private sector qatar english | january 2014
DESCRIPTION
Private Sector Qatar English | January 2014TRANSCRIPT
jan
ua
ry 2014w
ww
.privatesectorqatar.com/en
Lead Strategic partner
pUBLicatiOn LicenSed BY iMpZ
Qr 10
entrepreneUrShip partner
qatar.SMetOOLkit.Org
A look At the lAtest developments
Building new relationships
CONTENTSJanuary 2014
News
10 updatesA quick look at news and events in this region.
Events
14 save the dateFind out what’s happening in Qatar in the coming months.
About Town
16 Building new relationshipsQatar Shell and QDB sign three new local companies to join the supply chain for the Pearl GTL Project. Private Sector Qatar brings you the highlights from the awards ceremony.
Entrepreneur
18 preparing to soarThe Entrepreneurship in Economic Development Forum will be held in Doha in February 2014.
20 starting small, growing BigFaysal Mikati, Founder, Snow Comms, talks to Ayesha Aleem about his communications and events company.
Management
22 from the BeginningSunita Gomes, Chairwoman, UWC GCC National Committee and Member of the UWC Council, tells Ayesha Aleem how she’s scouting for well-rounded, young talent in the region.
24 we are familyDaniel Fleming, Head of Wealth Advisory, Middle East, JP Morgan, explains family businesses in the region.
Technology
28 when opportunity knocksJR Mayer, MD, QNET, shares his thoughts with Ayesha Aleem on why the company’s business model has succeeded.
30 the Buzz aBout duBizzleArto Joensuu, CEO, Dubizzle, talks to Aparna Shivpuri Arya about the website’s rise to fame.
16
Qatar Shell and QDB signed three new local companies to join the supply chain for the Pearl GTL Project. Private Sector Qatar brings you the highlights from the awards ceremony.
20
4
Sector Study
32 are we doing enough?Shaker Alansari, MD, Doha Plastic, reiterates the importance of recycling and the role each one of us plays in the process.
Bilateral Trade
34 refreshed tiesAdam Ereli, former Ambassador to Bahrain, visited Dubai recently and spoke to Ayesha Aleem about relations between the Middle East and the United States.
Women in Business
36 the one-stop shopMuna Fadel Sulaiti, Founder of Bridy Shop, tells Jenny Kassis why she opened this innovative store in Qatar.
HR
38 the final handshakeJeffrey Asselstine, Founder of Quest Advisors, explains Qatar’s current job market to Ayesha Aleem.
SME
40 the sigma sign Khaled Fayoumi, GM, Sigma Metal Industries, meets with Jenny Kassis to talk about the company’s progress.
42 switching on to Q-tecAbdul Rasheed, MD, Q-Tec Switchgear, in an interview with Ayesha Aleem, talks about the company and its relationship with Tasdeer.
3424
36 Legal
44 where’s my money?Laura Warren, Partner, and Alexa Hall, Associate, Clyde & Co, explain what happens when an employee decides to suspend work for non-payment.
Tasdeer
48 the Big 5Tasdeer helped bring Qatar’s private sector to the world at The Big 5. Read all about the massive construction and building event that took place in Dubai.
50 tunisia: an export opportunityFind out what opportunities Tunisia has in store for Qatari exporters.
52 finding the marketTasdeer advises how to start a business in a foreign market.
5January 2014
ChairmanDominic De Sousa
CEONadeem Hood
Managing DirectorRichard [email protected] +971 4 440 9126
EDITORIAL
Group Director of EditorialPaul [email protected] +971 4 440 9105
Group Managing EditorsMelanie [email protected]+971 4 440 9152
Georgina [email protected]+971 4 440 9105
Senior EditorAparna Shivpuri [email protected] +971 4 440 9133
Deputy Editor - EnglishAyesha Aleem [email protected] +971 4 440 9120
Deputy Editor - ArabicBadar Salem [email protected]+971 4 440 9116
ADVERTISING
Group Sales DirectorCarol [email protected]+971 4 440 9110
Commercial DirectorChris [email protected] +971 4 440 9138
CIRCULATION
Database and Circulation ManagerRajeesh [email protected] +971 4 440 9147
OPERATIONS AND DESIGN
Production ManagerJames P [email protected] +971 4 440 9146
Head of DesignFahed [email protected] +971 4 440 9132
PhotographerJay [email protected] +971 4 440 9137
DIGITAL SERVICESwww.privatesectorqatar.com
Digital Services ManagerTristan Troy Maagma
Web DevelopersAbey MascreenErik BrionesJefferson de JoyaLouie Alma
[email protected] +971 4 440 9100
Published by
Head OfficePO Box 13700Dubai, UAE
Tel: +971 4 440 9100Fax: +971 4 447 2409
Printed byAl Wraq Printing Press, Qatar
Distributed byDar Al Sharq Distribution
© Copyright 2014 CPIAll rights reservedWhile the publishers have made every effort to ensure the accuracy of all information in this magazine, they will not be held responsible for any errors therein.
EDITORIAL
Aparna Shivpuri Arya, Senior Editor, Private Sector Qatar
Talk to us:E-mail: [email protected] Twitter: @PrivateSectorQA Facebook: www.facebook.com/PrivateSectorQatarLinkedIn group: Private Sector Qatar
qatar.smetoolkit.org/qatar/en
I would like to take this opportunity to wish all our readers a very Happy New Year! I hope 2014 has started on a good note for you.
At our side, we have been working hard over the holidays to bring the first issue of 2014 to you in good time. There have been a lot of changes in our team and over the coming months you will get to meet the new faces and I hope you’ll support them just as you have supported the team so far.
In this issue, we have got quite an interesting mix of stories, which reflect the growth that Qatar is witnessing. Under our “women in business” section, we spoke to Muna Fadel Al Sulaiti, founder of the Bridy Shop, which is a one-stop-shop for all brides in Doha. It’s interesting to read how Muna found a gap in the market and took the bold step of filling that gap.
Moving on, we bring you the coverage from the Qatar-Shell and QDB award ceremony, where they recognised three local companies, which will be working on the Pearl GTL project. We also got talking to one of the winners, Faysal Mikati, Founder, Snow Comms, to know about his journey and his take on the Qatari market.
Besides this, we have an interesting line up of stories ranging from how to deal with non-payment of salary to family business wealth management.
I hope you’ll enjoy this issue. I look forward to working with you in 2014!
Editor’s note
8For more information, please visit www.privatesectorqatar.com/en
Raed Al-EmadiChief Operating Officer, Silatech.
Wael SawanManaging Director and Chairman, Qatar Shell.
Rashid Nasser Sraiya Al Kaabi Chairman of the Board, Energy City Qatar Holding.
Amal Al-MannaiExecutive Director, Social Development Center.
Professor Nitham M. HindiDean, College of Business and Economics, Qatar University.
Gail GosseDean, School of Business, College of North Atlantic-Qatar.
George M. White, Ph.D.Associate Teaching Professor of Entrepreneurship, Carnegie Mellon University-Qatar.
Hamad Mohammed Al-KuwariManaging Director, Qatar Science & Technology Park.
Abdulaziz Bin Nasser Al KhalifaChief Executive Officer, Qatar Development Bank.
Ali Al KhulaifiExecutive Director, Business Support Services, Enterprise Qatar.
advisory Board
10
Doha wil l host the GCC Digital Security Forum from February 4th-5th, 2014, under the patronage of the Qatar Minister of Information and Communications Technology, Dr. Hessa Al Jaber. The Forum is being organised by MEEZA, in cooperat ion wi th the Al-Iktissad Wal-Aamal Group.
The Forum aims to confirm that digital crimes are a growing global concern, as it is estimated that as much as USD one trillion was lost globally in 2013 as a result of cybercrimes, according to a report by the International Telecommunication
Union. The total global direct cost of cybercrime reached USD 113 billion, up from USD 110 billion, and the average cost per victim of cybercrime increased this year to USD 298, from USD 197 in 2012, according to the Norton Cybercrime Report 2013. These numbers do not reflect the true damage done to brands, organisations and entire markets, especially in the Middle East, a region that lacks accurate estimation of losses resulting from digital crimes. The event will focus on digital security and its impact on various economic sectors, as well as the role of governments in the development of digital
security systems within institutions and companies. This is in addition to laws and enforcements needed to prevent and fight digital crimes, as well as new trends and solutions for digital threats.
This Forum also comes at a time when digital defense strategies are at the forefront of governments’ priorities, as well as those of public and private institutions. Specialised agencies have been established to protect economies and societies from digital attacks and intrusions, which is estimated to cost billions of dollars annually. GCC countries have therefore
decided to collaborate to build a safer digital space.
His Excellency Sheikh Abdulla bin Saud Al Thani, Chairman, Qatar Development Bank (QDB), congratulated His Highness Sheikh Tamim bin Hamad Al Thani, Emir of Qatar, on Qatar National Day and announced that, in line of H.H the Emir’s strategy on national food security, QDB has launched a new financing scheme for Qatari farm owners to purchase and raise female livestock.
The launch of the new scheme comes with QDB’s strategic plans to provide support to private company owners and Qatari businessmen in various sectors, in a way that is aligned with the Qatar National Vision 2030. The aim is to enhance economic diversification in Qatar, stimulate the business sector and promote Qatari products internationally. Additionally, QDB offers other services related to food security strategy.
The new Sharia-compliant scheme is launched in co-operation with the Livestock Management Unit of the Ministry of Environment and Widam Food Company. It provides small farm owners with financial loans of up to QAR 250,000, with a payment period of up to five years, while it provides big farm owners with financial loans of up to QAR 750,000, with a payment period of up to eight years, with only 1% interest to encourage the sector.
Qatar’s economy was projected to expand by 6% in 2013, about 0.5% higher than in 2012, and by 4.6% in 2014. The figures are based on those presented in June 2013 by the Ministry of Development Planning and Statistics in its Qatar Economic Outlook 2013-2014 report.
The upward revision for 2013 reflects higher-than-anticipated growth in both hydrocarbon production and in non-oil and gas activity. H y d r o c a r b o n growth in 2013 benefited from higher gas output, which offset the impact of a slight decline in oil production.
The update expects moderate inflation in 2014 of 3.5%, a little higher than the 3.2% projected in 2013.
The Minister of Development Planning and Statistics, His Excellency Dr. Saleh Mohamed Salem Al Nabit, said: “The overall economy is set to expand during the foreseeable future, at a time when the profile of the non-oil and gas economy will continue to become more pronounced.”
An upward pres sure on residential rentals is likely,
but may soften. Although ris ing material costs
wi l l exert upward pressure on costs,
t h e i m p a c t i s u n l i k e l y
to spill over into consumer prices.
The document noted that Qatar’s external position will remain healthy and a current account surplus of close to 23% of GDP is expected in 2014.
News
GCC diGital seCurity forum
QdB launChes sCheme for Qatari farm owners
Qatar’s eConomy GrowinG
Dr. Hessa Al Jaber, Minister of Information and Communications Technology
11january 2014
Qatar’s commercial real estate sector witnessed a significant revival this year. The vacancy rates dropped to 10% in the much- sought-after Diplomatic District, reflecting net take-ups of prime office accommodation, which grew at 2.5 times the five-year average during 2013.
The majority of prime retail mall space is fully occupied and headline rental rates have held steady in 2013. With numerous shopping malls under construction, the supply of retail space is expected to soon increase and this has curbed rising rents, Qatar’s updated Economic Outlook noted, released by the Ministry of Development Planning and Statistics.
The real estate market has exhibited upward price momentum for more than three years, following the setbacks associated with the global financial crisis. Most of the price inflation is concentrated in the residential segment, especially in the premium tier.
Inflation, as measured by the change in the Consumer Price Index, was expected to average 3.2% in 2013, up from 2012’s 1.9%.
This pick-up is primarily due to rising rental costs. Construction activity is set to expand by 13.1% in 2013, up to 15.7% in 2014.
Qatar real estate Booms
Last year will be remembered for many events, some of which illustrate how much we rely on technology, whether that includes scientific research or enterta inment . Whi le 2013 confirmed technology’s importance, what does 2014 have in store for enterprises in Qatar? Marcus Jewell, Vice President, EMEA, Brocade, outlined the top technology trends to watch out for this year.
Network Functions Virtualisation and Software-Defined Technologies will gain momentum – In the Middle East and in Qatar, ex p l o r a t i o n o f N e t wo rk Fu n c t i o n s Vi r tu a l i s a t i o n
(NFV) and software-defined technologies like networks, virtualisation, data centres, storage and infrastructure will evolve.
Trimming the fat in data centres and cloud architectures – Technology disruptions are forcing us to rethink how networks should be built, designed, deployed and operated in data centres. Networks are c r i t i ca l to deliver applications.
Clouds loom large – According to Gartner, the push for more personal cloud technologies will lead to a shift towards services and away from devices. In 2014,
we expect the cloud to develop into a key business enabler and as private clouds mature, the desire to leverage public cloud elasticity will grow.
The Internet revolution continues unabated – According to IDC, an American market research, analysis and advisory firm specialising in information technology, the total “Internet of Things” market including technologies and services will be USD 8.9 trillion by 2020, with 212 billion devices connected to the Internet.
Although concerns over security and interoperability with devices
still remains, the Internet of Things is set to revolutionise industries such as healthcare, retail and transportation, with the movement gaining traction in 2014.
