuations affecting product prices, he noted domestic prices have been stable despite the euro fluctuation.

But he acknowledged that margins, particularly on some product categories, continue to be under pressure.