Lals Group: From Home-Grown Franchise to Successful Retail Conglomerate

Tracking the fabulous growth trajectory of a dynamic and versatile company that achieved distinct recognition and steady growth across the region

Starting from the UAE as a home-grown franchise in 1979 to becoming a household name in the Gulf region, Lals Group today caters to consumers across the GCC. The company serves an array of customers with unparalleled care and service in Qatar, Bahrain, Kuwait, Oman, and the Kingdom of Saudi Arabia. Over time, Lals Group has seen significant changes. The company has a combined retail space of over 1.5 million ft2, 180 retail outlets, and numerous leading global brands in home essentials, fashion, novelties and food products among others. In conversation with The Zone, Jayant Ganwani, Vice Chairman and CEO, Lals Group, talks about the Group’s journey, UAE’s business-friendly policies and more.

Can you outline the company’s journey, from a small repair shop to specialised mega malls?

Since its inception in the UAE, Lals Group has evolved from being an original food retailer and a grocery supermarket operator into a diversified conglomerate. Today, we have experience in manufacturing, poultry, real estate development, hotel operations, shopping centres, departmental stores, and several other industries.

We believe that the UAE is the land of opportunities. Every emirate has provided us with the opportunity to diversify our business and do something special. We are grateful to the Rulers of the UAE and our hosts here in Jafza, who are an integral part of our journey, for providing us with the platform to grow our businesses.

When did operations commence in Jafza and how has the free zone’s holistic business ecosystem benefited the company?

This is our second stint in Jafza, which has been an ideal place for our headquarters and logistics operations. We came to Dubai in the early 1980s. We were probably one of the first few companies to come and explore a garment manufacturing platform in Jafza. Then, we received immense cooperation and support. We ran the business here for about four or five years. Due to changes in regulations in the main source market, we pivoted outside.

We came back to Jafza in 2004, and now we have four facilities here, predominantly in the logistics, warehousing and trade sectors. Shifting to Jafza was a phenomenal idea at the right time as it provided us with the opportunity to own our businesses 100 per cent. With the evolution of laws in the UAE and the soon-to-be-launched corporate tax, free zones like Jafza that have several added advantages offer respite to businesses.

Elaborate on a few of your milestones and achievements since inception.

We started as a single-store operation in Ajman in 1979, and today we have expanded to the entire Gulf region. This in itself is a milestone that defines our hard work and investment. You always look out for opportunities to grow. We have transformed ourselves in the light of new laws, policies and opportunities to succeed in our businesses. We have diversified from a simple distribution business into a multifaceted-business organisation over time.

“We operate 180 stores in the UAE and run about 1.5 million ft2 of retail. Our achievements have ensured that we rank among the top three companies in some of the segments we operate in.”

Jayant Ganwani, Vice Chairman and CEO, Lals Group

Tell us about your global network and the size of your company.

We have operations in all GCC countries. Our base, however, is in the UAE. We export products to the entire region from here. We also have distribution businesses to handle exports to almost 50 different countries from Africa to Asia. The availability of smooth shipping connections from and via Jafza and other ports here has tremendously helped our business. As for our workforce, the company exceeds 4,500 employees, which is quite a substantial number. We operate 180 stores in the UAE and run about 1.5 million ft2 of retail. Our achievements have ensured that we rank among the top three companies in some of the segments we operate in.

How are you incorporating technology to ease operations?

Without technology, we would be blind, and this is a common statement for any successful enterprise. If we don’t know what we are selling, how we are selling, what are our margins, when we need to replenish, and when we need to re-order, we would not be able to operate any business efficiently. We are in the midst of a very substantial enterprise resource planning (ERP) platform to upgrade ourselves. We’ve been connected and online for the last two and a half decades. We believe that investment in IT is the best any business can make. Once we are up and running on the latest ERP platform in the Cloud, we will be a much more resilient and informed business.

How are you utilising e-commerce in your ecosystem for retail and online trade?

No brick-and-mortar business can succeed without having an e-commerce platform. Every business needs to have click-and-collect. The UAE average is circa 15 per cent to 20 per cent of the business that will move online, and we are foreseeing trends to that extent. We got online and adopted e-commerce in 2020. Yet, it has been the best experience that we’ve had in a long time. I think we were late to the party, but it was a mistake in hindsight. We should have done this substantially before, but it is never too late. We are online now with every business, and it is showing great signs of success.

What is your forecast for this year?

The year 2023 holds tremendous opportunities for our business. If you look at our sourcing, predominantly from Asia, we have seen far more disruptions in the supply chain than companies that were buying out of the US and the Western world. With China, Malaysia, and most of Asia reopening, I foresee freight rates will come down to improve businesses. Overall, opportunities for us to cater to the re-export businesses and consumers in our neighbourhood countries will improve. Particularly, for Lals Group, freights stability to the old level will truly help margins, which were under pressure. 2023 should be a good year in all respects.

How can you overcome supply chain disruptions and prevent them in the future?

It’s not just the UAE that saw supply chain disruptions, the whole world was affected. Geopolitical events, the pandemic and other unforeseen circumstances disrupted global businesses. With factories reopening and shipping lines going back to normal operations, businesses, at least in GCC and particularly in the UAE, will return to normal. Companies are now used to the idea of just-in-time inventories. But I believe everybody will have to carry some inventory in the future to insulate themselves, and their businesses, from disruptions like COVID. Facilities like ours in Jafza will help meet companies’ sales obligations and targets in the future by being able to store them in a secure, free zone area.