Big data becomes too big to handle – “Bring Your Own Device” and the explosion of data , espec ia l ly v ideo content, are causing many new challenges as the amount of data becomes too big to handle in terms of deriving value from it and using it to define a strategy. Furthermore, we expect to see one or two significant cases of network shutdowns caused by data overload.
BroCade prediCts it trends in Qatar
12
Coutts’ outlook 2014
ReGIONAL News
Coutts launched its 2014 investment outlook entitled Today & Tomorrow, which highlights Coutts’ view of the economic landscape and key investment themes.
Gary Dugan, Chief Investment Officer for Asia and the Middle East, Coutts, said: “Although global stock markets recovered in 2013 as investors’ optimism returned, we believe policymakers face a triple challenge of indebtedness, quantitative easing and changing demographics. As a result, we believe we are in for a sustained period of low growth and low interest rates.”
To best manage investments in this economic environment, the key investment themes are:
Keeping it safe – Low bond yields have been causing investors anxiety for years, but there are ways to enhance yields without taking too much risk. European and UK investment-grade bonds can offer protection against interest-rate uncertainty at a reasonable price. Some emerging market corporate bonds in Asia may play an important
role in portfolios for investors willing to accept the greater risks inherent in this asset class.
Stocking up on income – Dividend growth pays when real interest rates are negative, but don’t just focus on those that yield the most. The income play has been popular for years, so selection is important. We would look for sectors that offer net dividend yields that are historically above average and with room for dividend growth.
Quest for growth – Investors need to drill down deeper to unearth growth potential. We still prefer equities over bonds. As we enter 2014, emerging markets continue to have long-term growth potential. Shares in the luxury goods sector trade at a discount to many world equities. Technology companies offer growth potential, although you may want to look beyond the sector’s giants for the best opportunities.
Changing risks – Political instability remains a threat to Europe’s fledgling recovery. Japan’s politicians are playing with high stakes. Low
nominal growth rates in developed nations mean tax hikes are a real possibility.
Who dares wins – Low interest rates mean that investors need to step up the risk ladder to achieve returns. High-yield bonds are now closely correlated to equities. Consider absolute-return funds to diversify portfolios. Cash deposits will continue to lose money in real terms, after inflation, for savers.
Emirates Airline has boosted its fleet of Airbus A380s to 44 planes, taking delivery of two more superjumbos, which have started service.
“Emirates has received delivery of its 43rd and 44th A380 aircraft, with a double delivery from Airbus’ Finkenwerder facility in Hamburg, Germany,” the company said in a statement.
“From an operator standpoint, the A380 is still one of the most fuel-efficient aircraft per seat,” said the airline’s President, Tim Clark.
The airline announced during last year’s Dubai Air Show that it has ordered 50 Airbus A380s for USD 23 billion.
T h e o rd e r c e m e n te d i t s s t a tu s a s the s ing le l a rge s t opera tor o f the double-deckers.
emirates inCreases fleet
Gary Dugan, Chief Investment Officer, Asia and the Middle East, Coutts
13january 2014
GCC Calls nationals to work in tourismA joint committee of Gulf tourism authorities has called for more employment opportunities for GCC nationals as it moved to better cooperation in the sector.
Following the Fourth Joint Meeting of the Committee on Tourism Cooperation and Gulf Tourism Committee, the states also agreed to submit individual tourism studies to the General Secretariat. The studies would then be distributed to all member states.
It cited Oman’s experience in encouraging nationals’ engagement in the private sector.
In other items on the agenda, member states were urged to cooperate with statistical agencies to complete productivity t ab l e s prepared by the General Secretariat.
Meanwhile, Riyadh Governate Prince Khalid bin Bandar has talked about the potential of the tourism sector as he inaugurated the Laureate College for Tourism and Hospitality in the Salahudeen district of the Saudi capital.
With a capacity of 2,000 students, the new hospitality institution wi l l provide world-c lass,
tourism-related education and training programmes.
It is the first form of institutional learning of its kind in the country and one of seven colleges to be built across the country as part of the ambitious long-term strategy of the government.
“Tourism is an important economic sector and promises bus ine s s oppor tun i t i e s ,” Prince Khalid was quoted as saying. “What distinguishes the tourism sector is that it provides a great number of jobs, especially to citizens.”
Two top energy leaders of the region projected a stable energy market outlook for 2014. At the 91st Meeting of Council of Ministers of Organisation of Arab Petroleum Export Countries (OAPEC), Qatar’s Energy and Industry Min i s ter, His Excel lency Dr. Mohammed bin Saleh Al Sada, and Saudi Arabia’s Petroleum and Mineral Resources Minister, Ali bin Ibrahim Al Nuaimi, said they were “optimistic” regarding the world oil market in 2014, and added that the market would continue to remain stable.
Talking to reporters, Dr. Al Sada said the current energy market pr ices are “appropr ia te” for both the exporting and importing countries. The prices will continue to stay “fair” in 2014 as well. Market stability is key for energy producing countries, he said.
Addressing the ministerial meeting, Dr. Al Sada hailed the critical role being played by OAPEC in maintaining stability in the global energy market. OAPEC is also playing a key role in strengthening
Arab cooperat ion in the energy sector.
At the meeting, he highlighted the organisation’s role in various fields of energy, specifically fossil energy, which according to him will remain the focus of global energy resource in the long term and will be approximately 76% of the global mix energy by 2035. “This confirms the importance of our joint action to ensure the stability of the markets in the coming stages and ensure the stability of our people and our countries,” he said.
enerGy market outlook staBle seC siGns Japanese loan for
power plant
Saudi Electricity Co. (SEC) has signed a USD366 million loan agreement with the Japan Bank for International Cooperation (JBIC) and two Japanese banks to help finance the construction of a 2650 MW power plant in Jeddah.
The facility, funded by the Bank of Tokyo-Mitsubishi UFJ and Mizuho Financial Group, is part of a wider USD2 b i l l ion f inance package for the Jeddah South project, according to an SEC bourse filing.
The remaining USD 1.634 billion, to be completed t h r o u g h a f a c i l i t y provided by South Korea, will be signed later, the statement read, without elaborating further.
The Japanese -backed financing, which comes with a guarantee from export credit agencies N i p p o n E x p o r t a n d Inves tment Insurance and JBIC, has a 12-year lifespan, after a three-year grace period.
S o u t h Ko re a n g ro u p Hyundai Heavy Industries i s b u i l d i n g t h e n ew oi l - fired power plant , while Mitsubishi Heavy Industr ies wi l l supply equipment for the plant. The project is slated for completion by 2016.
14
Save the dateDate Event Location
January 9 Gallery and the Qatar International Conference on sustainable Development Doha exhibition Centre, Doha, Qatar
January 14-16 Techno Build Qatar 2014 Doha, Qatar
January 19-22 seventh International Petroleum Technology Conference and exhibition Qatar National Convention Centre
January 26-27 Current Trends in Immigration and Labour Law in Qatar Grand Hyatt Hotel, Doha, Qatar
January 26-29 Fourth Annual Roads Middle east w Doha Hotel & Residences
January 28-29 The Contract Management and Dispute Resolution Doha, Qatar
January 28-30 International sustainable Built environment Conference Intercontinental Hotel, Doha
February 4-5 The GCC Digital security Forum Doha, Qatar
February 18-20 First Arab states Regional south–south Development expo Doha, Qatar
February 23-25 sixth Facade Design & engineering summit Oryx Rotana Hotel, Doha, Qatar
February 23-25 The George Washington University’s Masters Certificate in Project Management Grand Hyatt Hotel, Doha, Qatar
February 24-25 entrepreneurship in economic Development Qatar University, Doha, Qatar
February 24-25 second Annual MICe Arabia Congress 2014 Grand Hyatt Hotel, Doha, Qatar
February 24-26 International Conference on energy and Indoor environment for Hot Climates Doha, Qatar
March 4-5 Corporate Performance excellence for executive Management Doha, Qatar
March 9-11 MultaQa Qatar st. Regis Hotel, Doha, Qatar
March 11-12 GCC Future Rail summit Doha, Qatar
March 16-18 Drainage and sewerage Middle east w Hotel, Doha, Qatar
March 17-19 Qatar Projects Conference Grand Hyatt Hotel, Doha, Qatar
March 24-26 world exchange Congress st. Regis Hotel, Doha, Qatar
April 7-8 Arab Future Cities summit 2014 Doha, Qatar
April 22-24 Gulf water Conference 2014 Doha, Qatar
April 28-30 Corrosion Management summit Doha, Qatar
January – apriL 2014
To know about the events happening in Qatar in the next few months, please visit our website: www.privatesectorqatar.com/english
eveNTs
Feast your eyes on some 450 types of seafood at Japan’s largest wholesale fish market in Tokyo, which services the world’s most discerning fish eaters. Tuna sells for astronomical sums at early-morning auction, while the bustling undercover market is a spectacle, and perfect for the freshest of sushi lunches.www.tsukiji-market.or.jp
More fish than anywhere else in the UK arrives at this London market from across the world, including Norwegian salmon, New Zealand eels, and live Canadian lobster. It’s all sold in 30 shops and nearly 100 stands, alongside smoked and cured fish, caviar, cooked shellfish, and other seafood produce.www.billingsgate-market.org.uk
The United States’ premier fish market was established in the Bronx in 1822, though it has occupied new premises since 2005. New York chefs turn up early morning for fresh supplies before retail customers arrive for the pick of everything from blue marlin to soft-shell crab, wild salmon to swordfish.www.newfultonfishmarket.com
Muscat’s main port district still retains the air of a fishing village, especially early in the morning when the live catch of the day arrives at the fish market. Tuna, grouper, shrimp, octopus, and whole kingfish ready to spit-roast are sold from stalls, wheelbarrows, or direct off the fishing boats.
FISH MARKETSWords by Brian Johnston
Tsukiji
Billingsgate
New Fulton
Muttrah
An octopus seller in the world’s largest fish market, Tsukiji Fish Market, Tokyo, Japan. ©
Pau
l Dym
ond
/ Get
ty Im
ages
oryxinflightmagazine.com
52fine food
oryxinflightmagazine.com
Feast your eyes on some 450 types of seafood at Japan’s largest wholesale fish market in Tokyo, which services the world’s most discerning fish eaters. Tuna sells for astronomical sums at early-morning auction, while the bustling undercover market is a spectacle, and perfect for the freshest of sushi lunches.www.tsukiji-market.or.jp
More fish than anywhere else in the UK arrives at this London market from across the world, including Norwegian salmon, New Zealand eels, and live Canadian lobster. It’s all sold in 30 shops and nearly 100 stands, alongside smoked and cured fish, caviar, cooked shellfish, and other seafood produce.www.billingsgate-market.org.uk
The United States’ premier fish market was established in the Bronx in 1822, though it has occupied new premises since 2005. New York chefs turn up early morning for fresh supplies before retail customers arrive for the pick of everything from blue marlin to soft-shell crab, wild salmon to swordfish.www.newfultonfishmarket.com
Muscat’s main port district still retains the air of a fishing village, especially early in the morning when the live catch of the day arrives at the fish market. Tuna, grouper, shrimp, octopus, and whole kingfish ready to spit-roast are sold from stalls, wheelbarrows, or direct off the fishing boats.
FISH MARKETSWords by Brian Johnston
Tsukiji
Billingsgate
New Fulton
Muttrah
An octopus seller in the world’s largest fish market, Tsukiji Fish Market, Tokyo, Japan. ©
Pau
l Dym
ond
/ Get
ty Im
ages
oryxinflightmagazine.com
52fine food
oryxinflightmagazine.com
About town
Q atar Development Bank (QDB) and Qatar Shell signed three Qatari companies to join the supply chain of services to the Pearl GTL (Gas to
Liquids) plant. Located at Ras Laffan Industrial City, Qatar, this is the largest GTL plant in the world. The Local Enterprise Awards Ceremony was held on 12th December 2013, in honour of the winners, at the W Hotel, Doha.
Speaking at the event, Wael Sawan, Managing Director and Chairman, Qatar Shell Companies, addressed the gathering by saying that the purpose of the event was to welcome three new SMEs into the Qatar Shell family as official supplier partners. Addressing the winners, he congratulated them, saying that they had been chosen from a long list of applicants, based on commercial sharpness, commitment to safety and adherence to technical standards. Abdulaziz Bin Nasser Al Khalifa, CEO, QDB, also addressed the audience.
The contract for the manufacturing of Personal Protective Equipment was awarded to Qatari Industrial Equipment WLL, part of Al Sulaiman Holdings. Chairman, Nasser Sulaiman Al Haider, was present to accept the award. The Heat Exchanger Re-tubing contract was given to GEA Batignolles Technologies Thermiques Qatar
WLL, which was represented by Tariq Al Mana. Translation services were awarded to Snow Comms Conceptual Communications & Events. Managing Partner, Mohammed Al Mannai, was present to collect the award.
A workshop held in May 2013 allowed SMEs and entrepreneurs to compete in four areas and learn about the financial support, as well as products and solutions, available through QDB that they would have access to as part of this contract. Following this, 26 local companies registered their interest. The group was whittled down to 17 in a pre-qualification stage. Twelve of these submitted bids, from which the final three companies were chosen.
A brief Q&A session with the media was held immediately after the event, where Wael said, “We had to go to Dubai to get our translation services done,” using Snow Comms, one of the winners, as an example. “However, local companies like Snow Comms are more than capable of meeting these requirements.”
