E-Commerce in the Time of Pandemic by Dubai Carbon

The Sustainabilist ISSUE 24

ISBN 978 - 1978357310

E-Commerce in the Time of Pandemic

THE PRESSURE IS ON

WHERE THE UAE STANDS

Disruptions of supply chains have shownt that these need to be more sustainable and future-proof

Research on the status and progress of E-commerce in the UAE

COVID-19 RESILIENCE

DISRUPTING THE TELCO

Interviews with top businesses deflecting novel adverse effects with innovative digital services

The all-online network operator that offers unique and innovative services built around customers' needs WWW.THESUSTAINABILIST.AE

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Issue 24 | September 2020

2020

has been quite a year. Global events have taken a toll on industries, people, and the environment. Novel solutions have been developed to address our needs and rather rapidly. As we anticipate the return to normality, it seems that certain disruptions may actually stay.

Eng Waleed Bin Salman Editor in Chief The Sustainabilist

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tellmeyourstory@dcce.ae

Commercial: venividivisa@dcce.ae

While stores were forced to close and people to stay home, digital sales took over and e-commerce soared. From groceries and medical supplies to other essentials and non-essentials, practically everything was a click away from being delivered to our doorsteps. Now that malls and shops have reopened, the picture of online sales towering over physical ones will not immediately be altered as some shoppers remain wary and others appreciate the ease with which they purchase their goods and services. Rather, the convergence of online and offline channels is increasing competition and bringing about more consumer benefits. COVID-19 has sped up the pace of the shift to e-commerce in the UAE, yet the industry’s growth cannot only be attributed to the pandemic. Currently, e-commerce represents 4.2% of national retail revenue and is expected to grow to USD 48.6 billion in 2022, from USD 26.9 in 2018. The UAE’s e-commerce ecosystem is diverse and encompasses government services and payments, among more, which is a driver for great potential. The UAE is an incredibly advanced nation,

“

The convergence of online and offline channels is increasing competition and bringing about more consumer benefits.

“

Letter from the Editor in Chief

which continues to prove itself time and time again, most recently with its ability to hinder the spread of the virus by having one of the highest coronavirus screening per capita in the world and continuous follow-up of the wise leadership. The Emirati model is recognised globally as an honourable model given its unique achievements and successes. The growth of e-commerce reflects the UAE’s landscape and readiness for e-commerce development, growth, rapid adoption, and innovation. The readiness can be attributed to factors such as the high internet penetration and adoption, the UAE Government support for entrepreneurial activities, high logistics infrastructure standards, as well as the successful and widespread adoption of e-payment platforms. Brick and mortar in the UAE will remain relevant and continue to grow alongside e-commerce as the industries evolve in response to COVID-19, competition, and innovations. This issue is dedicated to public and private responses to the pandemic, the adoption of digital commerce operations, and the early results of these activities.

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Contents THE STARS OF SUSTAINABILITY

The Sustainabilist ISSUE 24

E-Commerce in the Time of Pandemic

THE PRESSURE IS ON

Disruptions of supply chains have shownt that these need to be more sustainable and future-proof

COVID-19 RESILIENCE

Interviews with top businesses deflecting novel adverse effects with disruptive digital services

WHERE THE UAE STANDS Research on the status and progress of E-commerce in the UAE

DISRUPTING THE TELCO

Editor in Chief

Leveraging the Digital Economy

DEWA Offers Smart Channels

10 The Great Indoors

The all-online network operator that offers unique and innovative services built around customers' needs

12 The Upcoming Digital Tsunami in Retail 14 Reshaping PV Technology

E-commerce adoption has grown significantly around the world. The E-Commerce issue of The Sustainabilist sheds light on the platforms that have allowed businesses, governments, and the public to access goods and services during the peak of the pandemic.

16 The Pressure is On 18 The Stars of Sustainability 20 Fastest Growing E-Commerce Categories

22 After Hysteria Comes Hysteresis

TABREED TAKES OVER THE LARGEST DC MARKET

24 Lock Down Problems 26 Tabreed Takes Over the Largest DC Market 28 COVID-19 Resilience 30 Payments and the Coronavirus Shock 32 Grocers Turn Online 34 A Glimpse into The Future of Car Dealerships 37 Put Your Money Where the Sun Shines 40 Where the UAE Stands 42 Acclimatising E-Commerce to Meet Changing Needs 44 Depleting inventories 46 Disrupting the Telco

THE GREAT INDOORS

48 Canon's Circular Concept

ACCLIMATISING E-COMMERCE TO MEET CHANGING NEEDS

50 E-Commerce vs Brick-and-Mortar ccc 52 Unlocking the Full Potential of the Circular Economy 55 Rewriting the Course of Our Digital World

Issue 24 | September 2020

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OCTOBER Green Recovery

Editor in Chief : CEO : Creative Lead : Associate Director : Associate Editor : Designer :

Our next issue will focus on the Green Recovery. How is your

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SUSTAINABILITY STRATEGY

CREATE AN IMPACT Sustainability Strategy: A sustainability strategy is an instrument for organisations to understand and improve their economic, environmental and social impacts caused by their everyday activities. It provides an agreed upon framework to efficiently utilise resources, create a positive impact, monitor progress and communicate results to key stakeholders. It also serves as a roadmap to improvement in all of the identified areas of importance.

HOW CAN A SUSTAINABILITY STRATEGY HELP YOU? Assess and benchmark sustainability performance

Increase stakeholder engagement

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WHAT CAN DUBAI CARBON DO FOR YOU?

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Issue 24 | September 2020

FEATURE

Leveraging the Digital Economy B2B transactions are facilitated by the digital shift and the support of the local economy

radeling is MENA’s novel B2B e-marketplace, connecting the region’s markets with global suppliers to provide new business opportunities and contribute to the development of a prosperous digital commerce era. With his keen entrepreneurial brilliance, Muhammad Chbib, Tradeling’s CEO, is shaping the specialised digital ecosystem in a multitude of sectors. The Sustainabilist spoke with Mr Chbib about the prospects of a post-pandemic era in the digital market place and Tradeling’s corresponding role. Tell us about Tradeling and the value it offers to MENA businesses. Tradeling is a B2B e-commerce platform that we are building for the region. It aggregates regional demand and global supply. Our company specialises in B2B collaborations, in which our platform presents products which have been validated by Tradeling on behalf of clients and aids in simplyfing transactions. By optimising the trade journey for buyers and sellers alike, in addition to driving economic value, Tradeling supports the entire supply 5

The Sustainabilist | E-COMMERCE

chain and provides essential ancillary services for logistics and payments. We aim to become the preferred sourcing tool for business buyers across the region and help them thrive in the era of digital commerce. Do you believe Tradeling will revolutionise the online marketplace? Instead of revolutionising the online marketplace per se, we are augmenting existing business processes and bringing them to the online space to enhance efficiency. We work towards holistically optimising trade transactions such that individuals may operate in the online space without having to utilise a multitude of platforms.Typically, the two main hurdles of B2B transactions are finding suppliers, and awarding and executing the contracts. Our goal is to identify suitable suppliers for a request submitted by a buyer. Once the latter has shortlisted the suppliers, negotiations begin. The key component in this is to optimise tracking and documentation while reducing paperwork to zero, allowing for heightened transparency and overall business sustainability. For international suppliers, our platfrom provides additional sales channels, eliminating the need to open a company locally. Overall, we are producing a layer of simplification for both parties. What kind of support do you think will be required for your vision of the marketplace? We are very keen on our vision as this project was created as a successor of one of the Dubai 10X projects called ‘Dubai Blink’, the world’s first B2B smart commerce platform. This was a project by Dubai Future Foundation for the Executive Office adopted by Dubai Airport Freezone Authority (DAFZA). Just as any other start up, we have the liberty to raise 6

external funding but we have received strong support from the Governemnt of Dubai through their investments in our platform. With this support, we have hired a management team that can follow and execute the vision and the mission we have set for Tradeling. Our goal is to create value for the markets and I believe that proof of value comes from engagement by private sector companies as well as public sector entities, which we are experiencing. With the pandemic, a number of challenges have come to light and technological solutions seem to hold the key to their solutions. How do you think tech companies are leveraging this? If there’s one good thing that came out of the pandemic, it’s the questioning of the entire status quo by a lot of people. All of the sudden, we were forced to stay home and communicate with our colleagues, suppliers, and clients virtually, much more than anyone had ever been used to. Digital transition has been a buzzword for a number of years as we have sought to utilise digital technologies to meet new business and market requirements. What the pandemic did is accelerate the adoption of digital platforms, from what would have happened in 5 to 8 years to 5 to 8 weeks. As a technology company, we have the responsibility of making the digital transition for our clients as seamless as possible. At Tradeling, we teach our clients how to use the platform and hold their hands along the way to enable them to adjust to new current trends swiftly and effortlessly. Leveraging our expertise and customer services is allowing us to build our platform further and develop new features, to eventually become a virtual gathering tool or trade show.

With your experience in the disruptive technologies, what insight can you provide on what the post-COVID era will look like in the marketplace of major industries? The travel business has definitely been the most impacted, but it is just a matter of time until the big trade shows and conferences are back and things return to order. Therefore, it is important to figure out how to set a framework to protect businesses and customers. One way we will do this is through the development of new products and services which will be driven by artificial intelligence and augmented virtual reality, such as advanced wearables. The new developments will also optimise resource management for logistics and the entire supply chain. For example, I imagine that shipping containers will communicate digitally to assess their load, capacity, shipping date and route to optimise carbon footprint and other costs. How is the UAE positioning itself as a vital global trading hub? Two essential requirements for a global trading hub are a strong airport and a strong port. The UAE has both of these. In addition, a global trading hub also requires a large number of businesses to enable high volumes of trade and simplified processes, including the bureaucratic aspects. The UAE is investing heavily in attracting businesses and investors by offering enticing legal and corporate frameworks, access to desireable talent, capital, and convenient lifestyles for professionals. These investments have facilitated the perception of the UAE as a place of opportunity, which will continue to grow and position itself as a vital global trade hub.

L O W

DESIGNING C A R B O N

F U T U R E

BY THE ORGANISERS OF

25 NOVEMBER 2020 | DUBAI, UAE LEARN MORE: WWW.AVIATIONSUSTAINABILITY.AERO |

@DUBAIAIRSHOW

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FEATURE

The Great Indoors Ali Al Jassim, CEO of Etihad ESCO, shares with The Sustainabilist the efforts made by the Super ESCO to optimise comfort for building occupants, while safeguarding the planet

ow has the UAE embraced the concept of sustainability in the built environment and what evidence is there to support this? The UAE took initiative and designed several programmes with extensive targets to achieve greater sustainability within the nation. One such example is the second programme of the Dubai Demand Side Management Programme, Building Retrofits. The building retrofitting programme focuses on the main components of a building with an integrated approach, considering lighting, water, industrial processes, building envelope, along with upgrading the control or the replacement of operations and equipment optimisation.

