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Property egotiating Your Top Tips For N
ISSUE
Perfect Office
9
Insurance t Follow the Flee
Technologysite Work for You Make Your Web
Telecommunication partner
Join The Crowds
An Introduction to Crowd Funding
Dispute Resolution Google as a Marketing Tool
&
SMEs export 2015... The future www.businessinsight.ae
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Publisher & CEO Liam Williams liam@flipflopmedia.ae
FROM THE PUBLISHER
A
s we approach the end of 2014, we take a look at some of the largest developments this year, both locally and globally and evaluate where the key drivers for the GCC economy lie in 2015. It has been a fantastic year for SME’s, and with more and more partners opening the doors to financing and supporting growth, 2015 should be the year that we witness continued development in the SME sector and new innovation.
In this edition we explore the area of exporting and how it is vital for 2015, as well as analysing some of the latest and more exciting ways of financing your business and how you can ‘join the crowd’. The Business Insight team would like to thank our partners for the fantastic articles and the continued support this year, and look forward to delivering even more engaging content and updates to help your business for 2015. Keep your eyes open for the exciting brand extensions and announcements we have coming up in the new year, including awards ceremonies, annual business reviews and much more. We wish you a happy new year!
Enjoy!
Editorial Editor Tanya Selley tanya@flipflopmedia.ae +971 4 369 9063 Staff Writer Rachel Stracey info@flipflopmedia.ae Marketing Head of Marketing Harry Norman harry@flipflopmedia.ae +971 4 369 9062 Design design@flipflopmedia.ae +971 4 369 9063 circulation & Production Circulation and Distribution Manager Antonio de Marco circulationdm@flipflopmedia.ae +971 4 369 9063 Database and Circulation Manager Aaliya Khan databaseandcm@flipflopmedia.ae +971 4 369 9063 Production Manager Juan Vasquez productionmanager@flipflopmedia.ae +971 4 369 9063 Digital webmaster@flipflopmedia.ae
Liam Williams Publisher & CEO
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Registered at Fujairah Free Zone PO Box 27634 Dubai, UAE Tel: +971 4 369 9063 Fax: +971 4 369 8989 www.flipflopmedia.ae printed by CMS Printing Press LLC © Copyright 2014 FlipFlop Media All rights reserved While the publisher have made every effort to ensure the accuracy of all information in this magazine, they will not be held responsible for any errors therein.
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December 2014 | 3
43 12 December 2014
22
Contents Foresight Page 10 - Expert Panel Page 12 – Collaborative Distribution Page 14 – SMEs Import & Exports, 2015.. The Future Page 18 – How Social Media Affects Sales
28
Success Series Page 22 – Interview: Fadi Malas, CEO, Just Falafal Page 24 – Interview: Ulugbekhon Makumov, CEO, Inkas
Money Page 28 – Join the Crowds Page 30 – The Sukuk Way of Investment
People Page 34 – The Candidate
50 60
Legal Page 38 – Most Common Employment Disputes in the UAE Page 40 – Dispute Resolution In the UAE Page 43 - New Wills and Probate Registry
Marketing & Advertising Page 44 – Google as a Marketing Tool
DMCC Section Page 48 – Diamonds are Forever Page 50 – Inaugural Middle East Gems and Forum Shines in Dubai
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December 2014
Technology Page 52 – Make Your Website Work For You
Telecoms Page 54 – Under Attack
Insurance Page 56 – Follow the Fleet
Property Page 58 – Top Tips to Negotiating the Perfect Office
Travel & Hospital Page 60 – Bringing Luxury to a Healthy Lifestyle
Business Incubator Page 62 – The Smell of Success Page 64 – Does a Leader Need a Coach? Page 66 – Strategic Partnerships Page 68 – Why Research Your Market? Page 70 – It’s in the Detail… Page 72 – Ancient Egypt – A Golden Age
Regulars Page 10 – Expert Panel Page 20 – The Execs Wish List Page 74 - Competition
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EXPERT PANEL John Brash Founder & Chief Executive Brash Brands
Ludmila Yamalova Managing Partner HPL Yamalova & Plewka JLT
Jonathan Hall Founder and Managing Director Mulverhill Associates
Caroline Jones Director Infopod
Yogesh Mehta Managing Director Petrochem
Ravi Bhusari Managing Director & Co-Founder DUPLAYS
Jeffrey Rhodes CEO BTC (part of New Egypt Gold) & Founder & Managing Consultant Rhodes Precious Metals Consultancy DMCC
Zaid Maleh CEO DACH Advisory
Louis Lebbos/ Muhammed Mekki Founding Partner Astro Labs
Ramsey B. Jurdi President American Business Council of Dubai & the Northern / International Partner Chadbourne & Parke LLC
Dr. Tommy Weir Founder Emerging Markets Leadership Center
Nita Maru Managing Partner TWS Legal Consultants
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December 2014
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2020 READY
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P.O. Box 61450, Dubai, United Arab Emirates. Tel: +971 4 881 8288, Fax: +971 4 881 9157 e-mail: contact@aflogistics.com
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foresight
Collaborative Distribution
his all sounds really rather grand, and I can hear you ask how this can actually be? Well, you can achieve these savings and make yourself a greener company in the process by implementing collaborative distribution. Collaborative distribution involves multiple manufacturers combining shipments to create truckloads rather than transporting in smaller quantities; meaning you save on petrol costs, man hours and pollutants, whilst gaining increased customer satisfaction by improvements in speed and service levels. For instance, instead of having two manufacturers who deliver to the same sites, filling only half of their vans and making the journey, they consolidate so that they deliver one single load. At the start there must be a match between the type of cargo being transported; as an example, refrigerated cargo loads cannot be effectively combined with non-refrigerated cargo although breakfast cereal can be effectively transported with toiletries; because they will tend to go the same end user. There are two main categories of collaborative distribution: ll Back-haul matching: The goal of this collaboration is to match different distribution legs away from the company (back-haul movements) so that these
T
We all know the importance of supply chain management, it can literally be the difference between a company that thrives and a company that survives. However, you can take this concept one step further and not only save money, but help save the world in the process!
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December 2014
ll
are minimised. This means if the two companies transport to Carrefore and are serviced independently, in both cases the drivers return empty for the whole back-haul movement. By matching backhaul opportunities the length of empty trips is reduced Sequence matching: The goal of this collaboration is to match trips with a customer (e.g. from a shared distribution center or one in a similar location), that are done separately and less frequently, into a sequence which is longer but can be done more often. This enables lower inventory carrying costs as well as the required warehousing space because suppliers can now ship less quantities, more frequently and more in line with the requirements of their customers. Sequence matching can also involve one supplier and several customers and represents a common solution in city logistics
Whilst this is mainly the domain of corporations, momentum is taking foot in Europe for collaborative distribution networks and these would work very well in Dubai; these allow SMEs in city environments the
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foresight
ability to collaborate on their distribution since the proximity of suppliers and customers offer opportunities for consolidation particularly in sequence matching. Interestingly companies that service just one store and return to the depot for refilling have an average of 40% dead kilometres. This is reduced to just 15% when a van services many stores. Network Design Procedure There are some key points to consider during the design of your policy, which are replicated throughout successful collaborations: ll Identify customers load requirements and delivery frequencies ll Define clusters of customers serviced by each supplier; the number of customers in each cluster determined by delivery frequency, number of vehicles available and total number of customers ll Establish efficient routes for clusters from each supplier ll Determine the most efficient route to travel Regarding the actual process of the collaboration, you should take this one step further paying particular attention to: ll Network design ll Vehicle routing ll Scheduling optimisation Collaboration between companies is particularly attractive for the consumer packaged goods (CPG) sector. With pricing under pressure, the global temptation for retailers is to transfer the pain upstream to their suppliers by passing on price reductions and forcing them to bear an increasing share of costs. On the supply side however there is less and less room for manufacturers to absorb additional costs as volatile input prices put a squeeze on margins, and the marketing investment required to differentiate branded products from private-label competitors continues to rise. Supply chain collaboration has delivered some real value for participants, but they do take hard work to make them successful. Indeed participants in the 2010 CCM survey said that only two in 10 of their collaboration efforts delivered significant results. The high rate of failure among today’s collaborations is not inevitable however. On further analysis, those that failed all did so by not taking into account the common mistakes that companies make. There are several ways you can avoid some of the common pitfalls and achieve the benefits.
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Companies that service just one store and return to the depot for refilling have an average of 40% dead kilometres. This is reduced to just 15% when a van services many stores Consideration Points There are a handful of basic factors that make collaboration problematic. Some of these factors will be familiar to any organisation that’s involved in a change process, and it is especially true if your business relies more on distribution than service. Companies may lack the commitment they need from senior management to drive the collaborations as this has to be high on the agenda for all businesses, or the message that the collaboration is important may be “lost in translation” as it passes down through the organisation so that middle managers or front-line teams fail to prioritise this also. Also, it is not unusual for companies to fail to provide sufficient resources to make them work. The only way to over come all of these points is through communication. Keep staff updated and reiterate regularly the process and it’s importance to the company. These issues are not difficult to overcome, if you think of how the business you are aligning yourself with mirrors your own, because you will have to navigate the differences in company design and culture. Remember sharing information is vital, so being difficult may lead your partner to work on their parts of the “collaboration” separately. This is why very careful consideration should be given as to whom you wish to collaborate with. Do not jump into an agreement with the first company you come across. Ask yourself if they have similar values and structure organisationally, and if the board of both of the companies are driving this.
A steering committee is recommended, with at least one board member from both companies and predetermined meetings to agree how to move forward, is vital. Clearly, when you read all of the information, you can see it is hard work to implement this type of distribution network; but surely, when faced with the overwhelming evidence of financial savings as well as ecological savings, this is worth investing time and effort into?! n
Six Steps to Success There are six fundamental steps that should be taken into account, which will mean the difference between a productive collaboration and a frustrating one. 1. Collaborate in areas where you have a solid footing: Do you distribute to the same locations? Do you compete or compliment each other business? 2. Consider exactly how to plan your routes and truckloads. 3. Select partners on capability and strategic alignment, not just size: Take you time over this. Do they fit your culture? Can you build trust with them? 4. Invest in the right infrastructure and people. 5. Steering committee: Ensure the collaboration is jointly managed and impact measured on an ongoing basis. 6. Think long term: This is like a marriage. Collaborate for the long term.
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foresight
SMEs & Export, 2015... the Future The recent warning that David Cameron, Prime Minister to the UK, issued in his interview with the Guardian when he stated, “red warning lights are flashing on the dashboard of the global economy” as they had six years ago pre financial crisis, has been a sound bite for all businesses globally that they should be watching the political landscape to plot their next move
usiness here is booming as confidence has returned, and with Dubai winning the Expo 2020, the only way is forward. Whilst we may be safe and secure in our little bubble, we should still be paying attention to the wider world with contingency plans at the ready, just in case…
B
UAE It is known that the UAE relies heavily on imports and exports in various sectors of business, but the extent of reliance may be unknown. Did you know for example, 79 percent of the products exported from the UAE belong to just 5 categories? As you would expect, Crude Petroleum is the largest export with 46 percent, Refined Petroleum, Gold, Petroleum Gas and Jewellery make the rest (see Figure 1, page 18). Almost 68 percent of the UAE’s exports go just five countries (see Figure 3). At the same time, we are slightly less dependent on our imports by comparison; just over 53 percent of imports originate from 5 different countries (see Figure 4). Tourism – Another key driver for the UAE economy is set to contribute
8.5 percent of GDP. Whilst there are no figures for 2014, to understand the gravitas of the global economy on the tourist sector, in 2012, 9,957,161 tourists were welcomed in Dubai by hotels; of this 1,952,281 from Europe (specifically 686,842 from England and 314,951 from Germany), 586,209 arrived from North America, 763,986 from India, and 70,110 from Japan. If you were to review your business model would you have more diversity? With a dependency on a couple of countries, how would you cope with an economic slowdown? Do you know what the possibility of another recession in each of the countries you operate in? India India is the largest exporter to the UAE and the second largest importer of goods. Of all of the countries in the list, India appears to be doing far better than the rest of the world. In November, the Organisation for Economic Cooperation and Development (OECD) revised their forecasts. They initially published the following two years of economic growth below 5 percent, however India’s GDP should grow by 5.4
The biggest importer of the UAE’s goods, and the 5th largest exporter to the UAE is Japan. In November Japan’s GDP fell 0.4% in the third quarter from the quarter previous; despite forecasting a 2.1% rise. This meant that the world’s third largest economy shrank
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December 2014
percent in 2014 and 6.6 percent in 2015 due to an increase in private consumption in rural areas and increased political stability. South Korea South Korea, the UAE’s 4th biggest importer, appears to be doing well with a forecast growth of 3.8 percent in 2014, but they are fighting many factors. The OECD says that they are a rapidly aging society (over 14 percent of the population will be over 65 by 2017), and consumer debt is high which has meant a fundamental shift to consumer saving and not spending. This in turn means that the housing market has ground to a halt. To revive spending the benchmark interest rate, was cut by the Bank of Korea to 2.25 percent in August following a spending plan that had been announced by the government in June. Japan The biggest importer of the UAE’s goods, and the 5th largest exporter to the UAE is Japan. In November Japan’s GDP fell 0.4% in the third quarter from the quarter previous; despite forecasting a 2.1% rise. This meant that the world’s third largest economy shrank, and therefore they entered another technical recession.
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Reuters however reported that, Japanese exports grew in October to a 9.6 percent annual rise. In 2015, it is expected that the Prime Minister Shinzo Abe will seek a mandate to delay an increase in the sales tax to 10% as it is believed that the measure, which was introduced to curb the public debt, has impacted the economy with the rise from 5% to 8%. China In November, the central bank cut it’s interest rates. In a statement through Reuters, the worlds 2nd largest economy said it has cut the rate on one-year loans to financial institutions to 5.6% following China’s economic growth slowed to 7.3% last quarter. The increase in commodity prices has hit China who import coal and iron ore, which has pushed the cost of construction and manufacturing up and with rising incomes has led to a rise in property prices and creating a housing boom. Now, the cost advantage that China once had over the west has substantially diminished, especially if you factor in transportation and exchange rates costs. The International Monetary Fund (IMF) however state that they predict a gradual deceleration.
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Singapore The Singapore Dollar is tied to the US Dollar to minimise the impact of the exchange rate. This means that when the US Federal Reserve introduced ZIRP (Zero Interest Rate Policy), the policy affected Singapore due to their tie in with the US Dollar; creating an artificial rate for the pricing of loans, and a housing bubble by fuelling credit growth in many sectors of the economy. Income however has only increased by 15 percent, yet household debt in Singapore reached 75 percent to GDP at the start of 2014, a rise of 41 percent from 2010. Most alarming is the Monetary Authority of Singapore (MAS), which is Singapore’s central bank who estimate 5 - 10 percent of borrowers may have over-extended themselves to buy property. They believe that if mortgage rates rise by 3 percent, over extended borrowers could reach 10 to 15 percent. It is not just the public that this effects; banks too have been known to have almost 50 percent of their credit portfolios in propertyrelated loans. Of this residential mortgages account for up to 33 percent of banks overall portfolios.
