UMM AL QUWAIN // The upside of life in the second-smallest emirate is the relaxed pace, low prices and no traffic jams. The downside for businessmen in Umm Al Quwain is that they struggle to make a profit.
Fewer than 80,000 people live in UAQ, the least populous of the seven emirates, and traders and shop owners say that isn’t enough to sustain their businesses.
“The most important thing in any commercial project is profits, and the profits of UAQ’s businesses are low because of the small population,” said Mohammad Sayed Kamel, 38, an Iranian expatriate who owns the Umm Al Quwain Centre for Gifts.
“To attract customers I reduce the prices of my goods compared with other emirates. When I compare my shop with other UAQ shops, sales are not bad, but compared with other emirates sales are not good.”
Ahmad El Shanti, 30, from Jordan, set up the Farah aluminium factory three years ago because of the low rent and the speed with which the municipality provided licences and other documents.
“I opened my factory in UAQ but I work with clients from all other emirates except Fujairah,” said Mr El Shanti. “Sales in the other emirates are excellent, because there, customers accept any price, but UAQ clients find my prices too high because of their low incomes.”
With house prices rising in Dubai and Sharjah, more people are moving to UAQ, prompting calls by residents for improved infrastructure and more shopping facilities to encourage people to spend their cash in the emirate. UAQ has only three small shopping malls, with few big-name shops.
“The reason for the lack of customers, in my opinion, is the lack of services here, so residents go outside the emirate to buy their needs,” said Salwan Al Katea, who manages a confectionery store.
“I moved from the Abu Dhabi branch nine months ago and I found that sales here are about 10 per cent less, despite the prices being the same.”
Mohammad Shnan, 29, a Syrian expatriate who manages a supermarket, said many people moved to the emirate to save money, and as a result don’t spend much in local shops.
“We opened this branch six months ago because of the movement of many UAE residents to the emirate, and sales are still weak,” he said.
“In our branches in Dubai, we make desserts every day and all of them are bought, unlike here. Sales in this UAQ branch are Dh3,000 a day. The Dubai branch’s sales are between Dh25,000 and Dh30,000 a day.”
The low numbers of customers at stores and supermarkets takes its toll on every type of business.
Anas Akilan and a friend set up Al Masar, a weekly free advertising paper for local shops. In the four months since launch they have lost between Dh120,000 and Dh150,000.
“I lost this money because I have bills, rents of the office and workers’ apartments and salaries I have to pay. Besides, there are no customers. The reason is shop owners don’t have sufficient income and profit despite my prices being very low compared with the other emirates,” said Mr Akilan, 24, a Palestinian.
“The price of an advert is Dh250. The same size in other newspapers costs between Dh12,000 and Dh20,000.”
He now no longer relies solely on business from UAQ and is expanding to distribute his paper in Ajman, Ras Al Khaimah, Dubai and Abu Dhabi.
“The benefits of opening a business in UAQ are low rents and the ability to give low salaries to your workers compared with Dubai. But doing business in the emirate does not lead to huge profits.”
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