SMES
Small and medium enterprises are the engine of the Saudi economy, and with the government's push toward promoting industry and local manufacturers, the outlook is bright.
We are currently working on the National SME Strategy, a master plan that maps out what all players need to undertake to enable the SME sector. As part of the National SME Strategy, we will outline strategies for specific sectors in cooperation with the government agencies that are responsible for those sectors. We are working with the MoH for an SME health strategy, for example. Beyond SMEs, part of our mandate is to set up the venture capital sector in Saudi Arabia, which we are working on. An important enabler of that is the Fund of Funds, a SAR4 billion (USD1.1 billion) fund that is a co-investment mechanism to place a certain percentage into funds that are of national relevance for Saudi Arabia, which we are doing to enable the venture capital sector. We are also responsible for restructuring a number of existing government programs. The legal environment is another of our key tasks; we want it to enable SMEs to thrive and enable startups to flourish. There are many pockets that we need to worry about, the most important relating to the ecosystem. There are five areas of thrust for us there, including legal and government processes, funding and closing the gaps in funding, and access to market, which is basically the ability of companies with offerings to find a market for their goods.
We started around 25 years ago doing stationary retail. We started with small shops and then opened other branches until we had 10 branches for retail, all in Riyadh. Then we sought to enter into wholesale. Retail is different than wholesale and once we had enough time, experience, and money, we decided to focus on wholesale as it was growing faster. We started increasing the number of branches in wholesale and reducing those in retail. Every month we would close one in retail and open a new wholesale one in another city, such as Jeddah. In the end, just 10% of our business was retail. We started to go to China to find suppliers and get wholesalers to do business with us. As we are a retail business from a small area in Riyadh, we do not have to go to different places to get our things; we bring all of those in one showroom. Also, not all the products are ours; we buy from other wholesale dealers. In that way, retailers can get 90-95% of the things they need from one same showroom. That has made us grow quickly, and we had a thriving business and customers and thus became a public joint stock company. Before that, we merged with Muhammad Rashed Alduwish Company, our competitor, and became a closed joint stock company in 2008.
Al Wafa is a family business established by my father 40 years ago. At that time, we used to have only car spare parts, batteries, and other similar products. Then by time, the company starts getting bigger and expanded more and more. We also had a chicken farm with capacity of 300,000 chicks. In addition, we owned a jewelry business in Khobar and a home appliances business in Dammam. Our main business now is government supplies, particularly in the defense sector. We are utilizing our 40 years of experience in supplying different military sectors. The company used to sell military uniforms and special equipment. The defense sector has since became one of our main business lines. Subsequently, we started looking for business opportunities in Turkey. In the last six months, we found many defense suppliers eager to work with Saudi Arabia. I am happy that we have clear targets outlined in Vision 2030 and that the government is keen to work it out. For example, in the defense sector, the government seeks within five years to have 50% of government expenditures be localized. We are working to adapt with this strategy by expanding our range of military products and services.
GE has been in the country a long time, and we have done something different from an investment point of view, from tapping oil resources and helping different regions gain access to electricity, supporting aviation and the air force, to improving the healthcare system and, finally, establishing an advanced manufacturing and innovation ecosystem. In 2012, GE launched what we referred to as Project Kingdom, which was a commitment to invest USD1 billion to support the economy by successfully undertaking localization projects in human capability development, manufacturing, and innovation. When Saudi Vision 2030 was announced, we had been working on various investment initiatives for a few months and GE was the first company to support the vision by making a number of large announcements about a month later. At GE, we work with stakeholders to make sure that all the vision's areas are supported.
We came to Saudi Arabia more than 30 years ago and started by opening a factory in Yanbu in the royal commission area, producing three segments of paint. We then moved from the royal commission area to other factories in Jeddah and then to Dammam and Riyadh. We have offices and warehouses all around the country. We have more than 500 employees on the production line. Our Saudization level is between 40 and 45% in the company, and we are committed to it. Part of the company vision includes involving the local community in our business. We believe in long-term hires and investment in the local community. We started the educational part a long time ago, even before the government started the Saudization program. We involved university students and gave interior design opportunities in our activities developing candidates for the future. In Saudi Arabia, we have three major factories: Dammam, Jeddah, and Yanbu. We have around seven distribution warehouses and more than 500 distribution channels and staff everywhere.
We have been active in Saudi Arabia for nearly 90 years. With approximately 2,000 employees, the majority of whom are local, we are a highly skilled organization and long-term partner to the Kingdom. Over the past few years we have been focusing on developing new industries in Saudi Arabia, and that includes strengthening the manufacturing bases of our customers and suppliers. We succeeded in manufacturing the first “Made in KSA” gas turbine at the Siemens Dammam Energy Hub, and delivered it to one of the most iconic power plant projects in the southern region of Jazan. It was an endeavor that we initiated with our partners some years ago, and during that time, we trained and developed a strong Saudi workforce that built this unique engineering masterpiece, here in Saudi Arabia, for Saudi Arabia. With the announcement of Vision 2030, we succeeded in delivering the first Made in KSA gas turbine; since then we delivered five more from our factory. Siemens is proud to be the first to bring this specific gas turbine technology to the country.
Starting with the ethics and values we hold at Cisco in Saudi Arabia, we are renowned for putting our customers first and making sure that we practice what we preach. It is all part of the DNA of our organization and our team. Competing with integrity and responsibly is a fundamental value that is embedded in all of our employees. Cisco today is privileged to have a unique memorandum of understanding, as witnessed by HH Prince Mohammed bin Salman, being the key national digitization partner of the country. Reaching this point did not happen overnight; it has taken many years to foster and maintain a close, enduring working relationship that is based on trust, confidence, and our ability to deliver sustained value. The consultative role we have in our partnership with the Saudi government is based on our long-standing collaboration with Saudi businesses and public-sector entities, organizations, and stakeholders. It also reflects the value we add to the community and the technological ecosystem of the Kingdom at large.
