“Golden Apple” rolled into the Middle East – Kommersant

The network of perfume shops “Golden Apple” is preparing to enter the Qatar market and has already signed the first store lease agreement in this country. After the outbreak of hostilities in Ukraine, Russian retailers are increasingly looking for opportunities to expand into the Middle East. Until now, it was mainly about the UAE. But it is Qatar that is a promising direction in terms of the development of the cosmetic business, experts believe: despite the small capacity of the local market, consumer spending on beauty services there is much higher than in other Arab countries, not to mention Russia.

The Golden Apple has signed the first lease agreement for a store in the Qatari capital Doha, a Kommersant source in the retail market said. The company is also launching an internship program for employees with subsequent relocation to Qatar, according to one of the retailer’s vacancies on HeadHunter.ru. The Golden Apple declined to comment.

On the one hand, the market capacity of Qatar, where the population barely reaches 3 million people, is small. But, on the other hand, Mikhail Burmistrov, general director of Infoline-Analytics, says that the high level of income in the country has led to an increase in consumption in the luxury segment. Now in Qatar, purchasing power is many times higher than in Russia, Marina Malakhatko, senior director of CORE.XP, agrees, adding that the revenue of retailers in the country is also growing due to the increased tourist flow after the World Cup in 2022.

Moreover, the country has a huge number of beauty salons and spa centers, and local consumers spend an order of magnitude more money on cosmetics than in other Arab countries, explains Felix Lieb, CEO of Natura Siberica Group. This retailer is also considering entering the Qatar market. The demand for exclusive products is high in the country, and therefore many global brands strive to present their products in this market, Ms. Malakhatko adds. According to Mordor Intelligence forecasts, the volume of the Qatar cosmetics market in 2023 will be $119.14 million, with an average annual market growth rate of 6.16%.

Other Russian cosmetics players are also exploring opportunities to expand into the Middle East. Natura Siberica is already represented in the UAE, Saudi Arabia, Yemen, and Oman. Earlier it became known about the plans of “L’Etoile” to start working in Dubai. The company did not respond to Kommersant’s request.

Expansion to the Middle East is also of interest to clothing retailers. As Kommersant discovered, the Lime network is looking for an operating director and manager with relocation to Dubai. A Kommersant source in the retail market also heard about the network’s plans to enter this emirate. Poison Drop, Choupette, Akhmadullina, Lichi, Sodamoda, Belle You, 12 Storeez have already announced their release in the UAE, says Anna Lebsak-Kleymans, CEO of Fashion Consulting Group.

The countries of the Middle East are friendly to Russia, where companies have the opportunity to open accounts and scale their business, says Dania Tkacheva, business consultant for sales management and strategic development. Specifically, in the UAE, there is a convenient legal and administrative infrastructure for opening foreign branches, notes Anna Lebsak-Kleymans.

At the same time, the level of competition in the local fashion market is as high as possible. According to Ms. Lebsak-Kleymans, initially the retailer can rely on the Russian-speaking audience familiar with the brand. However, Dania Tkacheva points out, the bet on Russian emigrants cannot be long-term; for further business development in the Middle East, retailers will have to adapt their assortment to the local market.

Alina Savitskaya