Environmental Impact Achievements

Emission reduction per each year of operation for the delivered projects:

7,763

nO. OF BUILDINGS

304.8 GWH

ELECTRICITY

288.78 MIG

WATER

Equivalent to:

2,183,557

self generation

control

TREE SEEDLINGS GROWN FOR 10 YEARS

Strategy and Approach

132,055 28,037

retrofit

replacement

PASSENGER VEHICLES DRIVEN FOR oNE YEAR

tONNES OF CO2

44,917

TONNES OF WASTE RECYCLED INSTEAD OF LANDFILLED

Issue 24 | September 2020

What are some of the most prominent trends in green buildings? Through research and analysis, a number of trends have been observed in green buildings. Below is a list of the most prominent of such trends. 1) Net Zero Energy Buildings These are the buildings designed to produce energy equivalent to the amount consumed, and to reutilise resources. 2) Energy Efficiency This concept focusses on making buildings energy efficient as per current technologies and innovations. It improves the operation of a building in terms of energy required to perform its activities, hence making it more efficient. 3) Renewable Energy Currently, solar is the most commonly used renewable energy source used given its competitive price and long-term assurance. 4) Water Conservation Valuable water resources are conserved through the use of technologies aimed at storing rainwater, harvesting this rainwater and reusing it, in addition to the deployment of efficient water fixtures. 5) Smart Buildings 6)Green Building Materials 7)Low-emitting Windows and Cool Roofs What is Environmental Indoor Quality and how does Etihad ESCO promote the improvement of this aspect of buildings? Environment Indoor Quality, as the name suggests, has certain parameters which determine quality of the indoor environment. These factors play an important role in enhancing human comfort. Some of the major parameters considered are lighting, indoor temperature, CO2 levels, and humidity levels. Etihad ESCO, when retrofitting a project, not only works on energy efficiency but

also to improve Indoor Environment Quality parameters. With state of art technologies, we focus on monitoring and controlling indoor quality parameters very precisely so as to ensure comfort for occupants. With the movement restrictions and people working from home, domestic power consumption has increased significantly. Are there any energy saving or conservation projects in the pipeline for residential buildings? Yes, due to the pandemic, people are forced to stay at home and handle their work from home. This has inevitably resulted in an increase in domestic power consumption. In parallel to this, however, there has been a decrease in commercial and office building consumption. It is important to note that domestic unitary systems are less energy efficient in comparison to commercial systems. In recent times, Etihad ESCO has successfully implemented a series of energy efficiency projects in residential buildings, such as the UAE Citizen Homes

Retrofit in Dubai, the Mohammad Bin Rashid Housing, and Hatta Villas. Experts are interpreting the Covid-19 crisis as an opportunity for energy players to take bold action to become resilient and rely less on fossil fuels. Do you agree with this? Every crisis brings opportunities to restart or start something new. Rather than calling it an opportunity, we would say it is an eye opener. As we have all experienced how rapidly the world can change in just a few months, the crisis has certainly changed how individuals think and what they prioritise. In fact, now more than ever, we should all play our parts in addressing environmental issues. As the Super ESCO of the emirate, we are focused more than ever to bring energy efficiency, renewable energy, sustainability to the core of each business. In addition to reducing reliance on fossil fuels, these changes and improvements will assist businesses in reducing their operation costs.

UAE Citizen Homes Retrofit Project Recently, we did retrofits for 4,878 homes in Dubai for UAE citizens, this work consisted of using solar as resource for self-generation for each home and improving water conservation through water efficient fixtures. Below are results achieved through retrofit.

30.9 Gwh

Solar generation

4878

villas retrofitted

86.7 MIG

annual water savings

16.3 Gwh/yr annual electricity savings

The Sustainabilist | E-COMMERCE

FEATURE

Covid-19: The Upcoming Digital Tsunami in Retail The boom in the GCCâ&#x20AC;&#x2122;s retail industry comes with a number of challenges, the newest of which is the pandemic

By Dr Saeeda Jaffar Managing Director and Head of Middle East, Alvarez & Marsal By Tanveer Awan Managing Director, Strategy and Performance Improvement Practice, Alvarez & Marsal, Dubai

ver the past few years, e-commerce has witnessed an unprecedented growth across the GCC region, changing the face of the retail industry. Some of the factors that have

accelerated the uptake of online shopping include high digital penetration that offers fast and convenient shopping experiences, improved logistics and increased security for digital transactions. However, the great boom also brings its own set of challenges for both online and brick-and-mortar retailers, especially in the wake of the new coronavirus pandemic. Today, e-commerce is set to position itself as the key driver of growth regionally for retail. The COVID-19 outbreak and 2020 will mark a

O, efforts mise hile

tipping point for the adoption of e-commerce and mobile commerce platforms.

Issue 24 | September 2020

Online retailers continue to report an increase

changes consumers’ buying behaviour across all

platform or building sophisticated digital

in demand, with the number of real-time orders

demographics, even when the epidemic is over.

logistics and payment reconciliation capabilities to be in the lead in this race to recovery.

and transactions higher than ever. The number of stores providing e-services for consumers in

RETAILERS NEED TO BE DIGITALLY

the UAE rose by 150% due to the pandemic,

AGILE

Forward-thinking omnichannel retailers

according to the Telecommunications

Digital transformation has paved the way

and the emergence of online-only brands

Regulatory Authority (TRA). Moreover, the

for more sophisticated, multi-channel retail

offering strong digital propositions are

growth of e-stores is expected to continue in the

propositions, supported by increased uptake

exploiting these trends while advantageously

coming days to meet the consumer demand.

in smartphone usage and online shopping,

amassing vast quantities of consumer data.

ultra-convenient same-day home deliveries, and

Efforts by retailers who were late to the party

A NEW ERA IN RETAIL

efficient click-and-collect. The proliferation of

mimicked the mechanics of offering an online

IS UPON US

digital technologies has fundamentally altered

proposition often proved dilutive, as additional

As the consumer behaviour changes, retailers

the fabric of the customer journey. This spike in

infrastructure and investment were deployed to

will witness an increasing dependency on the

B2C e-commerce across the GCC is, of course,

service the same customer and the same order.

The fast-paced adoption of consumer technologies has presented shoppers with an array of digital touchpoints, which fundamentally altered their behaviour in physical locations. Shoppers expect to seamlessly transition from physical to digital channels, often in the same environment, while immersing themselves in retail spaces that help create memorable experiences ideal for sharing instantly for the purposes of social and online approval. The consumer love affair with online shopping and the growing importance of the experience economy has collided with rising operating

“

The experience economy is increasingly prominent as people reassess the value they attach to material possessions.

“

online orders.

costs and over-supply of stores. Fundamentally,

THE EXPERIENCE ECONOMY As physical and digital realms merge, the experience economy is increasingly prominent as people reassess the value they attach to material possessions. Although the shift towards experiences has arguably come at the expense of retail, its role in the customer journey is undeniable. While consumers claim to spend more time browsing products online than they do in-store, the relative importance in the discovery and research of retail products is more influential in physical locations, particularly flagship destinations where ‘experiences’ matter. Retailers and landlords alike recognise that staging meaningful experiences is critical in the moments that matter: moments of discovery; moments of desire; and moments of action.

this has altered the economics of store-based

due to existing online shoppers stocking up on

retailing, putting intense pressure on legacy

essentials given the coronavirus outbreak and

business models. This perfect storm has tested

the lockdown imposed by the Government (to

Moreover, shoppers expect digitally enhanced

retailers, pushing many of them to a breaking

contain the spreading).

physical environments; Instagram walls, Facebook check-ins and Snapchat codes that

point. The COVID-19 crisis has clearly favoured

inspire, excite and offer experiences that cannot

While the situation may be grave, we have

omnichannel retailers when it comes to

be replicated online.

also found grounds for optimism. Physical

minimisation of the negative impacts.

retail remains hugely relevant, particularly for

Therefore, offline retailers should have

In conclusion, a sharp focus on strategic

Millennials and Generation Z – a demographic

approached the lockdown period as an

transformation is needed to burn its way

set to become the biggest spenders in a decade.

opportunity to build a robust online presence.

through the challenges, declaring itself the

With COVID-19 pandemic, store operators

Retailers with an online presence, must take

overriding priority for retail and leisure. The

endanger losing this sweet spot too as retail

advantage of the recovery trends by introducing

race is on to pivot business models fit for

stores were shut during lockdowns, resulting

inventive ways of meeting customer demands -

tomorrow’s increasingly digital, experience-

in the formation of new habits that significantly

be it establishing an Online-to-Offline (O2O)

driven age.

The Sustainabilist | E-COMMERCE

INTERVIEW

Reshaping PV Technology Mohamed Saady, Jinko Solar’s Technical Services Manager of Middle East & Africa, explores with The Sustainabilist the

brand’s latest products and achievements

hat innovations is JinkoSolar particularly focussed on and how will these improve the LCOE of

projects in GCC? We always aim to provide the clients with technologies that really add value. We are the first company to offer the Tilling Ribbon technology in the market which increases the modules’ efficiency considerably compared with normal modules, at the same time we improved the overall specs of modules, such as degradation values, temperature coefficient and optimised frame design. These improvements, along with high efficiency mono, half cut technology, and multi busbars, lead to huge improvements in the Levelised Cost of Electricity (LCOE) and total investment. JinkoSolar will be supplying 1 GW of PV modules for Phase V of the Mohammed bin Rashid Solar Park. What does the brand’s expansion in the UAE market demonstrate about its technologies?

For the last 10 years, the UAE has expanded

UAE has always been one of the largest and

its renewable energy resources to meet 2030

oldest markets for solar PV in the region, and

and 2050 Strategies, so we were very glad to

it has always been very eager to adopt new

see many mega size projects in Dubai and Abu

technologies to maximise the performance.

Dhabi. After having shipped 1.17 GW for the

Issue 24 | September 2020

to work on another large project in UAE. Supplying 1GW for Phase V of MBR Solar Park is huge milestone not only for us and for the region, but for the solar industry globally, especially since the supplied modules will be bifacial and hence will provide a validation for this technology worldwide. How do you see the impact of new 500+ W modules in the industry? I believe this year has pushed the limits in so many ways. Last year, the biggest wafer size

“

Supplying 1GW for Phase V of MBR Solar Park is huge milestone not only for us and for the region, but for the solar industry globally.

“

Swehian Project in Abu Dhabi, we were eager

was 166 mm and now we are seeing wafer sizes reaching up to 217 mm, this has led to bigger modules with more power. We are also seeing improved module efficiency with new overlap technologies such as tiling ribbon, shingling and paving. Last year, available efficiency was 20% but there has been 0.5-1% improvement in efficiency for 500+Wp modules. The BOS suppliers, such as trackers and invertors, also improved their products to be compatible with all these changes.

What’s next for JinkoSolar?

portfolio. We have already launched our battery

I believe our future products will be based on

storage solutions and started supplying the

182 mm wafer size. Our future technologies

system to many projects in US and Africa and

will focus on improving the cell conversion

soon, the Middle East.

efficiency. There is great potential for N-type technologies such as PERT and TOPCON, and

We also introduced our new Building

that’s why we decided to showcase our new

Integrated PV (BIPV) modules with a variety

N-type Tiger Pro product with power reaching

of colors and sizes and are very excited to

up to 610Wp.

offer them in the region as there is a very high demand for this kind of products.

We are also adding new products to our

The Sustainabilist | E-COMMERCE

FEATURE

The Pressure is On As the supply chains of the supermarket industry face great pressure, companies must make their processes more sustainable and future-proof By Alain Kaddoum, General Manager Swisslog Middle East

he world is crippling with the adverse

world have definitely impacted the global

effects of the coronavirus pandemic.

supply chains. The most vulnerable sectors

Border restrictions and lockdown

hit by the pandemic include automotive,

measures were bound to cause a massive

textiles, electronics, and companies who

negative short-term impact on consumer

rely heavily or solely on factories in China

spending, investments, and disruptions to

for parts and materials.

international trade. On the other hand, the disrupted manufacturing operations around the

According to a report from Baker McKenzie

Issue 24 | September 2020

to a lack of understanding and flexibility of the multiple layers of a company’s global supply chains and a lack of diversification in their sourcing strategies. Due to an increased demand from stakeholders, companies struggled to take efficient action to be able to mobilise rapidly, set up crisis management mechanisms and build the supply chain resilience that would help them rebound in 2021. The need of the hour is for businesses to focus on how to minimise supply chain disruption and to adjust rapidly to a changing landscape. Covid-19 is now termed as the black swan event, and it is forcing many companies to

“

Automation can help grocers monitor the inventories in real-time and automatically notify customers once the product is back in stock.

