5 Porter`s Forces
1. Rivarly among competitors :
The luxury industry in UAE has many actors that have been performing in various activities
such as luxury leather and goods, luxury watches and jewerly, luxury eyewear, prestige
cosmetic and fragances and luxury fashion. Indeed, the presence of an ever booming
economy to extravagance clothing has made UAE an imperative middle for apparel and
textile commerce. UAE has gotten to be a major center within the world that incorporates
filaments, textures, apparels, cloth, outerwear, domestic materials, and specialized textiles
[ CITATION Mor201 \l 3082 ]. Nonethless, the UAE textile industry is not well advertised and
marketed which means that some companies operating in this industry does not have any
presence on internet. For this reason, the competitors that are mentioned in the list below
where chosen by analyzing every textile company with websites located in UAE in terms of
exclusivity, uniqueness and prices.
Nº Company Focus Location
1 Allure Fine Tailoring & Dubai
Men
2 Fabrics Abu Dhabi
Men, Women, Home Fabrics, Men`s
3 Regal Dubai
Eclusive Boutique
4 Como Luxury Fabrics Italian high textile fashion companies agent Dubai
Tatiana Luxury Fabrics &
5 Women Dubai
Tailoring
6 York Fabrics: embriodery, printing Dubai
7 Ultra Furnishing fabrics Fabrics: embriodery, printing Dubai
Imported luxurious fabrics by global fashion
8 Salem Alta Moda houses such as Ellie Saab, Zuhair Murad, Dubai
Valentino and many more
9 Bouquet Ladies fabrics Abu Dhabi
Qatar
10 Trevi Design Furniture, walls Dubai
Abu Dhabi
Table XY : Luxury textile companies in UAE with web sites
The information presented in the table shows that Jakob Schlaepfer’s competitors are mostly
located in Dubai. In fact, Dubai’s fabric stores are concentrated in small areas, shopping
centers or so-called “districts” where the list of competitors was also analyzed. The
competitors have diverse ways of doing business, most of the luxury fabrics stores in Dubai
and as well in Abu Dhabi offer to the customers more than fabrics. Some of them offer
complete services specializing in tailoring and others specializing in specific targets such as
men, women, furnishing fabrics, interior desing or fashion in general. Furthermore, the
quality of the fabrics are not the same in every store which can be reflected in the prices, the
location and as well in the desing of the store.
According to the GlobalData report the Luxury Market in Middle East and Africa is predicted
to reach $15.1 billion by 2022, growing at a striking compound annual growth rate of 5.6
percent [ CITATION AME20 \l 3082 ]. Some factors have helped the boost of this indusrty such
as the implementation of digital luxury goods platforms and the Middle East population
features. Indeed, the Middle Eastern population is the largest community of people under 30
in the world. Morover, they are not just richer than the global average but also are purchasing
more than ever before[ CITATION Mor20 \l 3082 ].
On the other hand, UAE`s government has implemented specific rules and procedures that
companies should follow in case they want to exit the market. In this regard, independently of
the type of business, the company should cancel the business licence and premissions in
which the company had been operating. Moreover, licences should be canceled depending the
from of the company and it will differ if is a sole propertorship or for example a company
with shares. Furthermore, closing a business in a free zone has a different closure procedure,
in this case the company will need to notify the free zone authority and the intention will be
published in an Arabic newspaper. In fact, the UAE government has an established procedure
for closing businesses ; nonethless, the language and the Islamic influence are factors that can
be perceived as obstacles in this context [ CITATION UAE20 \l 3082 ].
2. Threat of new entrants :
The lack of restriction on profit, competitive labor cost, extremely low import duty and low
corporate taxes are some of the advantages that UAE provides to the companies that are
planning to enter this market [ CITATION Mor201 \l 3082 ] Furthermore, UAE is becoming an
ideal destination for investments in luxury textile industries due to its accessibility of tall
telented and beneficial laborers, steady economy and absence of covered up costs adds to the
country positive textile environment. The textile industry in UAE represent a large income
and employment which is slightly located behind the oil incomes. In spite of the fact that
UAE has commercial activities with more that 50 countries, the country has a expansive
client base locally. In cities like Dubai, the local male buyer has become essential to the
growth of the high fashion industry. [ CITATION Mor201 \l 3082 ]. Among the GCC nations
UAE has gathered a lot of business from other countries moving the base of operation to
Fujairah. In fact, Fujairah is called free zone were companies are not required to pay taxes or
any expenses for repatraition. Indeed, this are important factors that companies take into
consideration and this is one of the main reason that brought numerous business and people
into the UAE which includes a bigger client base for their garments and textiles.
