UAE, DUBAI - Tourism
Executive Vice Chairman, Dubai Duty Free
Born in 1943, Colm McLoughlin began his retailing career in the 1960s, working at Woolworths, before moving back to Ireland to work for Shannon Duty Free. In 1983 he was invited by the government of Dubai to set up Dubai Duty Free.
We try to improve all of the time; we invest in technology and have recently introduced an online shopping portal that we expect to become increasingly important to our business and to our customers. Refurbishment is also necessary, and we closely examine how we deal with our passengers. If we identify congestion then we change and we have recently agreed with the airport to remove a number of retail structures from the center aisle in what we call Concourse B because of congestion. We keep trying to offer better value to the customers and we seek to be the number one in duty free from the point of view of special offers and ensuring that customers get what they want. We work closely with our suppliers to this end. We also have digital advertisement applications at the airports showcasing Dubai Duty Free’s offers.
In 2013, our average return on sale per square meter was $80,000, while the average of the rest of duty free was at $34,000 per sqm. Last year we reached $82,000 per sqm while the Apple store on Fifth Avenue in New York City was at $66,000. Once we open Concourse D at Dubai International Airport in 2016, the new 7,000 sqm of retail space will lower our average return. So we expect to be at $72,000 next year, which is still considerably above the average.
Let me start by saying that 70% of our products are acquired locally, helping suppliers, wholesalers, and importers. We have 6,000 employees to which we provide rented accommodation and we also own 740 apartments that house some of our employees. These employees spend money in Dubai, and not only them but also all their friends and family members who come visit every year. We not only give our employees accommodation, but flight tickets, too. They are all contributing to the development of Dubai. We sponsor a lot of events, like the Tennis Championships, which generates over $800 million worth of TV exposure for Dubai, as well as supporting the DP World Tour Championships, the Emirates Rugby 7s, and many more major events. In addition to that we own the Dubai Tennis Stadium, the Irish Village, and the Jumeirah Creekside Hotel. We are also planning on developing the Irish Village in a new theme park that will be constructed here in the UAE.
We expect sales to be close to $2 billion. Currently, we account for over 6% of the total sales in duty free around the world.
The build up to Expo 2020 is very exciting and the development of Dubai South, which will be the venue for the Expo being close to Al Maktoum International, will see much activity in the coming years. By 2020 we expect to reach $3 million and have 9,000 employees. It is expected that Dubai South will generate 260,000 jobs. At Al Maktoum we will open up to 80,000 sqm, which will mean around 3 to 4,000 jobs.
We have been dealing with banks for many years and they know our track record; we have never not paid anybody or paid someone late. We have always paid our staff on time and when something happens like holidays or national holidays, we pay our staff earlier in the month. We now have close to 6,000 staff and we have kept that record. We have never defaulted with the bank, and we have taken out two different loans; the money went to infrastructure development at the airport. At that time, interest rates were getting lower and lower, so we negotiated with the banks and they agreed that we were a sound and safe company for repayments; there were 26 banks involved in the first loan. We were able to restructure the loan, saving ourselves AED70 million, and it was because of our track record that the banks were happy to do this.
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