International retial

International Retail

The company is choosing between three different countries for its Middle East launch -- Jordan, Morocco and the UAE. There are a number of different sources for information that can help to make this choice. The initial research should include an analysis of the basic economic and political environments of these three countries, using information found on the CIA World Factbook. Jordan has 6.4 million people, around half of whom live in the capital Amman. This implies easy distribution as our stores would probably only be in Amman. There are 3.7 million people within the 15-64 demographic that we target. The GDP is $32 billion, ranked 104th in the world. The government is relatively open for the Middle East. This equates to $5,200 per capita.

Morocco has 31.6 million people, 20 million of which are in our target demographic range. They are spread around a number of different cities, which presents distribution challenges. The economy is the 58th largest in the world with a GDP of $145.6 billion, which equates to $4,700 per capita. As with Jordan, Morocco is a kingdom, but the government has pursued increased economic openness in recent years. Morocco receives large numbers of tourists as well, both Muslim and Western.

The UAE market is focused on the three "open" emirates, Dubai, Abu Dhabi and Sharjah. In total, the country has 5 million people, most of whom live in these three major emirates. There are nearly 4 million people in our target demographic. The UAE has significant wealth, with a GDP of $186 billion, good for 53rd in the world. The per capita GDP is $38,900, which is comparable with Western European nations. Each emirate has its own government, with these three being the most open. Major businesses are tightly controlled but retailing is an open sector.

The next step is to understand the sociological aspects of each country. Shopping is a major pastime in the UAE, and as a result the market for high fashion is substantial. The retail clothing sector is well-developed, with malls, factory outlets and other elements familiar to Western firms (AME Info, 2008). Both Dubai and Abu Dhabi have at various times promoted themselves as shopping holiday destinations, and they are considered to be trendsetters for the region (VacationInDubai.com, 2010). Jordan's retail fashion scene is similar to that of the UAE with an emphasis on high fashion (AME Info, 2007), although not on as grand a scale as the opulent malls of Dubai and Abu Dhabi. Despite restrictions on ladies' dress in the UAE, the market for Western fashions is strong, as women wear these fashions in the home and at women's only social events. Morocco's retail fashion industry is more nascent, and is focused on Casablanca, giving it a market structure similar to that of Jordan (CPP Luxury.com, 2010).

Other sources of information can come from chambers of commerce for the respective countries, as well as from news reports concerning the experiences of other retailers. However, as media in these countries is not free, the information is not always trustworthy. That said, first hand experience can also be valuable, as the company's managers can see the state of the market in each of these countries. It is recommended, on the basis of the sophisticated retail scene, the ease of distribution and the high per capita GDP that the United Arab Emirates is the first place of launch in the Middle East. In addition, as Dubai and Abu Dhabi are the region's fashion capitals, a successful launch in the UAE will raise the profile of the company throughout the region. The wealth of these two cities will likely result in higher sales, and provide the opportunity to open multiple outlets, whereas the concentrated industries and lower per capita GDPs of Jordan and Morocco would result in fewer expansion opportunities once the top two or three malls were entered.