Two of the UAE’s leading jewellery retailers are taking drastic actions to counter the COVID-19 impact on gold demand.

Joyalukkas, the first jewellery retailer to create a multi-store network in the Gulf, is closing its “weak performing” outlets, while Malabar Gold & Diamonds, with more than 100 outlets in the GCC states, has decided to delay opening all stores until there is clarity on rent reductions from its landlords. The gold trade has been the worst hit by the virus outbreak, as most residents stopped spending on anything other than essentials, while tourists too have been absent after the suspension of flight services.

The initial plan is for Joyalukkas to exit seven of its 24 stores in the UAE, and repeat the process in the other Gulf states. The UAE contributes the highest share of the retailer’s revenues, at 40 per cent.

“It has reached a point where we can’t retain all stores,” said Joy Alukkas, Chairman. “There will be a dip in our UAE sales because of the closures, but nothing too drastic, I hope. Fact is we will be better served by retaining just one store in locations where we had two or even three.

“Because there is such low consumer demand for gold jewellery right now, it’s better not to re-open some stores – that way retailers will end up with less expenses.” courtesy gulfnews.com