USA America impacts the UAE in two areas. First, the dirham is pegged against the dollar. Secondly, they are the UAE’s 4th greatest supplier of imports. The last few years have been turbulent for the White House, who followed a policy of increased governmental spending in 2014 with boosted outlay. The increased public investment is not unique to the USA with the UK, Germany, Italy and others doing the same. The IMF states that, “Most countries are pushing structural reforms to increase potential GDP, with often non-trivial budgetary costs. Reforms are broad based, generally aimed at increasing the flexibility of labour markets; improving the business environment by reducing administrative burdens, increasing the flexibility of retail hours, and improving the efficiency of the judicial system.” “Total US. consumer price inflation (CPI), was about 1-1/2 percent over the 12 months ending in August,” explains a release from the Federal Reserve. “Consumer energy prices declined further in September, largely reflecting continued declines in retail gasoline prices, and survey data suggested gasoline prices fell further over the first few weeks of October. Consumer food prices rose solidly in recent months.” The report is upbeat on US industrial production; which had, “increased briskly in September after having been little changed, on
December 2014 | 15
foresight
risks remain from the “low interest-rate environment and their derivatives exposure”. Lending growth has fallen due to demand. They point to Germany, France and Italy as their key areas of concern. In their report, Fiscal Monitor – Back to work (Revised October 2014): How Fiscal policy can help, the IMF state, “Germany is expected to have a moderately expansionary fiscal stance. Additional government spending (0.2 percent of GDP) will go to pensions, infrastructure, education, childcare, and other priorities. Lower debt servicing costs, however will result in a higher cyclically adjusted overall balance.” The Eurozone looked promising with 0.2% growth, despite Germany posting just 0.1%. It is good news for Greece though. Following 6 years of recession, they finally emerged; whilst Italy slipped into a third recession since the financial crisis. n
Lending growth has fallen due to demand. They point to Germany, France and Italy as their key areas of concern” IMF: How Fiscal policy can help net, over the first two months of the quarter,” although they point out that car manufacturers were slowing output but that sales, “fell back in September following a steep increase in August.” CPI remains below the desired 2% whilst total nonfarm payroll rose in September. Therefore the total unemployment rate has declined to 5.9% but the employmentto-population ratio remained static, with new job opportunities increasing. Over the summer, the housing market appeared to be slowly moving upwards, but stagnated in September. Despite sounding negative overall, it appears the entrepreneurial spirit has returned to the US. Spending on business equipment and intellectual property has increased in Q3. Purchased shipments started well, but declined in September and the Fed predicts that these will increase in coming months. Europe Whilst Germany is the country that we import the most from in the E.U, Europe provides more tourists than anywhere else. At present, the Eurozone slow down could mark a big shift for many countries. It’s affecting England’s export and manufacturing, with the Bank Of England Governor Mark Carney claiming that there is
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stagnation haunting Europe, “with growth disappointing again and confidence falling back.” However, with this warning came optimism, “We project growth of 3.5% this year, 2.9% next year, and 2.6% for each of the following two years,” he says of the UK. But it is their reliance of trade with the Eurozone that would affect these figures, where high debt and unemployment continue to rule. David Jolly, from the New York Times commented on the economic data that was announced mid November showing that activity had dropped to a 16 month low as France weakened further whilst manufacturing slowed in Germany, “The poor showing keeps the pressure on the European Central Bank (ECB), the Eurozone’s last resort for growth when the bloc’s political leaders have sworn off expansionary fiscal policies. With companies reluctant to invest, governments trying to hold the line on spending, and the jobless rate at 11.5 percent, few expect demand to bounce back soon.” He continued, “The gross domestic product of the Eurozone barely grew in the six months through September, and all indications suggest it is slowing further, with the possibility of a return to recession.” The OECD report that German banks have weathered well though
UAE Import/export facts Top 5 Products exported by The United Arab Emirates Crude Petroleum (46 percent) | Refined Petroleum (13 percent) | Gold (9.2 percent) | Petroleum Gas (7.4 percent) | Jewellery (3.5 percent)
Top 5 Products imported by The United Arab Emirates Jewellery (79.7%) | Refined Petroleum (5.7%) | Gold (5.6%) | Cars (5.2%) | Broadcasting Equipment (3.8%)
Top 5 Export destinations of The United Arab Emirates Japan (24%) | India (21%) | Singapore (8.4%) | South Korea (8.3%) | China (5.9%)
Top 5 Import origins of The United Arab Emirates India (18%) | China (17%) | Germany (7.1%) | United States (6.1%) | Japan (5.0%)
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Š 2014 EYGM Limited. All Rights Reserved.
The opportunity for the GCC is now — understand the challenges and drivers that impact you. Nationalization, diversification, global positioning and stability are key areas for governments and businesses in the region to consider for the future of GCC growth. The EY growth drivers report highlights how government and business can work together to address challenges and embrace opportunities in the region. For more information visit ey.com/growthdrivers
The views set out in this publication are not necessarily the views of the Ernst & Young global organization or its member firms.
foresight
Social Sales More and more we are being asked to ‘like’ and ‘share’ products on Facebook, pin them on Pintrest and retweet them. We are being told constantly that social media is a great marketing tool... but who knows the facts?
By May 2014 the country average for Facebook penetration in the Arab region was over 21.5% up from 15% in May 2013 (Arab Social Media Report) The Harvard Business Review in August 2013 reported on data from US., Canada and the UK. and found social media drives online sales, AND creates an equal volume of instore sales (TMGmedia)
The number of tablets in use in the US. rose from 34 million in 2011 to 55 million this year and is expected to reach 108 million by 2015 (TMGmedia)
61% of global Internet
users research products online (Comscor, July 2014) YouTube has become the
2nd Largest Search Engine – bigger than Bing, Yahoo, Ask & AOL combined (Social Media Today) 50% of all mobile searches are conducted in hopes of finding local results, and 61% of those searches result in a purchase. (Search Engine Watch)
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Country Usage UAE Twitter – 401k active users Best time to tweet in the day 1pm – 3pm (Stat.ae) Best time to tweet at night 10pm – 1am (Stats.ae) Facebook penetration – 41.66% - 13 and above 21.37% - 15 to 29 years old 19.86% - 30 and above
Country Usage Saudi Arabia 8m of the country’s 31m people use Facebook largest number of users are aged 26 to 34 2.4 million active users (Arab Social Media Report 2014) 40% of all tweets in the Arab world are from Saudi (Arab Social Media Report 2014) 87% of Saudi users of social media are men 88% own a facebook account (Statista, Q2 - 2014) 81% Twitter (Statista, Q2 - 2014)
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foresight
42% of marketers
say Facebook is critical or important to their business
(State of Inbound Marketing, 2012)
Auto-posting to Facebook decreases likes and comments by
70%
92%
Shoppers referred by Pinterest are
retweets because of the content (Mindjumpers)
26%
retweet because it says “please RT!” in the tweet. (Mindjumpers)
864 million
people log onto Facebook daily (DAU), which represents a 19% increase year over year (Facebook, October 2014)
Demographics of a social media shopper 69% MALE
On Thursdays and Fridays, engagement is
18% higher 42% of marketers
31% FEMALE
(Bit.ly blog)
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80% increase 145%
68%
The increase in daily users on Pintrest since 2012 (Mashable) Pins related to trending topics see an average of
8% 24% 35 - 54+ Years Old
55+ Years Old
have stopped following brands due to inundation of boring information (SMI)
18 - 34 Years Old
52%
A call-to-action pin description sees an
in click-throughs
than average on Sundays (Mindjumpers)
B2B companies, LinkedIn was the most effective, with 65% having acquired a customer through the professional network, followed by company blogs (60%), Facebook (43%), and Twitter (40%). (Marketing Charts)
of Pinterest users are women
Choose your days to pin Monday – Fitness Tuesday- Technology Wednesday – Quotes Thursday – Fashion Friday – Humour Saturday – Travel Sunday – Foods and Crafts (Irfan Ahmad)
people are on Facebook (Search Engine Journal)
30% higher
83%
Pinterest is virtually tied with Twitter (at 3.6%) for the amount of referred social traffic it sends to websites (Pooky Shares)
223 million
B2C Facebook interaction is
10% more
For the second year in a row, asos is the most popular UK online retail site in the run-up to the end of the year 2014 (Pinterest)
In Europe, over
report that Facebook is critical or important to their business (State of Inbound Marketing 2012)
likely to make a purchase than visitors who arrive from other social networks, including Facebook and Twitter They’ll also spend
on average (Wayfair)
(Digital Buzz Blog, 2012)
Worldwide, there are over 1.35 billion monthly active Facebook users (MAUs) which is a 14% increase year over year (Facebook, October 2014)
10% more
94% increase in click-throughs (Pinerly Study)
The best time to pin during the day is between
2PM and 4PM EST (Pinerly Study) The best time to pin in the evening is between 8 PM and 1 AM EST (Pinerly Study)
December 2014 | 19
foresight
execs wish list
We are all in business to earn money so in our wish list, we show you how to spend it with style...
The Worlds Finest Money Clip
POA
Orient Express Prestige Pen, Tanagra
AED 11,785
Tumi Tegra Lite
AED 3,730
Penhaligons The Peoneve Parfum Limited Edition, Harvey Nichols
AED 6,600
Neil, Barrett, Harvey Nichols
AED 8,500
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December 2014
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foresight
Amouage Silver, Harvey Nichols
POA
Carolina Herrera
POA
DSquared, Harvey Nichols
AED 9,500
Bulgari Exclusive, Harvey Nichols
AED 4,800
Carolina Herrera
POA
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December 2014 | 21
success
interview
FADI MALAS
CEO OF JUST FALAFEL A falafel is… well, just a falafel. But behind the scenes at healthy fast food franchise Just Falafel, lies a powerful master class in getting it ‘just right’ in terms of phenomenal business growth and global domination strategies
he first branch of Just Falafel was opened in Abu Dhabi in 2007. Since then the company has experienced extraordinary global growth, becoming one of the world’s fastest growing food chains and currently the largest falafel chain in the world. With franchises already throughout the UAE and in London (and plans to open 200 more in the UK by 2017); Oman has just opened 10 outlets and Canada, Brazil, India, Kuwait, and Australia have all opened their first restaurants. At the same time, Just Falafal have agreed the launch of 57 restaurants in the Benelux Region and a further 10 restaurants in Texas; the spiritual home of fast food itself, the US of A. We thought we would take a look back at our interview when Fadi Malas was just beginning the Just Falafel revolution…
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Social Media When we interviewed Fadi in 2012, he told us that they had 580,000 fans on Facebook. Fast-forward 2 years and the figure stands at over 2,027,000. Harnessing the power of social media since the beginning, Just Falafel has now made history by generating more than 3,500 requests for franchising opportunities from over 70 countries on its Facebook page, via a targeted social media campaign. It begs the question, well, several really… Fadi, how did the idea for Just Falafel first come about? The population here is completely international. Everybody is busy. Everybody, at some stage in the day wants to grab something quick and nutritious. Falafels have a solid tradition behind them
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and in the same way as ideas just come to entrepreneurs, the initial idea was to apply some innovation to a very traditional concept - something that would fit with and serve the international nature of people living here. So, we came up with the Greek and Italian falafels for Europeans, Egyptian and Emirati for the locals and so on. We had a very solid business plan and a very definite idea of what we wanted to achieve. We had, and still have to this day a massive focus on what we do. Did you experience any early mistakes or failures? If we are not making mistakes, then we are not doing something right. That holds true for any business. How else do you learn best practice? I’m glad that we made our mistakes early, it meant that we could refine our operations and then apply the known strategies to the business to grow it. But mistakes are only good if you learn from them. Was there a specific ‘breakthrough moment’ when you knew that the business model would work? We had a very strong business plan from the start, absolute determination to make it succeed and a level of focus on the business that has never waivered. Some business owners come into work in the morning, do what they have to do and go home at 5pm. The business stayed in our heads at home, the weekends and never left our minds. Of course, we have home lives and families, and it has never been the case that we don’t have time for family and friends, but our focus on the business was, and is still always there. So, there was not one specific breakthrough that made us believe the business would work, we just know that it would because we
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success
focused our minds on its success from the start. The big surprise was how quickly the business grew – we never in our wildest dreams expected that it would grow at the rate it has, and is doing. Social Media, particularly Facebook, has been very good for the business – how does it play into business strategy on a day-to-day basis? Well, we never had the marketing budgets of the big name fast food companies; we never had billions to spend on advertising, so we had to come up with a way of reaching people in a cost-efficient way. Social media is not just a revelation like a new revolution. In the same way as we have had the Industrial Revolution, and things have never been done in the same way since; we now have the ‘Social Media Revolution’ and business marketing should now never be conducted without it. For us, without the big budgets at the start, Facebook was like the largest country in the world, with a population of millions, that we could freely access. It allows us to interface directly with our customers, we are extremely interactive with them, and it is important that customers can feedback to us. Social media facilitates all of this for us.
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So would you say that social media played a core part of your rapid expansion? Social Media is like a business reality show that is on 24-7. It is a platform that enables us to create a sense of belonging, with constant communication. By interfacing with our customers and finding out what they want, we are able to respond to their needs. Recently we received more than 90 email requests for franchising in a single day. We received over 3,500 requests for franchising opportunities from over 70 countries from our Facebook page. So yes, social media has played a direct and huge part in our growth. What advice would you give to start-ups and smaller businesses looking to emulate your level of success? You need strong self-belief. Focus is very important, if you want to achieve business success in any sphere, you cannot diversify your focus. Something to be careful about is that entrepreneurs entertain great ideas all the time, so the biggest challenge they face is to remain focused on their core business of choice.
Starting a business is not like doing a job, it is a lifestyle choice and again, this is why focus is so important. Also crucial for new entrepreneurs is the ability to maintain momentum in business. Rather than finish at the end of the day, come to work again and try to remember what you have to do, momentum allows you to just keep on moving in the right direction without any interruption. It also helps to know how to take a punch without taking it personally. In business, you are always a work in progress, so analyse the ‘why why why’ aspect of all the operational details will help you to really operate the business from the best position of understanding. My last advice would be to believe in what you do, forget the naysayers and forget the ‘noise’ that people around might make when you talk about your business ideas. Take good quality advice and don’t be afraid to try different ways of doing things. You have to trust yourself, because ultimately, it is you that will run the business, ‘just the way you like it’! n
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success
Ulugbekhon Maksumov interview
CEO, Inkas
How long have you been in the UAE for? I moved here in 2006 so 8 years. Tell us about your coming to the UAE from Russia. How did your previous employment provide you with the business acumen to be as successful as you have become today? Back home I worked as a Sales Manager for the local manufacturing company. Since 2009 I have been working for myself creating and expanding businesses. My previous experiences taught me the basics of sales, the production process, management, procurement and logistics. All of these have become the pieces of the puzzle in creating my success to date. Have you always had a strong sense of business and entrepreneurial spirit? How did these manifest themselves? Yes, I love business. I am a risk taker and take risks in order to achieve success. Over this 5 year period I have been able to create a successful group of companies and one of my brands is the 3rd biggest player in the market. You have several businesses within the UAE; one of which is completely different to the others. Was this a conscious decision? Yes, it was a conscious decision because I don’t want to only operate and concentrate on one segment of the market. I like the diversity of my businesses and that they cover
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different areas of the market fueling each other’s success; as Warren Buffet says, “Never depend on single income. Make investment to create a second source.” What came first; Inkas or Gulf Autotrading? Gulf Autotrading in 2009. Inkas came later in 2012. How did you come up with the idea to start Inkas? I was offered to open the partnership for the well known Canadian brand Inkas which was originally established in 1993. I saw a high demand for armored vehicles and so decided that this would be a good partnership and it was a risk that I was willing to take and I believed would be successful. What are the type of clients that you attract? We attract many clients, but predominantly our buyers tend to be local armored forces, security companies, Embassies, VIPs. We also have business coming from oil and gas companies. What was the biggest hurdle that you have had to overcome to do this and how did you achieve this? To begin with it was hard to convince and then prove to clients, that this brand new company could be a strong competitor. We needed to work hard to prove ourselves; demonstrating our international high standards and competency levels. Along with this we have worked hard to establish ourselves in the market as well as branding Inkas on high quality and after sales support.