In an interaction with media persons, Nasser Sulaiman Al Haider, Chairman, Al Sulaiman Holdings, said “We’re covering 80% of Qatar’s market at the moment. Our intention is to deliver services, not only to Qatar and the GCC, but also the world.”
16
Three new local companies were signed by Qatar Development Bank and Qatar Shell to become the suppliers of choice for the Pearl GTL project. Private Sector Qatar was at the Local Enterprise Awards Ceremony to bring you all the news.
Building new relationships
17January 2014
Wael Sawan, Managing Director and Chairman, Qatar Shell Companies, Sheikh Thani Al Thani and Abdulaziz Bin Nasser Al Khalifa, CEO, QDB.
An award winner is congratulated
(L-R) Wael Sawan, Managing Director and Chairman, Qatar Shell Companies,and Abdulaziz Bin Nasser Al Khalifa, CEO, QDB
The signing ceremony
EntrEprEnEur
As countr ies shift towards pr ivate sector economies, Qatar aims to be a leader in adopting the changes and aligning itself with the Qatar National
Vision 2030. In relation, Qatar University and the Interactive Business Network are organising the Entrepreneurship in Economic Development Forum at Qatar University on 24th-25th February 2014, under the patronage of His Excellency Dr. Mohamed bin Saleh Al Sada, Minister of Energy and Industry, Qatar.
The aim of the Forum is to discuss the translation of the Qatari vis ion to the entrepreneurial community. In other words, how to encourage fos ter ing a generat ion of qual i fied young entrepreneurs, who possess the knowledge and business acumen to seize existing opportunities.
The Forum is a unique platform designed to assess the existing entrepreneurial culture in Qatar and the wider Gulf.
Key topics include: ■ Role and importance of government policy and
education in fostering entrepreneurship ■ Responsibility of Qatar University and other
Gulf educational institutions to act as incubators ■ Qualities of an entrepreneur ■ Common mistakes and hurdles faced by start ups
and SMEs ■ Technological innovation and creativity in
the Gulf ■ Practical advice and financing possibilities
The Forum is expected to attract wide interest and participation from officials and policy makers, major public and private institutions involved in education and youth development, as well as business leaders, banks and specialised financial institutions. The event will also host economists and various experts from the Qatari, GCC and international academic communities.
For more information, visit www.interactiveb.com
18
Entrepreneurs in Qatar can attend the Entrepreneurship in Economic Development Forum at Qatar University. Organised by the University and Interactive Business Network, from February 24th-25th, it will highlight ways in which the private sector can lead the way towards achieving Qatar’s National Vision 2030.
PreParing to soar
NO ONE KNOWS QATAR LIKE WE DO.
.......Operating in Qatar since 1979 we’ve been helping businesses here grow for decades;
delivering express solutions on-time, every-time.
dhl.com.qa
EntrEprEnEur
20
Faysal Mikati, Founder, Snow Comms, changed career tracks and opened his own events and marketing company. He is an example of a growing breed of new-age entrepreneurs in Qatar and a developing business ecosystem that supports them. Ayesha Aleem gets the full story.
You have a background in computer science as well as several years of work in the field. What made you change career tracks?I always wanted to run my own business, but I had to wait for the right opportunity. My wife was already working in the communications and events industry, and she encouraged me to make a career change.
What made you choose Qatar as the location for your headquarters?Family ties have always had a special place in my life. My family has lived in the Gulf for 35 years and my father moved to Qatar in 2005. Qatar is a small market, with huge potential. Almost everyone of importance knows each other, so contacts are made easily. Also, there is much less competition than somewhere like the UAE. Since I already had good contacts in Qatar and the fact that I would be close to my father, it seemed an obvious place to set up our headquarters.
How responsive is the Qatar market to a service like this?The Qatari market lacks skilled people and services. Any sector can flourish if its people are good at what they do and are ready to outdo their competitors. Having already made good contacts across the country, it was clear that an events company could succeed here. Qatar likes to think big, so large events sit naturally with the Qatari people. But success also breeds success. Having organised large events, companies also use our services to stage smaller events.
How has the events and marketing field developed in Qatar?Qatar has developed its brand as a strong and promising country. Its strategy is to become a business destination by hosting international events, exhibitions and conferences, all of which will improve tourism in the country. This direction
21January 2014
has helped local companies improve services to the international market. Snow Comms had the chance to execute the Ferrari Formula One Street Demo and Qatar International Boat Show. With Qatar winning the bid to host the FIFA World Cup 2022, football will keep the market busy for the next eight years. The event will also show Qataris their own potential in event management.
The mindset in Qatar continues to be that for anything big, it is easy to import expertise from Dubai. However, people are beginning to look towards home-grown expertise because of the success of local companies. This is good for Qatar.
How conducive is Qatar to the growth of a young company like Snow Comms?Qatar is trying to support local SMEs through different channels, but every company has to build a good reputation as well. I’m saddened that Qataris don’t want to align themselves with anything risky. A new entrant has to prove themselves first before getting contracts from either the government
or other large concerns. Small businesses have a difficult time getting off the ground in Qatar, but once they are established, the opportunities suddenly become exponential.
What unique challenges or opportunities does the Qatar market offer?Qatar is a special market. You tend to face a lot of pessimism and resistance to change. However, your efforts transform into opportunities when you show the value you are adding to the market.
Convincing both government agencies and large companies to take a risk, rather than waiting for a guaranteed return, is another big challenge. Qataris, as a whole, are averse to risk and this stifles creativity and entrepreneurship.
Please explain the operational and logistical planning process of delivering the service to a client. How large is the Qatar team? The event management cyc le s t ar t s f rom conception to planning and then implementation to closure. We operate as a medium-sized company and employ extra people depending on the requirements of each project. We have 12 people in our Qatar team, but for events, such as the recently concluded International Boat Show, we bring in expertise from around the world. Some of these people work for us in our overseas operations, while some are freelancers with whom we deal regularly. This makes costs manageable. We also work with partners, which makes sense when setting up in new markets.
Considering that you have offices in different parts of the world, how do you train your team to deliver a service that is specific to the individual needs of a client, keeping in mind cultural differences?The majority of our overseas staff has lived and worked in the Middle East at some point in their career, so they are aware of cultural differences. For example, one of our Far Eastern staff has worked extensively in the Middle East, including Qatar, as well as China, the Philippines, Indonesia and much of Europe and America. International experience always shows in the way people become more adaptable to other cultures, and this is something we strongly believe in, to offer a competitive edge to our clients.
How competitive is this sector? The event management sector in Qatar is currently very competitive. Snow Comms aspires to distinguish itself in the sector, not by competing, but by creating unique and creative selling propositions.
Faysal Mikati, Founder of Snow Comms, is an entrepreneur who started his career as an IT programmer. He has worked at Microsoft and SAP. In 2008 he started his own event management company. In 2010 he graduated with an MBA in Serial Entrepreneurship from Grenoble. Faysal can be contacted on [email protected]
Small businesses have a difficult time getting off the ground in Qatar, but once they are established, the opportunities suddenly become exponential.
ManageMent
Underlining the advantages of a world-class education, Ayesha Aleem speaks to Sunita Gomes, Chairwoman of UWC GCC National Committee and UWC Council Member, about the activities and efforts to discover and develop young talent in the GCC region.
Please tell us about the United World College (UWC) education model.United World College makes education a force to unite people, nations and cultures for peace and a sustainable future. Inspired by the pioneering German educator, Kurt Hahn, the UWC educational movement has flourished since the 1960s under the successive presidencies of Lord Mountbatten, His Royal Highness the Prince of Wales, Nelson Mandela and Her Majesty Queen Noor of Jordan. Our students come from all over the world through a variety of different scholarships, bursaries and fee-paying schemes.
Our strategic objective is to advance international understanding through education. The UWC educational movement is built on two assumptions: 1) that promising future leaders from a broad range of cultures should be afforded greater educational opportunities and serve to accelerate global networking; 2) that these educational opportunities take seed at UWC schools and colleges in the belief that our 14 schools and colleges around the world are impactful learning communities for students by being internationally and globally diverse, as well as locally engaged.
What kind of experience can a student look forward to at UWC?UWC schools and colleges offer life-defining experiences for young people, enabling them to discover the possibility of change through courageous action, personal example and selfless leadership. Annually, 7,500 students graduate from UWC schools and colleges, with the knowledge and enthusiasm to go out into the world and make a positive impact. Almost 50,000 students have graduated from UWC since the first college, UWC Atlantic College, UK, was founded in 1962. Most UWC Colleges educate students between 16 and 19 years, and teach the International Baccalaureate as their formal curriculum.
The impact that UWC achieves across its schools and colleges is testimony to the method of student selection and commitment to select as much on promise and potential as on merit. Through the multicultural environment, extracurricular activities, opportunities for student initiative and strong emphasis on social projects, we find our students energised by the UWC mission of building understanding in active, personal ways. The programme exemplifies how diversity can contribute to a much richer education and undergraduate experience.
UWC’s successes in innovative international education has enabled its alumni to attend the world’s most prestigious universities including Harvard, Princeton, Oxford, Cambridge, Yale, MIT and the London School of Economics. Among our alumni, we count presidents, teachers, aid workers and lawyers, among many others.
What are the main bodies of the organisation?Our current President is Her Majesty Queen Noor and the Honorary President was Nelson Mandela.
UWC International is governed by the International Board and UWC Council. The executive arm of the International Board is the International Office, the UWCIO in London. The Directors delegate management responsibilities to the Executive Director.
The UWC national committee network is a group of more than 2,000 volunteers who select students from an applicant pool of 15,000 students, spanning 150 countries.
Please tell us more about your activities in the region.A volunteer-based National Committee was set up in 2013 as an initiative to strengthen our presence in the region. Based in the UAE, our reach spans the GCC.
Our immediate goal is: ■ To increase awareness, recognition and understanding of UWC
in the region ■ To strengthen and develop the UWC’s volunteer and alumni
system in the GCC ■ To increase the number of students from the region,
both nationals and expats, who will attend UWC schools and colleges
How can students in the GCC contact you and apply for UWC for the next academic year?Our National Committee invites applications from students who are resident in Qatar, Saudi Arabia, Kuwait, Bahrain, the UAE or Oman who are committed to UWC ideals.
Students should have a sense of challenge, be adaptable and willing to live in a multicultural environment. Although academic strength
Starting young
22
23January 2014
is required for the International Baccalaureate programme, students must show that they have engaged in extracurricular activities and service in their communities.
We also consider the following personal characteristics – integrity, honesty, personal responsibility, compassion and service, respect for the environment, tolerance and mutual respect.
To be eligible you must meet the following criteria: ■ Applicants must be between 16 and 17 years of
age by September 2014 ■ Applicants should be citizens of, or expatriate
students resident and studying in Qatar, Saudi Arabia, Kuwait, Bahrain, UAE or Oman
■ Students must be enrolled in a secondary school in one of the above countries
We encourage them to visit our website, www.uae.uwc.org, and apply online as soon as possible, since the process can take several weeks.
Can you give us some examples of successful alumni from the region? How do you recognise future leaders?Bassem El-Remesh grew up as the youngest of six children in an underprivileged family in Lebanon. He was determined to find a way to pay for his schooling and started working in a shop at 13. When he was 15, he was working six hours or more each day, which enabled him to help his family, while he attended high school in a neighboring town. Bassem was selected to attend UWC Red Cross Nordic, which he describes as “a dream come true”. Following his graduation, Bassem was offered a Davis scholarship to study at Macalester College in the USA, where he plans to major in economics. He says that UWC is the best thing that has ever happened to him.
Dalal al-Waheidi, from Palestine, witnessed the terrible impact war and conflict has on children. At 17, Dalal was selected by the Ministries of Education of Norway and Palestine to attend UWC. Today, she is the Chief Operations Director at Free the Children and has
founded a youth group that wishes to set a positive example for leaders and prevent further violence. In 2006, Dalal was selected by the Women’s Executive Network as one of Canada’s 100 “Most Powerful Women”.
I hope that I can tell you a remarkable story about a UWC student from the GCC soon.
How has UWC adapted to changes in today’s world?When UWC was first established in 1962, during the Cold War, it was intended to promote world peace by bringing together bright young people with high potential from different national backgrounds. However, the world has changed dramatically within the last half century.
Faced with old and new tensions and uncertainties, we can see even more clearly that we need future leaders who know and understand one another and who are inspired and equipped to make a positive difference.
While there is an incredible amount to be gained from bringing together young people from different parts of the world and with different lived realities, at UWC we strive within schooling and with honest discourse, a deep commitment to explore sustainable ways to live and contribute to the communities our schools operate in. It is in probing deeply and living consequentially that UWC schools and students make a profound impact in the world.
How can the private sector help you reach your goals in Qatar and across the region? We seek support of the private sector for our scholarship system. The widespread provision of scholarship support is fundamental to the UWC model, not the exception or a token gesture. Overall, 60% of our National Committee selected students receive some scholarship funding and our schools also offer a scholarship/bursary programme for younger students. Our scholarship model is one of the key elements that differentiates us from a growing number of international schools.
Our two-year unique residential programme, serving students between 16-19 years who typically represent more than 100 different countries, combines academic challenge with an experiential, hands-on approach to learning. We are a non-profit educational movement. Our donor and alumni base is spread worldwide and we rely on their generosity to provide needs-based scholarships and financial sustainability.
