Stepin is on a mission to break monopolies and fill gaps in the UAE’s retail market

When I asked some of my colleagues and friends where they shop from locally, they mentioned brands like Centrepoint, Aldo, Mango, Zara, Carrefour, Sun and Sand Sports, LC Waikiki, and the ones that like to splurge mentioned Louis Vuitton, Chanel, Dior and the likes. The ‘usual suspects’ were the brands retailed by a handful of known retailers that have been established in the region for a decade or more. However, when asked about where they shop from when they are travelling, they ended up mentioning a range of different brands, many of which aren’t available in the region.

That got me thinking that while Dubai positions itself as a shopping haven – which for the most part, it is – are we limited by brands and retailers? Is there a lack of freshness when it comes to offerings? Do the customers here have access to all kinds of shopping choices and options or are they craving for more?

There are two points of views that need to be considered to address this. One is the brands perspective, where businesses trying to enter new markets need to break down the barriers to entry. And second, is the perspective of retailers that are trying to acquire the brands.

The United Arab Emirates is ranked 16 among 190 economies in the ease of doing business, according to the latest World Bank annual ratings. In the past few years, the government has introduced various legislations to minimise any entry barriers and facilitate a thriving environment for local and international businesses to flourish.

Now, let’s take the example of Zara, the Spanish fast fashion brand that has traveled to almost 80 countries globally. The brand is known to make calculated decisions on how to move forward with expansion based on extensive research and testing with it’s target audience and, strong partnerships and collaborations.

For many brands, global expansion is a mission, mainly because of one thing – scale. Having a presence in the U.S., Europe, and MEA provides immense opportunities for a brand to grow, acquire a wider cohort of customers, and give the leaders a sense of ‘I’ve made it’.

The fact that Dubai is a global travel hub, attracts tourists from all over the world all year round, provides tax-free shopping options, and has a very mature mall culture makes it a desirable destination for brands.

However, the retail landscape here has been dominated by the franchise model of business where local companies, many of which are family-run, acquire international brands and make it accessible to the customers in the region.

Now, the top name retailers here have done a commendable job in bringing some great brands from the world over to the UAE and the wider GCC market. However, as an industry-observer, one can’t fail to realise that there is a need for a shake-up in the landscape.

In the last decade due to various reasons including economic situations, changing trends and the surge in e-commerce, retail sales have begun to shrink and some of the brands seem to be reaching maturity. Customers are demanding a wider product mix and if the retailers fail to meet their expectations, they end up losing some of their loyal customers.

Some retailers have also begun to expand the market through additional brands. New brands can be introduced along with the old brand so that it helps build brand association as well as visibility. It can help the retailers attract a new segment of customers who were not targeted by the old brands. It can also be designed to provide price differentiation as well as new fashion trends, thus catering to a whole new segment in the market.

This also provides an opportunity for new retailers to enter the market and tap into the untapped potentials of the region’s retail landscape. Stepin is one such new entrant, which evolved from being a trading company to a retailer, having recognised the gaps in the market.

“We were a trading company supplying to companies in this region. After a period of time, we decided to get into retail considering we had the production capacity. We started with homegrown concepts and then we introduced some international brands to the market,” said Birendra Tiwari, Founder and CEO of Stepin.

Launched in 2019, it is home to a multitude of international and national brands of apparel, fragrances, accessories, cosmetics, footwear, and more. Birendra decided to launch the company after noticing that the region’s retail landscape was missing “freshness” given that most shopping malls in the UAE offered the same brands and concepts, without much of a transposition over the last decade.

“Most brands you see in our portfolio are new in the GCC and ones you’ve not come across in the region before. These brands are internationally well-known and customers that have travelled abroad would know the brand,” he said.

After identifying this gap in the market, Birendra set out to launch Stepin in 2019. Unfortunately (or fortunately) Covid-19 hit at the time they were planning on opening stores. “It initially made us panic, but then we realised that it is an opportunity. We started brand acquisitions very aggressively in fashion and F&B retail. In less than 18 months, we managed to open 34 stores. Stepin now has 27 brands within its portfolio,” he said.

These numbers are impressive for a new equity-funded retailer and the pandemic proved to be a blessing in disguise for Stepin. “Due to the presence of very established retailers in the market, entry has always been difficult, but there is always a moment. If you miss that window to breakthrough, it will be very difficult to set shop. For us, Covid was that moment,” he said.

Stepin is an anchor tenant in Gate Avenue Mall at DIFC, housing roughly two dozen stores including Italian fashion brand Calliope, Turksh menswear brand Ramsey, Brazillian brand Colcci and F&B brands like Pancake House and Galito’s among others. The mall opened its doors to the public in December last year, as an urban destination for retail, fashion, lifestyle and dining, which will focus on promoting culture and community.

When asked why he picked this mall considering it isn’t as popular as the behemoth’s in the region, as a result of which it will likely receive lesser footfall, Birendra said, “The catchment here (in DIFC) is very strong so you don’t have to look for customers. DIFC is already a destination for F&B. This is also not a very crowded place. The profile of the customers is high with a strong in-house population. Gate Avenue, therefore, has the potential to be a popular destination.”

“Since the (mall) area is not enormous, a new brand that opens here will be noticed. We need to make sure that the retail mix is right. We are trying to support DIFC by coming up a big portfolio of 12 brands with 23 units. The stores are already doing well. Being the anchor tenant, we are building this mall with them,” he added.

Stepin enters the region’s retail landscape with a clear mission of filling a gap and serving the customers right. While they are going to be faced with stiff competition from the honchos who’ve laid a strong foundation here already, the leadership at Stepin is optimistic. “I think in this market, businesses realise that the macro picture is more important than the micro pciture. Competition exists but nobody tries to put you down unfairly. At the end, the customer will win, as the more choices, the better,” he concludes.