Saudi franchiser Cenomi Retail is set to make a strategic entry into Uzbekistan as part of the capital city's ambitious urban redevelopment plans. The retailer has inked agreements with nine international brands, signaling its commitment to the burgeoning Uzbek retail sector. This move follows the company's earlier "Saudi First" strategy, which considered exiting certain markets to prioritize profitability, AGBI reports.
Expansion Plans and Brand Partnerships
Cenomi Retail has secured agreements for nine international brands to establish a presence in Tashkent City Mall, a forthcoming 250,000 sq m project. The signed agreements include renowned names such as Aldo, Cinnabon, and seven Inditex brands—Zara, Pull & Bear, Stradivarius, Massimo Dutti, Bershka, Oysho, and Zara Home.
Contradictions with "Saudi First" Strategy
The expansion into Uzbekistan contrasts with Cenomi's earlier announcement of a "Saudi First" strategy, which contemplated exiting certain markets, including the United States and the Balkans. The company also disclosed plans to close 55 stores in Morocco and Egypt as part of its drive for increased profitability. Despite these considerations, Cenomi expresses confidence in the potential success of its venture in Uzbekistan.
Uzbekistan, with a population exceeding 30mn, is witnessing a modernization of its retail sector to meet the growing demands of consumers. Dr. Gunther Helm, CEO of Cenomi Retail, emphasizes the robust growth in the Uzbek retail sector, citing double-digit sales increases. The company, having achieved success in several Commonwealth of Independent States (CIS) countries, sees Uzbekistan as a dynamic market poised for further growth.
Investment Landscape and Gulf-based Companies in Uzbekistan
Uzbekistan has attracted substantial investments from Gulf-based companies, particularly in the clean energy sector. Earlier this year, Saudi-based Acwa Power unveiled $2.5bn deals with Uzbekistan, encompassing solar projects, battery energy storage systems, and wind power plants.
Cenomi Retail reported a net profit of SAR 113 mn ($30 mn) in the first half of 2023, a notable improvement compared to a small loss in the same period of the previous year. This financial performance comes as the company executed strategic closures of dozens of stores. Cenomi Retail, initially established as Fawaz A Alhokair & Co in 1990, currently operates in over 1,300 stores across 100 shopping malls in 11 countries, employing around 10,000 people.
Follow Daryo's official Instagram and Twitter pages to keep current on world news.
Comments (0)