There are numerous pathways for private sector involvement in Qatar – endow a scholarship, volunteer to promote UWC, serve on the committee and participate in events.
Sunita Gomes is the Chairwoman of the United World Colleges GCC National Committee and Member of the UWC Council; the UWC Council elects the International Board. She is a Former Member of the British School Muscat Board of Governors and is currently Member of the Mowgli Mentoring initiative, Qatar. Sunita is also the Commercial Director of Hertz, Middle East and Africa.
There are numerous pathways for private sector involvement in Qatar – endow a scholarship, volunteer to promote uWC, serve on the committee and participate in events.
24
ManageMent
The old practice of mixing business with family can either spell success or disaster in the current economy. Following a few simple rules can make the system work well explains Daniel Fleming, Head of Wealth Advisory, Middle East, JP Morgan.
Family businesses can be found across the world and have often been in existence for generations. Middle Eastern family businesses are relatively young in comparison,
with many only founded during the economic growth that followed the discovery of oil in Saudi Arabia and Kuwait in the early 20th century. According to Campden FB, a magazine that focusses on business-owning families, 48% of GCC family businesses are managed by the first generation, 33% held by the second and only 19% held by the third or fourth generations. Despite their relative youth, 98% of GCC companies are still family controlled.
OverviewFamily businesses in the Middle East initially focussed on sectors that were in demand, which spanned everything from infrastructure
development to consumer goods. The largest family businesses dominated retail , finance, construction and real estate sectors and have since expanded into other areas, as the Middle East region flourished. Often, the original product line makes up only a small percentage of revenue as business operations diversify into other, more lucrative opportunities.
It is difficult to clearly categorise family business concerns. About 40% of family businesses are involved in construction, 37% in retail, 36% are focussed on manufacturing and 25% in hospitality, with many family businesses branching into more than one industry. Less than 20% of family businesses are involved in telecoms, banking and finance, utilities, oil and gas and other such capital-intensive sectors.
We are family
25January 2014
Success in the Middle EastA number of factors have contributed to the success of family businesses in the Middle East for several decades, one of which is plentiful hydrocarbon resources. The cumulative trickle-down effect of the oil and gas industry has fuelled growth of every sector in the region and families with the resources and ambition have capitalised on the opportunities very well. With a vast amount of the wealth created within the last one or two generations, many of the founders are still actively involved in the operations of the businesses. Therefore, many families have not suffered the issues that inevitably arise during transfer of the business to the next generation. However, for families that have had to do deal with this situation, the culture of the Middle East passes control of the family business to the eldest son, reducing ambiguity about succession.
Other contributors to the success of family businesses in the region include higher education in universities overseas and work experience outside the family business. Increasingly, members of the second and third generation have been educated in the United States and United Kingdom as well as have a few years of work experience in sectors unrelated to the traditional family business.
Another aspect to bear in mind is that most Middle East countries are “low-to-no-tax” jurisdictions, which means there is more cash for distribution to shareholders or for reinvestment in the business. In addition, there is no inheritance tax so shareholders are not forced to sell their stakes in a company or other personal assets to raise cash to pay taxes, which is a serious issue for families in Western markets.
Family businesses in the Middle East are currently in the transition phase from one generation to the next. With this occurring quickly, family businesses need to adapt to a changing global regulatory environment and avoid the power struggles within a family that can take place during these turbulent transition stages. Families need to protect their wealth as it is passed to the next generation, and ensure that
the roadmap for doing so, whether through trust structures or the like, is put in place alongside a strong corporate governance framework.
The structure of family wealthFamily wealth exist can be divided into two categories: business wealth, represented by the shares in the family business and private wealth, which are dividends received from businesses and other investments. For many years, these categories have overlapped through loosely documented evidence of ownership and basic accounting methods. But a global economy has seen more families distinguishing between the two.
For private wealth, and in particular wealth held outside the region in the form of financial assets, real estate and private equity, we increasingly see the use of offshore structures ranging from offshore companies that offer some legal protection and have some tax advantages, to the use of succession planning tools like Trusts and Foundations. The use of Trusts and Foundations is on the rise because they allow seamless transition of private family wealth to the next generation in the proportions and according to the timing that the settlor or founder wishes. This feature is important for wealth owners who want their children to be well-versed about preserving wealth. So, they look to trustees, external advisers, lawyers and bankers to educate the next generation and continue the process in their place.
Alternative structuresOther planning techniques on the rise are Private Family Funds (PFF), which permit next generation families to pool their offshore financial assets in a fund without the constraints of typical shareholder agreements. However, this does not offer any viable liquidity solutions except for selling these shares to other family members. PFFs have redemption processes and a defined investment strategy, which permits unit holders to decide if they want liquidity by redeeming the shares, without affecting other unit holders.
Many families have also started to create their own Private Trust Company (PTC), which acts as trustees of the different family trusts. It also provides the most flexibility without having a professional trustee worry about their own personal or legal responsibility of managing an asset. However, it is of utmost importance to invest in strong legal advice as well as an able administrator to ensure that decisions the family takes are in the right direction and in accordance with the trust deed. I always recommend that a member of the board guide the family in decisions.
Middle East countries are “low-to-no-tax” jurisdictions, which means there is more cash for distribution to shareholders or for reinvestment in the business.
Daniel Fleming, Head of Wealth Advisory, Middle East, JP Morgan, holds a Bachelor’s degree in Business Management and Administration from Webster University. Previously, he has served as Associate Director, HSBC, Trust and Estate Planning, Middle East and Intermediaries.
24
For business wealth, if structures are not put in place then Sharia succession rules will prevail. Although Sharia succession rules are precise and not very complicated, transition of ownership across generations can be complicated and disruptive because of long-winded bureaucracy, family disputes and a lack of involvement of the next generation in the business.
Patriarchs are increasingly restructuring their partnership and sole proprietorship companies along the l ines of joint-stock shareholding companies, where ownership can easily be passed from one owner to the next and where it is possible to segregate private liabilities. This kind of structuring also has the advantage of separating ownership from management.
More patriarchs are transferring their shares in the family business to the next generation during their lifetime to avoid local probate processes altogether and ensure the continuity of the business. Some families have structured their family businesses into Waqfs, which is the Middle Eastern version of a trust. Using Waqfs ensures continuity in the family business as assets held in this structure typically cannot be sold. Beneficiaries of Waqfs, which could be family members or charitable organ i sa t ions, on ly en joy benefi t s in the proportions defined by the founder.
While proper legal restructuring of a family business is important, putting in place sound corporate governance is just as important, which is often overshadowed by operational and commercial concerns. Without proper governance, the chances of a business’ survival are somewhat limited.
Corporate governanceGood corporate governance will enable family run businesses to tackle a variety of issues, including succession and separating family and business assets. Other issues like management and control, putting formal structures in place and rules and processes within the business are vital as more family members become involved.
In matters of management and control, a sound understanding of corporate governance will make it easier for businesses to open up a seat on their board to an external CEO or key member of management. If roles and responsibilities are clearly defined at the management and shareholder level, day-to-day decision making will proceed smoothly. Equally important when appointing family members is to ensure that they are chosen based on their
qualifications rather than family hierarchy. This is easier said than done, especially in this region. But small steps in this direction coupled with the growing number of qualified and educated family members will make the process easier.
Formalising board and management meetings is also important. Setting the frequency of meetings and defining their agendas, as well as effective follow-up of decisions made at meetings contributes to good corporate governance. Setting up formal committees within the family business like Executive, Audit and Compensation Committees will further contribute.
Effective corporate governance will prepare family businesses for smooth transitions of control to the next generation and will help them be more effective as they get bigger and go global. It also will lead to transparency and accountability with shareholders, who are within the family as well as outsiders and other vendors with whom they are doing business.
Regulatory environmentAs family businesses grow, they will be confronted with local government regulations exerting control. The bigger they grow, the more regulations they will be subject to. As a result, family businesses have to create internal structures to ensure compliance with these regulations. A good example is when family businesses seek outside investors through an IPO and the increased amount of information they have to make public, which they weren’t required to disclose before.
As family businesses become global, they face regulatory compliance obligations from other countries as well that may sometimes conflict with local regulations. How well a company adapts to these regulations will be another important factor that determines the survival of a family business.
ManageMent
26
The cumulative trickle-down effect of the oil and gas industry has fuelled growth of every sector in the region and families with the resources and ambition have capitalised on the opportunities very well.
At Enterprise Qatar, we are offering Qatari entrepreneurs and SMEs a modern office, located in West Bay, completely free of charge. You will have access to free Wi-Fi and meeting rooms so you can focus on your business idea.
- This offer does not include company registration- The number of offices is limited and their use is subject to a timing schedule
To apply, call 4012 5000. For information on EQ mentorship and advisory services, please visit www.eq.gov.qa
Follow us on
Technology
QNET’s success was a product of timing and innovative thinking, coupled with offering useful products. Proving this combination can go a long way, JR Mayer, Managing Director, QNET, tells Ayesha Aleem about the firm’s rise.
What is the story behind QNET’s beginnings?QNET was started in 1998 by Vijay Eswaran and Joseph Bismark in the Philippines. They were involved with an American direct selling company that suddenly disappeared, leaving them responsible for hundreds of unfulfilled product orders. They had a strong team and so decided to start their own company.
They merged the concept of direct selling with e-commerce. It was not easy to get customers accustomed to the idea of using the Internet for business, mainly because some of the countries we operated in didn’t have reliable Internet access. But they persevered and eventually distributors opened up to the online world as they started seeing the unlimited potential of the Internet.
While the company was started more to ensure that the 200-plus clients were not let down, the new approach with a tested business model helped fuel growth. The company started expanding outside the Philippines. It shifted headquarters to Hong Kong, one of Asia’s most vibrant economies, which was undergoing a period of change after the handover from the British to the Chinese. Many multinational companies were moving out because of the uncertainties and a lot of talented people were left without jobs.
QNET offers a mixed bag of products. On what basis are these products chosen?What sets QNET apart is the depth and range of our products. We offer hundreds of products classified into nine categories, with the primary aim of enhancing the lives of our customers. Our product focus is on encouraging a healthy lifestyle.
Currently, QNET offers a wide spectrum of products, ranging from skincare and nutrition, to Swiss-made watches and jewellery, as well as vacation packages, online learning courses and telecommunication solutions.
Until a few years ago, our product development strategy was focussed on lifestyle products and services. Over a period of time, as we kept diversifying our product offerings, we realised that we were offering too many products that could be considered “lifestyle,” but did not really make a difference in people’s lives.
Three years ago we decided to focus on products that add value and make a difference to the lives of our customers. The over-reaching product criterion since then has been “life enhancement”. This shift from merely lifestyle to life enhancement allowed us to expand our product offerings into education, weight management, air purification and water filtration.
There are a few other unique aspects we look into when evaluating new products. We fight against obesity, diabetes and other degenerative diseases by not allowing sugar, artificial sweeteners or chemicals in our products, driving us to reformulate our nutrition products and replace sugar with Stevia or Xlylitol.
Does a person need to have had a varied life experience or can the skills be learnt to excel in this business space? The direct selling model has consistently shown how people without a business background can learn skills to become successful entrepreneurs. This is perhaps the only industry that can be considered fair and equal, because there is no gender bias and it offers a level playing field to everyone, irrespective of their background, qualifications or experience. Distributors get paid according to the amount of sales they generate.
The beauty of the direct selling industry is that most successful companies provide a solid training programme, support system and business tools to their distributors to help them achieve their goals. In our experience, we have seen people completely transform their personalities once they become QNET distributors. Our training doesn’t just focus on sales skills, but also on personality development, overcoming mental barriers, team building, leadership skills and various other aspects that are important contributors to success. Our distributors have gone on to make many changes in their personal lives because of lessons they have learnt from their QNET experience.
With operations that extend so widely, how do you achieve optimal management?In 15 years, QNET has experienced tremendous growth. Having started in Asia in 1998, today we have distributors in the Middle East and North Africa, Central Asia, the Indian subcontinent and recently even in Europe. One of the primary drivers of growth has been our
Whenopportunityknocks
28
29January 2014
advantage in the e-commerce space. We were one of the earliest adopters of the model in the direct selling industry. This makes our business borderless.
This rapid growth also comes with its own challenges. Sometimes, we are playing “catch up” because our distributor base has expanded in certain countries, while our infrastructure doesn’t support their needs yet.
A strong leadership team that understands the diverse requirements of a growing global business is critical. At the management level, we have a strong team led by our Managing Director and Chairperson, who provide us with strategic direction. Our CEO leads a team of Chiefs who are responsible for specific business functions such as IT, operations, finance, PR and communications, customer service and marketing. Each of them have their own team that is spread across multiple regions.
These teams look into multiple aspects of any new region, including legal compliance, registration of our products with relevant authorities, compliance with laws for e-commerce and direct selling, tying up with local partners to provide on-ground after-sales support and customer service, as well as implementing marketing initiatives. We also have a sister company that handles training.
As a business, we are still young, so we have growth pangs. But each year we get better, as we learn through trial and error.
What else will be joining the QNET portfolio? In 2014 we are expanding our product portfolio in four areas. First, we just expanded our online education offerings, with courses like MBA and DBA. We will also be launching new courses in wealth management and success education.