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Inkas in particular, targets a very niche market. How has your marketing approach to this differed to Astrata or even Gulf Auto Trading? Astrata and Inkas are manufacturing companies whereas Gulf Auto Trading is a trading company. Inkas’ product is very specific and cannot be sold to a general consumer. It is aimed towards a particular market segment. The armored vehicles are advertised through world known exhibitions, for example IDEX where we will exhibit again in February 2015. Customers can view a live presentation of our products. Certificates of success tests advertise the stability and quality of our products. Flyers and marketing materials are of no use to Inkas because our products are very specific however Astrata can benefit from this form of marketing.
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“Be prepared to lose things; money, time, effort, people. It’s all a risk and you have to have the strength to be willing and prepared to suffer set backs and loses”
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“Inkas has been a great success for myself and it is what I am most proud of. Admittedly, we are still a young company however we are very rapidly expanding. In the 2 years since opening we have already built and shipped over 1000 vehicles and we have grown in size 4 times over from what we started�
What has been the toughest thing you have had to overcome in business? The toughest thing has been finding a team of hard working professionals who are as enthusiastic about the business as I am. I am certain I have found that now and the Inkas team have a powerful work ethic which encourages the company to strive. How do you mentally prepare when faced with a negative situation? I always try to stay calm and rely on my previous experience.
What has been your greatest business success? Inkas has been a great success for myself and it is what I am most proud of. Admittedly, we are still a young company however we are very rapidly expanding. In the 2 years since opening we have already built and shipped over 1000 vehicles and we have grown in size 4 times over from what we started.
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What is the one piece of advice you wish you had been told when you first started out in business? Think twice before making a big decision as it needs proper and thorough consideration. You need to be prepared to lose things; money, time, effort, people. It’s all a risk and you have to have the strength to be willing and prepared to suffer set backs and loses. What is the most important lesson you have learnt to date? If you want to go fast, go alone. If you want to go far, go together. n
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FORWARD THINKING & FRESH IDEAS
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& Compilation • CFO Services • Company Incorporation Services • Market Research and Business Plan • Credit and Working Capital Management • Enterprise Risk Management • Operational Improvement Services • Business Valuation • Audit & Assurance • Business process reviews • Business process re-engineering P.O. Box No: 26869, 108 & 109 - Al Diyafa Shopping Centre, Satwa, Dubai, U.A.E., Tel: +971 4 345 1522, Fax: +971 4 345 2512
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MONEY
Join the Crowds
Here at Business Insight, we have been hearing that despite the positivity returning to Dubai and the free and easy availability of credit to consumers, Businesses are still struggling to access the financial capital that they require in order to move their business forward, but is that because they are looking in the wrong areas?
he credit crisis saw businesses globally struggling to make ends meet. Credit that had been available to them was suddenly withdrawn, whilst access to future financial help dried up. “Historically financing a business, project or venture relied upon gaining a large loan from fewer, conventional institutions such as banks,” explains Rick Pudner, ex CEO of Emirates NBD and now Chairman of Beehive, a crowdfunding website provider. “Crowdfunding is a more collaborative approach to raising investment; using the Internet as a platform to reach thousands or even millions of potential investors and enabling a mutually beneficial relationship between investor and borrower. For the investor, smaller levels of investment across a diversified portfolio minimises potential risk and offers attractive rates of return. Borrowers are exposed to new channels of investment to drive growth with more flexible repayment terms.” Crowdfunding is of particular significance to the future growth of micro, small and medium sized enterprises (MSMEs), who until now may have struggled to gain
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the investment or funding required for expansion from traditional channels. Massolution, a consultancy that specialises in analytics from this market predicts that globally crowdfunding platforms are forecast to raise US$5.1 billion last year; up 81 percent from 2012. This can be evidenced by companies like Kickstarter and Crowdfunder who have proven that this is a highly successful concept in the US and Europe. Global peerto-peer lending (or marketplace lending as it can also be called), can produce strong results. RSA in the UK quoted that 30% of the investment comes from family and friends, 30% from acquaintances (the wider circle), whilst the remaining is from the ‘crowd’; so you need to drive the campaign through all channels including your own friends, family and social media platforms. Marketing To obtain your desired results, you have to drive your marketing the right way from the very beginning. It is at the start of the campaign that you will find if you sink or swim. The more people that invest in you, the more confidence
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MONEY
will grow about your product/service and the more investment you will obtain. This hard work is worth it and the potential returns are huge when viewing the money that flows through the crowdfunding system, “The market for P2P or ‘marketplace lending’ is estimated to be valued at almost US$9bn in 2014 and is forecast to deliver US$1 trillion by 2024. The growth of peer-to-peer lending is accelerating rapidly and its expansion into new markets is inevitable as economies seek smarter solutions to SME financing,” explains Pudner. The global crowdfunding industry, currently led by the key launch markets of US and UK have undergone regulatory changes in the last two years via the ‘Jumpstart Our Business Startups’ Act (JOBS Act) in the USA and the Financial Conduct Authority (formerly the FSA) in the UK. The anticipated approval of President Obama’s JOBS act Title III (nonaccredited investors) is expected to spark an explosion in peer-to-peer platform services in the future as crowdfunding becomes available to the US general public. In the UAE The 300,000 small and medium-sized enterprises (SMEs) account for about 60 percent of the UAE’s non-oil economy and 90 percent of total businesses. SMEs are critical to employment creation and economic growth, yet they account for only 3-4 percent of bank lending. This disappointing figure is further illustrated by the bank loan rejection rates that are recorded for SMEs, which are between 5070 percent depending on the bank in question. The International Finance Corporation (IFC) estimates the current SME funding gap in the MENA region to be at least USD$260 billion. This considerable gap between the demand and supply of capital is driving a critical need for alternative finance solutions to fuel growth in this significantly underserved sector of the economy. How Crowdfunding Works There are predominately four models for crowdfunding platforms: equity-based, lendingbased, reward-based, and donation-based. Classification is based on the funders’ primary motivation for engaging in crowdfunding. Globally, there are 4 ways that crowfunding works; 1. Equity-based crowdfunding - This is a model by which funders receive an interest in the form of equity in the venture they fund. Alternatively, they can receive revenue or profit-share arrangements. 2. Lending-based crowdfunding – Also known as peer-to-peer lending, by which
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30% of the investment comes from family and friends, 30% from acquaintances (the wider circle), whilst the remaining is from the ‘crowd’
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“Crowdfunding is a more collaborative approach to raising investment; using the Internet as a platform to reach thousands or even millions of potential investors and enabling a mutually beneficial relationship between investor and borrower” Rick Pudner ex CEO of Emirates NBD and now Chairman of Beehive
the model is that funders often receive fixed periodic income and expect repayment of the original principal investment. Reward-based crowdfunding – Allows funders to gain a nonfinancial benefit in return for financial contributions. Nonmonetary rewards often take the form of a token of appreciation or the pre-purchasing of products or services. Donation-based crowdfunding This model is widely available within the UAE. It provides funders with a way to donate to causes that they want to support, with no expected compensation (i.e. philanthropic or sponsorship based incentive). In contrast to equity-based and lending-based models, rewardbased and donation-based models are characterised by nonfinancial motivations for engaging in crowdfunding. This form is mostly used by charities and NGOs. In the UK and USA however some platforms enable an individual to apply to receive funding for something personal to them; for example, to get funding to pay for medical treatment that they need.
There are 3 types of crowdfunding possibilities available within the UAE. Beehive offer Lending based crowdfunding, whereby the money is loaned to a company in return for a guaranteed/pre agreed interest rate, which the investors finance. Aflamnah also offer crowdfunding specifically aimed at the arts whereby investors donate towards their chosen causes; as do Yomken who offer funding for innovations. Alternatively, Eureeca offer an Equity based model, whereby the investor will receive equity on the basis of the investment. Once you have ascertained which way you would like to move forward, you can apply via the website to upload your business plan, your ‘sales pitch’ and the amount you wish to receive. Then you simply sit back and wait. Outside North America and Europe, crowdfunding is still a relatively new concept but Asia and Oceania are being highlighted to account for the secondary growth. It seems clear that the model of crowdfunding will continue to expand globally as regions seek faster and more flexible ways to drive economic growth. n
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MONEY
The SUKUK Way of Investment Previously, we spoke about the meteoric growth of Islamic finance across globe amidst financial crisis, and the reason behind such growth and popularity. In this issue, we focus on Sukuk as the most sought after Sharia-compliant instrument, attracting investors from around the globe
What is Sukuk? Sukuk are Islamic bonds that follow the strict principles of Sharia law. They are fixed-interest bonds designed as an investment that pays profits, keeping in mind the Islamic ban on interest. The investor receives a profit return each year instead of an interest payment, or coupon as with a conventional bond. The return does not come from the lending itself, but rather from the sale or leasing of certain tangible and hard (real and substantial) assets, such as property. Traditional bonds pay a fixed interest amount over the life of the bond, and then upon maturity, the investor receives the principal back in full. This is where Sukuk differs substantially. A Sukuk in compliance with Islamic law cannot guarantee the return of the principal upon maturity or share of profits, as it depends on whatever returns are gained from the assets backing the bond. Global Trend of Sukuk Issuance The Islamic Finance Information Service (IFIS) state that there has been a rally in dollar Sukuk issuance for 2014. Adnan Halawi from Zawya Islamic, reiterated these sentiments in his blog in September, “I noticed that September was probably the best month on record for the Sukuk industry with the biggest number of new states (sovereigns) selling sukuk for the first time in the history of the industry: Hong Kong, Luxembourg and South Africa. If we add Sharjah and IDB, this is possibly the largest number of international sukuk sold in one month.” This train of thought was further backed up by Khalid Howladar, Moody's Global Head for Islamic Finance, “The year 2014 has become a landmark year for sovereign sukuk, with the UK issuing its inaugural sukuk, and with Hong Kong and South Africa expecting to conclude sales in September 2014. All three are major non-Islamic countries, and the transactions indicate a significant change in the potential size, depth and liquidity of this market.” The Past, Present and the Future In March 2012, His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, announced the next
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phase of Dubai’s Islamic economy initiative by sharing the Emirates plan to develop it into a centre of Islamic finance which would include Islamic finance instruments, Islamic insurance, Islamic contract arbitration, Islamic food industry and trade standards (Halal food), as well as Islamic quality-management standards. The recent flurry of Sukuk issuance seems to be in line with the ruler’s dream. The Emirate continues to seek to benefit from its lowest borrowing costs since the crippling debt crisis in 2009, and during April 2012, a US$1.25 billion two tranche Sukuk issued by the government was significantly oversubscribed. At present both Tunisia and Pakistan have insinuated that they may have sukuk sales by the end of the year, and as we go to print, Flydubai is conducting its roadshow investor meetings prior to its sukuk launch towards the end of the November. With all of this in mind, Howladar predicts that the sovereign sukuk issuance accounts for 36% of the US$269 billion of outstanding sukuk to July 2014 and will reach US$30 billion by the end of the year. Factors to Consider While Investing in Sukuk Due to the complex structure of Sukuk, the cost involved in issuing them and the type of return you can expect, potential investors should understand the following key factors before committing funds. 1. Sukuk can be structured differently, so you will at the most basic level need to identify the type of Sukuk you are considering investing in, whether it is a Salem Security, Ijara bond, Istisna bond, Mudaraba or Musharaka bond etc. 2. Whilst reviewing the structure of the Sukuk you also need to identify whether the Sukuk has been structured based on asset only, as a secured asset, or as an asset backed Sukuk. Though they all sound similar there are subtle differences on how the asset is attached to the Sukuk and how the structure is made. 3. Another key factor to take into consideration is the issuing authority, whether it is a sovereign/ government sector bond or private sector bond as each has its own risk-return ratio.
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MONEY
September was probably the best month on record for the Sukuk industry with the biggest number of new states (sovereigns) selling sukuk for the first time in the history of the industry: Hong Kong, Luxembourg and South Africa� Adnan Halawi, Zawya Islamic
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MONEY
The year 2014 has become a landmark year for sovereign sukuk, with the UK issuing its inaugural sukuk, and with Hong Kong and South Africa expecting to conclude sales in September 2014. All three are major non-Islamic countries, and the transactions indicate a significant change in the potential size, depth and liquidity of this market” Khalid Howladar, Global Head for Islamic Finance, Moody’s
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The currency denomination of bonds is also important because a local currency bond is stable and not subject to global currency fluctuations while a foreign currency bond is more vulnerable to currency fluctuations. Since Sukuk is a long-term investment, as an investor you need to be clear about the time frame of the investment. It is also essential to remember that the value of investment can go down as well as up depending on a number of factors. Although Sukuk offers a profit return each year instead of an interest payment or coupon as with conventional bonds, it is important to remember that Sukuk behaves exactly the same way; For example, when interest rates increase Sukuk prices decrease and vice versa. Lastly, you need to know whether as an individual you can invest in a particular bond as some Sukuk’s allow for individuals to invest whilst others only allow investors to participate.
December 2014
Is Supply Matching Demand? Ernst & Young says annual demand for Islamic bonds is expected to grow to US$900 billion by 2017. The exponential rise in demand is primarily a result of the double-digit growth of the Islamic banking industry, and the increasing appetite for credible, sharia-compliant, liquid securities. Experts say that the increased interest in Sukuk derives from conventional banks looking for alternatives outside the Eurozone crisis, Islamic financial institutions, fund managers, and very wealthy individuals. This boost in demand coupled with the fact that real assets back Sukuk’s increases their appeal even further. Amidst the huge popularity of Sukuk the question of whether supply can meet demand has yet to be answered clearly and despite the recent jump, there is still a possibility that supply might fall short of demand. This shortfall can be attributed to the inherent structure of
Sukuk, which promises to generate return without infringing Islamic laws. This sometimes makes the structure of Sukuk complex and unbending when compared to conventional bonds. Also, the issuance of Sukuk is dominated by Asia and Middle East, and due to infancy of the market, there is limited exposure towards the basic structure, a lack of knowledge and comparatively less initiative from the government to promote Sukuk as a funding source or instrument of investment. Apart from that, the cost associated with issuing a Sukuk is deterring certain countries, mainly those outside of Malaysia and GCC, and also corporates from promoting and investing as confirmed by Jason Kabel, head of fixed income at Bank of London and The Middle East in a recent interview with the Financial Times. It remains to be seen over the next few years whether the current rate of issuance is sufficient to address the growing demand. n
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1 U
people
The Candidate
In Dubai, there is no shortage of talent; good, bad or indifferent. Your time however is expensive. So how can you ensure that you only interview and hire the right staff?
n our series of articles, we look at every aspect of the onboarding process; from how to correctly read a CV to interviewing tactics, onboarding and retention. We spoke to Nuria Gonzalez-Martin, Head of HR at Food Fund International, the company that brings you The Meat Co, Eat Greek, Tribes and more to find out their best practice.
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When managers come to you asking for staff what are the steps you take to ensure that the staff are required? It depends on whether the staff request has been approved in the forecasted headcount budget for the year or not. When Managers come and ask for additional staff above the agreed headcount budget, we ask the Manager to present a business case to increase the headcount budget, with a summary of the positive expectations of
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people
the increased staff headcount; not just in terms of potential revenue but in terms of service delivery, the overall team and department performance. Whilst the manager is preparing this we look at the current budget; thinking in terms of clients, revenue, approved budget for the year, current staffing and job roles. Once the manager forwards the business case it is read in line with the above, and then HR makes their recommendation. This does not necessarily mean a yes or no. HR uses this time to identify any other potential solutions for either the long term or interim period. This is then submitted to the manager to review/debate, and finally it is forwarded to the relevant parties to increase the budget. This includes the CFO and COO as a minimum. Whilst this may sound quite heavy, I find that this is a useful tool to train managers to objectively think about the increase in headcount. They have the opportunity to consider what it actually means in terms of budget, output to support the increase, what they actually want as a result, and the potential of other strategies, rather than just a knee jerk reaction to a situation that is currently happening. Why is a job description important and how do you determine what the job role will entail? A job description is important for a number of reasons. Firstly all employees like to know (and preferably before they accept an offer of employment), what is expected of them, so they can assess for themselves whether they can actually do the job; Is it a role that they actually want to do? Who will they be reporting too? What the conditions of the role are? How they will be evaluated and deemed as competent in the role? Secondly for the employer it is a good tool to use to structure the thought process of a potential role; for example how the role fits in with other roles that already exist within the company, actual job duties, responsibilities, reporting line, whether this role duplicates any other staff members job role and specific duties, how critical the role is to the department and Company.