“

and pharmaceuticals. It could also be attributed

rethink and transform their global supply chain

and other elements crucial to any business.

model, making them more future-proof and

Automation solutions for grocers can and

sustainable.

should be customised for each business to fit their e-fulfilment strategy in the best way. When

Companies that implemented automation

every second is valuable, such a modernisation

prior to the crisis are able to navigate their

project can actually be executed on the side

businesses easily, keeping up with similar

without disruption to the main operations. This

levels of productivity by relying on automated

allows a business to continue its work, while

activities or robots catering to the increase

upskilling.

in demand. Automation processes can be devised to tackle a lot of challenges caused by

The flexible, data-driven, and robotic solutions,

Covid-19. For example, during the pandemic

such as a hub-and-spoke arrangement, a

the local grocery stores were witnessing rapid

bolt-on store automation approach, micro-

surges in e-grocery sales and the industry

fulfilment centres or a fully automated grocery

was throttled by persistent labour shortages,

store, enable grocers to meet rapidly changing

traditional fulfilment models, and last-mile

customer demands and make their operations

and Oxford Economics, Beyond COVID

delivery challenges. Automation can help

more sustainable while allowing them to

19: Supply Chain Resilience Holds Key to

grocers monitor the inventories in real-time and

leverage new technologies as they emerge.

Recovery, the pandemic has produced an

automatically notify customers once the product

unprecedented global supply chain crisis.

is back in stock.

Hub-and-Spoke Arrangements enable an automated fulfilment centre to assemble orders

The global supply chain crisis came about due

The automated warehouse solutions and the

for all non-perishable items and then bulk ship

primarily to the pandemic creating temporary

right automation technology can help grocers

to the stores where they are topped off with

‘manufacturing deserts’, whereby a city,

move their e-grocery fulfilment beyond manual

perishable items, thus allowing the fulfilment

region or a whole country’s output dries up

picking. Other important benefits during such

facility and automation system to be designed

so substantially due to lockdown conditions,

challenging times are energy-saving options for

hand-in-hand and eliminating the space

they become a no-go zone to source anything

businesses, smart execution of processes with

limitations imposed by integrating automation

apart from essential items such as foodstuffs

higher efficiency with less spending on utilities,

into existing retail locations.

The Sustainabilist | E-COMMERCE

Bolt-on Store Automation uses compact,

emerging concept, it integrates the automation

stationary, with an automated storage and

robotic automation technologies to create

into the shopping environment, allowing

retrieval system delivering the products they

small fulfilment centres at the back of the store

shoppers to have the flexibility to place their

need to fulfil the next order as it is needed. Pick

that automate current manual processes for

orders in advance or while in the store, to pick

time is thus reduced significantly, and accuracy

non-perishable item picking while utilising

their own perishable items, or to have the store

is improved, while pickers experience less

store inventory to top off orders with perishable

complete their order for pickup or delivery.

fatigue.

from one location, reducing transportation time

E-Grocery Automation Technologies provide

Robotic-Assisted Picking is another approach,

and costs.

groceries with a range of automation solutions

in which a robot guides the picker through the

to choose from. The best solution will depend

store to optimise travel based on the location

Micro-fulfilment Centres create an

to a degree on the selected e-fulfilment strategy,

of the items to be picked and allowing multiple

opportunity to convert abandoned or

but as with e-commerce automation in general,

orders to be picked at the same time. The robot

underperforming retail outlets into micro-

grocers should seek out solutions that are

leads the shopper through the aisles in the most

fulfilment centres that serve the same area

flexible, data-driven, and robotic to ensure they

efficient manner and even guides the picker on

as a traditional grocery store with automated

wonâ&#x20AC;&#x2122;t become obsolete as the market changes

how to package the order, determining which

fulfilment for curbside pickup or home

and can leverage new technologies as they

stock-keeping units (SKUs) should be put into

delivery. This strategy sacrifices in-store

emerge. There are multiple niche solutions

which grocery bag based on criteria, such as

shopping so it is particularly attractive to

being developed today to capitalise on the

the maximum weight for a bag, crushability

pure-play e-grocers but creates the opportunity

growth in e-grocery fulfilment, the primary

and whether items need to be segregated by

to optimise the environment by efficiently

automation solutions being used or considered

temperature.

integrating automated and manual picking.

are either robot-assisted picking or goods-to-

It allows grocers who donâ&#x20AC;&#x2122;t have an existing

person automation systems.

goods. This allows them to fill complete orders

brick-and-mortar footprint within a particular

Automation has proven to be a sustainable and future-focused solution and it is becoming

area to move fulfilment closer to customers,

Goods-to-person picking is a concept that

a competitive differentiator that can help

reduce transportation costs, and enable shorter

has been widely adopted in e-commerce and

companies uplift their operations without

delivery times.

multi-channel warehouses to enable higher

affecting business continuity while offering the

productivity and faster order fulfilment times.

smooth and organised experience for customers.

The Automated Grocery Store is a new type

Instead of pickers walking up and down

of grocery store that combines automated

warehouse aisles to pull orders, the goods-

e-fulfilment with traditional shopping. Still an

to-person system allows the picker to remain

Integrated Energy Logistics Provider The Tristar Group is a fully integrated Logistics Solutions provider that offers a comprehensive list of services to cater to the needs of the petroleum, chemical and petrochemical industries, both in the region and globally. The company’s core expertise lies in its ability to safely handle and distribute all types of retail fuels, lubricants, chemicals, petrochemicals and liquid gases. Specialized Warehousing for Chemicals & Dangerous Goods

Commercial Aviation Refueling

The JAFZA South custom built warehouse has the capability to offer both ambient and temperature controlled storage for a wider range of petroleum products, including industrial solvents and soft chemicals. Total warehouse capacity is in excess of 15,000 pallet positions. The facility has an in-house fully automatic tank cleaning facility installed by Groninger (Europe). The tanks will be cleaned with soft water with chlorine content less than 50PPM alongside with a high pressure pump of 100 bar and a Boiler designed to produce steam at 1.2 TPH, which generates hot water of 80 Degrees Celsius. A fully automated effluent treatment plant will treat and recycle all waste water from the cleaning station to be used for general cleaning and irrigation purposes.

Tristar is into Commercial Aviation Refueling operations in South Sudan and Liberia. It has a 25-year contract with CAA Uganda for the construction and operation of an Aviation Fuel Farm and Hydrant Line facilities at Entebbe Airport which will commence operations in the 4th quarter of 2020. Tristar’s Aviation facilities comply with international standards, specifications and guidelines set by IATA, JIG, AFQRJOS, as well as with IFQP requirements set by Airlines for Aviation Fuel Quality Control and Operating Procedures. Tristar has been a member of IATA since 2008 and recently became a JIG member. It has a technical service agreement with Hansaconsult.

Polymer Bulk & Bagging Warehouse

Fuel Farm

The multi logistics polymers facility in JAFZA South is designed for receiving bulk PP/PE granules into silos and bagging of the granules by fully automated bagging operation into FFS film bags and/or big bags. The packed material can be stored inside the warehouse in racking with a capacity of 8,000 tons. It also has a drum filling station with capability to drum from ISO tanks and road tankers thus providing customers a solution to receive in bulk and store and distribute in packed conditions.

Tristar owns, operates and manages 62 fuel farms globally with a storage capacity of more than 788 million liters for handling a wide range of petroleum products like Jet Fuel, Gasoline, Gasoil, Fuel Oil, etc. Tristar’s fuel farms and storage depots are constructed and maintained in the services of its clients. Our largest fuel farm is in the Pacific island of Guam which has a capacity of 4.2M barrels. All the operations comply with the local and international safety and environment standards, including OSHA and USEPA.

Road Transport

Shipping

Tristar owns and operates over 1,700 vehicles ranging from road tankers, trailers and delivery pickups in the Middle East, Asia and Africa. Operations are certified for Integrated Management System including the latest ISO 9001, ISO 14001, ISO 45001 and ISO 39001. Tristar is periodically assessed by the Gulf Petrochemicals and Chemicals Association for SQAS (Safety and Quality Assessment System).

Email: info@tristar-group.co

The shipping business acquired Eships in early 2016 and now owns and operates more than 30 chemical, oil and gas tankers and bulk carriers trading globally, mostly with Oil Majors. The vessels include the six Eco MR tankers (50,000 DWT) delivered in 2016 and the six new build 25,000 MT DWT, IMO Type 2 Oil and Chemical tankers to be delivered between June 2020 till January 2021. These ships are fitted with fuel saving equipment such as the Propeller Boss Cap Fins and Trim Optimization System.

Website: www.tristar-group.co

The Sustainabilist | E-COMMERCE

FEATURE

The Stars of Sustainability

Tristar Group, the integrated energy logistics provider, shares their sustainability initiatives

ristar’s Management Team drives a ‘Business for Purpose’ ethos which focuses on having a positive impact on the communities where it operates. The company has set a goal to decrease its dependence on fossil fuels and has initiated several projects to reduce its environmental impact across its operations. Some of these green initiatives include waste water treatment, EURO IV technology, green buildings, a biodiesel study and a rooftop solar project.

Waste Water Treatment In order to address the safe management and disposal of hazardous waste water generated at its operations, Tristar has installed two Effluent Treatment Plants (ETP) at its offices in Dubai. The ETPs recycle the waste water to a standard that can be reused within the facility and irrigation, thereby reducing the use of freshwater. In 2019, 2.4 million imperial gallons of waste water was safely treated by the two ETPs.

EURO IV Technology Tristar operates over 100 new vehicles in compliance with the European Emission Standard (Euro) IV. This standard defines the acceptable exhaust emission limits for vehicles sold across the globe. The Euro ratings impose stringent regulations on emission limits from the respective vehicle. The emission standards for vehicles, trucks and buses are defined by engine energy output in g/kWh.

Issue 24 | September 2020

These green initiatives have also led to economic savings. The ETP project was implemented with the involvement of all key stakeholders, including employees, government entities and external agencies. By installing the ETPs, Tristar also achieved considerable economic savings in municipal wastewater disposal charges.With the LEED Gold certified JAFZA South facility, Tristar has achieved energy savings of

over 300 MWh/year which translates to substantial economic savings as compared to operating a warehouse of its size with a total capacity of more than 15,000 pallet positions. Tristar’s green initiatives are regularly communicated to internal and external stakeholders through workshops, quarterly newsletters and annual Sustainability Reports.

“

Energy intensive conventional lights have been replaced with LED lights at various operations and renewable solar lamps are used exclusively at its facility in Haiti. The company is assessing the feasibility of solar energy infrastructure at its other operations in line with UN SDG 12 on Responsible Consumption and Production and with SDG 13 on Climate Action.

“

With the LEED Gold certified JAFZA South facility, Tristar has achieved energy savings of over 300 MWh/year

“

Green Buildings Tristar integrated green building standards when it built a new warehouse in JAFZA South and refurbished its existing warehouse in Jebel Ai Industrial Area No. 1. The JAFZA South facility received the U.S. Green Building Council LEED Gold certificate.

The Sustainabilist | E-COMMERCE

The TOP 10 list features staple product categories that had previously typically been bought in physical stores. It is clear from this list that during isolation, shoppers moved online for necessities and goods for their new lifestyles.

music Just like art, music can be comforting, especially during isolation. Also, many shoppers are spending their free time learning a new instrument.

10 9

art & crafting Consumers are shopping both for art and for art products to improve their living spaces and to get creative.

books With more free-time at home, people are stocking up on books to keep them busy.

