Hamleys has toy empire in its sights

September 1, 2006 by Dan Waldman

AS the British specialty toy retailer nears its 250th anniversary, CEO Nick Mather is determined to introduce the Hamleys brand to the far reaches of the globe. So far Mather has inked a deal to open stores in the Middle East and is now working to crack the Indian and Chinese markets to complement the retailer’s 13 locations in the U.K. and Denmark.

Mather took the helm at Hamleys last September and has since put his 15 years of retail experience into forging global plans. ‘We’ve pretty much been concentrating on running the flagship store in the U.K.,’ he says. ‘Nobody has really tried to maximize the potential of the brand and do something a bit more exciting with it until now.’

Wasting little time, he signed a deal to open three stores in Dubai, Kuwait and Saudi Arabia this past June. Daud Investments, a member of Muscat, Oman-based Getco Group that has some major franchises in the Middle East such as McDonald’s, will operate the outlets. A 75,000 square-foot spot in the world’s largest mall has already been scoped out in Dubai and is expected to open in 2007 or early 2008. The Kuwait and Saudi Arabia stores should open 12 months later. Three airport outlets in Kuwait, Saudi Arabia, and Abu Dhabi are also being considered.

Next stops for Mather and his team include India and China. They’re currently hunting for possible locations and franchise partners in both territories, but haven’t dotted the i’s on any contracts. Two locations will most likely be opening in Delhi and Mumbai, with up to seven major cities to follow if the initial stores are successful. Beijing and Shanghai will be first up in China.

According to Mather, Hamleys global ambitions are based on a number factors, including the rising disposable income of a growing middle class in these emerging markets, budding tourist offerings and lower operating and rental costs. He also points out Hamleys has global brand recognition that has yet to be capitalized on – 30% of the London flagship store customers are tourists. For example, a lot of middle-class families from the Middle East have been traveling to London for some time, says Mather. ‘So they’re very familiar with the brand.’ But the same cannot be said for China.

That country has a notoriously diffuse retail landscape where even retail giants such as Wal-Mart and Carrefour are finding it a very tough nut to crack. Mather, though, remains optimistic, insisting there is a hunger in the Chinese marketplace for the unique merch and presentation that Hamleys offers its customers. This summer, the toy retailer has decked-out its stores with pirate-themed decoration to promote merchandise from Disney’s new Pirates of the Caribbean movie. Mather thinks that such in-store theatrics will translate well to foreign markets.