Another important factor to take into cosideration is the access to distribution channels.
According to Euromonitor, the UAE persists the most engaging market in the region for
retailers [ CITATION Eur20 \l 3082 ]. In the emirates direct sales are not very widespread and
the foremost common way ist o market the products through local agents; notheless, the
govermentent has recently annulled the monopoly of agents. Therefore, companies tend to
utilize the geographic position of Dubai as a territorial center for stocking prodcuts before re-
exporting them to other markets.
The luxuroius textile indsury within the UAE is flourishing in steady government activities in
terms of framework advacement, asses exclussions, and transparency in paper work. The
foremost later advancement has been setting Dubai as a fashion hub by 2020 in order to
attract domestic and international brands [CITATION Tex181 \l 3082 ]. Indeed, the
government is putting a lot of effort to set up Dubai as a modern design capital.
3. Threat of subtitute products :
The textile industry in UAE is componed by some players that produce luxury fabrics in
others materials like leather or animal skin that can be perceived as a unique and exclusive
products for the customers and that can be used for many purposes as well as the case of
Jakob Schlaepfer products. In this sense, companies York, Regal, Como Luxury Fabrics can
offer a direct subtitute for the Luxury Fabrics that Jakob Schlapefer is producing. On the
other hand, there are some subitutes that can affect Jakob Schlaepfer indirectly like
companies that are buying the fabrics and selling end products. For instance, premium
companies that specialized in the luxuroius fashion industry, and in this case UAE is packed
of stores like this such as Chanel, Gucci, Hermes, Ralph Lauren, Christian Louboutin, Dior,
Prada, Fendi, Dolce&Gabbana and more [ CITATION Emi20 \l 3082 ]. According to Gulf
News, in 2017 ultra-high-net-worth individuals in UAE spent 1. 627 billion dollars in
desingner apparel and footwear (ready- to-wear) behind luxury cars that were in the first
position and before luxury leather goods positioned in the sixth place with 312 million dollars
[ CITATION Gul17 \l 3082 ]. Indeed, the wealthy residents of UAE are spending their
disposable income in luxury brands as a matter of quality, status or reputation. In fact,
customer in UAE are seeking for companies that impress them and offer a high customer
service with personalized treat. Emiratis are also looking for personal advisors which would
encourage higher purchases and more frequent spending [CITATION Wor18 \l 3082 ].
4. Bargaining power of customers :
According to the Knight Frank report the population of ultra-high-net-worht individuals
(UHNWIs) in UAE increase by 1,454 people in 2018 to the total of 52,344 individuals in
2017 [ CITATION Gul19 \l 3082 ]. Indeed, the UAE market is recognized as a ready-made
market for leisure brands, and Emiratis are considered big spenders able to consume around
30 percent of their wages on luxury goods [ CITATION Wor18 \l 3082 ] Moreover, the UAE`s
ultra-high-net-worth individuals can be indiferent to price performance. UHNWI are not
worried to buy from their favorite brands at any price point if the product and service fullfil
their high expectations and requirements. However, the difference between the competitors
is going to be settle in the customer service level that the brand can offer in order to provide
the best possible customer experience. Most of the UHNWI expect that their brands know
them personally and to treat them individually. Indeed, the companies efforts to impress the
UHNWI will reflect the loyalty of their customers and will be transformed in a low risk for
the brands that their customers easily change them.
5. Bargaining power of suppliers :
This factor has no relevance in the analysis due to fact that the main activity of the company
will still be done in Switzerland. In this sense, the possible suppliers will be need to take into
consideration in the future.
Market Attractiveness :
