Dubai

World-Class Infrastructure and a Global Hub for Trade, Transport and Tourism

Vision is one thing; executing that vision is another. Dubai is a place that marries the two and, as a result, delivers a business, finance, trade, logistics and tourism experience unlike that of any other city. Burj Khalifa, pictured here, is the tallest freestanding man-made structure. It was opened at the height of the global recession, representing an accomplishment on many fronts. But ultimately it is a business proposition that succeeds, like so many other business ventures in Dubai.

Under the vision and guidance of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, this city of more than 1.5 million inhabitants has built an extensive network of hard and soft infrastructure that both enables business and ensures a high quality of life for its citizens. This provides a sustainable competitive advantage that gives Dubai a firm footing as the region’s leading hub in so many areas for the foreseeable future.

It is this supportive entrepreneurial environment that has nurtured some of the Middle East’s strongest brands, just a few of which include the Jumeirah Group, Emirates Airline Group and Dubai Duty Free. As the history of this dynamic global city is written over the coming decades, there is little doubt that it will tell the tale of a nimble city that both makes possible and is supported by the economic development of the surrounding region, an area that includes some of the fastest-growing and wealthiest countries in the world.

Dubai Chamber: Promoting Dubai as the Unrivaled Trade and Investment Gateway to the Middle East and Africa

The impact of the global economic crisis on Dubai has been deep and far reaching, but one of the most significant positive outcomes in the eyes of His Excellency Hamad Buamim, Director General of the Dubai Chamber, is that the emirate is once again “a very competitive, very attractive place for business and investment.”

After several years of inflation, the cost of doing business – especially office, retail and residential rates, as well as wages and professional services costs – has dropped significantly. At the same time, the crisis has spurred changes in legal, regulatory and government-fee structures that are enhancing Dubai’s competitiveness. In addition, Buamim says the Chamber is working with the Dubai and UAE governments on more initiatives in this area to ensure that this competitive advantage will be sustained.

Furthermore, Dubai has the most modern and comprehensively developed infrastructure of any city in the region. “This will keep us ahead of the game with regard to all other regional competitors,” Buamim explains.

Dubai’s advanced infrastructure includes the 47-mile-long, fully automated Dubai Metro, and world-class airports, seaports, logistics facilities, conference centers and industry clusters in areas such as media, IT, financial services and healthcare. This infrastructure also includes an array of hospitals, schools, universities, world-class hotels, restaurants, shopping malls and entertainment destinations such as an indoor ski park and the observation deck at the top of the Burj Khalifa skyscraper, which is the tallest man-made structure on earth.

“These advantages are unique to Dubai, and they explain its attraction to international investors and the international business community,” says Buamim. “I also guarantee that companies can hire more people to do business in Dubai than anywhere else in the region.”

Growth and further development certainly fit well with Dubai’s strategy in the post-crisis world, Buamim adds. “We’re going back to the basics, to the traditional ‘old economy’ of trade, logistics, supply chain, financial services and tourism,” with other areas such as education and healthcare also playing an important role.

Gateway to Emerging Markets

The Chamber supports Dubai’s role as a gateway into the region for international business, particularly for the promising and fast-growing markets in Africa, as well as newly emerging Middle Eastern markets such as Iraq and Libya, Buamim says.

“Businesses all over the world are interested in Africa, as well as places like Iraq and Libya; but these are not easy markets. There are challenges such as language, as well as the way of doing business and identifying the right business channels,” says Buamim. That’s where Dubai comes in, he says, since its companies and the Chamber itself already have relationships with the right organizations and entities. “This means we can easily connect international businesses with Africa, Iraq and Libya through Dubai.” Plus, commercial passenger and air-cargo routes, shipping lines and banking relationships are already in place.

In March, the Chamber hosted 45 members of the American Chamber of Commerce Executives for a weeklong visit to Dubai that allowed them to see “in real life terms what Dubai is all about, and gave them a good feel for what Dubai has to offer,” Buamim says.