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“I want to see their last 2-3 roles described, how these roles and experience relate to the role they are actually applying for now” Nuria Gonzalez-Martin Head of HR, Food Fund International
Finally a job description provides the opportunity to agree on the characteristics needed by a new employee filling the role and it will then be used as part of the recruitment process. In addition to this, a job description can be used to manage performance, especially as here in the UAE you have to reference to potential disciplinary based on non-delivery of basic duties if you need to review their position at a later date. Job descriptions for higher roles within the company can be used as a template for training and development
to aid staff to achieve the necessary skills and knowledge for promotions and career progression, as well as being used as the foundation for job analysis, subsequent job grading’s and salary bandings. On a softer side, job descriptions can also be used to assist return to work policies where, for an interim period certain tasks are modified to ensure a smoother transition back to the workplace following a period of absence. The key to a good job description in my opinion is flexibility. Creating a more generic job description that emphasises expectations and accountability, as opposed to specific duties, to allow employees the flexibility to manage their own actions and focus on achieving the Companies expectations with creativity; thus enabling a more welcoming and open environment. And the plus side these type of job descriptions are easier to maintain so HR will not have to constantly change job descriptions in line with every change in job duties! At Food Fund International, when we develop a job description HR works with the Head of Department/Manager to ensure that the job description reflects their requirements and those of the Company. Assuming that the headcount budget for this person has been approved, and there is no overlap of duties with an existing staff member, HR will meet with the manager to gather in more detail what they want this role to achieve, what they think this person will be doing in terms of duties to meet the Company’s expectations, how they see this role developing in the future, who this person will be reporting too, how they intend to measure the performance of this person, what type of personality should this person have, and are there any qualifications, skills, knowledge or previous experience that this person must have. These details are then included into our Company approved job description template, and we undertake some desk research to identify if there are additional job duties such as best practice associated duties and any additional legal requirements
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then reviewed to identify whether the candidates previous work experience matches our requirements in terms of knowledge and skill. I ask myself several questions for example; ll Does the candidate have a good length of service history? ll Does the candidate’s previous employers relate to our industry? ll Are they a reputable?
“An ideal candidate is someone who is confident when answering your questions and who asks you questions about the role potentially on offer, the company, who their teammates are, and what their roles is likely to be Nuria Gonzalez-Martin Head of HR, Food Fund International etc. Once this has been undertaken these details are included in a draft job description for the manager to review. The Manager may be asked to remove anything that is not relevant, re-word anything that needs further clarification, and add any other details after this review that has been missed previously. By taking this inclusive approach, the job description directly relates to the business and the needs of the department, whilst ensuring that the duties are in line and competitive with market conditions and best practice. What recruitment tools would you use to fill a position? We use a variety of recruitment tools to fill positions depending on the position, and budget. These can be from job boards that specialise in our industry, referrals from existing staff and external professionals,
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recruitment agencies, job adverts in associated press and social media. As a Group we are currently taking advantage of social media to secure our staff. We have identified that for the 20-40 year old bracket social media is effective; this includes LinkedIn, Facebook, Twitter and various associated industry bloggers sites etc. Whether candidates come direct or referred we have an extremely good response rate, which specifically relates to our requirements. How do you read a CV? What exactly do you look out for? In the first instance the CV must be formatted in a clean style. Long, unformatted CVs, in strange text fonts or colours are not appealing. Furthermore spelling errors, colloquial words like “cum”, and poor grammar are also a turn off. The CV is
The CV should be concise, duplications of tasks and responsibilities are unnecessary. If the person has been working for a considerable period of time they shouldn’t detail job duties for every position they have held. Job titles, company name, dates, and potentially a brief summary will do, highlighting any achievements that they wish to be known. Instead I want to see their last 2-3 roles described, how these roles and experience relate to the role they are actually applying for now. A CV is basically in sales terms an, “invitation to treat” so they shouldn’t be gaudy, have lengthy un-relation personal bios, introductions that bear no relevance to the job, or go on for 7 pages. Another little helpful hint to readers is to ensure that their name is included in the saved file name, that way the CV is much easier to retrieve. HR managers/ business leaders will get hundreds of CVs through for any one position. Trying to retrieve a CV of a candidate that you wish to interview from numerous files called CV is a complete waste of time! What are you top tips to finding the right people to interview? Always telephone to screen potential candidates. Use this time to confirm key roles, duties etc. Ask why they are looking for a new role, and what they want from their next position? In addition use this to identify someone who has energy, sounds motivated, and isn’t bored in their current profession. An ideal candidate is someone who is confident when answering your questions and who asks you questions about the role potentially on offer, the company, who their team-mates are, and what their role is likely to be. I find it a turn off if asked about working time and salary! Ultimately, you want someone that will go the extra mile for your business. n
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LEGAL
By Ludmila Yamalova Managing Partner, HPL Yamalova & Plewka
Most Common Employment Disputes in the UAE
Most employment or labour disputes in the UAE stem from the same set of common grounds. These grounds usually relate to the issues of salary, commission, bonuses, end-of-service benefits, working hours, notice period, employment visa and non-competition
he UAE labour courts are rather consistent and predictable in their adjudication of these disputes. Much precedent exists to guide both employees and employers, though very few actually make the effort to understand the practical implications of the UAE labour law. It should be noted, that the labour courts are rather efficient and expeditious in resolving employment disputes. The court filing fee is minimal and employees are exempt from paying it. Many cases are decided in just one hearing, and the time schedule between filing and hearings is on average two weeks. The courts’ objective in swiftly moving the court docket along is historically based. The majority of employment cases in the past related to unpaid salaries and mistreatment of employees. This applies especially to lower ranking employees and labourers. Furthermore courts interpret laws in the light most favorable to employees and impose maximum awards and penalties on employers. Such resolution of disputes allows employees to swiftly resume their lives and re-
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enter the workforce. Similarly, it encourages companies to improve their employment practices and to treat their employees’ claims more seriously. In the long run, it allows companies to focus on growing their business, instead of being tied up in litigation. This trend of encouraging companies to treat their employees legally and their claims more seriously, is gaining further strength. A number of new employment laws and practices to that effect have recently been implemented. Various government authorities are now working closely together to facilitate this change. For example, as of November 2014 the Immigration Authority will not allow companies to hire new employees until those companies settle all of the employment court judgments against them. This is significant because many cases exist where companies purposefully delay settling their employees’ court judgments. Repeat violations will also result in those companies’ trade licenses being suspended by the Department of Economic Development. With time, free zones will also be part of this scheme.
The overarching rule therefore, is that all employees are entitled to a salary and employers are not permitted to either withhold or punish employees by refusing to pay salary
Also in Dubai, there is now an additional labour court located right in the Ministry of Labour where employees first have to launch their complaint. This has the effect of further expediting proceedings and shortening the time between filing and hearings whilst encouraging parties to mediation. This new labour court also now offers translators to be able to address the judge, a significant facilitator to the process. Unpaid Salaries Claims over unpaid salaries are the most common ones, for obvious reasons. The labour courts are inundated with such claims on the regular basis. Many employees complain that their employers refuse to pay them several months’ worth of salary, for one reason or another. Others complain that their employers withhold their salary, for whatever reason. And yet others challenge the amount of salary which they are being paid. Claims related to non-payment of salaries are treated by the courts very seriously and are typically resolved quickly. The UAE labour law is fairly clear and strict on the employers’ obligation to pay salary. Only few exceptional circumstances exist that allow companies to withhold salary payment. They usually relate to some egregious conduct by employees. The overarching rule therefore, is that all employees are entitled to a salary and employers are not permitted to either withhold or punish employees by refusing to pay salary. Commission and Bonuses The next most common grievance relates to employees complaining that their companies refuse to pay commissions and bonuses. In many cases there are no clear
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LEGAL
Employees sometimes complain about working excessive hours or strenuous shifts, without being properly compensated. Courts tend to give employees the benefit of the doubt in this regard, placing the burden on the employers to prove otherwise
Similarly employees abuse their companies’ goodwill in allowing employees to remain on company visa, while those employees are looking for a new job or until they sort out their lives. Cases exist where employees then bring claims against the original sponsoring company for non-payment of salaries during the time that the company allowed that employee to look for another job, while staying on that company’s sponsorship.
agreements or representations establishing employees’ right to either a commission or a bonus. In such cases, it is challenging for employees to prove that they are actually entitled to such payments. In the absence of clear documents establishing employees’ rights to bonuses and commissions, it is equally challenging for the courts to establish the grounds on which to award such payments. Importantly however, if an employee receives a regular payment, in addition to his monthly salary, the courts often treat those payments as bonuses and/ or commissions. And they will rely on them in calculating total monthly salary, especially for the purposes of the end of service benefits and notice. End of Service Benefits The issue of the end of service benefits (ESB) is the next one on the list of employee complaints. The labour law is clear on how ESB should be calculated and on when employees are entitled to them. Courts apply the law and tend to resolve such disputes promptly. Furthermore although not expressly addressed in the
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law, courts often consider payments of regular commissions, bonuses and raises as part of the basic salary, for the purpose of calculating ESB. Working Hours Employees sometimes complain about working excessive hours or strenuous shifts, without being properly compensated. Courts tend to give employees the benefit of the doubt in this regard, placing the burden on the employers to prove otherwise. The labour law sets out the allowable working schedule and relevant exceptions. Employment Visa Cases related to employment visas come from both employees and employers. Both parties often abuse each other with regards to this issue. Companies often require employees to start working without a visa or while on someone else’s visa, in order to save cost and minimise hassle. Sometimes companies refuse to cancel their employees’ visas, usually because of some dispute and sometimes because of spite.
Notice Many employment cases are filed on the grounds that companies fail to either give proper notice or pay out appropriate notice. In relevant terms, there are two types of notices. Depending on the underlying contract, there could be from one-month to sixmonth notice of termination. A company is required to either allow the employee to work through this notice period or pay out the full value of the notice instead. The employee is therefore required to work through this notice period or compensate the company for early termination. There is also a notice of dismissal for cause. In certain cases, if such notice is not served timely and properly, an employee may also be entitled to a three-month arbitrary dismissal. This is in addition to the usual termination notice. Non-Competition Many complaints are also filed by companies against their employees for violating the non-competition clause in their employment agreements. For such notices to be enforceable, they must be reasonable in scope and geography and clearly documented in the agreement between the parties. Unless they meet those conditions, they are unlikely to be enforced. n
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LEGAL
DISPUTE Resolution in the UAE By Ludmila Yamalova Managing Partner, HPL Yamalova & Plewka
micable dispute resolution includes negotiations and mediation. Adversary resolution usually refers to courts, special courts and tribunals/committees, police and/ or arbitration.
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In the event of a dispute between parties in the UAE, multiple forums exist to resolve disputes. Methods for dispute resolution in turn, can be amicable or adversary
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Amicable Dispute Resolution Amicable dispute resolution refers to parties trying to resolve their differences either through negotiations or mediation. These forms of dispute resolution are called amicable because the parties’ conflict has not yet matured to the level of confrontation and/ or impasse to warrant an official court action. Negotiations are informal discussions directly between the parties, which would ultimately result in a private agreement
settling their differences. Mediation involves a neutral private party to help broker a settlement between the parties in dispute; which could either be conducted informally by a mediator chosen by the parties, or mandated and brokered by the courts. For the most part therefore negotiations and mediation are voluntary proceedings and are usually not binding. They are also more informal and flexible than court proceedings. Some types of mediation however are mandated by, and administered through courts, and so they tend to appear more formal. But even in such cases, parties are not required to either come to a resolution,
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LEGAL
or honour their mediation agreement; for example in Abu Dhabi, it is mandatory that parties first try to mediate before filing an official court case. If the responding party does not want to mediate, and/or parties do not come to an agreement, then a court case could be filed. Similarly, parties’ settlement agreement resulting from the mediation before the Ministry of Labour is ultimately not binding even if it had been acted upon. Nonetheless resolving disputes through negotiations and mediation should always be the first choice of recourse. Although they are not binding, if there is a chance for a settlement, it is a preferred alternative to a formal court process. It is less costly and more expeditious, and parties have control over the ultimate result. There is no need to hire attorneys, pay court fees, hire an expert and incur translation and other court related expenses. More importantly, it allows parties to focus on their business and lives instead of committing resources to a lengthy adversarial journey. Adversary Forms of Dispute Resolution In the event parties fail to settle their differences amicably, the default forum for dispute resolution is the local courts of the UAE. Parties can however opt for an alternative court by agreeing in advance. An alternative court could either be a court located in another country or Dubai International Financial Center (DIFC) Courts. Finally, parties can also agree to resolve their disputes by arbitration, either subject to one of the UAE arbitral tribunal or a foreign one. Jurisdiction over criminal cases however, is reserved exclusively for the courts of the country where the cause of action arose. As such, parties cannot rely on a contractual provision between them in favor of a different court under such circumstances. In general court proceedings are expensive, lengthy and all consuming and litigation results are inherently uncertain, as the decision is now in the hands of a judge or arbitrator, away from the parties’ control. In the UAE local courts, the expense and time of litigating a case is further complicated by the need to have all documents translated into Arabic. Also, as all court proceedings in local courts are conducted in Arabic, the effect of the loss in translation effect is not to be underestimated.