Top 10 fas categories i

Spending more time at home and complying wit guidelines and restrictions meant venturing out was not possible. Bringing flowers and plants in homes is a safe alternative.

health & beauty

Flowers & plants

People are significantly more concerned with their wellbeing and health and are focusing on healthy and proactive habits. Also, with barbers and salons closed, sales of cosmetic maintenance products have surged.

Issue 24 | September 2020

Food & groceries Stores and restaurants were closed or with limited operations. Panic shopping and supply chain delays resulted in unavailability of some products in stores. As such, consumers switched to online to buy what they needed.

P 10

stest growing in e-commerce

th the doors nto our

Clothing & apparel

Demand for clothing and apparel has increased notwithstanding the movement restrictions. Athletic and leisure wear apparel witnessed a significant increase.

Home & garden Keeping living indoor and outdoor spaces fresh and clean has become a priority after being confined to our homes. Accordingly, consumers have resorted to shopping online for products to make their houses homes.

pet care Pet owners have been spending much more time at home with their pets and have avoided going into physical stores, hence they have shifted to shopping for their petsâ&#x20AC;&#x2122; needs online.

games & leisure With most activities and events cancelled, consumers increased their need for activities to keep busy at home, including table sports like pool.

This list shows the most popular e-commerce product categories of April 2020 based on sales data from over 500,000 online stores worldwide. Source: Wix, eCommerce Growth Report During Covid-19

The Sustainabilist | E-COMMERCE

#THEGREENECONOMIST

After Hysteria Comes Hysteresis By Ivano Iannelli CEO, Dubai Carbon

ysteresis refers to the effects that persevere even after their causes have disappeared. In the case of COVID-19, hysteresis effects include the disruption of daily lives, forced consumer behaviours, and the collapse of markets. But the question of great matter is what will happen once the hysteria (the global pandemic) ends and what changes will we keep?

E-commerce has undoubtedly emerged as a light at the end of the tunnel for a great number of brands and businesses that, without the online platforms, would have had no other routes to market. Consumers globally have in general been quite skillful in switching to shopping online. This has resulted in e-commerce becoming a sharp focus for many brands and disrupted how they communicate with their customers. The success of both parties in engaging in

online transactions should be leveraged by businesses moving forward and used to make plans on how to retain old and new customers. These plans should consider a number of aspects. Firstly, invest, invest, and invest. Brand building, e-commerce, and performance marketing require capital. Brands who swiftly moved budgets from things like cancelled events to media and e-commerce

Issue 24 | September 2020

E-commerce is a value chain, which like all other chains, is only as strong as its weakest link. This is problematic for brands who lack control, and it has in fact been happening since the crisis. Many businesses have had to depend on one single platform or distributor with no other route to get their products to the consumers. As e-commerce progresses, along with brands’ strategies, more points of sale providing multiple routes to market and reducing reliance on a single channel will proliferate. It is likely that direct-toconsumer (DTC) players will enter the open marketplace and that other brands pursue the DTC model more actively.

managed to take advantage of the shift. The choice of products on the digital aisles is practically unlimited. Developing your brand and targeting your consumers is crucial to positioning your products and services at the optimal eyelevel on the e-shelves. Now, we have learned that e-commerce is not an option but rather a necessity. Growth in e-commerce has taken place in sectors that had already been dominant as well as in emerging ones. E-commerce used to be considered limited to younger buyers, but in fact young, old, rich, and poor have all shopped online for necessities since lockdown measures were implemented around the world. From this,

One more thing to consider is that when it comes down to consumer behaviour, we are the individual snowflakes we were made to believe to be as children. There is no average in e-commerce. Buying fast and buying slow cannot be simplified into a standard as some consumers increase the length of their purchase journeys whilst others simply carry out confirmation transactions. For brands, this means that an engaging brand experience at point of sale is important, but so is that throughout the customer’s journey online. As social beings, physical interaction cannot be eliminated and will have to be compensated even as social distancing continues. A website will no longer serve as a mere point of sale as it will grow into businesses’ brand worlds. Brand power will be derived from digital visibility on platforms and from consumers’ awareness throughout the purchase journey. And lastly, an e-commerce platform is not

“

Businesses need to understand how to target the different demographics within their consumer bases and optimise the dynamics of their brands.

“

businesses need to understand how to target the different demographics within their consumer bases and optimise the dynamics of their brands.

complicated to set up. Many brands have proved this by setting up websites in a matter of days. It is probable that websites put together rapidly will not generate massive amounts in revenue, but it is a step into the right direction and an opening line into the e-commerce conversation. There are plenty of free website builders available to set up your own e-commerce platform. E-commerce growth is the hysteresis which will prevail even in the post COVID-19 era. Brands failing to capitalise on the shift from physical to digital shopping, especially in categories already prominent online, and to deploy excess budgets to grow digital presence, will likely find themselves losing market shares to businesses that manage to adapt and optimise resources quickly and effectively. 23

#LOCKDOWNPROBLEMS

Why is the electricity bill so high this month?

Itâ&#x20AC;&#x2122;s because I keep having to charge my phone. I receive about 100 deals and offers daily!

And why is the credit card bill so high?

Because the offers are way too good to pass up on!

The Sustainabilist | E-COMMERCE

INTERVIEW

Tabreed Takes Over the Largest DC Market in the World The Sustainabilist interviewed Adel Salem Al Wahedi, CFO of National Central Cooling Company (Tabreed), to discuss the recent acquisition of Emaar’s Downtown Dubai district cooling assets

abreed’s recent acquisition of 80% of Emaar’s Downtown Dubai District Cooling services, the largest corporate deal in the UAE this year, is truly significant. Can you tell us about what the transaction represents and the mindset behind it? Firstly, the transaction provides us scale in the largest District Cooling (DC) market in the world, which is in Dubai. DC opportunities of this scale are scarce in the market. Tabreed was under-represented in Dubai and had come across limited opportunities to grow due to large volumes locked under existing concessions. This is a transformational transaction which, along with concession growth, will lead to consolidation of Tabreed’s market positioning over time. 26

Issue 24 | September 2020

“

A longterm concession agreement with Emaar provides exclusivity to service current and future developments

“

Furthermore, Downtown Dubai is the most important socio-economic asset for Dubai which houses the leading landmarks of UAE, including Burj Khalifa – the world’s tallest building, The Dubai Mall - the world’s largest mall, Dubai Opera and Address Hotel, to name a few. The acquisition of Emaar’s Downtown DC assets significantly increases Tabreed’s ranking in Dubai from #4 to #2. We are already market leaders in all other geographies that we operate in.

This acquisition diversifies the customer concentration with high quality, investment grade customers. It provides strong cash flows and future growth potential which is underpinned by long-term contracts with Emaar Group. Over 90% of the connected in the UAE which will result in O&M capacity is contracted with Emaar Group efficiencies. while the rest is with other high-profile The transaction meets the qualitative institutions. tests on key parameters including, but not limited to, customer quality, bankable It is in line with Tabreed’s strategy and contributes to the acceleration of growth. contract structure, and project returns. A long-term concession agreement with Has the pandemic affected the returns Emaar provides exclusivity to service on this investment? current and future developments in Downtown Dubai. Further, the young age Given the nature of the business and the services we provide, we are not directly of fleet requires no expansionary capex for the length of the concession therefore impacted by COVID-19. Our business model includes a capacity charge and enhancing cash flow generation. In the current macro environment when organic a consumption charge. The capacity growth is relatively slower, M&A remains charge is fixed and drives around 85% of our EBITDA. The consumption charge one of the key growth drivers. is variable and is largely a simple pass through of our operational costs. The integration will lead to operational leverage and combination synergies driven Our contracts are very long term (25 years) and we offer an essential utility by Tabreed’s industry leading O&M service. Furthermore around 70-80% standards and centralised maintenance of our business is with government or team. Detailed technical due diligence government-related entities. Therefore, we concluded that plants are operating well do not expect to see any significant impact and are maintained to the highest of from COVID-19, unless this results in industry standards. Furthermore, the Downtown DC assets are of a similar kind customers closing down entirely and debts not being paid. and design to Tabreed’s existing plants

What changes has Tabreed witnessed in terms of district cooling demand and consumption since the implementation of the movement restrictions? To date we have not seen any material reduction in volumes due to COVID-19 lockdowns. Even the facilities that have been closed to the public require a certain level of cooling for maintenance purposes and to protect their equipment. It is still very early days to have a major impact on volumes. However, I think it would be prudent to assume that the longer this situation goes on until next year, there might be change in consumption pattern. However, volumes only contribute ~15% of EBITDA, hence the impact should not be significant. And at the same, we may also see volume increases for residential customers. The adoption air conditioner system has been growing globally, along with concerns over their impact on their environment. How does district cooling provide greater advantages in terms of cost in addition to environment preservation? District cooling is 50% more energy efficient and saves 16% cost over the life cycle of the contract. Therefore, a preferred choice for both corporations as well as governments. District cooling is environmentally friendly, as it reduces greenhouse gas emissions. In 2019 alone, Tabreed’s operations resulted in reduction of 2.06 billion kWh energy consumption which is enough to power 117.5 thousand homes in GCC for a year. In terms of CO2 emissions saving, it resulted in elimination of 1.23 billion tonnes of CO2 which is equivalent to removing 268,000 cars from the streets every year. GCC energy needs are increasing and given 70% of the peak energy consumption is cooling, district cooling is the way forward. 27

COVID-19

Resili

An insight into how top businesses are deflecting the novel coronavirusâ&#x20AC;&#x2122; adverse effects with disruptive digital services enhancing customer experiences, all while contributing to the green economy

ience

The Sustainabilist | E-COMMERCE

Payments and the Coronavirus Shock

The Sustainabilist spoke with Julia Schoonenberg, Senior VP at IDEMIA MEA, on the prospects of future payments and how the pandemic may have acted as a catalyst for the transition.

hat does the future look like for payments in terms of modes of transactions, customer experience? The consumer will always be partial towards methods that enhance the convenience and security of payment. Not only that, the mode of payment will increasingly reflect the social habits of the particular consumer. For example, digital natives expect to be able to pay their bills while commuting or pay for a ride with their phone. Meanwhile, payment cards still have a bright future and they keep being reinvented: some are premium products made out of metal, others are incorporating a biometric sensor or a dynamic CVV to further enhance security and convenience. Given this, the future of payment will take shape in a variety of forms, such as contactless cards, payment via mobile devices and so on. 30

Has the pandemic had a significant impact on hastening the process of digital transactions in place of cash? The pandemic spotlighted the hygiene concerns around the world and accelerated what was already a growing trend in the payment ecosystem, namely the rise of both contactless payments and e-commerce. According to Mastercard, contactless

transactions increased 40% worldwide in the last quarter ending March 2020. The UAE has already experienced a 78% surge in contactless payments in the same quarter. The trend towards contactless payment will last and we expect it to grow. According to studies, we expect almost a quarter of global retail sales to be done via e-commerce by 2022.