Second, we are embarking into new digital products and services that combine communication and business tools. The latest addition is Ello, an online business presentation platform that combines VoIP and cloud services. Soon this brand will expand to mobile applications and phone calls.
Third, we are developing a water treatment product line with alkaline water. We already offer products that energise and purify water.
We are also looking at sourcing local products from small businesses in some of our key markets to support the local community. We recently launched a hair care range in Egypt sourced through a local Egyptian entrepreneur.
What are your predictions for the direct selling space?Globally, direct selling has been around for more than 50 years and is very well established in many advanced
economies. Regionally, direct selling is entering many emerging economies, especially in the Middle East and North Africa (MENA) region.
With the rising popularity of the industry in the region, legislative guidelines will prevent unscrupulous operators from misleading consumers. QNET has been at the forefront of advocating such legislation.
The industry has undergone many changes in the past decade. Developing personal relationships in the online space will mean big changes in how companies work. What drives the industry more than anything else is the availability of talented people becoming distributors. When unemployment rises, people seek new ways to make money. The global unemployment rate among 15 to 24-year-olds is estimated at 12.6% in 2013, with 73 million people jobless worldwide, according to the International Labour Organisation. The direct selling industry provides opportunities to enterprising young people who are not interested in traditional jobs.
What unique business opportunities does the GCC region offer?QNET is a very product-focused company. The GCC region has an abundance of locally produced products of international quality and we are exploring opportunities to partner with local manufacturers. Also, our holiday products are very popular among our younger distributors. So we are looking to partner with resorts and hotels in the region to design exclusive offers for our customers.
What are QNET’s plans in the GCC region and worldwide?Global connectivity via the Internet has changed the industry dramatically, because of which we have been able to reach customers in the MENA region in a relatively short span of time. We serve approximately two million customers from our decade-old centre in the UAE.
In the GCC, we are in the process of expanding our warehousing and logistics, which is on schedule and slated to be completed by the first quarter of 2014.
With the expansion of this facility, it is our aim to serve more than 20 countries in the region and ship more than 120,000 products annually, making it the company’s second largest logistics facility after Malaysia, in terms of space and variety of products.
Globally, we are in the middle of an aggressive expansion strategy. This year we opened two new offices in Vietnam and in Rwanda, which is our first African footprint. Next year, we are set to establish a presence in Europe. We are also opening a customer support office in Russia next year. Our R&D team is constantly innovating and we hope to launch a new range of products in 2014 to provide healthy, life- enhancing solutions.
JR Mayer, Managing Director, QNET, has held this position since 2005. After graduating from high school, he spent some time gaining experience at Deutsche Bank and Barclays. He holds a Post Graduate Diploma (Diplom Kaufmann) in Business Administration from the University of Frankfurt.
Technology
If there is one website where you can find a job, post an opening as an employer, buy and sell houses or just about anything, it’s Dubizzle. Aparna Shivpuri Arya spoke to Arto Joensuu, CEO, Dubizzle, to find out what makes it click.
How did Dubizzle come about?JC Butler and Sim Whatley are the co-founders who established the business in Dubai. When they came here looking for jobs, they discovered that it was really hard to find a car, furniture or anything that was pre-owned. Newspaper classifieds were outdated, which made the user experience poor. So they established Dubizzle, (www.dubizzle.com) to help solve that problem.
Were there challenges along the way, like securing finances, since this was a new concept for the UAE?Dubizzle has grown over the past years and we’ve expanded across the region. But we really want to stay true to being a start up. We set ambitious goals and test our assumptions through innovation. Dubizzle started on a tight budget and we want to maintain that lean approach to everything we do. Naspers invested in Dubizzle a few years ago, but the ownership structure has been retained. Our co-founders are now moving back home to spend more time with their families, but will remain part of the board.
You’ve said that you want to function like a start up. Have there been any operational issues that you have faced along the way?With any start up, one of the key things to look into is obviously the data. You have to make sure that you are not following vanity metrics, but looking at information that gives a good indication of the value of the business. You can’t just focus on website visits. You need to look at the split between paid traffic and organic traffic, as well as customer lifetime value. By doing this, it also influences the products you release, marketing and customer support. It really drives everybody in the right direction.
What worked to Dubizzle’s advantage?Dubizzle was in the right place at a good time. It expanded with a true consumer focus, putting the customer first in everything. The co-founders even had their own phone numbers on the website. They received calls in the early days saying, “Hey, so you’re selling a Ford pick-up,” and they said, “We actually run the website, we don’t own these cars.” And the caller would respond with, “Okay, but is this still available?”
The buzz about
30
31January 2014
Things like these helped win people one at a time. If you are able to spark some kind of an emotion with the person that uses your website, that’s a great thing.
For the Dubizzle brand, we’ve looked at how we can develop something that has a personality. We try to make sure that the tone of the voice, whether a user is signing up to the website or the message that comes up when something goes wrong, sparks a certain type of emotion. So that a person feels like he/she is interacting with another person and not a robot or an animated message.
That little bit of irreverence says we’re not taking ourselves too seriously.
Tell us a little about your marketing strategy. For starters, we are active on social channels. We have our own customer relationship management path, but depending on the country, we also have a sales team that works with clients across the region.
For instance, banks are interested in advertising to people who are looking for cars. These people might need a loan or insurance, which the bank can provide. This contextual aspect is quite attractive to advertisers because of being able to reach an audience that is already that far down the purchase funnel.
How has your experience in Qatar been so far? I was there a few months ago and it’s quite fascinating to see the trajectory in terms of growth in investments and infrastructure, as well as the population growth in the next few years. Qatar is unique and what we do there needs to be tailored for the needs of the people.
Have there been any bottlenecks which have been country specific? Algeria and Tunisia are majorly French-driven markets and are very large countries with people living quite far away from each other. This is also the case with Saudi Arabia, where you have marked differences between places because of distance. Classifieds are very local – city-specific and even neighbourhood-specific. When expanding, we’ve been able filter down to neighbourhoods. That local flavour is very important.
In Qatar, trading s t i l l tends to take place countrywide because of the size. In other countries, it is more city-specific.
So for start ups or entrepreneurs planning to enter the online business sphere, what would your advice be?From what I’ve seen here at Dubizzle, one key factor is to create a product which solves a problem and makes people’s lives easier. When it comes to data,
getting yourself out on the streets to talk with people and contacting your users as well as running tests on the website is also key. It’s so easy to just stay in your office and work on the perfect product, but what’s important is that you continuously try to forge those relationships with your users.
What do you think are the common mistakes that a start up or entrepreneurs make? I think the start up world is quite similar to the video game industry. Thousands of titles are released every year, but only a small percentage become successful. The most important thing is that your passion and determination comes from doing something worthwhile and you’re doing it based on the right set of values and healthy ambitions. Because when you understand that you’re out there to minimise consumer exploitation, for example, and have some fun doing it, it provides a framework. And when you’re able to bring people together who share that vision, that is also really powerful.
It’s tough to jump on the entrepreneur bandwagon and make decisions about what areas to focus on as well as re-evaluate business plans. This is especially tough when you’ve spent nine months with ten programmers developing a certain feature that you assumed everybody’s going to love, but then no one’s using it.
You have to deal with that ambiguity and lack of clarity that characterises a start up. In the online world, things change so quickly. Look at Friendster, MySpace and Facebook. Even the biggest companies need to continuously make changes and not be complacent.
It’s a fascinating industry, but also very challenging because there could be a kid in a garage who’s developing something that could scare Google.
What are Dubizzle’s expansion plans? We’re currently operating in 11 countries and are focussing on driving business forward in these markets.
Which markets have grown the fastest in terms of penetration? The UAE is a strong market. Egypt is doing very well. But we have operations in Qatar, Bahrain, Oman, Kuwait, Jordan, Lebanon and some North African countries as well. The UAE and Egypt are definitely the strongest in terms of expansion and traction.
Do you plan to venture outside of the Middle East? At the moment, no. We have a lot of work to do and don’t want to compromise the user experience.
Arto Joensuu is a Marketing Change Agent with more than 13 years’ experience working in start ups as well as large multinational corporations. Since joining Dubizzle, Joensuu has been responsible for establishing the marketing organisation, as well as creating an in-house creative and media agency to support the overall regional expansion efforts. He has a BBA in international business from Helia, as well as executive education from INSEAD.
Sector Study
Are we doing enough?
32
We’re already in trouble because we generate more waste than can be disposed of. Recycling is therefore imperative in managing this condition. Shaker Alansari, Managing Director, Doha Plastic, explains what we can do to help.
One cannot deny the importance of recycling in today’s world, and the story is no different in Qatar. Did you know that plastic can be recycled to manufacture items, such as
carpets, cloth, plastic tumblers and more? It’s also fascinating to note that for every one tonne of plastic that’s recycled, reports estimate that seven yards of landfill space is saved. By recycling, one can also help conserve the additional 80% of energy that’s typically used when making new plastic bottles, containers and other items.
It is interesting to note that this sector also offers investment opportunities to Small and Medium Enterprises (SME), since it is a niche area, which hasn’t been explored in Qatar. Therefore the work being done by Doha Plastic is of prime relevance to Qatar’s economy.
Let me begin with a bit of background.
Waiting for my plane in Montreal, Canada, at Pierre Elliott Trudeau International Airport, I was reading one of Michael Moore’s books when suddenly I was stopped by a paragraph in which the author was arguing the concept of recycling and how it is actually worth the trouble. Although I recycle regularly in my hometown, Ottawa, and I work in the plastic recycling business, I never thought about the people who collect my garbage to find out if they are doing their job.
Recycling started as voluntary work, but soon it became necessary. Although it consumes time, effort and needs organisation in terms of sorting the garbage, more people are recycling because of an increase in awareness.
33January 2014
How can we make sure that our efforts are not wasted, that what we recycle is actually coming back to us in a different form and not being thrown away? Who can monitor this process? Who is responsible? After all, we’re dealing with garbage.
City councils, municipalities and Ministries of Environment are all stakeholders. We are all stakeholders when it comes to recycling and we need rules to regulate the relationship between stakeholders.
In Canada, for example, res ident ia l waste management and recycling services are mandated by the Ministry of Environment, but are carried out by local municipalities. Each municipality develops its own waste management programme which could include plastic, glass or cardboard collection, organic waste bins, drop-off stations, pay-as-you-throw and other programmes, providing they comply with the requirements of the Environmental Protection Act.
On the other hand, waste is handled differently for members of the Industrial Commercial Institutional (ICI) sectors. Waste varies from one establishment to another and in its effect on the environment. Unfortunately, it isn’t easy to monitor these sectors because they are individually responsible for complying with waste-related regulations, which is determined by their size.
In Canada, the recent introduction of stewardship and Extended Producer Responsibility (EPR) regulations has extended the traditional responsibilities of many ICI businesses, which are now increasingly mandated to take physical and financial responsibility for the wastes that their products create.
At the state level, the Ministry of Environment has regulations in place that mandates which substances
and components can be used in products. Such regulation should also state the responsibility of monitoring and disposing of waste from ICI sectors.
Implementing these acts and regulations needs mutual understanding from stakeholders who should understand that our main target now is how to process waste efficiently.
The way forward is to reduce waste at work, because it can reduce the amount of materials that companies pay to dispose. The Ministry of Environment can engage third-party auditors who can help collect waste data and introduce a comprehensive waste diversion programme. This can help businesses reduce waste and costs.
Doha Plastic as a recycling facility engages in multiple stages of waste diversion processes. Our fleet of trucks collects plastic material from around Qatar, a process that needs coordination between hundreds of clients, from massive companies to schools and universities.
Doha Plastic, established in 2003, is a producer of drip irrigation and high pressure pipes in Qatar. Its factory is spread across 15,000 m2 in the New Industrial area and employs 70 people. The current production capacity is approximately 4,500 tonnes per year.
The company also re-processes plastic materials, which are converted into different products that have uses in storage jars, bottles, bags, pipes and even large plastic drums. The plastics go through a long process of being sorted and classified, and are subject to several treatments like crushing, drying and washing, before being made into high quality clean plastic granules that can be used to make fresh products. Doha Plastic has been exporting since 2003 to the Middle East and Southeast Asian countries, and has recently begun focussing on customers in Africa and Europe.
By processing this waste to the point that it can be used as raw material, we can make good profits compared to what we would get by selling it without processing. For this, the Ministry of Environment should subsidise recycling facilities.
Finally, recycling needs acceptance and enthusiasm. People don’t mind participating in recycling programmes and educating their children about its benefits. However, using a recycled product is a different matter. While visiting Quebec, I bought a bottle of water which advertised proudly on its label that the bottle was 100% recycled and still recyclable. This encourages people to buy this bottle of water.
We need to educate society about the threats of not recycling. But this is not enough. Encouraging them to use recycled products is more important. With this we will reduce danger to the environment.
Shaker Alansari joined Doha Plastic as Managing Director in February 2012. He has worked in the financial sector in Ottawa, Canada, since 2006. Prior to this, he was a Managing Partner in Al Ansari Plastic and Rubber from 1987 to 2006.
By processing this waste to the point that it can be used as raw material, we can make good profits compared to what we would get by selling it without processing.
Bilateral trade
Adam Ereli, former US Ambassador to Bahrain, recently visited Dubai. Ayesha Aleem met with him to understand the current state of affairs between the Middle East and the United States.
The relationship between the Middle East and the United States has been a long and elaborate one, gaining renewed significance in the past decade. The aftermath of the 9/11 attacks and the more recent global financial crisis has provided a rich context for the development of bilateral relations.
