Dubai: Truly a city of Gold

Dubai has strict customer protection norms and a wide variety at competitive prices that make it a shopper's haven

By Suneeti Ahuja-Kohli

Published: Sun 8 Nov 2015, 1:14 PM

Last updated: Sun 8 Nov 2015, 3:18 PM

When doyens like Tawhid Abdullah, Chairman, Gold and Jewellery Group, say that today Dubai is more important for the jewellery industry than ever in its lifetime, you sit back and listen.

Tawhid Abdullah
"Let us start with the biggest producer and consumer of gold - India. Today, we (Dubai) are the number one importer of Indian jewellery. We are still the main supplier to India for bullion. For China, we are the most important importer of 'Made in China' products in different caratage. For Italy, in the last 20 years, we have been the number one importer. For Turkey, which is a growing market, we are the top importers of gold jewellery for the last 15 years. For the Saudi market, we are importer of jewellery. For Bahrain, Kuwait, Hong Kong and Thailand markets, we are undoubtedly the top importers and exporters of jewellery. These are the biggest producers in the world and they rely on us. We are the hub for selling manufactured jewellery," says Abdullah at his office in Deira.

Dubai's idea of becoming a city of gold has found a firm ground over the last few years. The reasons primarily include the presence of chain stores that represent more than 50 per cent of the retail business, strict adherence to quality standards as ascertained by Dubai Municipality, and industry's sensitivity to changing demands in the jewellery space.
More than 800 retail jewellery stores are redefining the way gold is manufactured, procured and sold. Traditionally what was seen as a married woman's domain is becoming an area of interest for the youngsters too - courtesy customisation and change of focus by jewellers.
"As we are the hub for jewellery, stores here make tailor-made pieces according to the needs of the consumers. We are the leading market for young generation jewellery. We have established ourselves at the Dubai International Jewellery Week 2015, and are aiming to capture an important segment of young consumers. If you look at other parts of the world, you will not find youngsters going to the jewellery store to buy gold. But it has changed here. We are designing for the young generation, and now we are producing and selling for them," says the chairman.
Why Dubai?
As a pioneer in this industry and also the chairman of the group, Abdullah understands the pulse of the industry like no other. According to him, what makes Dubai the place for buying of gold is its sensitivity towards the buyers, consumer protection laws and strict adherence to quality standards. Retailers understand consumers' needs rather than simply impose manufacturer's choice.
"We are reviving traditional jewellery into miniature versions to suit the youngsters' choice. The industry studies the needs and preferences of different age groups and designs according to their preference. That's why huge business is coming here and Dubai has become a hub for gold and jewellery. The main reasons behind the rise of Dubai as a hub of gold are the strategy of the country and availability of tourists. Almost 12 to 15 million tourists come to Dubai every year. Then there are GCC nationals, who frequent this place over weekends and holidays," says Abdullah.
Although there are no readily available numbers to suggest the contribution of the gold industry to the GDP of the emirates, the impact that gold and jewellery industry is making is quite significant. Dubai has more than 800 retail stores; each on an average sells Dh10,000 to Dh30,000 worth of gold every day. With turnover as high as Dh80 billion annually, jewellers in Dubai have the leeway to offer competitive pricing for a range of designs and styles that are procured from all over the world.
Designs
"Today youngsters hear the same music, eat the same food, and go for the same movies. So we cater to the young generation from Europe, Middle East, Asia, Far East, Africa, America and Australia. This is our mix. You will find all kinds of distinctive styles and designs in Dubai, and always find people buying something," says the chairman.
Overall, youngsters ask for simple jewellery, while married women prefer traditional heavy jewellery. Besides, gifting has become a very important part of the industry, says Abdullah. "People buy a lot of gifts, and today jewellery has affordable gift value. A bouquet of flowers now cost Dh500, but you can also buy a bracelet for the same price. So, would you buy flowers, which will lose their freshness and charm in about a week, or would you rather go for gold, which would last for a lifetime?"
The last quarter is the busiest for the industry as it makes up for almost 35 per cent of its annual sales. Diwali, followed by Christmas, are two big occasions where people buy for themselves, families and general gifting. The industry has been growing at 7 to 10 per cent every year and expects a good run this year too. "I expect gold to stabilise at around $1,200 per ounce for the time being. People are comfortable at these levels. We expect strong sales in the current quarter. Diwali is usually a bumper season for jewellers and this year we are expecting stronger sales," concludes Abdullah.
suneeti@khaleejtimes.com