Issue 24 | September 2020

How is biometric authentication enhancing the consumers experience and ensuring security and convenience? As a form of authentication, biometrics, whether its fingerprints, facial or iris recognition or a combination of them, is accepted as one of the most secure and most able means to prove the identity of a person. Hence biometric authentication is increasingly leveraged in the payment ecosystem to enable seamless and secure transactions. Indeed, the popularity of this method in securing payment is growing. According to a recent study, 1.2 billion consumers will use biometrics for authentication in 2020, increasing to 2.6 billion by 2023. Biometric authentication has been in use on mobile devices for a few years now. Consumers can authorise payments at point-of-sale (POS) machines or on their mobiles directly using their saved biometric information on the device. This enhances the seamless nature of the transaction as well as the security. Biometric authentication can also be incorporated into existing payment instruments, such as cards. Currently in many countries, contactless payment cards still require a PIN code (Personal Identification Number) when the purchase exceeds a certain amount. There are instances where people simply forget their PIN code. Biometric-enabled cards, such as IDEMIA’s F.CODE card, not only overcome this problem, but also enhances the security of the payment since only the cardholder is able to authorise the purchase without touching any part of the POS machine. As the number of payment instruments have increased greatly in a short amount of time, which of these instruments do

you think are most likely to remain in the future? Indeed, the consumer can now access many different ways to pay, such as with a payment card, on mobile and ultimately, there is still the cash option. The longevity of a payment instrument hinges on how well it fits into the lifestyle of the consumers and how much it meets their needs. As pointed out in the previous question, instruments that enable contactless and secure payment have the higher chance of staying longer in the consumers’ way of life. Take, for instance, the expected growth in e-commerce mentioned above. A payment instrument that enhances security for online purchases will definitely be a popular choice among consumers. The IDEMIA Motion Code card that incorporates dynamic Card Verification Value (CVV) technology, for instance, is designed to secure transactions especially in card-not-present situations, such as online purchases. Do you believe mobile payments will replace card payments in the future? What we understand as the traditional “physical touch-points”, including bank branches, monthly paper account statements and even automated teller

machines (ATMs), are being reduced around the word. In most cases banks are also increasing their offerings, sometimes only on the digital space. Based on these observations, it is quite easy to conclude that physical banking will one day disappear. However, we see the opposite happening as far as the payment card is concerned. In some cases, the payment card is arguably the last “physical” link, between a bank and its customers. As a result, the importance of the card has actually increased for the banks. Cards are now the platform through which banks strengthen brand loyalty through innovative designs and exclusive materials, such as metal cards. This is what we call the “top of wallet” effect. Exclusive cards, in particular, have proven to be valuable to banks at segmenting their customers. Neobanks, FinTechs, and tech giants, which have ventured into the payment space, are also offering cards to their consumers, in some cases metal cards. Actually, leveraging this physical touchpoint is also a way for these new players in the payment space to position themselves vis-à-vis incumbent banks. 31

The Sustainabilist | E-COMMERCE

Grocers Turn Online The Sustainabilist spoke with Xavi Nunes, Chief Marketing Officer of el Grocer on the brandâ&#x20AC;&#x2122;s adaptation and future predictions.

lthough movement restrictions have eased within the UAE and abroad, food delivery services have boomed. The F&B sector through online grocery delivery, pre-prepared food boxes, and restaurant delivery services are capitalising on these unprecedented circumstances. The digital transformation has shown that it is more than a temporary measure for short-term needs as the concept of eliminating unnecessary outings and the importance of touch-free experiences continue. Launched in 2015, el Grocer was one of the first online grocery delivery platforms in the MENA region. As a first mover, the brand managed to build a strong market share within its core market, the UAE. el Grocer, like many businesses has 32

had to adapt to the new situation. The Sustainabilist spoke with Xavi Nunes, Chief Marketing Officer of el Grocer on the brandâ&#x20AC;&#x2122;s adaptation and future predictions. What is the el Grocerâ&#x20AC;&#x2122;s business model and what is the brand focusing on for the upcoming months? el Grocer is an online grocery platform that connects retailers, consumers along with fast-moving consumer goods (FMCG) brands across all seven Emirates of the UAE. Our wide range of retailers and network of 150+ stores make it possible to offer a variety of products to meet all tastes, occasions, and shopper missions. Users can find selected supermarkets, like Union Coop and Grandiose as well as specialty stores like Eataly, or Paul Bakery on our platform.

el Grocer is currently focusing on sustainable growth. After the huge surge in demand driven by Covid-19, we are focusing mainly on operations, technology, and people. We have implemented a series of projects from mid-March amid the rising demand and the subsequent lockdown, including increasing our operations team by almost 3-fold and focusing on continuous training and education. How has el Grocer facilitated shopping for customers, and how does it enhance their grocery routines? el Grocer is an incredible platform that connects thousands of users with hundreds of stores across the UAE. We even deliver in Khor Fakkan and Kalba, which makes us the online grocery marketplace with the widest reach in the country. el Grocer

Issue 24 | September 2020

simplifies online grocery shopping by having more than 80,000 products available online through a network of supermarkets and gourmet grocers. We help consumers purchase a wide range of groceries online from the comfort of their homes. Our app is rich in features to enhance the shopping experience. Our most popular feature is the Personal Aisle, which provides recommendations to users based on their purchase history, making it easy and quick to re-order products. Our AI powered Shopping List feature is widely used by busy professionals who prefer buying groceries on-the-go. This intuitive feature allows users to upload their shopping list in the superpower search box, view the products on the screen, and swiftly select all the items they need. Since el Grocer is focused on replacing weekly and monthly trips to the supermarket, our basket size is generally greater than 25 products. This means that features like Personal Aisle and Shopping List Search Box are critical to minimise the time users spend on buying their weekly or monthly groceries. Our goal is to make the experience fast, smooth, and meaningful, and we do this by intuitively providing personalised shopping experiences. With the COVID-19 pandemic and movement restrictions, many people shifted to online shopping, how has this impacted el Grocer’s business? Covid-19 and the lockdown had an unprecedented impact on our business. el Grocer, which has been in the market for the last four years, has been reporting doubledigit growth every quarter since 2016. The impact of the current pandemic resulted in four times more orders versus pre-Covid times. Our GMV (Gross Merchandising

Volume) during March and April increased by five times as shoppers preferred buying their weekly and monthly groceries online through our platform. To meet this demand, we took several measures, and I am happy to say that our timely decision to partner with mid to large retailers put us in a favourable position to completely change consumer shopping behaviour. To begin with, we completely revamped our operations teams and hired and trained new staff in record time. We also tripled our onground teams, our heroes working in the stores to deliver daily orders of our users. The upscaling of the on-ground teams by three times was important to maintain our same-day delivery and the more challenging 2-3 hours delivery commitment. In the majority of cases, we were able to stick to our schedule. In other instances, our delivery timeline went up between two days and a week, especially in cases of our busy hypermarket partners that were serving basket size of more than AED 500. One of the biggest highlights and learnings of this phase is to have a resilient team that is strongly held together by the same values and principles. Surely there were moments of extreme pressure, but we were able to sail through it since we came together as a team and evaluated and designed plans for the current situation. Being fast and agile as a start-up was our biggest advantage that helped us quickly adapt to the new reality and creatively implement solutions in a matter of days. We also reached out to partners for recruitment and other resources needs, and everyone came to support the business in such a unique way. We are fortunate to be in a country that empowers, motivates, and encourages entrepreneurship spirit,

and this is what has made all the difference in finding quick solutions to our challenges. With your experience in groceries and online e-commerce, what predictions can you make on what the post-COVID era will look like? I think we are fortunate to be in a unique position that allows us to shape the major shift we are witnessing in customer behaviour and habits. We know that people will prefer to stay away from crowded stores and venues, and so they will eat at home and cook more. This also means that people would want to treat themselves to more ‘gourmet’ and ‘fresh’ at-home experiences, and this can only be possible if they can find and purchase these special items from retailers and businesses. We need to capitalise on this trend as well as inspire and engage those customers especially in a historically dry category such as grocery shopping. This ‘spend less time out’ behaviour doesn’t mean that people don’t want to go to the stores, but they’ll prefer ways and solutions that make their shopping quicker and more ‘touchfree’. Being a marketplace platform also means supporting our retailer and brand partners with more data and analytics. So, we are investing in more technology innovation, operations, and data analytics capabilities to support those businesses cost-effectively. Groceries have always been a low margin industry, and with higher operating costs, being efficient and effective is more important than ever to remain sustainable. We are also observing an initial trend of traditionally B2B businesses wanting to get into D2C (Direct to Consumer) models. Our tech, operations, and marketing know-how are enabling and supporting them in this transformation. 33

The Sustainabilist | E-COMMERCE

A Glimpse into The Future of Car Dealerships Markus Leithe, Managing Director of International Markets for INFINITI in the Middle East, Asia and Eastern Europe, answered The Sustainabilist’s questions about their new and adapted showroom.

ow is INFINITI revolutionising showrooms? INFINITI has always positioned itself as a daring and forward-thinking brand who today welcomes the changes in customer behaviours towards the showroom experience and how individuals interact with us as a brand. This could be at any point in their journey from becoming familiar with our products, to purchasing and the ownership experience over the following years. Customers today are used to a seamless offline and online experience. In the not so distant past, the showroom used to be the only method for individuals to interact with products. Today, customers have access to product knowledge and dealer offerings all online for their convenience and all before they ever walk into a showroom. This opens up many opportunities as we now have more touch points than ever to interact with our 34

customers which is why we have invested in technologies, such as our online INFINITI configurator which allows customers to design one of six INFINITI models exactly to their preferences. How will customers be able to interact with the INFINITI Configurator platform? You can interact with the configurator on our website, infiniti-carconfigurator. com. Customers will be able to interact with six different INFINITI models with many customisable options. Through our interactive hotspots, customers can learn about the features of each of our flagship models. Apart from customising colours and finishes to their liking, customers can even hear each car’s unique sound using the engine start-up feature.

They can even book a test drive, request a quote or share their personally created car with friends online and offline. How will the virtual showroom protect the wellbeing of customers? The idea of the INFINITI configurator was a project that was started well before COVID-19. From the beginning, it was our vision for individuals to be able to interact with our brand from anywhere – creating a seamless experience online and in the showroom. It just so happens now that the importance of the configurator allowing people to view our products from home during these times is something we are proud to offer as the safety of our customers and employees is our top priority. We believe that the INFINITI configurator is just the first step to our digital offerings which will expand in the near future.

Issue 24 | September 2020

Are you expecting great engagement from this initiative? The platform is extremely user friendly, and as people are spending more time remotely and connected with the digital world we anticipate very strong engagement for people who are looking to create their ideal INFINITI or are even just getting to know our brand better from the comfort of their home. Do you anticipate that the car dealership business will return to pre-COVID19 normality or will the post-pandemic era entail a new way forward? COVID-19 accelerated the trend towards online tools for the whole aspect of a customer lifecycle from search to shop to own. The speed of adaptation due to these specific circumstances is very interesting to see. I believe that many of these developments will prevail because they are convenient and we have seen these changes in many other industries before, think retailing, banking, travel to name a few. A car will always be a major purchase decision for individuals but, I believe, it is safe to say that now more than ever before the majority of the purchasing journey will be done online and remotely. Does INFINITI offer hybrid or electric cars in the UAE, and if not, is this something the brand is looking into? For the time being and due to low customer requests for such models we donâ&#x20AC;&#x2122;t offer hybrids and electric cars in the UAE but we have ambitious plans as the INFINITI brand on a global level to electrify our portfolio in the next three years. We do anticipate this will peak further interest in this market to offer such products. 35

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Issue 24 | September 2020

Put Your Money Where the Sun Shines Hardik Bhatia, Co-Founder at SolarGridX, spoke with The Sustainabilist about the platform revolutionising investments in solar projects for individuals

ell us about SolarGridX and its company mission. SolarGridX is a crowd-investing platform that lets people buy and sell fractional digital ownership in solar panels. Prices start at US $6 and earn up to 15% return on investment (ROI) from consumers, who use their funding to establish solar panels. Consumers enjoy free installation of solar panels. They pay per use of the panels, and can access cheaper and more sustainable energy than conventional sources. To provide an overview of our company, we sell a digital token, called an SGX, which represents the ownership of a fraction of a solar panel, one solar cell. Using investorsâ&#x20AC;&#x2122; capital, we use the funds to establish solar panels in India for consumers, and allow them to pay for what they use. We collect these proceeds, and distribute them to the investors in the SGX token. Solar panels have a high upfront installation cost, which can take eight years to break even. However, renewable technology needs to be implemented widely to avoid and reverse the impacts of climate change. To enable that, investments in renewables need 37

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Our team originates from India, where the majority of the population cannot afford to set up solar panels. Without finding a solution where they can invest in solar power, the move to clean energy seems impossible. Simultaneously, retail investors in the MENA region are actively seeking safe investment options in stable markets, with a low entry point, and good returns. There is currently a growing requirement for sustainable investment options which help save the planet and are strong investment opportunities. SolarGridX brings retail investors and consumers together by providing profits and value, whilst offering solar power consumers zero-cost installation. We seek to accelerate the adoption of solar energy. Our consumer target market is India and the UAE, while our investor market is initially the UAE. We seek to make SolarGridX an optimum investment option which promotes sustainability. How does the process of investing work through SolarGridX? Our company’s approach allows users to buy and sell digital ownership of solar panels on its platform. We divide up a solar panel into solar cells, a fraction of a solar panel. The ownership of one solar cell is one SGX token. 38

Similarly to the trading of stock, one can buy tokens from our exchange platform, which provides digital ownership of solar panels. Through not physically owning solar panels and enjoying electricity benefits, we can use the funding to install solar panels at feasible locations without charging consumers. Electricity generated by those panels can then be sold by us to be used in homes, and the returns flow back to investors.

