Jumbo in Dh5.14m revamp of Mall of the Emirates store
Big-box retailing concept to focus on brown goods, with CEO expecting good return on investment
Dubai: Dubai-based Jumbo Electronics has invested $1.4 million (Dh5.14 million) to revamp its Mall of the Emirates store with the shop-in-shop concept from reputed brands.
“This is our flagship store and one of the most profitable stores for us. The return of investment will be great and [we] expect the store to contribute a lot,” Vishesh Bhatia, CEO of Jumbo Group, told Gulf News after opening the 27,000-square foot store on Monday.
The Mall of the Emirates store is the biggest big-box retailing for the group.
According to Bhatia, big-box retailing doesn’t sell ‘white goods’ like refrigerators, washing machines and home appliances and only focuses on ‘brown’ goods such as TVs, audio/video systems and smartphones. White goods are not a everyday purchase and “we don’t get the return for the money invested in the floor space,” he said.
Footfall at Mall of the Emirates is “very good and we get more one million visitors a year,” he said.
Bhatia said the year ahead had its own negatives and positives. A strong dollar and a weak Russian rouble, which has hit Russian tourist inflow into the UAE, are among the challenges looking forward. The sluggish property market has also impacted investor sentiment.
On the positive side, Bhatia said the imminent easing of Iran sanctions was acting as a tonic.
According to him, Dubai can survive the challenges because it is making huge investments, in addition to the big pick-up in trade that is taking place and the huge number of visitors coming in.
“If visitor numbers fall for whatever reason, [they] may have an impact. So we are very careful and keeping a close vigil, and at the same time cautiously positive,” he said.
The electronics group is keen to enter Iran when sanctions are eased as it sees a huge opportunity for growth.
Nadeem Khanzadh, head of omnichannel retail at the Jumbo Group, said that there is a lot more that goes into store planning than meets the eye. Studies by McKinsey show that the process of improving store formats can increase customer sales by 20 to 30 per cent.
Jumbo will be opening its 20th store with a floor area of 2,000 square feet at Yas Mall in Abu Dhabi next month.
“With the high real estate prices and online presence, we don’t need to have 10,000 square feet shops now. [About] 2,000 square feet is sufficient now,” Bhatia said.
