Dr. Mohammad Amin Kashgari

'We will open two or three more hypermarkets in Dubai,' says President of Retail for the Savola Group, Dr. Mohammad Amin Kashgari, speaking to AME Info after the opening of its first flagship store in the elegant new Dubai Festival City.

'The Dubai market is a natural one for us. We are the biggest food retailer in Saudi Arabia next door, and we appreciate the growth potential in Dubai. There is also limited competition in the hypermarket segment in Dubai and that is where we will stay.

'After Dubai the logical next step would be Doha or Oman, and then we will spread out across the GCC and into the rest of the Middle East.'

However, Savola's first priority will be expansion in Saudi Arabia. The group is presently opening a new supermarket every 25 days in the Kingdom compared with a target of one hypermarket a year in other countries.

'In five years we want to reach a turnover of $5.3 billion compared with $1.6 billion today, and for profits to be $533 million against $320 million now. But we prefer to expand fastest in our core market and have our most aggressive plans in Saudi Arabia. Elsewhere we are selective and cautious in our approach,' says Dr. Kashgari.

'We will double the number of supermarkets in the group from 50 to 100 by 2010 and boost the number of hypermarkets from five to 25. We know our strengths in fresh fruit, fresh vegetables and bakery and have established the only nationwide retail brand in Saudi Arabia.'

A publicly quoted group, Savola has increased its paid-up capital to $800 million in recent years, and Dr. Kashgari says that the financing of this expansion programme will pose no problem as further bank borrowing against this capital base would not be difficult.

'We are one of the top 10 companies in the Kingdom and one of the most diversified conglomerates in the Middle East with interests from oil and sugar refinery to packaging as well as retail.'

Savola Group has indeed come along way from its origins as a humble producer of edible oils in Jeddah, and Dr. Kashgari explains that having operations for other products in many countries will help facilitate the expansion of retail operations as Savola therefore often has considerable experience of these foreign markets through the selling of cooking oil.

Meanwhile, the Dubai Festival City now has a 175,000 square foot HyperPanda hypermarket with a strong electronics department and even a health and beauty centre, a first for a UAE hypermarket. No doubt the Dubai consumer will welcome additional choice and competition in this sector.