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The retail industry in Dubai is looking to dry off and move forward after weathering two massive storms in the span of 15 days. On Thursday 2 May, in just 12 hours, the city experienced rainfall of 20 millimetres according to media reports, which was more than double the usual amount for both April and May combined. This, however, seemed like a drizzle compared to the unprecedented storms of 16 April, when nearly 100 millimetres of rain fell in just 12 hours. It was the greatest rainfall the city has ever seen since weather records began 75 years ago.
“What we saw in April was the storm of the century for Dubai,” says David Vercruysse, president of managed companies at Chalhoub Group, which operates over 300 international brands in the Middle East.
While much has been reported about the effects of the storms on Dubai International Airport as well as the city’s travel industry, the impact on local retail is still being estimated. Chalhoub Group was able to keep 159 of its Dubai-based stores operational in the day following the first storm — with one exception in the Dubai Mall. Times Square Group, which operates brands such as Manolo Blahnik, Furla and Zadig Voltaire in the region, closed two stores temporarily in the days after the first storm. Neither Chalhoub Group nor Times Square Group saw major stock damage.
In the days following the storms, videos of luxury shopping centre Mall of the Emirates flooding went viral, but retailers believe the reaction on social platforms was over the top.
“The first set of rains was more cumbersome to deal with; it was a lot more sudden,” says Samara Punjabi, CEO of Times Square. Last week, as the second storm hit, preventative measures were quickly implemented by the Dubai government, with drains on the streets opened a day ahead of the rainfall and mobile emergency notifications encouraging everyone to stay at home.
The overall impact on sales was not as negative as expected. “When you have a storm of that size, it’s obviously a major disruptor. Many had homes that were flooded, others had cars that stopped working. Shopping was perhaps not a top priority,” says Vercruysse. Nonetheless, sales targets were almost met the week after the initial storm. “We are trading at 85 per cent to 90 per cent of sales targets.” He notes that online sales were a little slower, as many were not in the mood to shop, and some customers doubted if deliveries would happen on time.
In reality, the most pressing issues for retailers were staff-related. “We had around 200 staff that could not find their way home during the first storm,” says Vercruysse. Chalhoub Group quickly found hotels and Airbnb options to ensure all staff had places to stay. However, at the malls, many employees of major retailers had to sleep there overnight. “We made arrangements for staff that were stuck on the 16th to spend the night safely rather than run the risk on waterlogged streets,” says Punjabi. For the most recent storm, Punjabi ensured extra drivers were on hand and also had flexible-working arrangements in place.
Vercruysse suggests that for days of storms, retail groups should use a “skeleton staff” system and look to only those who live close to malls to come to work, which is what Chalhoub did for the second round of storms and found that by the afternoon stores were operating with almost-normal footfalls.
Though events reverted to normal for a week in between the two storms, those that were scheduled for 2 May were cancelled — including one for networking hub Harrods Hive, by Dubai-based communications and events agency Z7 with offices throughout the region. Jaquemus, Missoni and Delvaux were among the brands that had to delay event schedules in the days after the first storm, but were rescheduled since. “This time of the year is very busy, it’s one of our peak seasons. It has been a healthy season despite the rain,” says Z7 founder Zeina El Dana. This week, the events calendar is expected to return to normal.
This run-up to the summer period is normally an important selling time for retailers. Most are optimistic about the upcoming Summer Surprises festival — an annual initiative by the Dubai Department of Economy and Tourism — that is due to commence at the end of June. While full details are yet to be announced, the festival usually comprises sales and promotions at retail stores, activations for children at malls and special packages at hotels for the holiday season.
The remainder of the summer period seems clear of showers at the moment, yet recent storms have highlighted the importance of preparedness, with retailers looking into upgrading stores to boost resilience against future extreme weather events. “It is a priority,” says Vercruysse.
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