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Local Courts If the parties either do not have a formal agreement between them or the agreement does not provide for a choice of forum to resolve disputes, the default is the local courts of the UAE. Every emirate in the UAE has its own court. The decision in which emirate to file depends on the nature of the underlying transaction and the parties themselves. Often more than one court could have jurisdiction over a dispute. The ultimate choice for where to file a case could be based on the location of the defendant’s assets. This is relevant for the enforcement of judgment, in the event enforcement is necessary to satisfy the judgment. Enforcement is simpler if the court that issues the judgment and the enforcement court are the same. DIFC Courts Some disputes may be subject to the jurisdiction of the DIFC Courts, which are different from the local courts. In relevant parts, the DIFC Courts are an English language-based common law system, modeled against English courts and laws. The majority of judges in the DIFC Courts are British educated and with significant experience in a British court system. The DIFC Courts could have either exclusive or non-exclusive jurisdiction. Cases that fall under the exclusive jurisdiction are either those where parties previously agreed on the DIFC Court’s jurisdiction or where the law mandates such jurisdiction. In particular, any cases related to real estate located in the DIFC are subject to the exclusive jurisdiction of the
DIFC Courts; this includes rental disputes. Similarly, all employment cases related to employees of a DIFC registered company would also be subject to the DIFC Courts. Some cases can also be subject to the nonexclusive DIFC Courts jurisdiction. This means that such cases can also be brought in other courts where jurisdiction can be substantiated. To be subject to the DIFC Courts jurisdiction, there has to be a connection to the DIFC and there must not be an agreement establishing an exclusive jurisdiction elsewhere. The DIFC connection can be established either on the basis that the cause of action arose in the DIFC, or that one of the parties is located in the DIFC or that some part of the underlying transaction took place in the DIFC. Specialised Courts and Committees Certain types of cases in the UAE. are also subject to exclusive jurisdiction of specialised courts or committees. For example, all employment court cases are subject to the exclusive jurisdiction of the Labour Courts. In Dubai rental disputes are subject to the exclusive jurisdiction of the Rent Dispute Center (RDC). At times special committees are set to adjudicate cases against certain parties, at the exclusion of any other forum. Such committees may be permanent or temporary. In the past, for example specialised committees were established for Amlak, Tamweel and Zabeel Investments. Also, a special Dubai World Tribunal was established under the DIFC Courts umbrella with exclusive jurisdiction to hear all cases related to Dubai World. Foreign Courts Sometimes parties may wish to resort to the jurisdiction of a court located outside of
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the UAE. This must be agreed on in advance and in writing, stating the exclusivity of the jurisdiction and identity of a foreign court. Parties reasons for choosing a dispute resolution forum in a jurisdiction other than the UAE can be numerous and diverse. One governing factor however, is the location of the parties’ assets, which would be reached easier in the event of enforcement of judgment. Arbitration Parties also have the right to choose arbitration as the forum for dispute resolution. Arbitration provisions are for the most part, exclusive and binding. UAE courts will dismiss cases that are brought before them if there is an arbitration provision and one of the parties challenges the court’s jurisdiction on that ground. Parties choosing arbitration in advance agree on the seat of arbitration, laws governing their dispute, credentials of the arbitrator and number of arbitrators. Typically, arbitrators are experts in a particular field and are not necessarily lawyers. Parties prefer arbitration in commercially complicated and time sensitive transactions, where knowledge of the subject matter is of the essence. Arbitration awards are also generally confidential. Importantly, the arbitration clause must be drafted very clearly, following the language and regulations of the chosen arbitration forum. In the absence of a precise arbitration language, parties risk losing recourse for their dispute. The UAE courts could dismiss the case due to the existence of the arbitration clause. And the arbitration tribunal may refuse to accept the case because of the defective language. With regards to the arbitration forums, the UAE has a number of its own forums. In Dubai for example, there are multiple arbitration forums. There is the Dubai International Arbitration
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Center (DIAC). There is also an arbitration center as part of the DIFC Courts, LCIA Arbitration Centre. Abu Dhabi has also its own arbitration center, as do other emirates. Enforcement of arbitration awards in the UAE can be challenging. This applies to both foreign arbitration awards and those issued by local courts. Police Cases that are criminal in nature are subject to the exclusive jurisdiction of the UAE courts, provided that the cause of dispute arose in the UAE. As such parties cannot contract out of the UAE court jurisdiction. Any agreements to the contrary will be rendered invalid and of no effect. Also, once a criminal case has been filed parties do not have the freedom to waive or dismiss it. That right remains solely with the prosecutor. Criminal cases vary greatly in their type and frequency. Some of the typical criminal cases that affect the business community include bounced cheques, breach of trust, defamation, theft and the like. Cases stemming from such claims could be brought directly to the police or prosecutor.
A strong contract can serve as a deterrent to escalating conflict
Conclusion Parties should always aim at resolving their disputes first amicably, either through negotiations or mediation. As emotionally charged as some conflicts could be, it is important to put emotions aside and focus on resolving the matter at hand. The emphasis should be on moving on quickly and focusing on productive ventures. Many conflicts can also either be avoided or resolved more swiftly if parties’ agreements are clearly and solidly drafted at the outset. A strong contract can serve as a deterrent to escalating conflict. In those cases where a conflict cannot be avoided, it is essential that the venue for dispute resolution is the one where parties have the best chance for enforcement. n
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LEGAL
New Wills and Probate Registry By Nita Maru Managing Partner, TWS Legal Consultants
In a landmark move, the Dubai International Financial Centre (‘DIFC’) has set the ball rolling for the introduction of new rules relating to succession and inheritance matters of non-Muslims owning assets in the Emirate
n November 16th 2014, the Dubai International Financial Centre’s Dispute Resolution Authority launched a month-long consultation with the public UAE legal community on a new English language DIFC Wills and Probate Registry expected to take effect in early 2015. Once implemented, these much anticipated rules and procedures will provide certainty to nonMuslims in passing their assets in Dubai to their chosen heirs, avoiding the need for their executor and or heirs to be involved in complicated, costly and uncertain proceedings often encountered in the Dubai Courts. Resolution Number (4) of 2014 has been signed by HH Sheikh Mohammed bin Rashid Al Maktoum, President of the DIFC, providing for the legal basis required for the establishment of the DIFC Wills and Probate Registry (for non-Muslims).
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With its impending launch, the DIFC will become the first jurisdiction in the region where a non-Muslim individual can register a will under the internationally-recognised Common Law principles. Currently, the distribution of assets of a deceased is guided by UAE federal laws such as the Personal Status Law, Civil Transactions Code and by public order. The Background to the Rules Currently the dilemma of the contradictory legislation where inheritance matters are concerned coupled with the legal uncertainty of expatriate wills and the courts discretion in applying Sharia Law (when they consider it appropriate) will welcome such a move. In order to avoid lengthy and costly probate battles at the Dubai Court, the risk of estates being contested and the conflicting inheritance laws, many expatriates transfer their assets into offshore structures. Such a shift is common where property is purchased as there is no right of survivorship concept in the UAE (that is property passing onto the surviving joint owner upon the death of the other owner) and this is a serious concern for many investors. Guardianship issues for those parents that have minor children residing in Dubai is a common fear. The fixed distribution of assets as per UAE law and the freezing of bank accounts, for example tend to make expatriates uncomfortable in retaining funds leading to them to transferring funds offshore and out of this jurisdiction. This naturally affects the economic growth and further investment in Dubai and the surrounding Emirates.
Highlights of the DIFC Will and Probate Rules ll The DIFC Wills and Probate Registry will mark the introduction of a new set of rules relating to succession and inheritance matters for nonMuslims with assets in Dubai ll The DIFC Wills and Probate Registry will provide a mechanism for nonMuslims with assets in Dubai only to pass on their estates according to their wishes ll The rules governing the Wills and Probate Registry will complement existing UAE laws on inheritance for non-Muslims, and provide nonMuslims with the option and right to choose the way in which their estates are distributed ll The DIFC Wills and Probate Registry will be within the DIFC jurisdiction and will work with the DIFC Courts for the production of grants and court orders for the distribution of assets. As the grant is issued by the DIFC Court, it will be directly enforceable in Dubai without the need to go through the Dubai Courts ll The DIFC will be the first jurisdiction in the MENA region, where nonMuslims can register a will under internationally-recognised common law principles The current thought is that the Registry would register the wills of nonMuslims and, upon receipt of evidence of death, issue the necessary Court orders to allow for the distribution of the deceased’s Dubai based assets (as well as Court orders relating to Guardianship) in accordance with the registered will. Also, as a “common law” jurisdiction, the use of the DIFC procedure would allow for testamentary freedom for dispositions for non-Muslim expatriates and a speedy and orderly administrative process of a deceased non-Muslim’s estate in Dubai. Once the Registry is in place, precedents would organically evolve and providing a greater degree of certainty in the handling of such inheritance cases in the future. It is hoped that the Registry will be functional and officially open its doors by early 2015. Should you wish to prepare a DIFC will or should you wish to review your existing will in light of the aforementioned developments, it is prudent to seek the advice of a lawyer registered with the Government of Dubai Legal Affairs Department. n
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marketing & Advertising
Google as a marketing tool
We speak a lot about the importance of marketing, but have you ever considered using Google as a marketing tool? By Ahmad Abugosh Learning & Development Manager, AstroLabs
f you’re like most people, you use Google every day. Whether you want to look up something, check the spelling of a word, or stalk an old acquaintance; Google is most peoples’ website of choice. Google is even used as a verb (how many other brands have that privilege?) when, in 2006 it was added to Oxford Dictionary. Since Google is currently the most popular site on the internet, let’s look at a few ways you can use Google as a marketing tool to promote your business.
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Google is constantly scouring the web looking for new websites (and changes to old websites). If you post something on the internet, chances are Google will find it almost right away. It has ‘bots’ that look for websites, and then displays those websites in Google whenever someone searches for a relevant term. But how can you make your site appear naturally in results for those relevant words people search for? That’s where SEO comes in.
SEO Optimisation SEO stands for Search Engine Optimisation. It is the method by which we try to make a site get more relevant traffic organically from Google. There are two main branches for SEO; 1. Technical SEO - Which involves technically optimising your website to make sure you have maximum exposure on Google (fixing your sitemap, robots.txt file, no duplicate content, page load time, proper meta descriptions etc). 2. Content SEO - which involves creating engaging content that people want to regularly visit and share.
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marketing & Advertising
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marketing & Advertising
Another key area (although less so in recent years) is the concept of “link building”; often referred as a ‘hotlink’. This involves getting other sites to place a link to your site from their own. This will boost your overall rankings on Google search. In general, the more quality links you have linking back to your site (known as “link juice”), the better. However, if link building is done using “blackhat” techniques (like buying junk links or spamming forums) beware! Google is always taking measures against those who use nefarious means to promote their site; you may be penalised with a lower rank if you use those blackhat techniques. That’s why it’s always good to have a smart SEO strategy in place, and that requires time and effort. What if you think SEO is a good long term strategy to have, but you need results right now? Is there any way to get traffic to my site today, without having to spend all day doing SEO work? The answer you’re looking for is Adwords. Adwords Adwords is Google’s advertising tool that allows you to pay money to promote yourself across Google and its network. Adwords is split into 2 main categories; 1. Paid Search. 2. Display Ads (GDN- Google Display Network). When people typically say Adwords they mean Paid Search, which can also be called SEM (Search Engine Marketing) or PPC (Pay Per Click). Whatever name you ascribe to, they all mean the same thing: paying money to put text ads on Google Search. These text ads are typically displayed on the top, right and bottom whenever you do a Google search. You only pay Google whenever someone clicks on your ad (hence the term Pay Per Click). Adwords is how Google makes most of its money, and you can make money from it as well if you’re smart; by bidding on relevant keywords and match types, all while typing relevant catchy ads and staying in budget. If you use it right, Adwords can be a great way to bring cost effective relevant traffic
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According to Google, the Google display network reaches 80% of all internet users through its network of sites to your site, which in turn helps your business grow. The second part of Adwords is display ads. These are image-based ads that are shared on Google’s network of sites in the Google Display Network (GDN). If you add an image ad to Adwords it will not be displayed on Google Search, but instead on any 3rd party site that uses Adsense to display ads. According to Google, the Google display network reaches 80% of all internet users through its network of sites. When running a display campaign on Adwords, you can choose to target only certain site categories. For example, if you are selling car insurance, you can choose to only target car sites for your ads to be displayed on. One thing you should always keep in mind when running display ads is that this marketing channel relies more on “push marketing”. What this means is that the ad is displayed to all users, whether or not they are actively searching for your product (unlike Paid Search). In most cases, GDN ads are used more for branding purposes and to boost the overall performance of all channels.
Youtube Another Google channel that you can use to advertise on is Youtube which is now the 3rd most popular site on the internet and by far the most frequented video site. It is a great place to get your message across in a more visual way. The most popular form to advertise on Youtube is through displaying your video ad before Youtube videos (TrueView instream ads, aka those ads that you can skip). One major advantage to using this type of ad as a branding strategy is that you only pay when 30 seconds of your video pass, or when your video is finished (you aren’t charged if someone skips before that). Whether you choose to use one or many of the ways Google lets you market your products, it’s always important to have a strategy in place. Think about what goals you want to accomplish with your marketing then set aside a budget, define your KPI’s and constantly work to optimise your spending to make sure you have a good ROI. If you work hard at it, Google can be a great marketing tool for your business. n
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FlipFlop Media is one of the fastest growing publishing houses in the UAE, focusing on offering unique online and print solutions.
www.flipflopmedia.ae
www.flipflopmedia.ae
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Diamonds are Forever The Kimberley Process - Facilitating conflict free diamond trade in the UAE
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ubai sits firmly at the crossroads of the global diamond trade. It connects the producer markets in Africa; the cutting and polishing markets in Asia and consumers in Europe and the United States of America. The ever increasing number of market participants choosing to operate out of Dubai has had a significant impact on the rapid growth of the diamond market in the UAE. In addition to its strategic geographical location, Dubai has transport links which makes doing business here extremely convenient,
and one of the most efficient places for global commodity traders. DMCC has extensively contributed to Dubai’s position as one of the world’s top three trading hubs for gold, diamonds and gemstones. Through DMCC, Dubai now boasts world-class infrastructure that facilitates all aspects of commodity trade. From buyers to sellers to service providers - Everything the industry require in terms of infrastructure and a marketplace is available under one roof in a secure environment at Almas Tower including: the Dubai Diamond Exchange, vaulting, boiling, polishing, certification and transport services and the UAE Kimberley Process Office. The Dubai diamond market also meets the highest international standard of ethical trading practices, thanks to the Kimberley Process Certification
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Scheme (KPCS). The Kimberley Process is a government, industry and civil society initiative created in 2002 to stem the flow of conflict diamonds. The UAE became the first Arab country to become a member in 2003. The UAE KP office is now well established with offices in Almas Tower in the DMCC Free Zone and Dubai Airport. Here the International Gemological Institute (IGI) and Gemological Institute of America (GIA) certified professionals inspect and evaluate every shipment of rough diamond that passes through the UAE. Once a shipment is controlled and approved, a certificate will be issued as an assurance that the diamonds are conflictfree. “In a nutshell, the Kimberley Process Certificate can be considered as a passport for rough diamonds - people cannot travel far without a passport and rough diamonds handled through KP member countries can’t travel without Kimberley Process Certificates”, explains Maryam Al Hashemi, Director of Kimberly Process, DMCC. Dubai is at the centre of the New Silk Route for the diamond trade and increasingly the unifying point where all markets meet. The UAE KP office therefore actively works towards an improved understanding of regulatory measures to enhance trading relations between countries and to ensure industry participants and consumers alike are aware of the initiatives taking place in Dubai and the UAE. “Diamonds are beautiful gemstones and are often referred to as ‘a girl’s best friend’ in the world of jewellery. Beautiful as they are, it is also important to recognise the complexity of the journey diamonds take to reach the jewellery designer’s shop window. We all have a role to play when it comes to ensuring diamonds are sourced ethically and that the appropriate steps are taken throughout the entire supply chain. The KPCS initiative is a big part of that. Transparency and solid corporate governance are key priorities in any supply chain management which is why we are collaborating with entities across the globe to raise awareness and continuously enhance the regulatory measures available to ensure a conflictfree supply chain today and in the future,” concluded Maryam Al Hashemi.