The Chamber showed how Dubai could help small and medium enterprises (SMEs) expand beyond the U.S. market. “We were able to demonstrate that through Dubai, they can access growing Middle Eastern and African markets.”

Green Building

Dubai also is committed to reducing its environmental footprint. In December, a high-rise office building located along Dubai Creek became one of only four existing commercial buildings in the world outside North America to receive LEED (Leadership in Energy and Environmental Design) certification from the U.S. Green Building Council.

This is important to the Chamber because it exemplifies to members Dubai’s regard for sustainable business behavior. Buamim also sees a significance for the international business community: “It shows that in Dubai, in this part of the world, we can have the best international practices, specifications and standards.”

Dubai Duty Free: The Largest Single Airport Retail Operation in the World

It is clear, even in the corporate offices of Dubai Duty Free, why this company is the largest single airport retail operation in the world. Its care, precision, sense of presentation, customer service and innovative ways of doing business are on full display, from the office workers wearing the same aqua-colored sports coats as the staff on the sales floor to the enthusiastic and energetic greeting of visitors to the visitors’ water glasses wrapped in paper napkins tied like carefully knotted sarongs.

These qualities have helped Dubai Duty Free grow, even during the worst of the global economic crisis last year when it registered growth of 3.8% and sold more than $1.14 billion of merchandise. Additionally, sales were up 21% during the first quarter of 2010 from the same period a year earlier – nearly twice the industry average of 11.2%, as calculated by industry analyst Generation Research.

But these numbers are not just a result of Dubai Duty Free’s prime location in one of the world’s fastest-growing airports. It’s also because this 27-year-old duty-free operator knows how to sell.

Dubai Duty Free consistently sells to 43% of departing travelers – more than double the industry benchmark of 20%.

“To achieve this, we’ve learned how important it is to have correct positioning, work in close cooperation with airport authorities, provide good value, and keep staff trained properly and enthusiastic,” says Colm McLoughlin, the company’s Managing Director.

A Changing Market

Successful sales trends hint that the duty-free business has changed. There continues to be softness in the movement of luxury items, and sales of “less-strong” brands are doing well. What’s more, discounts continue to attract customers. “People are looking for value,” says McLoughlin.

Customer trends also are changing. “Big spending by Russians is being replaced with big spending by Chinese travelers,” McLoughlin says. In fact, a luxury Chinese cigarette brand, Chunghwa, which costs one-and-a-halftimes more than Marlboro-branded cigarettes, is the second-best-selling cigarette brand for Dubai Duty Free.

At Dubai Duty Free, the focus is on creating a feeling of “Wow!” as McLoughlin puts it, when passengers enter the duty-free shopping area. This is achieved through the interior design, a variety of special offers and the thrill of seeing some of the most elite luxury automobiles displayed as promotional prizes. The Finest Surprise Promotion also adds to the air of excitement, offering the chance to win a Porsche, a Maybach or BMW, as well as $1 million and $2 million in prizes.

Helping Build Dubai

However, much of Dubai Duty Free’s raison d’être is to help promote the country’s image. It does so by enhancing the tourism experience and by sponsoring a number of sporting, horse-racing and cultural events in Dubai and around the world that garner additional visibility for the emirate. The company also generates profits that help fund aviation and other projects in Dubai.

McLoughlin says Dubai Duty Free’s ambition is to retain its top spot as the world’s largest airport retail operation and to continue to grow its sales, which it expects to double by the middle of this decade.

Dubai Airport Growth

Some of this future growth will be driven by 26,910 square feet of new retail space at the Al Maktoum International Airport, Dubai’s second airport. Passenger flights are tentatively set for mid-2011, which will trigger the opening of Dubai Duty Free’s retail facility there. Eventually the new airport, which will grow to handle 160 million passengers a year, will have 64,000 square feet of retail space, all managed by Dubai Duty Free.

