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Too many restaurants spoil the profit margin

SHARJAH - Sharjah is considered to be one of the favourable places to dine in the UAE. There are a variety of restaurants that offer delectable Lebanese, Indian, and Egyptian cuisine.

By Mahmoud Ali

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Published: Mon 24 May 2004, 9:36 AM

Last updated: Thu 2 Apr 2015, 2:26 PM

The residents, however, have noted that restaurants along Jamal Abdul Nasser Road have been increasing in a haphazard manner. A number of restaurants - between eight and 10 of them - are serving the same type of food within a 300-metre distance. The number of restaurants might offer more choices for people residing in Sharjah, but it has affected the owners of such restaurants who incur huge losses.

Several owners of these restaurants have expressed their frustration on the indiscriminate way licences are being issued to restaurants without taking into consideration other existing food establishments in the area, and the unfair competition among these restaurants.

"It is not fair to issue licences in this manner as there are more than six restaurants on the Jamal Abdul Nasser Road. All located along a 200-metre stretch. Each restaurant may have its special customers but we are losing a lot of money. Our profits have decreased and we are trying to develop ways of serving people better by offering delivery and vegetables free-of-charge," said Nasser Mohammed, manager of Falafil Arax, one of the restaurants operating along Jamal Abdul Nasser Road.

Nasser Gharz Al Din, owner of Falafel restaurant, said, "Our restaurant is away from Jamal Abdul Nasser Road, and the number of restaurants over there (Jamal Abdul Nasser Road) is affecting us too. During the past five years, the number of Faba beans and Falafel has increased considerably. This increase had divided the profit among restaurants. Licenses should be issued in a more organised manner between residential clusters in Sharjah. Some managers are enhancing the quality of their restaurants' food and services. Unfortunately, the customers are spread out among the large number of restaurants."

Another manager of a restaurant located along Jamal Abdul Nasser Road said, "We are planning to sell the restaurants because we can not afford to incur more losses. I cannot jack up the prices of sandwiches following the increase in the prices of basic ingredients. If we do so, we will definitely lose a lot of customers. Unfortunately, there is no committee to organise prices and deal with the increasing competition among restaurants. I would not directly blame the officials, but would lay the blame on restaurant owners who are simply greedy." Reacting to the issue, a cross-section of Sharjah residents said they were delighted that there were a number of restaurants in the area.

Y. Khatib, a Lebanese expatriate, said, "The Falafel restaurants in Jamal Abdul Nasser Road are too much to handle. I would certainly be pleased if we were getting excellent service from these restaurants due to the competition, but how can they gain profit when customers are unequally divided among them? The indiscriminate issuance of licences is not fair to restaurants, particularly those which have long been established in the area and have its own valued and loyal customers."

Ahmad Ghanem, an Egyptian expatriate, said, "It is inappropriate to keep these restaurants next to each other. They are not gaining any profit, and most of the time I find the restaurants empty. It is unfair for residents of Sharjah at all. If I want to get this particular dish I have to travel to Jamal Abdul Nasser Road to get it. If the division of restaurants was equal in Sharjah, people would not have to wait for the delivery or go to Jamal Abdul Nasser Road for their food."

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