The recent news circulating regarding the departure of two major international brands, H&M and Starbucks, raised concerns about the potential economic repercussions, as a significant number of jobs these brands provide to Moroccans will be lost.
Alshaya Morocco, the Kuwaiti franchise that owns the rights to both H&M and Starbucks in Morocco, has acknowledged the boycott campaign’s impact. They have, however, justified their decision to leave by a perceived lack of attractiveness for their businesses.
H&M and Starbucks introduction into tfrohe Moroccan Market:
In 2011, Alshaya Morocco began operation in Morocco, introducing H&M and Starbucks alongside seven other international brands in Morocco Mall in Casablanca.
The expansion, which was backed by a 40$ million investment, aimed, at that time, to create around 300 jobs in retail, logistics, and key support functions such as Property, IT, HR, and Finance.
Two Starbucks stores were opened in December 2011 in Morocco Mall, and one on Avenue Anfa in March 2012.
Back then, Starbucks in Morocco employed over 30 individuals and held ambitious plans for rapid expansion in line with their growth strategy.
Until now, Alshaya owns 4 stores of H&M in the Kingdom, with 2 operating in Casablanca, one in Rabat, and the other in Marrakech.
It also owns 18 stores of Starbucks located in the major cities, including 10 in Casablanca, 3 in Rabat, 3 in Marrakech, 1 in Kenitra, and 1 in Tangier.
While precise figures are unavailable, it is reasonable to assume that both the number of stores and the number of employees have increased since 2011.
By comparing the number of stores opened at the time to the present, we can infer a rise in expansion and employment for both H&M and Starbucks in Morocco.
As a result, this expansion is likely to result in higher revenues for both H&M and Starbucks in Morocco.
However, since the pandemic, the Kuwaiti franchise’s stores in the Kingdom, have been struggling, according to The NewArab.
In December 2022, the group’s capital was reduced from 142 million dirhams (15 million USD) to 65 million dirhams (7 million USD) in December 2022. “This decision was made at a general assembly of the board of directors,” a source quoted in several local media reports added.
In 2017, the Kuwaiti franchise increased its capital to 566 MAD million in a recapitalization of MAD 67 million.
This move comes as Alshaya expands its network in Morocco, where it already has around fifteen outlets operating under various banners, including five Starbucks and three H&M, among others.
The Kuwaiti franchise holding company played an important role in funding the development of its Moroccan subsidiary without incurring debt.
Through significant equity injections, such as the 150 million Moroccan Dirhams in 2014, Alshaya has been able to contribute to the growth and expansion of its operations in Morocco.
H&M’s global sales franchises in 2015 totaled 4,494 million Swedish Krona (SEK), including Value-Added Tax (VAT), and included operations in several countries, including Morocco.
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