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Inaugural Middle East Gems and Jewellery Forum shines in Dubai MCC, Dubai’s and the region’s global gateway for commodity trade and enterprise officially launched the Middle East Gems and Jewellery Forum (‘MEGJF’) earlier this month. The interactive forum welcomed over 250 delegates and partners, including title sponsor Gemfields, the world’s leading producer of rare coloured gemstones. The event was inaugurated by His Highness Sheikh Ahmed Bin Saeed Al Maktoum, President of the Department of Civil Aviation, CEO and Chairman of The Emirates Group and Chairman of Dubai World, and was held at the DMCC headquarters in Almas Tower, Jumeirah Lakes Towers. During his welcome address to a full house of delegates Ahmed Bin Sulayem, Executive Chairman, DMCC, hailed the strong synergies between the jewellery industry and the UAE’s heritage, trade story and rapid evolution with focus on pearls, gold, diamond and coloured stones. Mr Bin Sulayem also stressed the importance of strong collaboration between industry participants ranging from traders to regulators, banks and jewellers to foster further industry growth in the region and beyond – one of the key purposes of hosting the MEGJF. “As the UAE has the highest per capita gold jewellery consumption in the world and Dubai is ranking among the world’s top three trading hubs for gold, diamonds and gemstones, it is fitting that DMCC is organising the first Middle East Gems and Jewellery Forum here in Dubai”, said Ahmed Bin Sulayem, Executive Chairman, DMCC, speaking at the event. “In an ever-changing economy, it is key that we learn more about what the future holds for the industry here at the MEGJF and we hope the event will lead to new partnerships being formed and ultimately future growth to the benefit of the entire jewellery trade. This is only the beginning, we are going to ensure traders and consumers alike benefit from the leading jewellery hub Dubai is
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becoming”, Mr. Bin Sulayem added. The MEGJF was conceptualised in a bid to support the gems and jewellery industry’s global supply and demand and capitalise on the Emirate’s ideal location between the producing and consuming nations along the ‘New Silk Route’. “It gives me great pride to attend and sponsor this event. I have always believed in the power of partnerships, especially so when two or more parties come together with such a clear degree of passion, commitment and focus. I am 100% confident that events like the MEGJF give the market a positive momentum and help the industry scale new highs”, said Ian Harebottle, CEO of Gemfields. Inspiring speeches from Robert Wan, Founder Robert Wan Group, on the topic of ‘The case for pearls, heritage and the future prospects’ and Alex Popov, Board Chairman, World Diamond Mark, ‘Diamonds share of today’s luxury spending’ sparked fruitful debate among the delegates representing all aspects of the jewellery industry. Matteo Marzotto, President of Fiera di Vicenza, took the opportunity to announce the inaugural ‘Vincenzaoro Dubai’ where DMCC is a strategic partner. The four day jewellery show is to be hosted in Dubai, 23-26 April 2015, organised by Fiera di Vicenza SpA, the organiser one of the world’s largest and most-respected jewellery event portfolios and Dubai World Trade Centre. DMCC also announced that it will be hosting and participating in a number of other industry events in the first quarter of 2015, in order to foster networking, innovation and opportunities for industry experts, as well as open the doors to new market participants. “Next year is set to be very exciting for the gems and jewellery industry and Dubai”, said Gautam Sashittal, Chief Executive Officer, DMCC. “DMCC is to host its very own Dubai Precious Metals Conference in April. This will be the fourth edition of what has become the largest conference in the MENA region for the gold and precious metals sector,” Mr. Sashittal announced.
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technology
By Ahmad Abugosh Learning & Development Manager, AstroLabs
Make your Website Work For You
Website are like opinions, nowadays everyone has one! The question is though, is your website doing what it should be doing? What you need to ask yourself is if your website is fulfilling its maximum potential in relation to your business
“When designing and developing your website, don’t think of your website as a distinct entity, but rather keep in mind what you want to achieve for your business”
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“You must keep in mind what makes sense for your business in terms of what goals you want your site to achieve that will have an impact on your business”
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technology
s you are likely to have noticed when you first arrived in the UAE, it can be really rather difficult finding what you want/need from websites as often the information just isn’t available. However as it is often the first thing that people check when they want information on a company or service, should there be any excuse for you not to have this information? This is probably your company’s first chance to make the right impression. Make it count! Due to the importance of this, Business Insight magazine thought it best to ask Astrolabs, who are partnered with ‘Google For Entrepreneurs’ to find out more. Ahmad Abugosh, Learning and Development Manager at Astrolabs explains, “Is your website helping you grow and promote your business? If you have an ecommerce company, it’s relatively easy to determine since success can be tied to how profitable your website is in terms of sales and customer retention. But what if you aren’t selling anything online? How can your website work for you?”
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Where to Start Starting a website is a bit of a nightmare. You have to consider everything; your proposition, brand, USPs etc. You have to pay careful consideration to what you believe is important and what you feel isn’t. Look at competitors and what others globally are doing. “As Stephen Covey said in The Seven Habits of Highly Effective People, “Begin with the end in mind” (Yes, I know that’s a cliché quote). When designing and developing your website, don’t think of your website as a distinct entity, but rather keep in mind what you want to achieve for your business,” suggests Abugosh. “It’s a subtle shift in mind-set, but it makes a huge difference in what elements you highlight on your site. For example, if you’re a digital agency, then an important part of your business is to attract new clients. That means that your website should; Showcase information that would make someone interested in becoming a client and make it easy for someone to get in contact with you with regards to becoming a client.” Once you define your business objective that you want your website to achieve, the next step is to define Goals (events and actions) you would like users to perform on your site. That can be anything from them browsing your site for a long time, collecting an email or phone number as a lead, or the user making a purchase on your site.
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Traffic “If you build it, they will come” and while that may be true for Kevin Costner, it doesn’t necessarily apply to every website that’s launched. Once you build a site you need to bring traffic to it. Easy free ways to do this are through Social Media and utilising your email contacts. However if you want constant traffic you need to build in a marketing strategy. There are various ways you can do this as Abugosh explains, “It could be content based (make content people want to share on their own), outreach based (by spending time and money on marketing and PR), or a
ongoing process. You need to keep updating content, fix technical issues, redefine goals as your business objectives change, and keep improving on your design. One key concept that top websites use across the world is A/B testing, but what is this method? Abugosh explains, “It is exactly what it sounds like. It’s a way of testing what works best in a controlled environment; For example, if you want to improve your conversion rate on your signup page, you can run an experiment by sending half of your traffic to a page with a red signup button, and the other half to a page that is exactly the same but
combination of both. Having a strategy across multiple channels like SEO, Adwords, Email Marketing and Social Media is a good idea. Again though, you must keep in mind what makes sense for your business in terms of what goals you want your site to achieve that will have an impact on your business. A good place to start is by using free Analytics tools, like Google Analytics, which can help you easily define and measure the impact of your marketing efforts.”
with a blue signup button. Then, you see what page has a higher conversion rate. This has endless possibilities, because there are countless elements on any given website that can be tested against each other.” He continues, “Think of your website like a well-oiled machine, like an expensive sports car. Even if you feel like it works great and looks good in the beginning, you need to keep maintaining it; changing the oil, and maybe even upgrade to a newer model as time goes on. Technology changes every single second, and if you want your business to succeed, you need to stay on top of it. That is how you make your website work for you.” This is also the time where you get to be creative, and have fun! n
Maintenance Once you have these elements in place, you’ll be sure to have a successful website, but your work is not over. It never is! Maintaining a website is an
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telecoms
Under Attack
Imagine that your body is being targeted by 75 million viruses. That is exactly what’s happening to digital devices at any given moment today, with smartphones and tablets being targeted in record numbers rom a cyber-criminal’s perspective mobile phones and mobile applications represent a weak link to be exploited for profit; six out of every 10 cyber-security breaches occur as a result of a mobile device, say the Ponemon Institute, an organisation that conducts independent research on privacy and data protection. In 2012, malware targeting smartphones increased 155 percent, and in a span of just seven months the volume of malware targeting Android phones increased 3,325%. In a world of 7 billion people, there are now 5.9 billion mobile-phone subscribers. In the USA alone there are more mobile phone subscriptions than people. Even Ian Carrington, Mobile and Social Advertising Director at Google stated that globally, more people will own a mobile phone than they do a toothbrush. The mobile Internet that we’ve come to rely upon, for everything from financial transactions to business operations, is increasingly vulnerable. The reason for the assault on mobile device technology is because it is so profitable. People carry their bank account details on their phone with them all day long for example, or they purchase things on a
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whim when travelling, their card details being kept on the device. The result is a new generation of mobile malware that is increasingly sophisticated. With UAE business people now routinely using their smartphones to store sensitive information such as client data and even personal/company credit-card details, cyber-criminals are targeting these devices with ‘Trojan horse’ mobile applications, which look and feel like legitimate apps. Once downloaded however, these apps automatically transmit confidential data from the unsuspecting user’s device to a cyber-criminal’s server. Some criminals are now taking this concept a step further by building entire fake storefronts of mobile apps. It is no longer just the individual’s data that is at stake: very often the target is high-value information owned by businesses. Cisco, in their 2014 Annual Security Report state, “99 percent of all mobile malware in 2013 targeted Android devices. Android users also have the highest encounter rate (71 percent) with all forms of web-delivered malware.” Admittedly, you have to take into account that Android grew to 87% of the global smart phone market however, if you were to compare the fact that Android detected malware rose to 804 new threats in 2013, yet the
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telecoms
combined total of new threats for all other devices (Apple, Windows and Blackberry etc.) is actually 0%, you can see the concern. The remaining 1% is related to Nokia’s IOS platform. Given the rise of mobile malware, and the huge reliance on mobile devices that businesses in the UAE favour, it is vitally important to stay current on security threats, four of which are unique threats to mobile devices: QR Code Scams QR code attacks are relatively new. A QR scam works because, as with a shortened URL, the link destination is obscured by the link itself. Once scanned, a QR code may link to a malicious website and download an unwanted application or mobile virus. For this reason, it is a good idea for mobile users to refrain from clicking QR codes from unfamiliar sources, and stick to codes provided by known advertisers or vendors, which are the least likely to be infected. Smishing/SMS Phishing This is the mobile version of phishing (the term is short for ‘short message service phishing’ or ‘SMS phishing.’ Rather than email, SMishing scammers send text messages, which appear to have come from a legitimate, trusted organisation. The message will ask the mobile user to click on a link or provide credentials in a text message reply. Once you understand how it works, you are better positioned to recognise SMiShing, and to avoid clicking links within text messages or even responding to such scam messages. Jailbreaking or Rooting ‘Jailbreaking’ an iPhone or iPad is the process of removing the limitations on the device's operating system imposed by Apple and mobile carriers. This allows the phone's user to gain full access to the iOS (operating system) and all of its features. Similar to jailbreaking, ‘rooting’ involves the process of removing the limitations on a mobile or tablet running the Android operating system. Jailbroken and rooted phones are much more susceptible to viruses and
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malware because users can download apps that have not been through the vetting processes used by Apple and Google to help ensure that users download virus-free apps. Premium SMS Fraud McAfee reports that one of the simplest ways to profit from malware attacks on mobile devices is for fraudsters to use the technology to place a call or send a text to a pay-for premium number. If this activity is infrequent (for example, only once a week) and concealed (by erasing the log and using the hiding capabilities of a rootkit), then it may go unnoticed for a long time. The key factor to this malware's popularity is that the software will covertly send messages. In this case, Android is more risky than iOS because in Android, permissions are assigned once at installation and cannot be dynamically controlled. Repackaging A common technique is ‘repackaging’, whereby a malware writer takes a legitimate application, modifies it to include malicious code, and then republishes it to an app market or download site. The repackaging technique
“99 percent of all mobile malware in 2013 targeted Android devices. Android users also have the highest encounter rate (71 percent) with all forms of webdelivered malware”
Cisco, 2014 Annual Security Report
is highly effective because users struggle to tell the difference between a legitimate app and its repackaged fake. It should be noted though, that the researcher and security specialist state that whilst Android accounts for 97% of all threats, it comes from the user purchasing third party apps carrying malware. Google’s official play store found that this accounts for just 0.1% of their apps. Ultimately, if you want to remain safe, be careful what you download; be it an app or an email attachment. If you want an app, only buy these through the official channels. n
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insurance
Follow the Fleet
I am sure you all know that any motor vehicle that is used or left on a public highway is legally obliged to have adequate insurance cover, and the same is said for all business automobiles. However as with all insurances, what makes a business policy such a viable option and why? f you have only one or two vehicles but are looking at expanding your transportation numbers, fleet insurance could be an option, as by putting them under a fleet policy, you will align your insurances by giving them the same renewal date with one premium payment, which in turn makes the administration much easier to navigate. There may also be a savings to be had…
are often a tool of the business. They are used to pick up supplies, deliver goods to customers and in the case of hire car companies or taxi companies, they are a critical component of the business. If these vehicles are off the road then customer orders cannot be fulfilled. If this happens, then your customers will go to your competitors – and may never return, which impacts the long-term viability of your business.
Why is Fleet Insurance so vital for SMEs? “Motor Fleet insurance is vital and mandatory for an SME. Legally, all businesses must ensure their vehicles have 3rd party motor insurance. But there are other key implications that may mean investing in comprehensive insurance is a better decision,” Clint Draper, Head of SME with Zurich Middle East explains. “Fleet vehicles
The Benefits As we said above, Fleet insurance is a type of insurance that will cover a number of vehicles under one policy. Yes, administration will be easier as you will not have the hassles that arise from having several policy numbers and insurances that relate to differing vehicles; especially at renewal or when you need to make a claim
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insurance
and yes, it streamlines the administration to make it less time consuming, but it is more than this. “SMEs should ensure they select an insurance solution that is tailored to meet their business needs and risks. For instance, there is specialised insurance cover for hire cars. You can also get extension covered to the include tools of trade, such as cranes and fridges etc,” says Draper. He continues, “SMEs should also see what fleet risk assessment advice the insurer or broker can provide. The right advice can help to reduce the size and frequency of claims and losses, improve the day-to-day management of the fleet and help ensure your vehicles stay on the road.” It also provides cover to your employees for all business related travel, some offering increased Emergency Medical coverage. Not only are you keeping the vehicles safe, but you are also telling your employees that you care about their wellbeing. Happy and healthy employees mean a happy and healthy bottom line. For your executives, who need to be mobile, it can offer a courtesy car if theirs if off the road due to accident or something that is claimable under the terms and conditions of the policy. You can also include off road cover for any 4x4 vehicles which is extremely handy for those in the construction industry for example, who will often have to travel to sites where the roads have not been made. It should also be noted that off road insurance applies even to those cars that park on the sand behind their offices/home etc. You could also opt for Breakdown Assistance who will assist during either a breakdown or in event of an accident. If the company has two cars used for business travel and three vans for a delivery business, compiling two car insurance policies and three van insurance policies would become a major hassle. Fleet insurance will simply cover all the vehicles and ensure that each vehicle is outlined in the policy. The vast majority of fleet insurance policies are held by businesses and there are no restrictions to the type of business that holds a fleet insurance policy; Carriage of own goods, haulage, plant hire, vehicle hire, construction, builder merchants, retailers, wholesalers, solicitors, doctors, sales teams etc.