In 2003, the United States began the Middle East Free Trade Area (MEFTA) initiative, which was meant to be fully operational by 2013. However, certain parts of the contract are still under negotiation with various member states. Through this movement, the United States intends to increase trade and investment in the region. The UAE, Qatar and the Kingdom of Saudi Arabia, along with several other Middle Eastern countries, are already members of the Greater Arab Free Trade Area.
When asked about the current bilateral relations between the two countries, Ereli said, “Saudi Arabia is currently our 12th largest trading partner. We deal in infrastructure, defence, the petrochemical industry and food services, to name a few. We’ve invested heavily in solar power, oil refining and pipelines. In Qatar alone, we have about USD 50 million invested in various areas, which includes oil and gas, the new airport and the American universities in Doha.”
Saudi Arabia and the United States have been active international partners since the early part of the 19th century. According to the Office of the United States Trade Representative, US goods and services traded with Saudi Arabia in 2010, which is the latest available data, totalled USD 48 billion,
with exports at USD 16 billion and imports at USD 32 bi l l ion. The top export categories were vehicles, machinery, optical and medical instruments and aircraft, while the top import categories were mineral fuel, organic chemicals, fertilisers and iron, and steel products.
“We’re paying attention to strategic investment or human capital, through training and education,” said Ereli. “This part of the world is too big and too important to be ignored and that is not just for oil, but because of geography. The Middle East is a centre of world commerce.”
He further added, “The region is investing in education and that is the future. Politically, it’s doing all the right things. It’s important to note how resilient this part of the world is and its resourcefulness.
He continued, “Saudi Arabia forms approximately 70% of the GCC market. If something were to happen here, the Middle East would suffer. As the saying goes, ‘If Saudi Arabia were to sneeze, the Middle East would catch a cold.’ The disruptions that are happening in Egypt and Syria, for example, we need to prevent them from happening here. It’s not in anyone’s interest.”
The United States presently has free trade agreements with Bahrain, Jordan, Morocco and Oman. As more such agreements are signed, the reduction of tariffs and fees are likely to facilitate a greater flow of goods and services between the United States and the Middle East.
34
Adam Ereli is Vice Chairman of Mercury’s Washington, D.C. office and co-leader of the Mercury International Affairs operation. He served as US Ambassador to Bahrain from 2007 to 2011. He oversaw the implementation of a Free Trade Agreement with Bahrain. Ambassador Ereli has a Bachelor’s degree from Yale University and a Master’s degree from the Fletcher School of Law and Diplomacy at Tufts University.
Under the Patronage ofH.E. Dr. Mohammed Bin Saleh Al Sada, Minister of Energy & Industry – Qatar
/IBNQr @IBNQr
Interactive Business Network
www.interactiveb.comT: +974 44877442 / 44881525 I F: +974 44873196 I [email protected] I Doha - Qatar P.O. Box 96494
24-25 February 2014at Qatar University
Fostering the New Generation of Entrepreneurs in Qatar and the Gulf
interactivebusinessnetwork
Organized by
Promotingentrepreneurs
entrepreneurial
YoungSocial
innovationLeading
Cultu
rete
chno
logi
cal
ange
l
role
educational financing
future investorsprograms
Desig
ning
exam
ple
developmenttrainingArab
inno
vato
rsve
hicle
youn
g
needs
women in business
36
As if planning a wedding isn’t enough, brides also have the stress of finding the perfect outfit and ways to look their best on the big day. Jenny Kassis meets with Muna Fadel Sulaiti, Entrepreneur and Founder, Bridy Shop, to discuss establishing a one-of-a-kind shop in Qatar.
The one sTop shop
37January 2014
What encouraged you to start Bridy Shop?I was involved with the International Wedding Exhibition in Qatar for more than three years and many women would ask me to accompany them to choose their bridal dresses. We did not have all the requirements that a bride needed in Qatar. This forced women to travel to other countries. So I decided to open a store where a bride could find everything she needs.
What does your shop offer?Bridy Shop offers everything from henna to wedding dresses and accessories. We also do chocolate decorations and handle gifts. There is a section in the store called “young designer,” which is dedicated to new Qatari designers and allows them to display their creations. I attend fashion shows in different countries, so I choose designs that best suit tastes in Qatar.
How did you get access to finance when you started your business? Besides personal finance, I applied to Qatar Development Bank (QDB) through its programme Al Dhameen. I prepared a feasibility study and presented my project to a committee. They really liked the idea and accepted to finance the project. I am very grateful to QDB for this.
What difficulties and challenges did you face along the way?It is normal for any business to face some challenges. However, the difficulties I encountered were a bit unique. It is hard to find suppliers that fit our customs, traditions and style or can modify the product to suit us, if we import them. In addition, the involvement of women designers to create attractive designs that catch the market’s attention is also a challenge for us.
As the store offers several solutions, we have to stock various kinds of products, which requires a lot of time to find and choose the right sources. The shipping procedures, delivery of products and follow-up is also a difficulty we face on an ongoing basis. But in the end, there is nothing more satisfying than success and seeing people come to the store to buy your products.
What is your opinion about fashion and trends in Qatar?Investment in fashion requires strong support. I did not establish this store for myself, but for every Qatari woman who has a sense of creativity. This is the right place for her. It allows her to present designs and add value to them. I encourage Qatari women designers to display their work, as I prefer local products over others.
As an entrepreneur, do you think women in Qatar are getting the support to set up their own projects?I see that women have significant support in Qatar. I have witnessed this personally at the Customs Administration, which facilitates transactions for us. I can even say that Qatari women get more support and assistance than men. All doors are open to them.
What advice would you like to give a businesswoman trying to establish a business in Qatar?My advice is to be patient. Regardless of the sector in which a woman establishes her project, the business world is difficult and requires patience and perseverance. In the early stages, the project seemed very easy. But in the application and implementation stages, everything changed because the models were different and the people we dealt with were different. It is important to cater to what the market wants, even if that is different from our personal tastes.
What are your ambitions and future projects?I hope the idea of Bridy Shop will succeed in Qatar and be appreciated. I also hope that Bridy will become a well-known Qatari trademark. We have a lot of entrepreneurs in Qatar who can be role models that beginners can learn from. There are no limits to my dreams and ambitions. I hope that Bridy Shop will some day become a commercial centre that offers everything a woman needs.
My advice is to be patient. Regardless of the sector in which a woman establishes her project, the business world is difficult and requires patience and perseverance.
HR
Getting a job today anywhere in the world has become more difficult following the economic downturn. But Qatar’s job market is looking up. Ayesha Aleem talks to Jeffrey Asselstine, Founder, Quest Advisors, to get an insider’s perspective in landing that coveted position.
Please give us a brief overview of Qatar’s job market. The recruitment market in Qatar is improving. When Qatar won the right to host the FIFA World Cup 2022, it kicked off a major infrastructure boom. Contracts are now being awarded to build this infrastructure. With these contracts comes the need for people to execute the plans.
This does not mean just architecture, engineering and construction jobs, although there is a clear boom in these areas, but in all related sectors. The population of Qatar is growing rapidly, which has put demands on the country’s infrastructure and this has created jobs in financial services, telecommunications, real estate, education and healthcare.
In your experience, does the recruitment process in Qatar have any distinct features when compared with the rest of the GCC region? I don’t believe that the recruitment process in Qatar is very different from other GCC countries. However, job applicants need to be aware that a lot of people have picked up on the Qatar growth story so competition is high.
One of the key lessons that many employees have learnt during the global financial crisis is that it is no longer just a case of “I have a job offer from a company”, but rather, “What is that company and what are its prospects?”
Consider the stability of the company when you receive an offer and what the growth prospects are. The opportunity to grow within a company is much greater when the company itself is growing. Firms would rather promote employees after recruiting them at junior levels, rather than hiring senior talent from outside. Qatar provides an excellent opportunity because the majority of companies are growing.
What can help people, both locals and expats, to get hired in the Qatari market?The most professionally prepared applicants have the greatest chances of success. We strongly encourage people to have their CV professionally prepared, or at least reviewed. Applicants should also have all of their personal documentation ready, including scanned copies of a valid passport, degree certificates and professional organisation certificates.
For expatriates who apply for positions in Qatar, how should they assess whether their job offer is on par with industry standards? What should they be careful about?To ensure the right job offer, we recommend that people speak to others in the industry, within Qatar, as well as other GCC countries. Although there are some regional variances, they are not that wide. So a corporate banker in Dubai would be paid approximately the same in Qatar or other GCC countries.
The final handshake
38
Jeffrey Asselstine has 18 years of international banking and property investing experience. He has been running his own businesses since 2009, one of which is Quest Advisors, a firm created to help foreign individuals and companies establish operations in Qatar. He holds a Bachelor’s degree in Business Administration from Wilfrid Laurier University in Waterloo, Ontario.
39January 2014
The key factor for most employees to consider is the components of the package. These components vary greatly from firm to firm. Some packages are “cash only”. There might be allowances for housing and flights, but because cash is paid directly to the employee, it is up to them how to use it.
Other firms provide the actual allowances, in the form of housing or schooling, with no cash paid. So their package might look lower because the monthly amount credited to the bank account is lower. Lastly, some firms will provide just a monthly salary with no allowances and then the employee decides how to use it.
We see a growing trend with companies to provide just a salary and leave the individual to decide how they spend it. We advise candidates to not count on a verbal promise. We’re not saying don’t trust it. Just don’t count on it. If it is not in writing, it is not committed. Too often we meet candidates that are looking to change roles and we hear: “I was promised that after three months I would be promoted and my salary raised.” If it is not in writing, don’t be disappointed. Make sure you are happy with the offer as it is, without the promise of future changes.
What would be your advice for employers seeking quality staff in Doha?Our advice for employers is similar to what we suggest to candidates – be focussed about the recruitment strategy. We see many firms hiring multiple headhunters, advertising on their company website and using online services such as LinkedIn and Bayt to advertise for a role.
The feedback we get from the human capital departments that do this i s that they are overwhelmed by the number of applications they receive and often struggle to manage the process. We recommend limiting the sources. More CVs does not necessarily mean a better quality hire. It often just means more CVs to process.
Lastly, we recommend firms to be quick in their decision making. As much as firms have a choice in the people they want to hire, strong candidates also have choices. We often see firms lose a good candidate because of internal delays. Hiring firms need to understand that while they are evaluating the candidates, applicants are also evaluating them. The common feedback we get from frustrated candidates is, “Is this firm serious?” when they see the process being prolonged.
What is your advice for people seeking a job in Qatar?The best advice we can give candidates to land their dream job really covers two main areas. First, the search and secondly the interview and recruitment process. While you are job hunting, be focussed. Decide which industry you want to work in and attend networking events and conferences to make yourself a familiar face.
Secondly, when it comes to the recruitment stage and you have an interview, be prepared. Do all the research that you can on the firm. With the Internet, this is easier than it has ever been and yet people turn up for an interview with no clue about the firm. Knowing about the company shows that you are interested and have made an effort to do the research. But keep in mind that the candidate needs to be happy with the firm as well, and not just the other way around.
We see a growing trend with companies to provide just a salary and leave the individual to decide how they spend it. We advise candidates to not count on a verbal promise. We’re not saying don’t trust it. Just don’t count on it.
SMEs
40
The manufacturing sector is still new in Qatar, but companies are working to excel and develop in it. Jenny Kassis visits the factory of Sigma Metal Industries and meets with General Manager Khaled Fayoumi, who explains the steps the company has taken to grow.
The Sigma Sign
Where did you get financial support to start and develop your business?In the first stage we got support from Traffic Tech as well as our Qatari and Jordanian partners. After three years, with the market size and the projects’ requirements increasing, we needed to expand. We decided to establish a new factory in the industrial area, for which we had to submit a feasibility study to the Ministry of Industry at the end of 2011. They gave us approval to obtain industrial land on nominal rent.
After obtaining the land, we prepared plans and asked for funding from Qatari banks. Fortunately, we knew about lending programmes by Qatar Development Bank (QDB). QDB asked us to provide an accurate feasibility study. We attended several meetings with the bank where we had the chance to explain our expansion plans.
Does SMI export products?It is still too early to export as our products are large and difficult to transport at competitive prices. Traffic sign design requires our presence at the location. However, our vision for the future is to become the only company specialised in traffic solutions in Qatar and the Gulf region. We are currently signing agreements with companies from several countries that specialise in intelligent transportation and road safety.
What are the main challenges you face in the Qatari market. How do you overcome them?Initially, our biggest challenge was to prove our presence among large companies. Therefore, it was very difficult to convince the contractors that we were able to provide the service. We were able to overcome this challenge through Sigma’s team, which has years of experience in this field, in addition to the good relations Traffic Tech has with several contractors. Moreover, our presence in the Qatari market gives us the advantage to supply faster than others.
If you’ve been lost while driving in Doha, desperately looking for a road sign to point you in the right direction, chances are that road sign was manufactured by Sigma Metal Industries (SMI). Established in 2008 as a fully-owned subsidiary member
of the Traffic Tech Group, SMI is an authorised reflective sheeting sign maker, producing hot dip galvanised and anodised aluminium steel structures to display road signs.