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Our company is the firstto-market in creating an attractive exchange-traded investment commodity for retail investors from solar panels.

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to scale up. Currently, only a fraction of the US $120 billion per year which flows into solar asset financing is contributed by individuals; the other contributions are made by governments or corporations. For a wider adoption of solar energy, the general public need to be able to invest more.

What kind of ROI does the investors expect? Investors can earn up to 15% ROI per annum. How does SolarGridX distinguish itself from the other players in the market? Our company is the first-to-market in creating an attractive exchange-traded investment commodity for retail investors from solar panels. There are other players

in the market (not in the region), which offer fractional ownership of solar panels, or have crowdfunding models, but they would have a lock-in investment period of 25 years, which is unattractive to investors. With our approach, we offer a no-lock-in investment. Investors can easily sell their tokens to other buyers, enjoying near real-time withdrawal of their investment. We believe this will make a significant difference in attracting investors. Some companies do offer zero-cost installation for consumers, but these are attached with high electricity costs. We do not charge for installation, and sell electricity at a cheaper price. Some companies even provide zero-cost installation for consumers but they come with high EMIs. SolarGridX provides more than just zero-cost installations as it offers electricity at cheaper price than regular supply. Consumers can enjoy even up to 20% reduction in their electricity bills. What does it mean to have won the Youth Entrepreneurship Program from StartAD and do you have any projects in the pipeline? This has been a great journey for us. With this validation, we have received a great push from the network and all the help to further ahead our venture. It is a good breakthrough for us. The criticism and the feedback which we’ve received, alongside the suggestions have worked wonders for us, and we’re thankful to the Youth Entrepreneurship Program and to the startAD team for giving us that opportunity. As for our next steps, we are first planning to apply for our innovation testing license from DIFC. We are currently in talks with

Issue 24 | September 2020

third party solar panel suppliers to partner with and build our official app. The beta app is in the pipeline as well, and we shall move ahead once our platform is up. Additionally, we shall be participating in a range of opportunities to gain market exposure and understand our competitors. COVID-19 has delayed our fundraising timeline, and while we had a plan of launching our application at the end of this year, we shanâ&#x20AC;&#x2122;t be able to achieve that plan without funding.

Meanwhile, we are developing a step-bystep strategy to shorten our development time and mitigate the impact of this virus. The climate crisis cannot be ignored, in spite of COVID-19, and we have to keep moving forward. Sustainable recovery is currently a leading economic trend, and our concept is in line with that theme.

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RESEARCH

Where the UAE Stands

E-commerce relies extensively on a developed digital landscape. As one of the worldâ&#x20AC;&#x2122;s most technology advanced countries, the UAE allows for significant prosperity to occur in the business world. The value of e-commerce in the UAE in 2018 was valued at USD 55 billion and is forecasted to grow to $63.8 billion by 2023. The following research highlights the UAEâ&#x20AC;&#x2122;s progress along with a comparison of statistical data of global and local digital media in January of 2019.

9.61 million 7.676 b 200% 67%

Total population

Mobile subscriptions penetration

Internet users penetration

54%

99%

Active social media users penetration

54%

99%

Issue 24 | September 2020

Mobile connectivity index

Financial inclusion factors

E-commerce activities

Money connectivity

Assessment by GSMA on Intelligence of key drivers and enablers of mobile connectivity

Number of people as a percentage of population aged 15+ that report owning or using a financial product or service

Number of people as a percentage of population that report performing an activity within the month

Number of users as a percentage of population that use each financial activity

HAS AN ACCOUNT WITH A FINANCIAL INSTITUTION

SEARCHED ONLNE FOR A PRODUCT OR SERVICE TO BUY

USING MOBILE BANKING

88%

83%

OVERALL COUNTRY INDEX SCORE

74.27/100

VISITED AN ONLINE RETAIL STORE ON THE WEB (ANY DEVICE)

MOBILE NETWORK INFRASTRUCTURE

68.32/100

HAS A CREDIT CARD

45%

92%

29%

HAS A MOBILE MONEY ACCOUNT

68%

PURCHASE ITEMS ONLINE USING A MOBILE PHONE

21%

55% MADE AN ONLINE PURCHASE VIA A LAPTOP OR DESKTOP COMPUTER

CONSUMER READINESS

71.68/100

35% MAKES ONLINE PURCHASES AND/ OR PAYS BILLS ONLINE

60% AVAILABILITY OF RELEVANT CONTENT AND SERVICES

MAKE MOBILE PAYMENTS

PURCHASED A PRODUCT OR SERVICE ONLINE (ANY DEVICE)

AFFORDABILITY OF DEVICES & SERVICES

81.51/100

60%

MADE AN ONLINE PURCHASE VIA A MOBILE DEVICE

55%

OWN SOME FORM OF CRYPTOCURRENCY

5.2%

76.23/100 Source: Hootsuite, The Global State of Digital in 2019 Report

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FEATURE

Acclimatising E-Commerce to Meet Changing Needs Organisations must adapt by optimising human resources process strategies to grow their digital businesses By Natalja Kissina HR VP Gulf Countries at Schneider Electric

s people come to terms with the realities of these unprecedented times, shopping behaviours are one of the many things that have changed. With store closures and restrictions on movement, itâ&#x20AC;&#x2122;s natural that e-commerce would perform strongly as consumers based at home shift their shopping from brick-and-mortar to digital. Most organisations have wondered: what does it take to successfully reap the benefits of B2B e-commerce? And what are the main challenges faced when it comes to putting together a well-oiled B2B e-commerce organisation? In fact, for a B2B organisation, getting into e-commerce is easier said than done. B2B e-commerce is more than just another channel. It is a business strategy, set to enhance the overall endto-end customer experience. This means that B2B organisations need to include into their digital transformation approach the various departments, organisational structures, complex legacy technology environments, systems, operational processes, and business priorities. We can regroup this into three main challenges that come with setting up B2B e-commerce: People, Technology and Processes. 42

Issue 24 | September 2020

So, in our current increasingly competitive candidate-driven job market, why aren’t B2B organisations able to capture this pool of talents? First, these are new roles and experiences B2B organisations are not used to hiring. Then, there is a shortage of e-commerce resources looking to work in B2B: it seems the B2B world does not appeal much to digital talents. Several reasons can help understand why: • Today, people value work-life balance, a pleasant and creative work environment as well as flexibility. All of these are not really B2B organisations’ greatest assets. • B2B organisations usually lack a strong consumer brand • Lastly, attracting digital talents means attracting millennials. Having said that, millennials look to work for companies that will give them opportunities for career advancement which means companies offering flexibility to learn and grow quickly as well as entrusting even the youngest with responsibilities. The Processes How does one team or organisation need to both rethink existing processes and reshape them into new ones to

guarantee a successful B2B e-commerce transformation? And how do these processes implemented bring more efficiency and structure in our business? When we talk about a team’s or an organisation’s processes, we refer to multiple things altogether which are the working methods, the leadership styles, the working relationships and collaboration structures as well as the culture and mindset.

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Instead of traditional methodologies, agile ones give the framework needed to anticipate and respond rapidly to this ever-changing landscape.

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The People When we talk about people, we actually refer to many things altogether: setting up the right culture, the right leadership, and the right combination of profiles with the right expertise in each role. This is a real challenge when it comes to B2B e-commerce. You probably won’t find the e-commerce expertise and competency you need in your organisation straight away. Even worse, you will most probably struggle to attract digital talents.

Processes are a crucial component of any B2B e-commerce transformation journey. Indeed, a digital transformation represents a fundamental change in how a team or an organisation operates. It forces us to rethink our existing processes, which are directly impacted by it and need to be updated. Also, today, the business environment, the market dynamics, and the customers’ needs are constantly evolving. When you add to this the fierce competition with new digital entrants, you realise that traditional ways of working are no longer suited. Instead of traditional methodologies, agile ones

give the framework needed to anticipate and respond rapidly to this ever-changing landscape. Adopting agile ways of working implies moving away from traditional hierarchical organisational models to small, selforganising teams. This means the role of leaders necessarily evolves. The former rigid hierarchy, bureaucracy and governance give place to employee empowerment and greater autonomy. More than owning up to one’s responsibilities, it is about team members having a shared understanding of business priorities, working towards common objectives and embracing the broader picture. The team and its leader face a true challenge here as finding the balance between alignment and autonomy is the ultimate test of leadership during a digital transformation. Cultural and behavioural changes are also inevitable. Risk appetite and tolerance need to be high to both learn and fail fast. The focus must be on innovation rather than optimisation. Lastly, customercentricity is key in the digital age. Indeed, customers increasingly expect companies to respond swiftly to inquiries, to customise products and services seamlessly, and to provide easy access to the information customers need, when they need it. To sum up, organisations can enable an improvement in their growth trajectory by redefining and narrowing down their people strategy to have more experts and less all-rounders. In addition, they need to rethink processes and develop tailored ones to be more agile and faster in execution while setting up their e-commerce business. 43

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FEATURE

Depleting inventories Learning how to safeguard the supply chain is a crucial lesson to be learnt from the pandemic By Francesco Antoniola Supply Chain & Operations Network Lead – Accenture Middle East

he supply chain has always been an essential lifeline for people, getting goods and services to all types of customers everywhere quickly, safely, and

securely. Never has this been truer than in the current unprecedented times of global restrictions due to the COVID-19 pandemic. Companies worldwide have

a shared responsibility to safeguard and ensure a smooth and reliable supply chain in all its forms, primarily via e-commerce. Even as millions are still quarantined or self-isolated, a significant increase in online purchases left businesses scrambling to ensure the resilience of their supply chains. Unfortunately, the reality is that most companies were unprepared for a global pandemic of this nature. With labour shortages and reduced productivity challenges cropping up across the entire value chain, the supply chain’s ability to deliver has taken a severe hit across the

Issue 24 | September 2020

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Companies worldwide have a shared responsibility to safeguard and ensure a smooth and reliable supply chain .

“

world, specifically across the following touchpoints: • Suppliers face challenges in distributing products and commodities due to quarantine and trade restrictions, while consumers are concerned about the traceability and source-country of the products. • Manufacturers have factories in quarantine, with some production plants shut down or facing challenges due to the lack of availability of raw materials. • Logistics providers are dealing with travel restrictions and market closures. At the same time, carriers face a shortage of drivers or a limitation in the number of driver hours. • At the end of the chain, sales teams are dealing with shifting demand as consumers move to online platforms and away from physical stores, prioritising ‘need’ versus ‘want’ purchases that lead to depleting inventories.

