A collaborative research project between New York University Abu Dhabi and Tharawat Family Business Forum

Spotlight

Chalhoub Group

Information last updated on 15 April 2022

Snapshot

Founding

Family Name:

Chalhoub

Founder’s Name:

Michel Chalhoub

Earliest Documented Business Name:

Unclear

Founding Year:

1955

Founding Location:

Damascus, Syria

Today

Current Operating Status:

Operating

Family Business Name:

Chalhoub Group

Headquarters Location:

Dubai, United Arab Emirates

Key Industries:

Retail and distribution of international luxury brands

Number of Employees:

11,000+[1]

ABOUT THE FOUNDER

Michel Chalhoub was born in Damascus[2][3] to a prominent Syrian family in 1931.  After graduating from high school, Michel attended law school, where he made friends with classmates who traveled between Paris and Damascus. Michel grew fond of the French luxury objects to which they had access and saw a business opportunity in introducing them to Syria.[4] In 1954, at the age of 23, Michel quit law school to pursue his business idea.[5] Around this time as well, he married Widad Mireille Marie (Mazloum),[6] with whom he had two children, Anthony (b. 1955[7]) and Patrick (b. 1957).

FOUNDING STORY

Michel’s friends provided him with contacts in Paris, whom he worked with to open one of the first Western tableware boutiques in Damascus in 1955, together with his wife.[8] They licensed the rights to sell three luxury French brands:[9]: Baccarat, the fine crystal manufacturer; the Jean Patou fashion house; and Christofle, the goldware and silverware company. During this period, however, Syria was seeking to restrict imports into the country to “protect its agricultural and industrial production, as well as its international solvency.”[10] The situation in Syria became even more difficult for the Chalhoubs in the early 1960s[11] following the coup d’état and subsequent political instability.[12] In the mid-1960s the Chalhoub family moved its operations to neighboring Lebanon.[13]

GROWTH PHASE

Lebanon’s economy during this time was far more laissez-faire than that of most other countries in the region. The government maintained low tariffs on imports and mandated import licensing on just a few agricultural products.[14] Since the beginning of his entrepreneurial journey, Michel Chalhoub strongly believed in the growth potential of the Gulf region.[15] To tap into the market, he reached out to contacts in Kuwait. As national regulations required him to have a local business partner,[16] in 1967, he built a partnership with a Kuwaiti businessman that would prove to be beneficial a decade later. In Lebanon, meanwhile, there were growing political tensions. The sectarian government system the country adopted ultimately led to a civil war in 1975.[17]

 

As soon as the civil war broke out, the Chalhoub family decided to move their operations once again — this time to Kuwait.[18] The new headquarters location reflected the family’s desire to further grow their business in the Gulf, taking advantage of the partnerships they had established.

 

Shortly after the 1975 relocation, Anthony Chalhoub, Michel’s oldest son, joined the Chalhoub Group, which now had 30 employees. This was a pivotal year for Kuwait as a whole, because it marked the nationalization of Kuwaiti Oil.[19] As a result of the oil boom, Kuwait’s per capita income soared to among the highest in the world,[20] and the Chalhoub Group’s fortunes grew enormously. In 1979, Michel’s second son, Patrick Chalhoub, joined the Group, with now 100 employees, at the age of 22.[21]

 

The group opened Tanagra, their own concept store, in 1980 and it became one of their most successful stores to date. Three years later, they opened the very first Louis Vuitton boutique in the Middle East in Kuwait. In 1989, they opened Faces, another concept store that was an immediate success.[22] At the same time, Kuwait’s territorial disputes with Iraq were becoming increasingly heated and on August 2, 1990, the Gulf War broke out. Thousands of lives were lost and Kuwait’s infrastructure suffered massive damage.[23]

 

The Chalhoub family immediately fled Kuwait and in 1990 re established their headquarters for the third time — now in Dubai. This proved to be a great location for the headquarters of a luxury retail business as Dubai was beginning to market itself as a luxury tourist destination.[24] The Chalhoub Group were able to play a part in the city’s commitment to building their luxury lifestyle image from the very start. This gave the Group a vital first mover’s advantage, facilitating their growth into one of the biggest luxury retailers in the country and, eventually, the entire Middle East. The Group maintained good relations with the Dubai government while launching new joint ventures with international brands and continuing to expand their line of concept stores. In 2005, Chalhoub expanded their operations to India, where they occupy 15 percent of the luxury cosmetics market today. Despite that impressive level of success, Patrick has said that the Indian market is still not ideal for them, but that they are in it for their grandchildren.[25]