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It should also be noted that off road insurance applies even to those cars that park on the sand behind their offices/home etc. Premiums “Risk management is the key to reducing premiums as it focuses on reducing the likelihood of accidents and claims,” Draper says when asked what companies can do in order to drive their premiums down. “The added benefit is that it is keeps your vehicles on the road, which ensures they are earning the income they are required to do.” A little goes along way here. Educate your staff to wear seat belts, report problems with the vehicles, and encourage them to take regular breaks when driving distances (the UK Government recommends taking a break every three hours). Also, service your fleet every year; checking tyres, water, breaks etc. Orange Card From October 2011, an Orange Card was made mandatory for all cars that travel over boarders within the GCC. Each member
country has a Unified Insurance Bureau, which will deal with claims in another country. The unified Insurance Bureau of the UAE is Abu Dhabi National Insurance Company (ADNIC) What is the one thing that you would advise an SME business to be aware of when taking out Fleet Insurance? “The cheapest isn’t always the best. When choosing an insurance partner it is very important to consider their reputation in regards to paying claims,” advises Draper. “It is vital to have fleet vehicles back on the road as soon as possible. Delays in having the vehicle repaired and back on the road will have a greater impact that the dirhams you can save on the premium.” He continues, “You must also ensure the cover you select fits your business requirements. Not all fleet policies provide adequate cover, or they may provide cover that is not relevant to your business.” n
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property
Top Tips for Negotiating the Perfect Office “The UAE rental market is a funny one, the lack of exclusivity between landlords and real estate brokers means most offices have 2 or 3 agencies working on them. For us we simply played them against each other, which meant we managed to get a reduced rent - and even managed to reduce the commission paid to the broker” Jon Richards CEO of compareit4me.com “I am a big believer in five year strategies and always keep the ultimate targets for the business in focus. I tend to start at the end and work backwards, never losing sight of the finishing line. Accordingly when looking for suitable office space I always keep this mind and plan for the maximum number of staff” Jeffrey Rhodes CEO, BTC (A division of), New Egypt Gold
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“There isn’t a shortcut; research the market carefully and make sure you have 3 or 4 viable options” Liam Mooney Managing Director, BLUE PENCIL INTERNATIONAL “The best tip which always works, is to pretend you are a Real Estate expert and articulate the rent in conjunction with the actual development cost vs. margin per SQM. This will expose the rent ask price as well as the landlord since it becomes apparent how greedy the margin is. Another trick is to portray the asking price in light of the underlying economic fundamentals; which only works if you have a case of course e.g. financial crisis, summer downturn etc.” Mr Zaid Maleh CEO DACH ADVISORY
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property
“Before I go into any negotiating situation, I make sure I’ve done my homework and got my facts at my fingertips. I also visualise before the meeting the questions I am going to ask and try to imagine potential responses; so that I feel better prepared for different outcomes. Once involved in the situation, I firmly believe in the old adage two ears and one mouth therefore letting the other person do the talking as much as possible. This gives you time to digest what they are saying, formulate a measured response and also gives you a greater sense of being in control. I certainly never take any business situation personally, so I like to leave my emotions at the door and remain business like and unflustered.” Russell Hemmings Cognitive Behavioral Hypnotherapist “We usually recommend to our clients which buildings they should consider on the basis of what fit-out they are after. Therefore, we recommend taking this into consideration in the first instance.” Jerry Gallagher General Manager, Joint Creative Technical Services LLC
“My best advice for negotiating office space is to ensure that there is a willing landlord and a willing seller. If the parties are on the same page in terms of their intentions and expectations and are acting in good faith, everything else is a matter of semantics. They will find common ground and mutually beneficial terms. In more specific terms, the first step to all negotiations, be it for tenants or landlords, is to establish the identity of the party. To that end, it is essential that parties request and provide each other with the documents establishing their identity and their legitimacy to enter into the underling transaction. Next specifications and relevant details of the property should be established. This includes title deed, service charges, maintenance report, parking and all other property facilities. After that commercial terms should be agreed on. Usually, the longer the office lease, the better chances are for negotiating better terms.” Ludmila Yamalova Managing Partner, HPL Yamalova & Plewka DMCC
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December 2014 | 59
Travel and hospitality
Bringing luxury to a healthy lifestyle Powwer™ Lounge brings a unique combination of luxury and wellness to empower the women of Dubai to become more physically, mentally and spiritually fit ocated on Jumeirah Beach Road, Powwer™ Lounge is the brainchild of acclaimed weight-loss consultant Ahlaam Ali, who has focused her much sought after experience to create the centre, which embodies her own philosophy for health and wellbeing. Inspired by Ali’s vision to help and support women, Powwer™ Lounge is a fitness spa that brings together all the tools necessary for creating a healthy lifestyle, offering women a sanctuary in the city to escape their busy lives and focus on self-improvement in a fun and supportive environment. “Women wanting to lose weight, get fit and tone up will enjoy this unique environment where they are pampered and well looked after, whilst being empowered to lose weight,” says Ali. “The Lounge is where our clients come in and workout, relax, hangout at the healthy Detox Bar, bring in their friends and generally just enjoy an overall healthy lifestyle. The Lounge is a sanctuary that encourages healthy living and offers a range of activities and weight-loss treatments that enable people to live their lives in a more empowered and productive way.” Activities the centre provides include: Nutritional advice, Personalised Weight Loss Programmes and Slimming treatments, Health and Fitness seminars, Body Sculpting treatments and wraps, and even Bollywood ‘dancercise’. Group fitness and exercise classes are also on offer, with sessions targeted to specific problem areas such as abs or thighs, as well as overall body sculpting sessions. They also offer many alternative treatments including theta healing and gastric mind banding, a form of hypnotherapy applied to weightloss, Gong Meditation,
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We believe that to make a lasting change, the mind-set of an individual needs to change and that’s when a complete transformation will come through
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Raw Food demonstrations and many other exciting healthy lifestyle options. The Lounge also provides a crèche onsite for the little ones to play while their mothers workout or relax in the lounge. The speciality detox bar provides detox juices and protein shakes after a workout. This wide variety of activities and services, combined with Ali’s philosophy, makes Powwer™ Lounge more than merely a health and fitness centre. It’s an escape that combines relaxation and pampering with fitness and nutrition to make a healthy lifestyle a reality for women. “There is no other Lounge quite like this in the UAE, helping people to achieve their optimum level of health and fitness using a wide variety of non-surgical, specialist methods focused on healthy living,” Ali says. Ahlaam is a well-known figure in the Dubai health and wellness scene, having run Powwer™ Living for the last eight years as a health consultancy service. Ali is respected for her ability to assess her patients’ needs and turn that into a manageable weight loss programme. “We have worked with over 3,500 people to date and have positively and significantly affected their lives by helping them to improve their diabetes, cholesterol, high blood pressure, arthritis and other obesityrelated diseases by changing their lifestyles for the better. “We do not believe in diets as they are short-lived. We believe that to make a lasting change, the mind-set of an individual needs to change and that’s when a complete transformation will come through. This is what we help individuals achieve by coaching and counselling them and holding their hand through this Weight Transformation process.” n
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Unveil a world of radiant festivities. Stay in high spirits all through the season at an intimate destination nestled in Emirates Hills. Hosting an exceptional Carnival on the Lawn, festive dining experiences and extraordinary New Year’s Eve experiences at Aquaviva Terrace and Nineteen, The Address Montgomerie Dubai is where celebration happens. Choose your experience at myfestivedubai.com
T +971 4 423 8884 | dine@theaddress.com
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WWW.THEADDRESS.COM
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business incubator
The Smell of Success Smells bring about many feelings of nostalgia, memories are triggered and we can mentally go back to that safe warm place in childhood where we knew no different. But how are businesses using this to their advantage? We meet with Emma Henry, Director of Fragrance Du Bois to find out more
“Aroma/Scent marketing is an extremely powerful, but very subtle way to increase your brand” Emma Henry, Director, Fragrance Du Bois
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hen walking into Fragrance Du Bois beautiful Lounge as Henry calls it (which is located in a stunning office situated high up in the Arenco Building with an amazing view along the Sheikh Zayed Road, sweeping towards Jumeirah Lake Towers), it is the rich aroma that hits you, “I have always had an interest in perfume and beauty,” she explains. “My background is events. When we first started, I was doing the PR for the events to introduce the fragrance.” What started up as a way of marketing the parent company, quickly turned into a business of it’s own when they realised that they had
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formulated such a great product. The company behind Fragrance Du Bois is very interesting. Offering an alternative investment to diversify your portfolio, Asia Plantation Capital enables investors to buy a number of Agarwood trees (reputedly the most expensive wood in the world), which in turn produces Oud; also know as Liquid Gold. With plantations across Asia and Thailand, they replicate the natural process of producing Oud, which can be used in oil, fragrance and herbal teas. “The tree is harvested after 7 years and the tree remains gets used for woodchips. For every tree that we cut down, two more are planted. We are a sustainable company.”
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business incubator
Whilst Fragrance Du Bois will take you down your own personal journey to provide you with a niche, luxurious scent that is 100% pure, natural and organic; they do not provide off-the-shelf versions, “We want luxury. Prince Albert of Monaco has endorsed a perfume, proceeds of which goes to his charity. David Haye has also created his own fragrance, ‘London Oud’” In this region, fragrance has a huge following. Babies are used to strong scents from birth and the fascination/ obsession lasts a lifetime, but scents can be used much more than just as a way to make the wearers more appealing. Aroma Marketing Aroma/Scent marketing is an extremely powerful, but very subtle way to increase your brand and gain customers loyalty; especially when you consider how smell is cited as one of the strongest triggers of emotions and memories. Therefore it is unsurprising that businesses are increasingly taking this approach by employing consultants to interpret the brands message from customers and translating this into what their fragrance should be. Top brands are using aroma marketing to target their audience creating a sensory branding program. “The Address Hotels have their signature fragrance. As soon as you walk in, you know you are in an Address hotel. It invokes memories and feelings; which is basically everything that you could possibly want from a brand. These are the feelings that people wish to recreate,” says Henry. This can be a difficult process so you need to understand fully what you want, “I was asked by a hotelier to recreate paradise. When you are recreating a scent, their version of paradise can be completely different to mine. It is a very personal preference. They do it as a way to trigger different feelings and create memories that instantly revert to them, the brand.” Henry elaborates, “For example, for me Cinnamon is Christmas. But they don’t celebrate Christmas here like they do in the UK, so what does this mean to the local Emirati population? It is a tricky one. The Address has this spot on. Their signature scent calms me as this is my familiarity.”
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The Address however are just one of the businesses following this path. JW Marriot and other spas regularly use scents to convey their particular message. Companies like Dunkin’ Doughnuts have a distinctive smell, which immediately entices you to buy what is on offer. As this new and exciting form of marketing is slowly but surely seeping it’s way into the business world, how long will it be until you use the power of perfume to make your brand instantly recognisable? n
Understanding the Marketing Jargon Billboard: Putting the fragrance into the air in the same way many hotels are now doing. Ambient: This is when you would ultimately like clients to feel instantly comfortable/energised etc. Themeatic: Creating a scent around a specific theme. For example, if you are selling/leasing cars, you may want to recreate the smell of a brand new car.
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business incubator
Does a Leader Need a Coach?
By Ceri McVittie – Life and Executive Coach
Bill Gates said in his April 2013 Ted talk, “Everyone needs a coach.” However if you see yourself as an already successful and established leader, you would be forgiven for questioning this in light of your success… nd you wouldn’t be wrong; to have become a good leader you will have been doing a lot of things right to get you there, but do you know where your blind spots are? Great leaders know how to leverage a coach to find out.
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Why Use a Coach? Great leaders develop others and even use the coaching techniques that they learn to empower those around them in their development. The International Coaching Federation Global Coaching Client Study carried out by PriceWaterhouseCooper showed that the median company return on investment for coaching is 700% indicating that typically a company can expect a return of 7 times the initial investment of providing their leaders with a coach. What Does a Coach Offer? Coaches, whether they are sports, relationship, performance or executive offer the same thing; they help you see yourself as others see you and are able to provide you with some hard truths of how you come across. It helps you understand your range of influence, and focus you on areas you may not have thought of so that you can improve on developing yourself. Coaches provide objectivity; ask questions and challenge leaders to do better. They help challenge assumptions and enable leaders to think through problems to get solutions. One important distinction to make, is that coaches empower their clients to come up with the solutions; not to bolster a weak leader, it’s up to the leader to figure it out. What are the Benefits of Coaching? Historically, organisations pay the bill for coaching to improve the bottom
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The median company return on investment for coaching is 700%” PriceWaterhouseCoopers
Figure 1.1 – From International Coaching Federation Global Client Survey report
line and increase productivity. A study of Fortune 1000 companies using coaching showed the following percentages reported by executives in the benefits the company gained from the coaching they received; ll Increased productivity (by 53%) ll Increased customer service (by 39%) ll Increased retention of senior people (by 32%) ll Reduction in costs (by 23%) ll Increased bottom line profitability (by 22%) On an individual basis coaching has many benefits though the outcomes will most likely differ, as they will be personal to the individual being coached (see figure 1.1). Further research shows that leaders have report further key benefits; ll Increased productivity ll Deeper self awareness ll Improved and faster decision making
ll ll ll ll
Gaining new skills Increased confidence More open to change Greater understanding of beliefs and assumptions that are holding them back
Top Tips to Finding a Coach 1. Interview your coach – if the relationship isn’t right, it won’t be successful 2. Check their experience/understanding of your world - The coach does not need to understand in’s and out’s of your business, but they should understand the challenges. 3. Is the chemistry right? - Any good coach will offer a free introductory session to establish if there is a good rapport and if you can work together. 4. Check out their credentials – Referrals are a great way to check out the reputation of the coach and how credible they are. Ask for testimonials. n
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business incubator
Strategic Partnerships
The value of strategic partnerships is something that is frequently overlooked by companies. If you want a business product or service you pay for it; or at least you used to‌ by Liam Mooney, Founder, Club Fit for Business
trategic partnerships are often confused with barter deals; whereby each business gives away a product or service to another in return for a product or service that they can offer back. However strategic partnerships are much more successful than a barter deal as Liam Mooney, a seasoned entrepreneur who has founded the networking club, Fit for Business as a means of getting businesses to strike up these partnerships, explains. Since starting my business I have found that in many instances, it makes sense to form strategic partnerships with companies where we can both benefit. No money needs to exchange hands, just a simple agreement with clearly defined goals which are regularly assessed.
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For those who haven’t considered strategic partnerships there are many benefits you can obtain; ll Improve the Product you Offer to Clients - By partnering with a number of other businesses you may be able to offer a range of services that you could not necessarily offer. The result could be a unique product that makes you stand-out from your competitors ll Wider Marketing Potential - All companies want to get their message out to as many people as possible. By forming partnerships it could allow you to reach target audiences that have previously been unattainable. The more awareness of your brand, the more successful it will be
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ll
ll ll
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Provide Internal Support and Professional Guidance - This can be anything from IT, Technology, office support to professional advice. I have experienced great success in partnering with IT and Technology companies whom have proved very useful in growing our brand Partner to get Economies of Scale - Partnering with a trusted supplier can help you share costs Improve your Network - You cannot simply be an expert at everything. Finding a trusted partner is a short cut to improving the quality of product and service that you can offer to your clients. Many companies would rather point a customer towards an expert that they know can help them, rather than attempting to do an average job themselves. In the highly relational environment in which we operate referring someone to a trusted partner is both a shortcut to the schedule and a guarantee of quality Mentoring - Mentoring is something often overlooked and spending time with great business leaders has a clear benefit for both parties, and very often the mentoring can run both ways. A few words of wisdom from a top performer are worth 100’s of ‘Business help’ books!
Whilst the benefits are there to be seen, the downsides of a bad partnership can be devastating. Partnerships are a two-way relationship, if things become one sided or one party lets the other down the consequences can be huge. When implementing partnerships, finding the right ones is vital otherwise you run the risk of; ll ll ll ll
Wasted costs included time and money Damage to your reputation by association Bad feeling towards the other side, which is particularly detrimental where you have mutual contacts Damage to moral and loss of momentum in that area of business
All partnerships must have clearly defined goals, which are written down and regularly evaluated. Develop a plan, structure new strategic partnerships, and keep the relationships with your existing partners on a solid footing. These success factors do more than build
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good partnerships; they build income streams that will grow steadily over time. 1. When the intent to form a partnership is cemented hold a strategic planning meeting between the key people in each company. This will get everyone’s ideas, concerns, and expectations on the table and create positive momentum. 2. Agree on the targeted goals for the partnership and what each party will offer. It’s a partnership so both parties must offer something of benefit. 3. Determine a plan that outlines all the costs, roles and responsibilities. 4. Agree on what constitutes success up front. What metrics will be tracked, measured, and reported to both companies to understand if the partnership is successful? A simple single page document or brief executive summary can be a valuable communication tool. Then quarterly, the cross-functional team meets to review results and adjust the game plan. 5. Focus on creating “quick wins.” Don’t take on too much too fast; Start small and build momentum
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and success stories. Both partners should agree on what the early wins will be so there is focused energy toward realising the goals. Do your research. You need to be confident that a partner can deliver what they’re promising before you enter into any kind of relationship. Ask your network for recommendations and look for businesses with an established track record. Always ask to see evidence of results. Keep communicating. Once you’ve found a great partner, established a good relationship and figure out your objectives, don’t forget to keep communicating. Maintain contact with frequent check-ins to talk through any problems. This will keep confidence levels high on both sides, and will mean you can deal with any unexpected issues or changes swiftly.