We have identified seven priorities for companies as they repurpose their supply chains to increase both resilience and responsibility: • Preserve the extended workforce. Promote the health and wellbeing of supply chain workers, supporting their mental health and emotional and physical needs as well as their physical safety. • Repurpose your capabilities. Look for ways to repurpose supply chains to help societies manage the urgent challenges of COVID-19. • Think local. Think creatively about how to reallocate resources to support local communities across the whole supply chain. • Secure the supply base. Strengthen the security of supply networks to enhance overall resilience and help any areas of the supply base at risk from operational and/or financial disruption. • Respond with confidence and insight. Use analytics, automation, digital platforms and digital twins to model disruption and test out potential responses. • Learn and evolve. Capitalise on this once-in-a-generation opportunity to identify points of supply chain failure, their root causes, and how they can be strengthened. • Reshape for the future. Keep planning for the investments needed once this crisis passes and economies rebound, while building in the purposeful and responsible features developed during the pandemic. This is a time of unprecedented supply chain disruption. By stepping up and building purpose and responsibility into supply chains, companies will strengthen the business over the long term, and build the greater resilience and customercentricity that will be vital to growth as economies rebound.

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INTERVIEW

Disrupting the Telco Erik Dudman Nielsen, CEO of Virgin Mobile Middle East & Africa proudly shares with The Sustainabilist, the successes of the Group

he pandemic has pushed many businesses to go digital. Virgin Mobile MEA was ahead of many in this sense through its all-online services. How has the brand been able to leverage its expertise to ensure business continuity during these times? Digital has always been the core of our business proposition. We are proud to carry out our dayto-day processes delivering excellent customer service through our digital infrastructure and offerings. We have been consistent in providing services that are uniquely digital in all our markets. At the very early stage of the pandemic, we were able to quickly shift to working from home. We became the first mobile brand in the UAE to operate a fully remote customer care centre, thanks to our innovative chat model and agile infrastructure, which allowed us to continue delivering 24-7 support while ensuring the safety of our people. In addition to that, we also supported our customers during the health crisis through rolling out free national calls in Oman as well as providing parents and their children in the UAE and the KSA with free internet data access to over 190 online learning platforms. Our existing home delivery service is a very 46

Issue 24 | September 2020

valuable feature especially during the time that curfews and lockdown were in place. Our unique service means our customers can order a SIM through the Virgin Mobile app and have it delivered directly to their doorstep. We can then activate them on the spot, without the need for the customer to leave the comfort and safety of their own home. We have expanded our fully digital proposition even further with the introduction of new offerings, aimed at promoting the use of eSIM to give a 100% end-to-end digital service. For example, in the KSA, we added special new features to our App which allow customers to order an eSIM online, activate it and begin using it immediately. These features include integration with the government portal “Absher” (Saudi Digital ID), enabling customers to activate their eSIM cards without the need to visit branches, contact the service centre, or engage in any other human interaction. In Oman, where we are present as FRiENDi, we are promoting electronic credit card payment function for our customers. This new payment method enables us to ensure FRiENDi customers can access the services they need digitally while staying safe and healthy. Being digital is also about reducing the need for physical recharge card thereby eliminating plastic wrapping and packages. Virgin Mobile has reduced its single-use plastic from an annual level of 50 tonnes per year down to almost zero. Oman, in particular, is already 100% singleuse plastic-free and both KSA and UAE operations are fully committed to getting rid of the remaining plastics this year. All future products, even our physical products, are being specified without

any single-use plastic, which is what we envision alongside Virgin’s global combined efforts towards sustainability. This plastic-free initiative also reduces the possibility of spreading the virus since it reduces the number of potential touchpoints for the virus to spread. With the option of topping up credit digitally, there is also no need to leave the house to run this errand, which is beneficial while the public in large parts of the region remained under various forms of lockdown. Virgin Mobile is known for its digital ethos of seamless connectivity and we take pride in playing a crucial role to provide fully digital services to our customers, especially during these times. What is the Virgin Mobile business model and how is it disrupting the traditional mobile service? From onboarding and activation to billing and customer care, the experience we bring is completely built around our customers. Our business model is focused on providing flexibility, convenience and an array of choices to make mobile better. We want to offer customers something they can’t find elsewhere, a unique yet simple customer journey all controlled through an all-encompassing App. Since our launch in 2017 in the UAE, we have disrupted the status quo by eliminating the need to go to physical stores, sit in long queues, complete complex paperwork and even removing the requirement to sign up for lengthy, fixed contracts. There are no commitments or rigid, fixed plans, meaning our customers have the freedom to only pay for the minutes and data that they use, and the ability to amend their plan on a monthly

basis should their requirements and usage change. With this disruption in the region’s digital landscape, we are proud to be the first market globally to have a completely app-based acquisition, verification and delivery proposition, marking a paradigm shift in the telco industry. What are the benefits, from the perspective of the consumers and the business to solely provide digital services? Through the implementation of our fully digital proposition, our customers are able to manage all their mobile needs directly through our unique in-app experience with no need to navigate. We have built an agile system where every single interaction, across the customer lifecycle, is handled through the app. Through making our services completely digital, our customers have the flexibility to easily manage, update, pause or cancel plans within the app. We have also introduced an in-app chat feature should our customers need to talk to us, meaning they can contact our customer care team seamlessly via the app, online or via social with no horrible IVR to navigate. Our services are built around the needs of our consumers, and these have always been an essential part of our company’s business objectives. As we witness this need to be increasingly digital, we continue to build on our brand purpose to make mobile better by providing innovative digital services and offerings to our customers. Keeping up to date with the present lifestyle of mobile users opens up huge opportunities for us to address their future demand, making our offerings sustainable in the long run. 47

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INTERVIEW

Canon’s Circular Concept The Sustainabilist spoke with Venkatasubramanian Hariharan, B2C Business Unit Director at Canon Middle East, on the brand’s efforts to promote the circular economy.

ince launching an e-commerce platform for the region, how has Canon ME’s business changed and what has been the consumers’ response? The Canon e-store was launched over 2 years ago with the main objective to bring our products and merchandise even closer to our customers. It’s a testament to our commitment to make the Canon experience enjoyable for our customers from the start and cater to digitally savvy consumers and the rapid rise of online transactions in Middle East. Online shopping is growing in popularity in the region, and the pandemic and consequent lockdown further accelerated the transition to e-commerce. An Ernst & Young survey conducted in May found that 92% of consumers in the UAE and Saudi Arabia have adopted online shopping. While a sharp incline, I expect it to gradually adjust as malls and stores are now open, but I don’t think we will be seeing a significant decline any time soon. 48

Our foresight in developing our e-commerce platform allowed us to be more agile in responding to our customers’ requirements during the pandemic and ensured their business continuity as well. Whether it’s through our retailers’ network, our partners’ showrooms or online, we’re offering an omnichannel approach to customers, and in today’s retail environment this is particularly important given how customers are using these varied options in their buying journey. In the past period, especially during the lockdown, there has been a noticeable demand through our e-commerce channels for home printers, ink toners, paper arising and vlogging equipment from the customers need to stay connected, work seamlessly from home or manage e-learning. To support our customers, we also implemented next-day delivery of products and supplies to meet this demand. This has given our customers the confidence in knowing that we are

available and will support their imaging requirements, even in the most uncertain of times. What is the value added of allowing consumers to purchase Canon products and merchandise online? It is absolutely invaluable to offer customers multiple ways to connect with a brand and its products, whether we’re looking at a pre, during or postCOVID-19 period. Customers have their own preferences on how they like to shop, and often access multiple platforms and sources before they decide to purchase, and any organisation in this day and age has to be able to offer this approach. What this past period has reaffirmed is that digital platforms have never been more prominent than they are today. It may have been a preference for the digitalsavvy youth before COVID-19 hit to shop online, but currently every demographic has had an interaction with a digital platform in some form or another.

Issue 24 | September 2020

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Having a digital platform is also an opportunity for organisations to ensure their business continuity

This doesn’t mean that the physical retail will no longer be, but essentially both have to work together to give customers a more holistic and flexible approach for purchasing. How does Canon ME manage its environmental impact? At Canon, we operate according to the philosophy of Kyosei Japanese word that means ‘living and working together for the common good’. We use the UN Sustainable Development Goals (SDGs) to define ‘common good’ and provide a framework for Canon to manage its social and environmental impacts. As a result, we have developed three key themes to govern our sustainability strategy and adhere to our core philosophy. On a local level we implement these strategies in the countries in which we operate and support national sustainability initiatives as well. As Canon wants to lead the sector by contributing to the development of a Circular Economy, how is the brand

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More specifically, having a digital platform is also an opportunity for organisations to ensure their business continuity, lest they may become obsolete as we enter an age where there is additional preference for the digital.

considering this economic system in both its physical and digital stores? We are innovating to transform into a more circular economy, and moving away from the traditional ‘make, use, dispose’ linear economy by adopting the principles of a circular economy. We do this by keeping materials in use for longer and minimising waste. We are making products smaller and lighter, and reusing and recycling materials as much as possible. We also strive to reduce waste consumption and the generation of waste from the manufacturing process. In addition, we also launched a complimentary recycling campaign to collect Canon products and consumables from our B2C customers including ink, toner, batteries and paper as well as electronic waste such as old printers, cameras and scanners. This initiative in the consumer market in the UAE, highlights Canon’s commitment in creating awareness about e-waste, how to safely dispose of electronics appliances, and the benefits of recycling as part of our efforts to embrace a circular economy. We continued with the door to door recycling programme during the COVID-19 lockdown as we view it as an integral part of the overall economic recovery phase and transition to a more sustainable approach to economic growth. 49

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HOT SEAT

E-Commerce vs Brick-and-Mortar

ven well before the pandemic and the resulting movement restrictions, online shopping made it easy for consumers to order pretty much anything from anywhere in the world from the comfort of their home and with just a few clicks. Open 24/7, with secure payment systems, speedy delivery times, and exchange policies, online shopping is extremely convenient, which is why it comes as no surprise that retail e-commerce sales have been growing tremendously worldwide for decades. However, as with many other habits of ours, we often forget to consider the anthropogenic effects. It is often believed that online shopping is more environmentally friendly than brick-andmortar stores as the latter have overhead environmental costs from operating such as air-conditioning and electricity. Moreover, shoppersâ&#x20AC;&#x2122; trips to the physical stores add to the carbon footprint of traditional shopping. But when we consider even just some of the processes of shopping online and their corresponding greenhouse gas emissions, 50

our perception of e-commerce as the greener alternative can change. For example, the packaging used to deliver a product and ensure its safe transit is far greater than that used in physical stores. This is because packaging for online sales must be durable, protective, and is a marketing opportunity for a brand. As the most direct connection with a customer, brands focus on delivering a branded packaging experience to add value for the consumer. Blogs about optimising branded packaging experience suggest using tissue paper, fillers like packing peanuts, stickers, business cards, custom notes, tape, and many more [unnecessary] components. Expectedly, this results in significant waste that cannot always be recycled and consequently ends up in landfills. Another aspect of online shopping to consider is the return policies. These are very convenient as we get to order a number of items, try them at home, and send them back if they are not to our liking. Sending an item back, however, leaves a trail of emissions through the

ships, planes and trucks needed to return the package to the sender, in addition to the waste from the extra packaging. Oftentimes, for the retailer, the most costeffective way to deal with a returned item is to dispose it. In fact, in the US alone, five billion pounds of returned goods end up in landfills each year. Express shipping options with next day deliveries have a massive toll on the environment as air freight produces almost three times the emissions of shipping. Additionally, last-mile deliveries contribute to city congestion sand impede cities from achieving their decarbonisation targets. Online shopping has ensured our safety during the pandemic and its convenience is almost unprecedented. But as, on average, e-commerce produces more emission per item because of the additional packaging, the fewer items per purchase, and the multiple deliveries, it is important that we rethink our shopping habits and reconsider the value of our consumption.

