How to build a billion-dollar business: An interview with world-renowned Irish businessman Colm McLoughlin
Business

How to build a billion-dollar business: An interview with world-renowned Irish businessman Colm McLoughlin

COLM McLoughlin is the Executive Chairman and CEO of Dubai Duty Free.

Having started his career in London, the Galway man gives his thoughts on Brexit, shares his toughest moments and reveals what you won’t read about him on the internet.

The award-winning industry leader also tells SIOBHÁN BREATNACH what it takes to build a billion-dollar business...

Tell us about your career to date?

In June this year I'll be 50 years in the Duty Free business and 57 years in the retail business. I'm still very positive about it and I think that attitude has reflected onto our team. We have many senior people who've been here for a long time. I'm happy that's the case.

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What was Dubai like when you first arrived in the 1980s?

When we first heard about Dubai, we had no idea where it was. Many people we spoke to reckoned it was some place in Saudi Arabia. It didn't have its own identity. It was very small. The population was about 300,000 people but even at that time, the attitude was very positive. So making the decision to come here, wasn't that difficult. I only signed up for two years in 1983 - that has been extended to 36 years.

What inspired the move?

In 1983 the Government of Dubai and Aer Rianta in Ireland did a contract to send a team of people to set up a Duty Free at Dubai Airport. I was one of a team of 10 people that came here. During that period, which was supposed to be a six-month term, I was asked if I would stay and run the Duty Free, which is owned by the Government of Dubai.

Trailblazers: Colm in 1983 with the first batch of DDF staff (Image: Supplied)

What’s changed since you first arrived?

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The changes have been fantastic. There are now 3.2million people living in Dubai and 9million people in the United Arab Emirates. Last year there were 89million passengers to the airport. Our Dubai Duty Free (DDF) has grown along with that. In our first full year, we had 100 staff. We still have 25 of those original pioneers working for us.

Our business in the first full year was $20million sales and in conjunction with the rest of Dubai, the whole thing has grown. The traffic to the airport last year was 89.1million, Dubai Duty Free’s business was $2billion, which makes it the single largest Duty Free operation in any city in the world. We now employ 6,100 people.

When we came here in 1983, there was no Emirates Airlines, which now employs 100,000 people. There are thousands of cabin crew, school teachers and pilots in Dubai and in the United Arab Emirates, and there are opportunities for all. It continues to grow.

You were born in Ballinasloe, Co. Galway in 1943 – what was your childhood like?

I remind myself a little of my grandson, who’s a bit of a tearaway. I was active, I liked doing things, I liked sport a lot when I was a kid. I played tennis and squash and was in the final of the Co. Clare squash tournament many years ago – I was thrashed! My parents wanted us to do things.

I remember when I was 12 making pocket money from sowing lettuce and selling them to the local shop. I remember buying my first bicycle. It was £11. I had saved a lorry load of turf and my dad sold it for me.

My mam and dad kept us involved in a lot of stuff, like the St. Patrick's night concerts, trying to speak Irish and sport. But I wouldn't for a minute try to say I'm special, I just thought I was very normal.

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Is it true you were once a London bus conductor?

When I first went to London, in the summer of ’61, it was my intention just to stay for the summer and go back to university in Dublin. I decided to extend that and was doing a variety of jobs. Eventually, after having been a bus conductor for nine months, I joined Woolworths as a trainee manager. That sounded very posh, except it meant sweeping the floor and learning the departments, filling up the counters and unpacking the lorries.

But I progressed through the system and I was appointed as a ready man and a manager of Woolworths in 1969. Then because I thought I knew everything about the retail business, when I was on holiday in Ireland, I saw a job advertising the Duty Free at Shannon. I didn't really understand what it meant but I went for an interview and was offered a job. And it took.

Honoured: Colm accepts Ireland’s Distinguished Service Award from President Higgins in 2014 (Image: Supplied)

You’ve met a lot of successful people, who stands out?

In our tennis tournament, Roger Federer won his 100th professional title in Dubai in March. The first tournament he ever won in his career was won in Milan and that tournament was owned by Dubai Duty Free. He has won the Dubai Men’s Championship eight times. He's a great example of sportsman and success.

