Timex sees bright ME prospects

Muzaffar Rizvi
Filed on June 12, 2011

DUBAI — Timex Group Luxury Division, which manufactures and sells luxury watches in partnership with Italian fashion designers, sees bright business prospects in the Middle East as it recorded phenomenal growth in Dubai this year amid tourism revival and increase in economic activity in the emirate.

The luxury unit, a part of the Timex Group based in Switzerland, noted an 85 per cent sales growth during first five months of this year compared to full-year business in 2010. The division, which started its activity in 2004 with the establishment of Vertime SA, is expected to post 40 per cent growth in Dubai this year due to strong demand from tourists and residents in the emirate.

“We have strong growth plans for Dubai as it leads the Timex Group Luxury division in the region after Saudi Arabia,” said President and Chief Executive Officer of Timex Group Luxury division, Paolo Marai told Khaleej Times during his recent visit to Dubai.

The Timex Group Luxury Division distributes watches in more than 65 countries and covers various channels including over 350 mono-brand boutiques, department stores and more than 1,000 independent retails, duty free shops, cruise lines, and airlines.

Marai, who launched the 2011 watch collections of Salvatore Ferragamo, Valentino and Versace at Burj Khalifa last week, said Dubai is back on track and the Timex Group luxury division will further consolidate its business in the emirate through expanding its sales points.

“We are in close touch with our local partner and distributor in the region and we hope to expand the retail network in the region to capitalise the business opportunities,” he said adding that the luxury division of the Timex Group’s regional sales manager will be relocated to Dubai from Europe to further strengthen the business in the region.

“The business growth is amazing and I’m scare we cannot last it for long. We had tremendous growth all over the world during first five months of 2011,” Marai said.

Versace boutique

The group also announced plans to move further into the jewellery market. The firm already has one Versace jewellery and watch boutique in Dubai Mall, but is weighing up the possibility of an additional store either in Saudi Arabia, Kuwait or Qatar — the three promising markets in the region.

“We launched the third Versace boutique in Dubai in late 2009 during recession, but it performed very well and recorded sustainable business in difficult times,” Marai said.

In reply to a question, he said the group has no plan to set up a watch manufacturing unit in Dubai to retain Swiss made title of the brand.

Marai said Middle East is a very important market for Timex Group’s luxury division as it contributes about 40 per cent in the group’s overall businesses across the globe. He said Dubai contributes approximately 30 per cent in the group’s overall sales in the Middle East.

“The emirate is one of the best Middle East markets, as it recorded tremendous growth even in the recession due to strong local buying,” he said.

In reply to a question about the impact of recession on Timex Group’s luxury division business in Dubai, he said there was no negative impact as the group still posted eight per cent growth during recession period. “We only noted reductions in growth from 20-25 per cent to single digit number in 2009 and 2010,” adding that sales in other Asian and European countries fell 10 per cent during this period.

He said the luxury division of the Timex Group sees bright business future in the region due to revamping of businesses and revival of tourism with signs of recovery in global economies.

“The Timex Group’s luxury division business comprises on tourist buying and local demand. After low growth in past two years, we have seen strong rebound in tourist buying as well as in local demand for luxury products,” Marai said adding that the luxury division has a massive expansion plan for the region under which it will increase point of sales.

He said Saudi Arabia, Qatar and Kuwait are other major markets in the region as they recorded 10 per cent consistent growth in past three years despite recession.

He said Bahrain, Oman and Yemen are comparatively smaller markets for the luxury division of the Timex Group and the ongoing unrest in the region will not have any significant impact on its businesses.

Marai said financial crisis hit the group’s global business as the sales growth shrank to meagre eight per cent during recession from on an average 20 to 25 per cent.

“We are expected to achieve 20 to 25 per cent sales growth this year, but it is still down from 40 per cent at peak time in 2005 to 2008,” he said adding that Middle East will remain the top market for luxury products while China, India, Hong Kong and Korea are fast emerging as potential key markets for luxury products.

In reply to a question, he said exploring Brazil for Timex Group’s luxury division products is also a challenge for him. Marai said the future of fashion brands look bright as the tourism is picking up and major economies are recovering from the global financial crisis.

“We expect 15 per cent sales growth worldwide this year as the situation is improving on economic front.” He said fashion and luxury products are expected to post 10-20 per cent consistent growth during the next five years if there is no major crisis in the world. “We expect couple of good years after the crisis and I hope the growth will be consistent,” he concluded.

ERROR: Macro /ads/dfp-ad-article-new is missing!
MORE FROM Business
MORE FROM Khaleej Times
CurrentRequestUnmodified: /business/parzel-express-unveils-self-service-8232-collection-kiosks-in-uae macro_action: article, macro_profile: ,1036,1000 macro_adspot:
KT App Download
khaleejtimes app

All new KT app
is available
for download:

khaleejtimes - android khaleejtimes - ios khaleejtimes - HUAWEI AppGallery