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FEATURE

Unlocking the Full Potential of the Circular Economy The five key circular business models and the value they bring By Massimo Cannizzo CEO and Co-founder of GELLIFY Middle East

worrying 2.12 billion tonnes of waste is what we produce every year, partly because we only use 1% of what we buy and the other 99% is trashed within six months. The global waste is projected to pile up by 70% in 2050, creating as much as 3.4 billion tonnes of trash annually. Upon realising how we overuse the earth’s capacity, several green companies have moved away 52

from the linear economy, the current economic model based on ‘take, make, waste’ approach used by most businesses, to the future – the circular economy. Aimed at eliminating waste and the continual use of resources, a circular economy not only allows the natural environment to regenerate, but it also allows us to benefit from manufacturing and economic growth. According to reports by Strategy & Middle East, it is estimated that GCC cities could save $138 billion and 148 million tonnes of C02

emissions between 2020 and 2030. Such sustainable system that yields enormous environmental, social and economic benefits, follows a guiding principle to retain product value by repairing, reusing, and recycling. To accelerate the transition towards a circular economy, businesses need to unlock the value and leverage the entire spectrum of circular business models to maximise the potential. Five Key Circular Business Models:

Issue 24 | September 2020

2) Recycle and reuse: Production and consumption systems that were considered waste are instead recovered, recycled or regenerated to be reused for new processes. As the system completes a full cycle, it also maximises economic value of a product. New technologies can be a catalyst when transforming waste through innovative recycling services. The UAE has started to lay the foundation towards optimising waste management, targeting to divert 75% of its solid waste from landfills by 2021. In fact, the emirate of Sharjah envisions to become a zero-waste city by 2021. Early this year, environmental management firm, Bee’ah, partnered with the UAE-based startup, Seramic Materials, to turn ashes from municipal solid waste incinerators into sustainable, affordable, and durable construction materials. In addition, Emirates Waste to Energy Company is set to build the UAE’s first waste-to-energy plant in 2021 that will process solid waste to generate electricity, divert waste from landfills, and displace almost 450,000 tons of CO2 emissions annually. Last year in Abu Dhabi, the Ministry of Climate Change and Environment launched a closed loop recycling model for plastic bottles, beverage cartons, and other packaging in Abu Dhabi in collaboration

with a coalition formed by NGOs, local and global food MNCs. At the postponed Expo 2020 in Dubai, an estimated 173 tonnes of waste generated daily by millions of visitors will be collected, processed, and converted into bags, lights, cups, food trays, bowls, candle holders, coasters, and more. 3) Sustainable inputs: Adoption of a circular supply chain using renewable, recyclable or biodegradable resources

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The UAE has started to lay the foundation towards optimising waste management, targeting to divert 75% of its solid waste from landfills by 2021.

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1) Product as service: Instead of selling only the product, the company keeps ownership of the asset. Thus, designing the product for longevity and selling the corresponding service along with other related benefits such as customer assistance, training, among others. A good example of this is a ride-hailing app Careem, where the service provided, as alternative to own a private car, becomes an enabler of optimisation and generates employment opportunities.

in all its lifecycle. This model offers a wide range of possible implementations depending on the product, but the main concept is not to use something once and to reduce resource dependence. Taking as an example international fashion designer Stella McCartney, who is known as a sustainable luxury movement leader, the brand cultivates ethical fashion from

sustainability-source fabrics, such as recycled nylon and polyester, and organic cotton. Online luxury fashion retail platform Farfetch also joined the bandwagon and launched a series of initiatives that promote conscious shopping. Aiming to offset carbon emissions brought by its logistical processes, the e-commerce platform launched a climate-conscious delivery service where parcels will be shipped in bulk and in efficient packaging sizes, while also having vowed to protect forests and invest in renewable energy developments. 4) Life extension: The company design and manufacturing processes are aimed at extending the product’s life instead of wasting energy and material components of used assets. The embedded value is maintained and improved through reparation, upgrading, remanufacturing or upcycling – generating additional revenue and ensuring products stay economically useful. Part of Farfetch’s conscious shopping initiative are product reselling and a donation service to help consumers extend the life of clothing and handbags. On the furniture front, Ikea’s ‘Second Life for Furniture’ is a buy-back and resell service that aims to extend lifespan of furniture. The company buys the furniture back from customers at a lower price and pays them with vouchers which they can spend at the store. The furniture is then sold at the ‘As-Is’ area of the store. This model helps conserve resources. According to the company’s 2019 sustainability report, Ikea had given 47 million recovered products a second life. 5) Sharing: Collaboration of platforms that brings asset owners and users 53

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together, allowing consumers to save but also gain profits from a shared asset. This model is usually enabled by technologies that can forge relationships where idle products can be shared, rented or swapped. A perfect example of optimising use of the asset is a rental by-the-minute concept allowing short-term car hires by two homegrown startups Ekar and Udrive. These pay-as-you-go car-sharing services are both app-based with GPS-enabled map that bridge a gap between having somebody drive you around and buying or renting a car for a long term. With a number of successful enablers in the UAE, I believe we are gearing up for change. Innovative products and contracts designed for a circular economy are already available in a variety of forms. At GELLIFY, we help forward-thinking companies shift to the circular economy through our tailor-made solutions. We help companies to ideate, prototype and 54

build innovative solutions that leverage advanced technologies to realise circular economy paradigm. The industrial IoT, Industry 4.0, and AI solutions are able to create new supply chains based on a disruptive local ecosystemâ&#x20AC;&#x2122;s interoperability, which is a key asset in the post-pandemic world where global supply chains will struggle. As a business, we offer innovation consultancy and digital services by tech startups such as Enerbrain that provides energy saving solutions to reduce consumption and improve comfort to both humankind and nature. This solution provides sustainability and savings by using easily-installed sensors, algorithms, actuators and a dashboard to measure, analyse, monitor temperature, humidity, and CO2. Buildings that use Enerbrain have reduced energy bills by up to a third while giving more comfort to the occupants, and

CO2 emissions have been reduced. If all buildings on the planet were to use this system, we would save about 1.6 billion tonnes of CO2, equivalent to 170 million trees. The real value of circular economy As with every major transformation, it is essential to take a systematic approach, beginning with a change in the mindset, which is then followed by innovation. Change starts with the choices we make in everyday life, such as our purchasing decisions. As established in the beginning of this article, part of the billion tonnes of waste is from the things we buy and throw away within half a year. Material wealth cannot be viewed as a sign of happiness, and the consumer in us is currently destroying the planet. To use the full potential of the circular economy, we need to find out how each component will allow us to heal the Earth and improve our overall well-being with happy and purposeful lives.

Issue 24 | September 2020

FEATURE

Rewriting the Course of Our Digital World YouGotaGift has witnessed a renewed interest in eGift Cards since the pandemic, the waste-free solution for celebrations, rewards, and gifts

oday, the world is witnessing unprecedented challenges on all levels and in almost every sector. Nevertheless, creating newly tailored solutions to adapt in times of crisis, has been the strong point of successful businesses and individuals, all while focusing on delivering happiness, guaranteeing customer satisfaction and contributing towards the economy. As movement restrictions and social distancing continue to be respected, online shopping is witnessing a renewed interest in eGift cards that are seeing significant upticks globally. The increased popularity of eGift cards are not only being driven by individuals, but are also becoming crucial to businesses that are looking for eco-friendly solutions as an answer to their day to day operational challenges, all while sticking to the newly implemented precautionary steps of protecting their employees against the pandemic. Individuals and businesses are opting to explore better solutions for celebrations, rewards, and gifting. Whether a friendâ&#x20AC;&#x2122;s

birthday is coming up, a special occasion is right around the corner, or even employees are being thanked for their constant efforts and motivation, eGift cards are becoming the ultimate solution. Individuals as well as companies are striving to spread positivity through an easy and simple procedure: customising eGift cards to their liking and adding a unique flair, which reflects a creative, well-thought-out gift, loaded with any desired amount. As Mr Husain Makiya, CEO of YouGotaGift, the leading eGift Card company in the GCC and MENA region, said, â&#x20AC;&#x153;The company has noticed a remarkable growth of 80% in online searches compared to 2019 with sales figures growing exponentially on a monthly basis.â&#x20AC;? The world has long been shifting towards a digital experience, but with the current situation, the shift has been accelerated. Old practices like bulk-buying physical gift cards, be they plastic or paper, are now seen as inefficient and unsafe. Receivers of 55

The Sustainabilist | E-COMMERCE

YouGotaGift has been a trendsetter in e-commerce by servicing major businesses in the region with customised loyalty programmes, and increasing customers’ engagement thanks to the exciting use of digital gift card redemption. Another prime benefit of eGift Cards is that businesses can participate in protecting the environment and going green as part of their CSR strategies. Our world is fighting a great battle against global warming and plastic plays a big role in it. Digital gift cards eliminate the waste created through physical cards. Environmental NGOs around the globe are also encouraging businesses to reduce the consumption of paper to save trees and forests and boost a positive environmental impact. Shifting to eGift Cards would contribute towards reducing the plastic footprint and contribute to saving our planet. these cards are also requesting a smoother digital experience. When it comes to businesses, companies in various sectors have adopted eGift cards to render the rewards process easier and faster. The pandemic has affected the world like never before. It has limited business performance and halted the economy of most countries. Consequently, people’s general purchasing behaviours have been repositioned throughout the past six months. Consumers and companies now prefer to send gifts and rewards safely, and so are resorting to digital assets for this. For YouGotaGift, this was highlighted by the growth in users visiting the brand’s digital platforms. eGift cards are becoming the first and constant recourse 56

for celebrating occasions, appreciating employees, and even donating to families in need, all while preserving social distancing. As businesses invest in the newest capabilities of the digital world to bring a better experience both for employees and customers, technology has ensured that superlative customer experiences can be built irrespective of the customers’ or employees’ location. By adopting eGift cards for their rewards and recognition programmes, businesses benefit by automatically creating a sense of excitement and appreciation among employees. For customers, when businesses provide them with a tailor-made loyalty program eGift Cards through the YouGotaGift platform, the end result is a highly satisfied and loyal customer.

As we continue to evolve and adapt to new technologies, it is crucial that we grow without harming our environment and offer better opportunities minimising risks for ourselves and our surroundings. Now that eGift Cards sales are rising and people are familiarising themselves with the process, adopting eco-friendly solutions is becoming much easier and considered in people’s lifestyles. eGift Cards are an eco-friendly solution for consumers and businesses alike that are growing in popularity as they correspond to transforming consumer habits. In the end, the question resides, will eGift Cards be the new green trend as businesses and consumers revisit their use of plastic and balance sustainable environmental issues with instant and efficient eGift Cards?

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E-Commerce in the Time of Pandemic

Articles inside

Unlocking the Full Potential of the Circular Economy

E-Commerce vs Brick-and-Mortar ccc

Put Your Money Where the Sun Shines

Canon's Circular Concept

A Glimpse into The Future of Car Dealerships

Grocers Turn Online

Tabreed Takes Over the Largest DC Market

The Pressure is On

Payments and the Coronavirus Shock

Reshaping PV Technology

After Hysteria Comes Hysteresis

The Stars of Sustainability

The Upcoming Digital Tsunami in Retail