Crystal company aims to raise regions from 3% of profits to 6%.
By Claire Ferris-Lay
Swarovski plans to double its market share in the Middle East through an “aggressive” expansion plan that will see it increase its stores in Saudi Arabia from six to 20, its chief executive has said.
The luxury crystal and jewellery house generates 3% of its profits – around £30m – from the Middle East but aims to raise it to 6% in five years, said Swarovski chief executive Robert Buchbauer.
“With an extension of businesses from six into 20 stores in Saudi, we should be able to increase the share of the region from 3% to 6% in the next five years,” he said.
“We have a few emerging regions which grow at an even higher rate than the rest of the world [at] double digit growth and these will regions most likely take over a bigger part of our shares. [The] Middle East region and Latin American are the most important ones.”
The Austria-based firm, which was established in 1895 and is still family run, will increase the number of stores in the region from 25 to over 40 by the end of the year. The bulk of store openings will target Saudi Arabia, but the firm also sees opportunity in Qatar and Iraq.
“Is it quite an aggressive plan, the way we want to grow,” said Rasmus Olsson, manager consumer goods business Middle East. “We are present in all of the Middle East except Iraq but it is just a question of time until we have our first boutique in Iraq as well.
“Abu Dhabi is definitely where we see quite a deal of potential, Qatar also potential no question [and] Saudi is the big engine,” he said, adding that the group also hopes to increase its market share in Kuwait, Syria and Egypt.
In the past 10 years Swarovski has experienced a dramatic turnaround in its business, moving away from kitsch miniature sculptures and figurines to collaborations with some of the biggest names in fashion, jewellery and lighting. Last year, the firm generated £2.34bn in turnover and grew 23%.
“We are growing 16% after 23% last year, although what I am most proud of is 2009 [when] we grew 6%,” Buchbauer said, adding that the firm maintained good sales amid the downturn as a result of its “duel business model”.
“We try to be very aspirational and very desirable as a brand but at the same time accessible. I think playing into both directions really makes it very attractive as a brand even when times get tough and wallets become thin,” he said.