We inform you that on this website we use our own and third-party cookies to collect information about its use, improve our services and, where appropriate, display advertising by analyzing your browsing habits. You can expressly accept its use by pressing the "ACCEPT" button or configure and select the cookies you want to accept or reject in the settings. You can also get more information about our cookie policy here.

The global fashion business journal

Jul 14, 20205:58pm

Apocalipsis Retail hits Middle East: AlHokair cuts revenues, shutters stores

The owner of Zara franchises in Saudi Arabia has broken distribution agreements with giants like Marks&Spencer and is in the process of closing stores.

Nov 13, 2019 — 5:00pm
mds
Save

Apocalipsis Retail hits Middle East: AlHokair cuts revenues, shutters stores

 

 

AlHokair reduces its store network as well as its revenues. The Saudi Arabia retailer enters losses in the second quarter of its fiscal year. The company is optimizing its stores and breaking agreements with retailers on a “portfolio optimization”, as stated by the company.

 

The losses of the group in the second quarter (period ending on September 30) stood at 26.7 million Saudi riyals (6.46 million euros), compared to the benefit of 8.9 million Saudi riyals (2.15 million euros) of the same period of the previous year.

 

AlHokair, owner of the franchise’s rights for brands such as Zara or Banana Republic in Saudi Arabia, has closed the second quarter of the year with revenues of 1.23 billion riyals (297 million euros), with a 3.1% drop year-on-year.

 

The company justifies the evolution of the benefit by the increase in financing costs, but also by the fall in sales by the reduction of the store park, “implementation of a portfolio optimization strategy mandating the termination and closure of non-performing stores and disposal of weak brands” also affected the quarterly results.

 

Last August, for example, the group finalized its distribution agreement in Saudi Arabia with Marks&Spencer, although it maintained the stores in Armenia, Georgia and Kazakhstan. The company also highlighted the breakdown of other similar agreements, although it did not specify which. As detailed by the company on its website, AlHokair has a network of more than 1,750 stores of 75 brands. The company, which has more than 10,000 employees, operates in thirteen countries.

Advertising
Participation rules

info@themds.com

 

Validation policy for comments: 

 
MDS does not perform prior verification for the publication of comments. However, to prevent anonymous comments from affecting the rights of third parties without the ability to reply, all comments require a valid email address, which won’t be visible or shared.
 
Enter your name and email address to be able to comment on this news: once you click on the link you will find within your verification email, your comment will be published.

0 comments — Be the first to comment
...