Apart from static traffic signs, the company also makes dynamic traffic signs, indoor directional signs that point people towards staircases, for example, as well as urban signs, such as the kind that display the name of a neigbourhood. SMI also supplies certain products from Switzerland, France and the UAE as exclusive agents in Qatar.
Sigma Metal Industries currently operates out of a modern manufacturing facility in Doha’s industrial area. The company’s aim is to expand area of operations to 20,000 m2, which can ultimately service the larger Gulf region.
We spoke with the General Manager, Sigma Metal Industries, Khaled Fayoumi, to find out more.
Please tell us about your operations and products within the Qatari market. Sigma Metal Industries is a subsidiary of Traffic Tech. In 2007, Traffic Tech wanted to develop its specialised products in traffic management, traffic control and parking management. So we agreed with Traffic Tech to set up a factory to produce traffic signs. Two years after establishing the factory, we realised that we were able to execute steel-related activities alongside, such as the production of steel platforms, steel ladders, sliding gates, safety fences, handrails and other products. In this context, we are currently working on huge projects with Ashghal and Qatar Petroleum.
41January 2014
What differentiates Sigma from its competitors?Competition in the market is very intense and it mainly comes from the UAE and KSA companies. However, the results we have achieved in the first five years are very good. Competition benefits everyone. In the end, we hope preference will be given to Qatari companies, because we have the ability to supply faster and build better relationships with the customer.
Many things differentiate us from our competitors: Proper marketing as well as direct support of Traffic Tech, and we use advanced technology. Most of our machines are programmed and our team attends continuous training.
What are some of the innovative production methods SMI uses?All our machines are programmed, so human error is reduced. We use specialised software to design. Also, our company is the first in Qatar, in the production of road signs, which has received the ISO quality certificate. Continuous participation in relevant manufacturing technology exhibitions, in Qatar and abroad, gives us an opportunity to modernise raw materials and obtain the best quality.
What is your opinion about the manufacturing sector in Qatar?Manufacturing is a promising sector in Qatar, but I think it is still in its infancy, since most of the
industries in Qatar are related to oil and gas. As for other industries, namely manufacturing and metal, they are still at the beginning of their journey. However, we can see a large number of companies registering to operate in this sector because of the preparations for the FIFA World Cup 2022. The event will require large-scale projects that need specialised companies in the metal industry, construction and others.
How is SMI preparing for the FIFA World Cup 2022?We are executing some projects for the metro. We are co-operating with the main contractors and the management of Q Rail. In addition, we have implemented some of the work earmarked for the FIFA World Cup 2022 stadiums and have signed contracts to produce steel products. We are now trying to form a specialised team for projects related to this event, where signage will be very essential.
What is your advice for SMEs and startups in the Qatari market?A feasibility study is essential to establish a company. You must prepare an accurate study before recruiting and training your employees to make them productive. It is also necessary to maintain a good relationship between staff and management and create appropriate working conditions for employees.
Khaled Fayoumi is the General Manager of Sigma Metal Industries. He graduated as a mechanical engineer from the University of Jordan. He is a member of a number of professional organisations, such as the American Society of Mechanical Engineer (ASME) and Jordan Engineers Association (JEA). He is the Founder and Partner of Sigma Metal Industries and has 21 years’ experience in manufacturing and projects management. Khaled can be contacted on [email protected]
We provide you with exclusive access and advice on everything you need to know.
Where success is just a heartbeat away
Register on businesspulse.ae now to join our growing community of business entrepreneurs and receive the support needed to turn a business idea into reality.
The know-how on today’s key business activities and challenges
Access to templates, including business plans
Exposure to investors and venture capitalists
Announcements on upcoming events covering various business topics
Business Pulse: Your Complete SME PlatformIgnite. Enrich. Grow.
C
M
Y
CM
MY
CY
CMY
K
BP-Print-advert-October2013-175x100-KnowledgeFont-final.pdf 1 10/27/13 4:10 PM
SMEs
42
Participating at The Big 5 in Dubai, in November 2013, Abdul Rasheed, Managing Director, Q-Tec Switchgear, spoke to Ayesha Aleem about manufacturing electric equipment and the support they receive from Tasdeer.
43January 2014
Can you please give us a brief profile of the company?Q-Tec Switchgear WLL is among the leading suppliers of Low Voltage (LV) and Medium Voltage (MV) electrical equipment in Qatar. Our wide range of switchgear for critical applications is available in power generation, distribution, control , protect ion and final consumption. In addition, the company can also customise product s based on spec i f i c requ irements, offering prototypes for approval of concepts. Q-Tec is becoming a major source for electrical contracting, which performs turnkey solutions for industrial and commercial electrification, substations and power plants.
Q-Tec Switchgear is associated with ABB as a channel partner for LV and MV Switchgear, through whom we offer innovation and technology. We employ experienced engineers and technicians, and have a state-of-the-art manufacturing plant spread over 20,000 m2 in Qatar.
Which industries form the largest part of your market?Infrastructure, railways and transportation, as well as mechanical electrical plumbing contractors, pump controls and oil and gas, are a few examples of where our customer base is spread.
Can you please elaborate about Q-Tec products’ safety features?Q-Tec products are tested according to the International Electrotechnical Commission. Manufacturing is done with high safety standards [in mind] for people operating the equipment. Every product is routinely checked according to international standards and local regulations.
We conduct failure analysis in case any deviations are observed during internal testing and believe in long-
term preventive actions. And, finally, we believe in continuous improvement.
What energy efficient options is Q-Tec exploring through its products?Q-Tec has developed energy efficient options in different areas with the support of its engineering resources. Examples of such developments are direct digital controls for high power consumption equipment, such as pumps, chillers, fans and air conditioners, as well as energy monitoring systems for shopping malls. We also provide energy audit services and advise necessary corrective actions.
What challenges have you faced along the way and what lessons have been learnt? A major challenge we have faced is in getting the right people with the right skills, who can handle the bottlenecks.
Mainly, we have learnt that we need efficient human resources personnel. Q-Tec has a good human resources team.
Another challenge is the encouragement of local manufacturers by the government. We have received support, but require more to strengthen the “Made in Qatar” aspect of the brand.
How is the power sector in Qatar developing? Qatar’s power sector is developing very rapidly and the rate of growth will continue to increase. The forthcoming FIFA World Cup 2022 is a major driver for growth. Qatar National Vision 2030 is also contributing in a big way towards the development projects. We expect a big surge in demand from the private and public sector. What they need is a partner for their applications and our facility in Qatar can serve them well.
What are the risks involved for a product like this?These products are complex and safety is important. Installation and even regular operations require people who have been trained or have experience using the equipment.
How has Qatar Development Bank (QDB) or Tasdeer helped you in reaching other markets?We thank QDB because they have helped us by financing our huge factory in Qatar. We appreciate Tasdeer ’s efforts in encouraging the Qatari manufacturing sector and will continue to co-operate with both organisations.
Abdul Rasheed, Managing Director, Q-Tec Group Limited WLL, is an electrical engineer. He began his career in Qatar with Golden Door in 1986. He established his own company, Investment World Trading & Contracting, in 1998, which was renamed Q-Tec Group Limited WLL in 1999.
The forthcoming FIFA World Cup 2022 is a major driver for growth. Qatar National Vision 2030 is also contributing in a big way towards development projects. We expect a big surge in demand from the private and public sector.
LegaL
44
What happens when employees are not paid regularly? Or if their salary is late? Do they continue working, hoping that this condition is temporary and will be quickly resolved? Or does he stop working in protest? Laura Warren, Partner, and Alexa Hall, Associate, at Clyde & Co (Qatar Office), explain how legalities apply to both parties when this situation arises.
If an employee decides to exercise that contractual right, they must follow the procedural requirements. Should they fail to comply with these requirements, they may make themselves vulnerable to a claim by the employer for procedural breach of contract.
The decision to suspend work is a difficult one and possibly politically sensitive, depending on the nature of the contract. Plainly, such steps will not be well
received by a paying party. However, employees must protect themselves from what they perceive to be unfair treatment by an employer acting in breach of its contract.
An employer might cons ider su spend ing performance when suffering from persistent late payment or non-payment. There may be circumstances which genuinely entitle an employer to withhold payment. However, these should be clearly stated in the employment contract.
In the construction industry, persistent late or non-payment to a contractor may be viewed cumulatively such that an employer’s unacceptable past performance would serve as an indicator of possible unacceptable future performance and be said to violate the principle of good faith that is stated in Article 172 of Law No. 22 of 2004 of the Qatari Civil Code, that: “A contract must be executed
in accordance with its contents and in a way that is consistent with the requirements of good faith.”
The right to suspend performance is likely to be an effective remedy in circumstances where there is no realistic prospect of obtaining further payment. The most obvious example of this is when an employer is insolvent or on the brink of insolvency. In such circumstances, suspending all work would be an effective means of cutting costs and likely reducing losses, for the employer.
Where’S my money?
For more than a century, Carnegie Mellon University has been inspiring innovations that change the world. Consistently top ranked, Carnegie Mellon has more than 11,000 students, 90,000 alumni and 5,000 faculty and staff globally.
In 2004, Qatar Foundation invited Carnegie Mellon to join Education City, a groundbreaking center for scholarship and research. Students from 39 different countries enroll at our world-class facilities in Education City.
Carnegie Mellon Qatar offers undergraduate programs in biological sciences, business administration, computational biology, computer science and information systems. Carnegie Mellon is firmly committed to Qatar’s National Vision 2030 by developing people, society, the economy and the environment.
Learn more at www.qatar.cmu.edu
Excellence. At Carnegie Mellon.
However, suspension of work may occur when an employee thinks that there is a realistic prospect of obtaining future payment. It could be used as a tactic to obtain payment.
Entitlement to suspend To act properly in the circumstances described above, an entitlement to suspend for non-payment must exist, especially because there is no right in Qatari law for an employee to suspend works for non-payment.
Article 697 of the Qatari Civil Code imposes a general obligation on an employer to “Pay the amounts payable to the contractor when he takes delivery of the work, unless agreement or custom rules otherwise.”
Further, Article 692 of the Qatari Civil Code provides an employee with a right to apply for annulment of their contract and claim any compensation that might be available, in circumstances where “Execution of the work requires that the employer for the work performs something in particular, but has not done so at the appropriate time.”
The law also contains a provision which is known colloquially as the “Corresponding Obligations Clause”. This provision arguably is a defence to justify non-performance where the “duties” of the parties are concurrent. That is, the suspension of the works, for example, is proportionate to the non-performance of the corresponding obligation, the non-payment.
Article 191 provides, “In contracts that are bilaterally binding, if the reciprocal obligations are exigible, either of the parties may refrain from fulfilling his obligation, if the other party does not fulfil his obligation, unless otherwise agreed or custom dictates to the contrary”.
The risksThere is a significant risk that the suspension of performance will be seen as wrongful. This is particularly the case of a single instance of non-payment.
If an employee suspends work in circumstances where the employer is entitled, even in part, to retain a certified sum, they could find themselves in breach of contract and be liable to pay contractual damages.
An employee may also face the risk that the employer will exercise the right to terminate for failure to proceed regularly with the works, if expressed in the employment contract.
In most cases, an employee will face the dilemma of choosing between suspending work and risk breaching the contract, or continuing to work despite non-payment. When it is able to establish a clear breach of contract by the employer, or an entitlement to terminate the contract, the employer might have become insolvent.
This dilemma is avoided where the parties have signed an unamended international form of contract, like the FIDIC Conditions of Contract 1999 or Red Book, which usually contain an express entitlement for an employee to suspend work for non-payment.
If an employee decides to exercise that contractual right, they must follow the procedural requirements. Should they fail to comply with these requirements, they may make themselves vulnerable to a claim by the employer for procedural breach of contract. The employee may then face the consequences of wrongful suspension.
Even where there is an express contractual right to suspend, an employee may still be at risk if the employer is able to prove that the payments claimed by the employee are not payable. In such circumstances, the suspension of work will, again, be wrongful.
Suspension for non-payment is a high-risk strategy unless the entitlement to suspend is absolutely clear. If an employer is able to pay, but is not paying, there is likely to be a dispute between the parties. In such cases, claiming breach of contract may be a better remedy. It would be sensible to seek legal advice before suspending work, unless agreed upon by both parties.
Note: All Qatari Laws (except those issued by the Qatar Financial Centre (QFC) to regulate its own business) are issued in Arabic and there are no official translations. Therefore, the information mentioned in this article has been translated and interpreted in the context of Qatari regulation and current market practice.
Laura Warren, Partner, Clyde & Co., is responsible for the Qatar office’s disputes practice. She advises on Qatari law issues as well as drafts and advises standard form and bespoke contracts and appointments for construction projects in Qatar. She can be contacted on [email protected]
Alexa Hall, Associate, Clyde & Co., is part of the dispute resolution team based in the firm’s Qatar branch. She has experience in construction and projects work, including transport, development, financial institutions, local government, leisure and retail, education and healthcare. She can be contacted on [email protected]
46
LegaL
Tasdeer
Qatar’s booming construction market had a chance to showcase some of its
products, services and accomplishments at The Big 5 in Dubai late last year.
Tasdeer helped companies participate in the event.
48
49January 2014
Qatar Development Bank (QDB) sponsored the Qatari private sector at The Big 5 2013 through its export arm, Tasdeer. The event, which took place from 25th-28th November 2013, at Dubai
World Trade Centre, the UAE, saw Tasdeer host Qatar’s national pavilion and showcase 32 national companies, with the aim of raising the profile of Qatari exporters and products within the international building and construction industry. This is the second year that QDB has hosted Qatar’s national pavilion at The Big 5, which saw an increase of 11 exhibitors.