Meanwhile, at the current airport, a new concourse dedicated exclusively to Emirates Airline’s A380 fleet will open in two years and will have 8,000 square feet of duty-free retail space. In addition, Terminal 2 is being expanded, which will add to Dubai Duty Free’s existing retail operations.

As McLoughlin explains, there are no plans to take this successful franchise beyond the borders of Dubai – which leaves only one option for global travelers looking to experience the “Wow” factor for themselves: “Fly by Dubai.”

Jumeirah Group: Helping Build Dubai as a Top Global Convention Destination

Over the past decade, Dubai has successfully made its mark as a top global vacation destination. It is now looking to do the same in the global meetings, events and incentives sector, with Jumeirah Group, the Dubai-based luxury hospitality company, set to play a major role in the effort.

For Dubai – whose expansion was once constrained because builders couldn’t keep up with the city’s growing international appeal – this is an important step. With a steady supply of hotel rooms coming onto the market, the bottleneck is gone, says Carl Palmlund, Director of Sales – Groups, for the Jumeirah Group.

Jumeirah currently operates eight five star hotels and serviced residences in Dubai, including the world-renowned Burj Al Arab, Jumeirah Beach Hotel, Jumeirah Emirates Towers, Madinat Jumeirah, Jumeirah Bab Al Shams Desert Resort & Spa, and the Jumeirah Living World Trade Centre Residence; with several new developments planned to open in Dubai and worldwide in the near future.

In addition to the Jumeirah Carlton Tower and Jumeirah Lowndes Hotel in London and Jumeirah Essex House in New York, the group also operates Talise, its global spa brand; Jumeirah Restaurants, its dedicated restaurant division; Wild Wadi Waterpark; and The Emirates Academy of Hospitality Management, which offers specialized degree programs in hospitality management, all located in Dubai.

“Dubai is a fantastic proposition for the meeting and events sector. It is a tremendous leisure and tourism destination, but it’s also a city for business…a global city with diverse cultures. It is open minded, business friendly and supported by an excellent infrastructure, and it has established itself as one of the best-connected trading hubs in the world. There are few destinations with such a mix,” Palmlund says.

The Dubai Bid Alliance

In addition to its own business development efforts, the Jumeirah Group is participating in other event and meeting industry stakeholders through the Dubai Bid Alliance. This body coordinates bidding among industry members such as hotels, transportation providers and organizers for major events.

The city’s expanded focus is already taking effect, with Jumeirah seeing a 15% to 20% increase in MICE-related (meetings, incentives, conferences and exhibitions) hotel stays at its Dubai properties over the past year, including a 30% increase in MICE guests from North America.

Jumeirah has some of the largest state-of- the-art facilities and the most diverse and flexible settings for meetings and events, Palmlund says. With its properties in Dubai able to accommodate thousands of meeting attendees, and with city, desert and beachfront settings, Jumeirah offers an easy one-stop shop for planners and buyers.

A Strategic Global Partnership

In yet another critical move, in May 2010 the Jumeirah Group signed a three-year partnership agreement with Meeting Professionals International (MPI), the largest international association of meeting and event planners and buyers, whose 23,000 members have global buying power of $16.4 billion. “The ability to communicate with its members gives us fantastic trading opportunities,” Palmlund says.

But the move provides more than just direct commercial benefits, as Palmlund explains: “It shows we are taking a clear position of commitment to this industry and tapping into this market more aggressively than ever.”

A Top International MICE Destination

Jumeirah is the first luxury hotel chain in the world to form such a partnership with MPI; and as the first company to sign such an agreement in the Middle East, the relationship promises to help increase business opportunities for Dubai, the UAE and the wider Middle East as well, says Palmlund.

“Just as we have partnered with stakeholders in the Dubai leisure industry to emerge as a global name in luxury leisure holidaying, so too can we pool our resources, talents and drive to achieve a long-term vision to see Dubai not only as the leading events destination in the Middle East, but also as a top meeting and events destination globally.”