 

Michel Chalhoub, who was nicknamed the “Wandering President,”[26] resigned from his position as CEO in 2001. His two sons took over as co-CEOs and Michel became Group chairman. In 2018, Anthony Chalhoub died at the age of 63 after battling cancer,[27] leaving Patrick as the sole CEO. In 2021, Michel Chalhoub passed away.[28] Today, the Chalhoub Group’s board and executives are primarily non-family members, but the company remains a fully family-owned business[29] and has no plans to go public.[30]

TODAY

As of 2022, the Chalhoub Group comprises over 125 companies, affiliates, and joint ventures and has over 650 retail outlets in 14 countries.[31] It has approximately 11,000 employees worldwide, mostly in the UAE.[32]

Notes

Credit Photo: Founder Michel and his wife Widad, 1990. Source: Fashion Trust Arabia

[1] Refinitiv

[2] According to some sources, he was born in France.

[3] Michel Chalhoub, Founder of Dubai-Based Luxury Retailer, Dies. https://gulfbusiness.com/michel-chalhoub-founder-of-dubai-based-luxury-retailer-dies/. 15 Apr. 2022

[4] Le Groupe Chalhoub, Porte d’entrée Du Luxe Au Moyen-Orient. https://thegoodlife.thegoodhub.com/2015/11/26/le-groupe-chalhoub-porte-dentree-du-luxe-au-moyen-orient/. 15 Apr. 2022

[5] A Values-Driven Legacy Binds Our Family Business | LinkedIn. https://www.linkedin.com/pulse/values-driven-legacy-binds-our-family-business-patrick-chalhoub/?trackingId=LEgoUrUMR6WehAVynnNe%2Fw%3D%3D. 15 Apr. 2022.

[6]Anthony Chalhoub. https://prabook.com/web/anthony.chalhoub/308523. 15 Apr. 2022.

[7] Anthony Chalhoub. https://prabook.com/web/anthony.chalhoub/308523. 15 Apr. 2022

[8] Le Groupe Chalhoub, Porte d’entrée Du Luxe Au Moyen-Orient. https://thegoodlife.thegoodhub.com/2015/11/26/le-groupe-chalhoub-porte-dentree-du-luxe-au-moyen-orient/. 15 Apr. 2022

[9] “Michel Chalhoub & Family.” Forbes, https://www.forbes.com/profile/michel-chalhoub/. 15 Apr. 2022

[10] Michaelis, Alfred. “The Middle East Economy in 1950.” Middle East Journal, vol. 5, no. 2, 1951. https://www.jstor.org/stable/4322274 P. 223–38. 15 Apr. 2022

[11] Middle East Luxury Retail Pioneer Michel Chalhoub Dies | Business – Gulf News. https://gulfnews.com/business/middle-east-luxury-retail-pioneer-michel-chalhoub-dies-1.1627805108787. 15 Apr. 2022

[12] THE SEPARATIST PERIOD IN SYRIA, 1961 – 1963: Searches the Contents of 400+ Databases & Publishers (7 Million+ Sources). https://eds.s.ebscohost.com/eds/detail/detail?vid=0&sid=9ff27dc5-978f-421b-8d1d-c4b0ca071a17%40redis&bdata=JnNpdGU9ZWRzLWxpdmU%3d. 15 Apr. 2022

[13] Le Groupe Chalhoub, Porte d’entrée Du Luxe Au Moyen-Orient. https://thegoodlife.thegoodhub.com/2015/11/26/le-groupe-chalhoub-porte-dentree-du-luxe-au-moyen-orient/. 15 Apr. 2022

[14] Persen, William. “Lebanese Economic Development since 1950.” Middle East Journal, vol. 12, no. 3, 1958. https://www.jstor.org/stable/4322274 . P. 277–94. 15 Apr. 2022

[15] CHALHOUB GROUP MOURNS WITH THE CHALHOUB FAMILY AND CELEBRATES THE EXTRAORDINARY LIFE OF MICHEL CHALHOUB WHO DEVOTED HIS LIFE TO CREATE AN IMPACT AND MAKE A CHANGE. 2 Aug. 2021, https://chalhoubgroup.com/chalhoub-api/uploads/pdf/Chalhoub_Group_-_MC-_Press_Release_2021-_English.pdf. 15 Apr. 2022

