THERE is no doubt about it. People in the Kingdom do like to shop. And as ever more malls spring up, with often astonishing ranges of goods, retailers are extending their sales and, it would seem, their profits. A new report suggests that retail sales grew a strong 11 percent last year. Stores are said to be well on track to better that figure this year.

In the field of electronic consumer goods, it is not uncommon to find the very latest devices on sale in Saudi shops long before they have actually reached markets in Europe and North America. Thus an Irish expatriate shipped home one of the first large-format curved OLED TV screens, bought in Riyadh last fall but not available in Dublin until this year. It is not clear if the arrival here of this technology, almost the minute it was launched in South Korea, was the result of an inspired bit of business by a Saudi retailer. It may equally have been a deliberate sales push by the manufacturer into the Saudi market, which is known to be both willing and able to afford the very latest consumer electronics.

The essence of the modern shopping mall is to make visitors feel entirely at home, especially families who come with their children. Thus, as well as the full-on shopping experience, there are places where people can go to relax, to eat or just to chill out.

In Europe and North America, big brand names, especially food stores, go to considerable lengths to design the layout of their premises to lure the customer into extra purchases. Once upon a time, the more obvious lure was the smell of freshly roasted coffee. How the tactic has moved on. Minute attention is now paid to controlling the subtle smells elsewhere in a store. Wholesome disinfectant in a pharmacy area, a faint, unidentifiable perfume near cosmetics. Even an area selling jeans can have a robust scent of cloth injected into the air.

By the same token, at an international level, big name stores will often demand from mall owners, not simply a prime position but a guarantee that no competitor will be operating nearby. This works in some malls here in the Kingdom. But the traditional arrangement of having concentrations of the same type of shops is still holding out. Thus, especially with electronic and white goods, shoppers will happily compare prices walking between several adjacent stores. They select the cheapest offer and even then seek to drive a bargain with the storekeeper.

Saudis can be highly discriminating shoppers. However their eye for a bargain is often a nightmare for international stores. These are used to having their customers elsewhere in the world, eating out of their hand and paying the price that is on label. Modern bar-code scan-based checkout and stock control systems are based upon a fixed price. Negotiating that figure is not an option for the ordinary employee, especially if he is an expatriate. He will therefore have to call a manager, who may not, under company rules, have the flexibility to bargain. Thus a sale will be lost.

The genius of the traditional bazaar trading has always been cash flow. It is far better to accept a reduced profit on a sale than have no sale at all. Alien to the eyes of Western expatriates, a trader fully expects to bargain on virtually every deal. The international style malls in the Kingdom continue to challenge that way of doing business. They are interested in clearly defined concepts such as “foot-fall,” “time-to-sale” and indeed luring a customer into buying a bigger and more expensive item. The big international retailers see absolute efficiency from their supply chain, through their back office to the point of sale as the way to gain competitive edge. Arguing about price is not within their retailing vocabulary. It is utterly inefficient.

To be fair to the global retailers in our malls, who will all have Saudi partners, they are under increasing cost pressures. The Nitaqat program is seeing expatriate workers being replaced with more expensive Saudi sales personnel. In time, as every retailer boosts their local workforce, the extra expense will be factored in to the cost base of every business. At the moment however, some retailers are managing to maintain their expatriate staffing levels, so giving them a temporary advantage over their competitors. Yet maybe that advantage is more perceived than real. Saudi sales staff surely are in a far stronger position than expatriates to say to a Saudi customer, who is eager to start haggling, “I’m very sorry sir, we don’t work that way any more.”