Kuwait retail franchise operator Alshaya Group closes down Debenhams, The Body Shop, Mothercare, and Pinkberry in Egypt
The retail franchise operator, Al Shaya Group, has decided to downsize its business operations in Egypt due to pressure from foreign exchange markets and challenging economic circumstances, according to an internal note reviewed by Asharq Business and distributed to staff.
Alshaya Group is a dynamic family-owned enterprise established in Kuwait in 1890. It is one of the world’s leading brand franchise operators with a portfolio that extends across MENA, Turkey, and Europe, with thousands of on-ground stores, as well as a growing online and digital business.
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Complete and Partial Closure:
The firm announced that it will shut down Debenhams locations in Egypt by the end of February. Meanwhile, an official of a significant Egyptian mall claimed that the group had notified them of its ultimate decision to shut down all The Body Shop, Mothercare, and Pinkberry locations.
Other retailers, such as Bath and Body Works, American Eagle, Victoria’s Secret, and H&M, will, however, only be partially closed.
According to Al Arabiya, the business plans to close about 60 of its stores nationwide and lay off 375 employees. However, the note we have seen places the number at 450. According to its plans for downsizing, the company will operate about 100 stores in Egypt, 80 percent of which will be Starbucks locations.
Alshaya cited the “economic situation over the last three years,” as well as a weakening EGP, exchange rate pressures, and soaring inflation for its decision to downsize. The company also faced “difficulty moving hard currency out of Egypt,” Al Arabiya wrote.
Are Boycotts a Factor?
Since the beginning of the global Palestine solidarity, boycotts campaigns in Egypt and elsewhere in the region adopted the blacklist posted by the BDS movement and started focusing on major brands that Al Shaya group operates of them such as Starbucks, Bath and Body Works, American Eagle, Victoria’s Secret, and H&M. However, none of the statements issued by the group has mentioned the boycotts affect towards their decision.
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Is it the end?
“Alshaya Group has been in the Egyptian market for 18 years, and we are extremely proud of the business we have built. We are committed to the market and look forward to continuing to trade and hopefully growing again soon,” the group said.
One of Egypt’s shopping mall operators is in negotiations with Al Shaya group in hopes of having it rethink its decision, according to an official who told Asharq.