[16] Le Groupe Chalhoub, Porte d’entrée Du Luxe Au Moyen-Orient. https://thegoodlife.thegoodhub.com/2015/11/26/le-groupe-chalhoub-porte-dentree-du-luxe-au-moyen-orient/. 15 Apr. 2022

[17] Malley, Muadth. “The Lebanese Civil War and the Taif Accord: Conflict and Compromise Engendered by Institutionalized Sectarianism.” The History Teacher, vol. 52, no. 1, 2018. https://www.jstor.org/stable/26646477 . P. 121-159. 15 Apr. 2022

[18] “Patrick Chalhoub, Co-CEO, Chalhoub Group.” A&E Magazine, 16 Jan. 2017, https://aeworld.com/fashion/in-focus/patrick-chalhoub-co-ceo-chalhoub-group/.15 Apr. 2022

[19]Information Center Kuwait Oil History. https://www.kpc.com.kw/InformationCenter/Pages/Kuwait-Oil-History.aspx. 15 Apr. 2022

[20]   Kuwait – Demographic Trends | Britannica. https://www.britannica.com/place/Kuwait/Demographic-trends#ref45147. 15 Apr. 2022

[21] Jones, Rory. “Family Man Luxuriates in Joint Rule.” The National, 20 Jan. 2012, https://www.thenationalnews.com/business/family-man-luxuriates-in-joint-rule-1.407354.

[22] About Us. https://www.faces.com/ae-en/About-Us.html. 15 Apr. 2022

[23] Horner, Jim. “The Iraq‐Kuwait Border Dispute.” Journal of Borderlands Studies, vol. 7, no. 1, Mar. 1992. Taylor and Francis+NEJM, https://doi.org/10.1080/08865655.1992.9695416. P. 1-18. 15 Apr. 2022

[24] Dubai – Economy | Britannica. https://www.britannica.com/place/Dubai-United-Arab-Emirates/Economy. 15 April 2022.

[25] Le Groupe Chalhoub, Porte d’entrée Du Luxe Au Moyen-Orient. https://thegoodlife.thegoodhub.com/2015/11/26/le-groupe-chalhoub-porte-dentree-du-luxe-au-moyen-orient/. 15 Apr. 2022

[26]CHALHOUB GROUP MOURNS WITH THE CHALHOUB FAMILY AND CELEBRATES THE EXTRAORDINARY LIFE OF MICHEL CHALHOUB WHO DEVOTED HIS LIFE TO CREATE AN IMPACT AND MAKE A CHANGE. 2 Aug. 2021, https://chalhoubgroup.com/chalhoub-api/uploads/pdf/Chalhoub_Group_-_MC-_Press_Release_2021-_English.pdf. 15 Apr. 2022

[27] Chalhoub Group Co-CEO Anthony Chalhoub Dies at 63 | UAE News. https://gulfbusiness.com/chalhoub-group-co-ceo-anthony-chalhoub-dies-63/. 15 Apr. 2022.

[28] Chalhoub Group Founder & Chairman Michel Chalhoub Passes Away | Travel Retail Business. https://www.trbusiness.com/regional-news/international/michel-chalhoub-founder-and-chairman-chalhoub-group-passes-away/210869. 15 Apr. 2022.

[29] A Values-Driven Legacy Binds Our Family Business | LinkedIn. https://www.linkedin.com/pulse/values-driven-legacy-binds-our-family-business-patrick-chalhoub/?trackingId=LEgoUrUMR6WehAVynnNe%2Fw%3D%3D. 15 Apr. 2022.

[30] Le Groupe Chalhoub, Porte d’entrée Du Luxe Au Moyen-Orient. https://thegoodlife.thegoodhub.com/2015/11/26/le-groupe-chalhoub-porte-dentree-du-luxe-au-moyen-orient/. 15 Apr. 2022

[31] “Profiles of Top Companies and Organizations in the Arabian Gulf.” Dhow Net, https://dhow.com/dhows-profiles/. 15 Apr. 2022.

[32] Refinitiv

To cite this article please use:

“Chalhoub Group” Family Business Histories Research Project, New York Unviersity Abu Dhabi and Tharawat Family Business Forum, 20 Mar. 2023, familybusinesshistories.org/spotlights/chalhoub