Partnerships are powerful and really do help you build your business and brand in a cost-effective way. Avoid the temptation to rush into one. Research, plan and regularly assess your partners to get the most from your relationship. n
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ADVERTORIAL
n today’s world, thanks to easily available information, wide social networks, etc., ideas are aplenty, however it’s imperative to understand if an idea, process, product or service can be executed and will be viable in the first place. For a business to succeed in bringing in a new product or to keep re-inventing its current product/service line, market research is one of the most helpful and powerful techniques of assessment. Even current services and products may be appropriately altered in accordance with the outcomes of such market research. Prospective customers may exhibit behavior styles and choices and usually test various services and products of a specific kind, size, colour, cost range, or other such guidelines. These studies can offer you useful information about current rivals, their adopted techniques, effect on target customers (as well as their responses), along with other such specifics. Market study helps determine current gaps and brand new enterprise possibilities. Market research is also the fuel behind innovation and the future of it lies on addressing evolving needs of not just the customer but the product or service itself. Realtime analysis and out-of-the-box audience engagement are creative tools to help with the same. It is also equally important to help mould industry experts into
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Why research your
Market?
Market Research is a process by which one can interpret a certain market for a particular product or service. It involves analysing characteristics, purchasing patterns, demandsupply scenarios, needs of the target market, location of the proposed business, etc. Whether your company is in a start up stage or within an expansion phase, researching the market is essential for knowing the critical factors of one’s target audience to understand sales potential, ROI and general business success
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ADVERTORIAL
tapping key trends and changes in various markets to help steer a more powerful market research campaign and therefore capitalise on opportunities that lie ahead. The Challenge Some of the biggest challenges involved include getting the required response rate for interview requests, budget and time constraints to test various parameters/ possibilities, and difficulty reaching out to certain segments. There are also times where interview respondents fill in questionnaires or surveys with incorrect, vague or inaccurate responses either because they don’t want to spend time on it or because they don’t want to divulge information. Such situations require alternate approaches/strategies to elicit the required information for the client. Understand Your Objectives A company should determine their market research objectives by understanding, looking into, and gauging their unique business situation. Today it’s extremely difficult to effectively sell an item or service without performing a market study. The significance of researching the market is the fact that a small business organisation has a suite of options for developing company procedures, growing earnings, increasing organisation efficiency, examining rivals and obtaining more happy clients. The business owner seeking a research should be able to articulate the endgoal of the research. Businesses should also be able to articulate their product/business ideas clearly to the Consultant, so that the research is undertaken in the right direction and addresses the type of decisions that the research needs to assist with. Some of the determinants that affect the output of any market research assignment include: • Depth of research expected • Budget constraints • Availability of information • Timeline for completing research • Access to a certain ‘segment’ or ‘target group’ Understanding Feedback Companies must approach this by using the following suggestions: a) Respondents or customers often face the problem of being inarticulate while trying to express how they feel about a certain product/service/idea. Focus groups generally help in resolving such an issue
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wherein customers (participants) speak out about how they really feel about a product. Traditional techniques of questionnaires and surveys do not exactly capture the emotions of a target market. b) Keep questionnaires short and to the point. Customers generally end up giving vague feedback in lengthy questionnaires and often a researcher cannot make much out of it. Preferably have the researcher ask these questions face to face or over the phone to help understand the reaction or response to certain questions. It also saves time and allows you to ask more related questions if need be. c) Do not use numeric data available in market intelligence reports as the be all and end all of customer feedback and response. How Can Ethics Plus Assist? Our experienced consultants strive to not only to present the Client with accurate results, but to ensure that they understand the analytic techniques utilised to obtain those results. We are equipped to meet our Client’s research needs to ensure that the project is a success. Our consultants have necessary skills and experience in a variety of data collection methods and will work with the Client to help determine the best method for their unique research project. Our in-house Consultants have vast experience with designing online surveys and questionnaires.
At Ethics Plus, we go beyond the data and information we unearth, and come out with tangible business recommendations for our clients. We think of the problem from the client’s shoes, and look at ways in which we can find and interpret the necessary information to enable our client solve their biggest challenges in the business. While our in-house consultants are generalists, we focus on getting advice from specific industry experts in order to provide that value-added advice to our clients. With a wide industrial network, our core strength is to be able to secure accurate responses from industry players, competitors as well as end-users by contacting available and cooperative focus groups for any kind of product or service. Ethics Plus Top Tips ll Understand the product/idea/service first before diving into the target market ll Understand the business model in focus ll Assess your current resources and gauge if it will be enough to plan, design and execute a market research assignment ll Understand the regulatory framework for the focused product/service/idea ll Keep questionnaires or surveys concise with the end goal in mind ll Aim to as much face to face interaction with your respondents as possible ll Ensure that any interviews are conducted with the right audience mix ll Ensure that interviewers are well-trained, and the data is to be back-checked on a random basis to ensure authenticity
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It’s in the detail… By Ahmad Abugosh, Astrolabs
Design Thinking has become a new buzzword in not only the creative field, but for business in general. Its methodology focuses on the end user (customer), and building your product or service from their perspective. The approach utilises empathy, creativity and rationality when tackling a project. We had a chat with Carolyn Chandler and Hala Hemayssi, two User Experience (UX) designers from Chicago who came to the UAE for a workshop with Astrolabs, and with over 30 years of design experience between them, there is no one better placed to advise how companies and individuals can best leverage this concept
All companies are service companies. Even if you’re primarily known for creating a product, there is always a service component” Carolyn Chandler
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What is Design Thinking? “Design thinking is a method of problem solving that takes into account the people who need to use your solution,” Chandler explains. “The approach combines empathy for those users, creativity in generating solution ideas, and rationality when choosing, designing, and refining those solutions. It involves getting out into the field to understand the context around a problem,
stretching your mind to consider new possibilities, and then working to help the best ideas to create something powerful and profitable. Design thinking isn’t just for digital designers; companies have been using it to solve strategic problems with people from a variety of roles.” “I think Design Thinking and Design Doing/Making are the ultimate tools to address the failures of the archaic systems of the industrial age where the human condition was not really a consideration,” Hemayssi added. “Design based thinking methods are entirely human and allow us to elevate our products, services and experiences to a new level of sensitivity and connect it to what is essentially human in every interaction and transaction. Designers are attuned and emotionally intelligent about the human experience they are creating because ultimately they working towards making the world around us fit our human sensibilities. To me that is the biggest difference when we approach solving problems applying design thinking and human centered approaches. It allows us to re-frame every level of the problem (i.e. value, systems, operations, culture...) in human terms not just designing a more human output (i.e. service or product).” Do you find Design Thinking relevant to “non-creative” organisations, or service companies? Chandler nodded, “Nowadays I think all companies are service companies. Even if you’re primarily known for creating a product, there is always a service component, whether
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Empathise
Construct a point of view that is based on user needs and insights
Learn about the audience for whom you are designing
Define
you have a fully-grown customer support department or a third-party touch point. You still need to understand the journey of your customer or your partners in order to create the best experience you can, whether that experience is the joy of using your product or the efficiency of resolving problems that may occur. Design thinking encourages you to think of the entire system, not just one component. Nothing you create is used in a vacuum. You have to think of the overall context. What are your customers trying to accomplish? What happens when things go wrong? The companies that people feel true loyalty to are the ones that stand out in these areas - where their brand values are expressed with each interaction. Service companies that have complex processes or stages can gain a lot of benefit from design thinking in particular, because the process really helps you understand the major stages you have to account for. For example, a company providing insurance needs to understand how to work with the customer during both the sales process and the stressful claim process.” Hemayssi chimed in, “Learning how to design with empathy at the center of your approach applies to all companies. No industry or company can afford not to address the unmet needs of the customers. Companies without a key value add will ultimately be replaced. The time for transformation is now and design thinking is a great methodology for that. It is a proven method to get you from A to B. It is my favorite magic wand. Let’s go even further and say that all companies need to make sure that they have design thinkers and doers in all levels of the company because those are the team members that will ultimately drive change and lead the evolution of the company inside and out. It is a great time to be a designer and learn how to become one. The demand
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Ideate
Build a representation of one or more of your ideas to show to others
Brainstorm and come up with creative solutions
Prototype
A lot of people hear ‘design’ and think ‘graphics.’ They are the most obvious visual elements of a design, but design involves a lot of strategic thinking” Hala Hemayssi for design thinking skill set will simply accelerate and grow with time. That is the trend we have seen in the US and will prove to be true elsewhere.” What is a common misconception about Design Thinking? “A lot of people hear ‘design’ and think ‘graphics.’ They are the most obvious visual elements of a design, but design involves a lot of strategic thinking. There are deep questions you end up asking that get to the core of a company’s identity; What are your values? Are those being expressed in the products and services you offer? Does the design of your products, processes, and customer interaction show that you understand their needs, etc.? I’ve met clients who think they need a web site redesign, but they end up realising they’re actually dealing with a brand identity crisis.” Do you think these design decisions can have a real impact on business? “We live in an age where ideas are everywhere and everybody is a
Test
Return to your original user group and testing your ideas for feedback
designer,” replied Hemayssi. “Ideas are cheap. We live in the age of Idea Democracy and the winners are the ones with the audacity and know-how to make it happen. We believe that the role of design is to go beyond the call of duty of designing an experience to designing systems that connect us all, and platforms that change the world. Design thinkers and doers are at the forefront of making that real change roll through the system worldwide. Meaningful Innovation is Human.” How do you think we can make the concept of Design Thinking relevant to the MENA region? “Design Education in my opinion, is key, albeit unused and under-appreciated. Elementary schools are designing the minds and spirits of the future,” explained Hemayssi. “It is a shame that today, design is not taught the same way we teach math, science and literature. Especially in the Arab world; a time of transition is upon us and we are at the cusp of tectonic social and economic shifts. We need to turn our Arab world into the hub of creativity and allow for true ingenuity to spread across the world by building a solid design capacity into our education. Not only will it help secure economic and social advantage in the world economy, but it will also enable us to transform and seize the power of our collective energy as we revamp our connections, governing bodies, and communities, and thus re-designing our future and how we chose to impact the world. The ultimate project for me would be to build a design school here in the Arab world with the goal of teaching design to all. I want to empower this generation to become the best designers that they can be and to design their life by designing the choices they make. That is how change is made real.” n
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Ancient Egypt – A Golden Age
By Jeffrey Rhodes, CEO
Ever since the glittering tomb of Tutankhamun was excavated in 1922, most people have associated the mysterious land of Ancient Egypt with untold wealth and glittering treasure. It seemed as though every piece of funerary equipment removed from the tomb was gilded in the precious yellow metal or even made entirely of solid gold, like the famous funerary mask and inner coffin. And if this was the treasure placed in the tomb of a relatively insignificant pharaoh who only ruled for a few years and died young, what wealth could the tombs of the mighty kings such as Ramesses the Great and Thutmosis III have contained?
Production in 2013 was just over 11 tons and worth about US$488 billion, up from just over 8 tons in 2012 (approx. US$380 Mio)
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t was in international trade that gold became important those ancient times as Egypt became famous for the amount of the prized precious metal that it sent to all corners of its far flung empire. It was not only used for trade, it was also an important diplomatic tool as pharaohs would send quantities of gold and gilded treasures to their allies and vassal monarchs in order to keep them happy and fighting to maintain Egypt’s borders. Gold was also given as rewards to courtiers and military leaders. As the wealth and might of the Ancient Egyptian empire grew, so did the prestige of goldsmiths. The men who created the exquisite jewelry, statues and funerary masks became feted and wealthy in their own right. They developed several techniques that are still used by jewellers today such as utilising the lost-wax technique to make intricate statues by beating gold into fine leaves, and mixing it with other metals to create alloys.
I
Electrum, a blend of gold, silver, copper and other metals, was one such alloy that was very widely used to plate the exterior of monuments such as obelisks and the pyramidions that topped the pyramids. Gold has been mined and worked in Egypt since predynastic times or 3,100 BCE, with this very early gold extracted from alluvial deposits and most of the gold extracted in antiquity in Egypt was mined in the Eastern Desert and Nubia. In fact Nubia even incorporates the ancient word for gold ‘nub’ in its name. All of the gold mines in Ancient Egypt were state monopolies and were worked predominantly by prisoners and slaves. To date there have been over a hundred gold workings and settlements that have been found, most in the arid wadis of the Eastern Desert. However according to the map on the Turin Papyrus, there were at least 1300 such mines in ancient times. More evidence and remains of the ancient
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gold mining industry could be excavated from beneath the sands of Egypt. Modern Day Gold Mining in Egypt Although Egypt has such a long history of large scale gold mining, those ancient deposits have long since been exhausted and today there is only one signifcant operation in the country; Operated by Centamin plc, a mineral exploration, development and mining company dual listed on the London Stock Exchange and the Toronto Stock Exchange. Centamin’s principal asset, the Sukari Gold Mine, began production in 2009 and is the first large scale modern gold mine in Egypt. Production in 2013 was just over 11 tons in 2013 worth about $488 billion, up from just over 8 tons in 2012 (approx. $380 Mio). However many modern day gold exploration firms believe that there is significant potential for a much bigger gold mining industry in Egpyt and with the sociopolitical problems of recent years giving way to a new era of optimism under the newly elected President El Sisi, a new golden age could be on the horizon. Egypt’s Gold Market today Despite the extremely modest levels of primary gold production in Egypt, there are still 90 million Egyptians most of whom
Source Thomson Reuters Eikon
Source Thomson Reuters Eikon
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regard gold as the ultimate store of value with an unshakeable belief in the yellow metal. When I first agreed to take on the assignment as CEO of BTC (the bullion trading arm of New Egypt Gold) I had no idea just how big the physical gold market was in Egpyt, the scale of which has really impressed me. As with many emerging markets where gold could be called ‘the currency of the street’, a key influence on demand for physical gold or supply of secondary scrap flows in Egypt is a combination of the US dollar price of gold and the exchange rate between the greenback and the Egyptian Pound. This arbitrage of the price of gold in USD and the price of gold in EGP is a major driver of whether Cairo imports kilo bars or exports scrap dore bars and the volatility of the local gold price can be extreme leading to large scale trading opportunities. This is illustrated by the chart below. The gold price in EGP per ounce in June 2012 was around 9,300 but by January 2013 it had risen by 20% to 11,220. This move attracted large scale scrap flows with the market savvy Egyptians trading in their jewelery with gold finding its way to the major London Good Delivery refineries in Zurich and Johanesburg to be swapped
into loco London credits. We then saw the gold price in EGP steadily decline througout 2013 to reach a low point of 8,200, a fall in value of 27%, mirroring the USD gold price losses that year. This fall in price resulted in a sharp increase in physical jewelery demand from Cairo’s gold souks with major inflows of kilo bars from Dubai and Zurich to satisfy the buyers. The sideways nature of the gold price in local currency terms so far in 2014 has seen the day to day demand for gold jewelery being satisfied by the regular flows of old gold jewelery being sold or swapped for new modern designs. While statistics are not so readily avaliable my belief is that when there are extreme price movements Egypt’s physical gold market can be as large as 200 tons per annum, while in less voltile trading conditions there is a fundamental 100 ton self-contained market. As the local currency is vulnerable due to high inflation and a lack of adequate foreign currency reserves, strict foreign exchange and capital controls are in place to protect the value of the Pound and minimise the potential flight of capital out of the country; making it difficult to import and export without a system of licences that are granted only on a very select basis to those local companies with proven capabilities. Egypt’s gold market is very similar in many ways to the other major physical gold centres around the world whereby a handfull of large wholesalers service a broad group of merchants. It is a truly fascinating market with signifcant potential for growth given the recent changes in the political scene and I am told by colleagues at New Egypt Gold that although it is early, the mood on the streets is optimistic. With the potential for a significant growth in gold mining in the country in the coming years, and Egypt’s undying infatuation with the yellow metal Misr (as it is known in Arabic) could be on the cusp of a new golden age to rival the days of The Pharoahs. n
The gold price in EGP per ounce in June 2012 was around 9,300 but by January 2013 it had risen by 20% to 11,220
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