SMES
TABLE OF CONTENTS
Column
YB Pehin Dato Lim Jock Seng, Minister at the Prime Minister’s Office & Second Minister of Foreign Affairs and Trade, Brunei
TBY talks to YB Pehin Dato Lim Jock Seng, Minister at the Prime Minister's Office & Second Minister of Foreign Affairs and Trade, Brunei, on the sector.
read articleReview
A Crude Awakening
The Kingdom has made renewables a critical aspect of its ambitious Vision 2030 effort to diversify its economy and wean itself from a strictly carbon-based diet, not to mention empower local businesses and individuals to take up the mantle and lead the energy sector into the next generation.
read articleInterview
Abdulaziz AbdulKarim, Vice President of Procurement & Supply Chain Management (PSCM) , Saudi Aramco,
TBY talks to Abdulaziz AbdulKarim, Vice President of Procurement & Supply Chain Management (PSCM) at Saudi Aramco, on the IKTVA program, supporting local content, and looking back over a successful year.
read articleInterview
Ayman Abdullah Alfallaj, CEO, Thiqah
TBY talks to Ayman Abdullah Alfallaj, CEO of Thiqah, on how the private sector can keep pace with the speed of public reforms, delivering a strong and lasting value proposition, and integrating the fruits of privatization into the public sector.
read articleFocus: Technology Investments
Investment Calling
A technological revolution is underway in the Kingdom. Already one of the most tech-savvy nations in the Middle East, the Saudi market has long sought a thriving domestic technology and innovation scene. And with Vision 2030, it is on course to deliver just that.
read articleReview
A Hejaz Unhindered
An ambitious series of road and rail projects from the Jordanian border down to the Indian Ocean are slated to open in part before the end of 2017. They bring the Kingdom that much nearer to its goal of greater non-carbon-based economic integration with the world.
read articleInterview
Sulaiman bin Abdullah Al-Hamdan, Former Minister of Transport and Minister, Civil Service
TBY talks to Sulaiman bin Abdullah Al-Hamdan, Former Minister of Transport and current Minister of Civil Service, on an attractive legislative framework for investment, railway linkages, and port developments.
read articleInterview
Rumaih M. Al-Rumaih, President, Public Transport Authority (PTA
TBY talks to Rumaih M. Al-Rumaih, President of Public Transport Authority (PTA) & Acting President of Saudi Railway Organization, on teaming up with commercially committed partners, making sure the Kingdom's land and sea bridges are of the first order, and providing employment for all the Kingdom's inhabitants.
read articleInterview
Nabeel M. Al-Amudi, President, Saudi Ports Authority, and Minister of Transport
TBY talks to Nabeel M. Al-Amudi, Minister of Transport, and President of Saudi Ports Authority, on optimally restricting concession agreements, resolving bottlenecks in the logistics chain, and privatizing as rapidly as possible.
read articleInterview
Khaled Bin Abdullah Al Hogail, CEO & Managing Director , Saudi Public Transport Company (SAPTCO)
TBY talks to Khaled Bin Abdullah Al Hogail, CEO & Managing Director of the Saudi Public Transport Company (SAPTCO), on the importance of strong and rational regulations, knowledge transfers, and unifying public and private transportation networks.
read articleInterview
Imad El-Zein, CEO, Auto World-Sixt Saudi Arabia
TBY talks to Imad El-Zein, CEO of Auto World-Sixt Saudi Arabia, on growing market share in challenging circumstances, partnering with world-class players to boost its local presence, and combining better services with lower costs.
read articleInterview
Saleh H. Al-Ghamdi, Acting CEO, Saudi Air Navigation Services Company (SANS)
TBY talks to Saleh H. Al-Ghamdi, Acting CEO of Saudi Air Navigation Services Company (SANS), on maximizing safe and effective services, effectively increasing the rate of Saudization, and easing the pathway of women into the workforce.
read articleInterview
Khalil Kutubkhanah, CEO, Jeddah Development and Urban Regeneration Company (JDURC)
TBY talks to Ibrahim Khalil Kutubkhanah, CEO of Jeddah Development and Urban Regeneration Company (JDURC), on Jeddah's unplanned settlements, the company's redevelopment projects, and its partnership model with the private sector.
read articleInterview
Dr. Khalid Bin Mohammed Al Shaibani, Deputy Minister, Planning and Health & Director of the Vision Realization Office
TBY talks to Dr. Khalid Bin Mohammed Al Shaibani, Deputy Minister for Planning and Health & Director of the Vision Realization Office, on reforms within the Ministry of Health, the corporatization of healthcare provision, and transformations in care delivery.
read articleInterview
Mohanad A. Dahlan, CEO, University of Business and Technology (UBT) Company
TBY talks to Mohanad A. Dahlan, CEO of University of Business and Technology (UBT) Company, on the evolution of the company, education investments, and upcoming sectors that will need support from the sector.
read articleFocus: Universities
Broad and Deep
As part of the continuing decentralization of higher education in Saudi Arabia, individual universities are pursuing their own paths to grow their faculties, engage with various international stakeholders, and ultimately move toward a more privatized future.
read articleInterview
Rafique Izhiman, Area General Manager KSA Jeddah, Yanbu Hotels
TBY talks to Rafique Izhiman, Area General Manager KSA Jeddah/Yanbu Hotels & General Manager, Intercontinental Hotel Group (IHG), Jeddah, on the role the firm plays in the market, expanding its footprint in the country, and expectations for 2017.
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