Ace aims to add two home improvement stores in Dubai

Ace, the home improvement retailer, is seeking to add two more stores in Dubai as new communities in formerly outlying areas begin to gain traction.

“We see the growth in the city of Dubai and feel we need to be in the communities where people are buying homes,” said Wayne Cohen, general manager of Ace.

One of the stores will be based near Arabian Ranches, where a number of new communities are being built.

The location of the second store is yet to be decided.

The retailer will also move online in the fourth quarter of this year, offering a full inventory with cash-on-delivery and shop-and-collect options.

The DIY store said it posted year-on-year sales growth of 6 per cent in 2014, although that fell more than half from the 14 per cent sales growth in 2013.

“The strong sales growth we saw in 2013 was uncharacteristic as the sector has generally been growing at 6 per cent for the past decade,” Mr Cohen said.

On the company’s plans for the capital, Mr Cohen said: “We have three stores in Abu Dhabi, and that covers the local demand sufficiently in the capital for now.”

Ace recently altered its “destination” store model, where it sits as a stand-alone unit to a mall store in Dalma Mall in Abu Dhabi.

The 20,000 square metre outlet is dwarfed by the Festival City and Yas Island outlets at 100,000 square metres and 60,000 sq metres but offers softer inventory, catering to female customers.

The alteration of its business model comes on the back of a consumer survey, in which 78 per cent of the 1,112 respondents covering 13 different nationalities wanted DIY workshops. Ace has also provided a home improvement guide in response to the survey.

“The financial aspect of the increase of real estate prices, especially in Dubai and Abu Dhabi, is translating into limits in the home interior arrangements,” said Diana Jarmalaite, a research analyst at Euromonitor International. “We have seen a more budget-conscious expatriate entering the market compared to the pre-crisis consumer. The new wave of consumers is more practical and considered in spending on home goods.”

Ms Jarmalaite expects Expo 2020 to become a catalyst for higher growths in population, disposable income and therefore in higher spending on home-related products. “Over the period 2014 to 2019, we expect the home and garden market to increase annually by 6 per cent.”

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