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We are the title sponsor of the Dubai Duty Free Irish Open. For the first four years of our sponsorship there, that tournament was hosted on our behalf by Rory McIlroy. Rory McIlroy was world number one, he has won four majors in his career.

And over the years we've had many people who excelled in their sport.

For example, Serena Williams and her sister Venus. They’re all dedicated people and apply themselves correctly to their job.

Tell us something we can’t read about you on the internet?

Will I have to give the secret away that I smoke cigarettes?! I like keeping things simple. I don't like people who get notions. I don't like people who step out of line. I like to stay very normal. I like being able to talk to people on an even keel. But I preach that all the time so if you looked it up you might find it.

Is it true Duty Free was invented in Ireland?

The Duty Free industry at airports started at Shannon Airport in 1947. It was founded by a man called Dr Brendan O’Regan. The business on its first full year was $10,000 - it’s now $76billion. Half of that is at airports and Dubai Duty Free is six per cent of that total on its own. Shannon was the first to sell Duty Free perfumes. It was considered for a long time that Duty Free meant alcohol and tobacco and that was all. But then it started introducing other brands and that has spread right around the world.

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Teeing off: Colm with Irish golfer Rory McIlroy (Image: Supplied)

What do you look for in a potential employee?

We like people who will work honestly and genuinely. We think all our staff are the very same, we treat everybody the same. We have a policy of internal promotion. So we have not recruited a senior person for 19 years.

What’s your greatest achievement?

I’m very happy that Dubai Duty Free is the single largest Duty Free operation in the world. I'm very happy with the policy we adopted regarding internal promotion and to see the company progressing so well. I'm very happy personally that I've been 50 years working in the industry. Right at the beginning, his Highness Sheikh Mohammed, who was the Minister for Defence at that time, made it quite clear that part of Dubai Duty Free’s duty was to promote Dubai. And if you take the Dubai Duty Free Tennis Championship as an example. The ATP and the WTA gave us an assessment last year of the value to Dubai of those tournaments - TV viewers, media coverage - and it was valued at $980million. Those sorts of things are very satisfying.

Who inspires you?

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At Shannon Airport in the beginning, there was a general manager in Duty Free called Bill Maloney. He had been a long time in the business and it's fair to say he would have been an inspiration. The industry was founded by the late Dr Brendan O’Regan and in the early days I met him. He was a very inspiring man.

But of course the biggest inspiration in my whole life is my wife Breda. Our kids are doing good. We have two grandchildren and we're trying to inspire them.

Soulmates: Colm says wife Breda is his biggest inspiration (Image: Supplied)

What are your thoughts on Brexit?

I’m certain if there was another referendum it would be a resounding result not to leave the EU. Personally I think leaving the EU is bad. If ever there was a possibility of having a hard border between the Republic of Ireland and the North of Ireland, it’s a very bad thing.

I think is has to have an effect on the business in London, in England. I read about companies threatening to pull out if Brexit goes through. I think it's now going to end up with a couple of months delay, but that's all. Mrs May is losing votes, which is a pity, because she's a very dedicated and hardworking lady.

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How is Brexit being viewed in Dubai?

It’s being looked at seriously because of the affect it might have on imports and exports. There are over 100,000 British people live in Dubai. It's not being treated with disdain, it’s not being treated as if it's a million miles away. It is being looked at seriously. One of the biggest destinations out of here is London airports. We do a lot of business with English companies so it is a consideration. We’ve yet to see what effect it will have with suppliers from the UK.

How do you embrace technology?

Personally my technology is limited to a 10-year-old telephone, which I use on a day-to-day basis. But from the company's point of view, we are highly technical and we have to be. Last year we sold 70million pieces of merchandise, we had 27million transactions on our registers. One of our senior managers is in charge of our IT department, and it's vital we stay up-to-date or we wouldn't be able to manage our business.

What’s been your toughest moment?

There are sad things in life. Our youngest sister passed away four years ago from Motor Neuron and I witnessed what I thought was about eight or nine years of absolute agony. In my life, I have seen people treated badly. I don't want to use the word abuse, but treated badly. I've tried to make sure that I wouldn't follow that track.