This is the largest trade show for the construction industry in the Arabian Gulf. It is one of the most commercially successful trade fairs, featuring approximately 2,500 companies from 65 different countries. The Big 5 features national pavilions from all major exporting countries, alongside local developers, contractors, importers and distributors.
The main highlights of The Big 5 included:Two thousand construction-related product suppliers hosting keynote sessions by high-profile industry leaders, business development and training workshops, free seminars and conferences, and interactions with leading contract and captive original equipment manufacturers from the construction industry.
The event attracted more than 50,000 visitors from 130 countries, making it a grand success.
Why should a company exhibit at The Big 5?Companies should participate at The Big 5 to showcase their products to the Middle East market. With USD2.87 trillion worth of projects currently in the planning or construction phase, the Middle East region offers unlimited business opportunities.
Tasdeer supported 32 companies to participate in The Big 5 exhibition in Dubai. In accordance with the Qatar National Vision 2030, Tasdeer has initiated the “Export Strategy for Non-Oil Qatari Origin Products”. The study, focusing on SMEs in the private sector based in Qatar, will help identify key exporters, their products and target markets, and support these exporters to enter new markets through various tools, such as participation in exhibitions.
Some companies, such as Future Pipe Industries and Almisned Trading and Joinery, recorded approximately 75 export enquiries at their stand. However, Alshams Advanced Lighting Technologies was in a leading position, with as many as 200 enquiries.
Some companies have already identified key target markets for exports and have planned the appointments of agents or distributors in those markets. Examples include Alshams Advanced Lighting Technologies in the GCC market, Doha Plastic in the UAE and Qatari Gypsum Factory in Bahrain, the Kingdom of Saudi
Arabia and Jordan. Other markets accessed include Yemen, Libya and Egypt, extending as far as Morocco and Pakistan.
Some companies were able to convert these inquiries into actual prospects. Khalid Manufacturing, Future Pipe Industries and Almisned Trading and Joinery secured approximately 20 contracts. However, Growtech Trading & Industrial Group recorded the highest number, with 30 contracts.
The overall feedback from participating companies about the support provided by Tasdeer predominantly ranged from “Very Good” to “Excellent”.
At a time when construction is booming across the Middle East and North Africa, international companies see the MENA region as the ideal platform for launching new and innovative industry ideas and practices.
50
Tasdeer
TUNISIA: AN EXPORT OPPORTUNITY
Imports for these products saw growth of more than 10% between 2008 and 2012.
Growth rates for imports are expected to remain high due to:
■ Changes in government policy ■ Improving technology adoption ■ Increasing income levels in Tunisia ■ Domestic supply disruptions due to
market factors
1 580
1 020
224 194 173 109 90 78 60 58 26 22 16 4 0
500
1 000
1 500
2 000
2012 TUNISIA IMPORTS FOR SELECT PRODUCTS
LOGISTICSThe cost of sea-borne shipping of non-refrigerated goods from Doha to Tunisia is:
■ USD 2200 for a 20ft container ■ USD 3300 for a 40ft container
The country has eight commercial ports, with 80% of containerised goods passing through the port of Rades
SAVE THE DATE FOR: ■ Meetings with Qatari exporters in
Doha in the week of January 19, 2014* ■ Workshop: Exporting to Tunisia in
presence of government officials and Qatar-based exporters (Tentative date: First week of March 2014*)
■ A match-making event in Tunis,Tunisia (Tentative date: April 2014*)
* Final date to be communicated closer to the event
HIGHLIGHTS FROM UPCOMING TUNISIA TRADE SHOWS
■ February 26th to March 1st, 2014:
Exhibition of equipment and facilities in the
construction sector
Tunis, Tunisia
■ March 2014:
International exhibition for packaging,
handling and conditioning
Tunis, Tunisia
■ May 7th to 10th, 2014:
International laboratories fair
Tunis, Tunisia
VOICE OF THE TUNISIAN IMPORTER ■ “We are very interested in importing from Qatar as the proposed price
is more competitive than the local one.” (Manufacturer of cardboard cores, thermal paper roll boxes, offset, Kraft gummed and roller draws plans)
■ “We are interested in importing energy saving lamps as the Tunisian government is encouraging import of these bulbs.” (Importer of electrical equipment)
■ “We heard a lot about this brand, especially the taste of their products. We will be very pleased to exclusively represent this brand in Tunisia.” (A leading importer of frozen processed meat)
Bizerte
TUNIS
Zaghouan
SousseM onastir
Ma hdiaKairouan
SilianaLe Kef
Kasserine
Sidi BouzidSfax
Gafsa
Gabès
KebiliMederine
Tataouine
Tozeur
JendoubaBéja
For information on industries and trade in Tunisia:
Ministry of Trade and Handicrafts www.commerce.gov.tn
Ministry of Industry www.tunisieindustrie.gov.tn
For more information on shipping and taxes:
OMMP (Office of the Merchant Navy and Ports)
www.ommp.nat.tn
Tunisian Customs
www.douane.gov.tn
Proximity and a growing economy make Tunisia a worthy market for Qatari exporters to explore. Tasdeer offers useful statistcs that prove this.
Source: AMC Ernst & Young, Tunis, Tunisia
AGENC222 ADS_Private Sector_20.7x27_Eng.pdf 1 10/22/12 5:13 PM
50
Tasdeer
FINdINg ThE marketWhen a company is ready, it needs to explore other markets to discover the opportunities and benefits that exist on foreign soil, an important step in business growth. But it’s also a big step with a fair amount of risk. Tasdeer, from its handbook Trade Secrets, details some expert tips that can make the process easier.
Which foreign markets can the product be sold in?Market research allows firms to determine which foreign markets have the best potential for a particular product. New export firms should seek a few target markets, based on demographics, physical and political environment, economic factors, the social and cultural environment, market accessibility and product potential. Conducting a thorough market factor assessment will help the firm predict the demand for its products or services and how well it will perform in the target market. To identify two or three foreign markets, it is important to conduct the following market factor assessment based on ten countries that appear to offer export opportunities. The exporter should answer the following:
About the customer ■ What is the overall population of each country,
considering growth and density trends? ■ Is the population of target age groups adequate?
(1 to 10, 11 to 24, 25 to 40, 41 to 60, and so on) ■ How much of the population is located in urban,
suburban and rural areas? ■ To what degree is the target market similar to the
home market? ■ Are there climate and weather variations that
may affect the product or service offered?
About logistics ■ What are the shipping distances from the point
of export to the various target countries? ■ What’s the average age and quality of
transportation and telecommunications infrastructures?
■ Are there adequate shipping, packaging, unloading, and other local distribution networks?
About the government ■ Is the system of government conducive for
conducting business? ■ To what extent does the government get involved
in private business transactions? ■ What is the government’s attitude towards
importing foreign products? ■ Is the political system stable or do governing
coalitions often change radically? ■ Does the government seek to dismantle quotas,
tariffs and other trade barriers? ■ What is the country’s commitment to fostering
higher levels of imports and exports?
About the target market’s financials ■ What is the GNP of each target market? ■ What is the percentage of imports and exports in
the target market’s economy? ■ What is the import-export ratio in the target country?
49January 2014
■ How does the rate of inflation vary for each country and what are the currency exchange regulations?
About customers’ financials ■ What is the per capita income of the target
country and are income levels increasing? ■ What is the percentage of discretionary income
that can be spent on consumer goods? ■ What percentage of the population is identified
as middle class?
About the market ■ Will the product or service need to be adapted
before use in the target market? ■ What are the legal aspects of distributor
agreements in each country? ■ What documents are required? ■ What are the technical or environmental
import regulations? ■ Is the market closed to foreigners, despite a free
and open appearance? ■ What are the intellectual property protection
laws which would affect the product or service? ■ If a commercial dispute arises, does the judicial
system offer a fair and unbiased review?
How can exporters determine if the chosen product will fare well in the target market?Selection of the right export commodity is crucial for success in the export business and depends on a number of factors, including:
■ Export/import trends: The exporter should utilise publications and contact organisations to analyse the trends in international trade of a particular product
■ Supply base: A steady supply base is essential ■ Manufacturing capacity: Inability of the
exporter to deliver the product because of limited production capacity can spoil the exporting firm’s reputation and image
■ Product adaptability: To ensure the success of a product in domestic and foreign markets, it is necessary to adapt the product to meet export market needs. The exporting firm should determine if the product requires a change in colour, size, taste or packaging
■ Target markets: The product should have a stable, but rising demand in the target market. It is necessary to determine this demand through demographic and market research
■ Servicing facility: If the exported product requires after sales service, the exporter will have to either open a servicing centre abroad or find an agent who can provide this service locally
■ Trade restrictions: Products selected for export should be eligible for export according to Qatari export regulations. This information can be obtained from the Qatari General Directorate of Customs
Where can exporters find market reports for specific markets? The International Trade Centre in Geneva, a subsidiary of the United Nations Conference on Trade and Development and the World Trade Organisation, monitors major markets for fresh fruits and vegetables, cut flowers, tropical and ornamental plants, common spices, raw and semi-tanned hides and skins, bulk-packed fruit juices, rice and selected pharmaceutical raw materials. Depending on the product group, the Market News Service (MNS) provides updated information on actual prices paid for specific products, supply and demand and other economic information that may have an effect on the market situation. MNS subscribers can receive this information via email, telefax or airmail. The Trade Information Dissemination Unit also prepares market briefs on the market potential of products in a specific country, such as the market for T-shirts in the European Union, for example. The brief reports detail import and export rates, consumer preferences, duty rates and other market access information, prices, sales promotions, distribution techniques, commercial practices, market opportunities and useful contacts.
Where can Qatari exporters obtain import duties of different countries?
■ Customs tariff can be accessed at www.worldtariff.com. This is a paid site
■ Qatari exporters will be able to obtain import duties by visiting websites of member countries of the World Customs Organisation and websites of international agencies that are linked to the Organisation’s website
■ The World Customs Organisation www.wcoomd.org 30, Rue du Marche, B-1210 Brussels (Belgium) Telephone: 32.2.209.92.11 Fax: 32.2.209.92.62
How do you conduct a market factor assessment?A market factor assessment provides a complete breakdown of factors in the previous question.
The exporter should rate each prospective country on the condition scale from 1 (poor) to 5 (excellent) and tally the results to identify target markets.
50
Demographic and physical environment ■ Population size, growth, density ■ Age distribution ■ Urban and rural distribution ■ Climate and weather variations ■ Shipping distance ■ Physical distribution and
communication network ■ Regional and local transportation facilities
Political environment ■ System of government ■ Government involvement in business ■ Attitudes toward foreign business trade ■ Political stability and continuity ■ Fair and free trade mindset ■ National trade development priorities
Economic environment ■ Overall level of development ■ Economic growth – CNP, industrial sector ■ Import/export percentage of total economy ■ Balance of payments ■ Currency: inflation rate, availability, controls, stability ■ Per capita income and distribution ■ Disposable income and spending habits
Social and cultural environment ■ Literacy rate, education levels ■ Existence of middle class ■ Similarities and differences in comparison
to the home market ■ Language barriers
Market access ■ Adequate distribution network ■ Documentation and import regulations ■ Local standards, practices and other
non-tariff barriers ■ Patent, trademark and copyright protection
■ Adequate dispute resolution mechanisms ■ Tax laws and rates
Product potential ■ Customer needs and wants ■ Local production, imports and consumption ■ Exposure to and acceptance of product ■ Attitudes towards products of foreign origin ■ Competition
What is a trade map and how can it be used by a Qatari exporter?The trade map is a tool that:
■ Helps in conducting specific market research aimed at promoting international trade through precise knowledge
■ Provides comprehensive coverage of ongoing worldwide trade
■ Has suitable mechanism to provide a holistic view of the total trade
■ Includes information on values of exports and imports, quantities, growth trends, market shares and various other rankings
■ Locates new markets and assesses export competitiveness
■ Benchmarks export performances and analyses potential for product diversification with other partner countries
■ Can be used by entrepreneurs, business people, market analysts
What are the features of a trade map? ■ Foreign trade statistics for more than 5,000 products ■ All indicators are based on the United Nations
Statistics Division “COMTRADE” data, the world’s largest database for international trade
■ It covers statistics for 180 countries, including mirror statistics, representing more than 90% of total world trade and includes five million records.
Tasdeer
OQOODTogether we make legal matters as easy as solving this mazeWhat is OQOOD?
OQOOD is a 70% subsidised legal services programme offered by Enterprise Qatar to Qatari entrepreneurs and SMEs. The programme entails the provision of intellectual property rights and trademark registration, and the development of contracts, agreements and article of association. The objective of this programme is to give Qataris access to subsidised, professional legal services to ensure a sound legal framework for their business. Who is eligible?
OQOOD is offered to Qatari entrepreneurs and SMEs who need assistance in developing contracts and agreements and who are interested in the intellectual property and trademark registration.
Follow us on
To apply, please contact Enterprise QatarTel: 4012 5000 | Website: www.eq.gov.qaE-mail: [email protected] | Fax: 4012 5001Address: The Gate, Bay Tower 4 – Floor: 16, West Bay, Doha.
Start
Achieve
Terms and Conditions apply