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Remainer: The Galway-born business heavyweight is not a fan of Brexit (Image: Supplied)

What’s happening in the property and construction business?

Thirty five years ago, a foreigner could not buy real estate in Dubai. Now, one of the biggest developments in the world is happening here. In 2003, nobody had heard of Palm Jumeirah. It is built in the sea, there are 30,000 people living there. There are 5,600 hotel rooms. It goes 8km into the sea, it's surrounded by a crescent which is 13km long and there's an 11km boardwalk where people can stroll. That's the kind of development that happens in Dubai all the time. The best in the world, in my opinion.

Expo 2010 was awarded to Dubai a couple of years ago. It's run every four years for a six-month term. There’s a new development going on near the Al Maktoum International Airport to site it. So far there are 195 countries pledged to take part and all the construction work is going on now. They expect 22million visitors. The motorways and the metro system are being extended and this will all be finished prior to the start of Expo 2020. I think so far, the work has created 70,000 new jobs and they’ve had 50,000 volunteers willing to go and work during the exhibition itself.

There's a new airport in Dubai near Expo 2020. At the moment the capacity of that is 26million passengers a year. In 10 years’ time there will be three runways in operation, three concourses and a capacity for 135million passengers. That's definitely going to happen.

How do you promote and market your business?

We spend 2.5 per cent of our sales every year on marketing and promotion. It's headed up in Dubai Duty Free by Sinéad El Sibai.

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London organisation iSportsconnect has 24,000 members and for Women's Day they named the top 10 ladies in the world in sport. One is Mary Davis, who is in charge of the Special Olympics. One is Serena Williams - the best women tennis player ever. One is a lady in charge of marketing Formula One, another is in charge of marketing for FIFA. One is an Olympic athlete, and one is Sinead El Sibai from Dubai Duty Free.

We don't have any board of directors, we’re assigned to a Government-owned company called ICD, the Investment Corporation of Dubai. We’re part and parcel of that and 61 other companies. I'm the Chief Executive and my Chairman is his Highness Sheikh Ahmed bin Saeed Al Maktoum, who’s a terrific man. In addition to being Chairman of Dubai Duty Free, he’s also the president of the Dubai Airport Company, and Chief Executive and President of Emirates Airlines. He's in charge of Expo 2020 and the development of the new airport. He’s on the Government Fiscal Committee and he’s the chairman of Emirates National Bank of Dubai and 22 other boards.

With Sheikh Ahmed bin Saeed Al Maktoum, President of Dubai Civil Aviation Authority and Chairman of DDF

What does success mean to you?

I think not being afraid to try something new. We're the title sponsor of the Dubai Duty Free Irish Open Golf and have been for five years. We’re the title sponsor of the Dubai Duty Free Irish Derby and have been for the past 12 years. We own a tennis stadium, which we built in Dubai. We own an Irish pub called The Irish Village, which we built under the stadium. We own the tennis tournament that goes into that stadium.

I like that we continue to progress. I like that we continue to do new things. Five years ago we did not own a hotel. We now have a 292 bedroom five-star hotel managed for us by the Jumeirah Group.

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How do you approach corporate social responsibility?

We have a foundation called the Dubai Duty Free Foundation. We’ve given away $27million. We have restored over one million eye sights in the last seven years. We have helped rebuild a village in Sri Lanka, which was wiped out by a tsunami. We built, in a southern island of the Philippines, a street ruined by earthquake.

We had some staff working for us in that area and there's now a street there called the Dubai Duty Free Street, where we rebuilt 32 houses for the people who had lost their homes. I think it's just a case of giving back. We have all our customers spending, we have staff from 45 different countries. I think it's just the right thing to do.

What’s your advice to anyone moving to Dubai?

I’m almost half my life in Dubai and I've learned an awful lot from how things are done here. The present ruler of Dubai, Sheikh Mohammed, 30 years ago said ‘this is going to be such a kind of a city… it's going to have this, it’s going to have that’ and he has done a fantastic job. Like in every country in the world there are rules here. Act normally, work honestly, work hard. My advice would be just to obey the rules and to behave yourself and everything will work out terrifically.