Alyasra Group: Mohamed Samir Discusses Food Services and Fashion Retail in Kuwait and the GCC

Interview with Mohamed Samir, Group CEO at Alyasra

What sort of challenges are you facing internally to help you grow your business?

Right now, you can argue that with COVID being in action for more than a year, people have reached a fatigue level that is difficult and some people have more stamina than others. But in general, there is a fatigue among the people and keeping them motivated is not easy because it is not only the factors of working for the company it is also many other factors that impact the mood of the people. The second, which is more internal but also has an external component, is that all companies are worried about cash, both receivables and payables. The last one, which is a very personal one, is the debate about should you take the vaccine or not? And if you take the vaccine, which one? If you take it, can you travel? And if you do not take it, what happens? So, this whole discussion is on people’s minds from an internal standpoint. Then, these factors all get into the question of whether to keep on investing because in every crisis there is an opportunity or do you slow down until things get better? Especially when you are working on developing markets, they always say not to invest now, to wait and next year will be better because things will be calmer. If you are working in the Middle East and you wait for the calm year, it will never come. So, you cannot keep on waiting; you have just to go.

So, there is never going to be a perfect business opportunity or perfect business climate. There is always going to be something working against you somewhere. So, if you keep waiting for this perfect opportunity, well, that does not really exist, basically?

With more than 30 years’ experience in the region, I would say I do not think there is a perfect opportunity. I hope that for my children or my grandchildren one day, it will be much more stable. But, I think having these challenges also makes it fun. Imagine if you wake up every morning and there is nothing challenging happening. It is going to be very boring as well.

What is your scope of business and what is it like doing business in Kuwait?

I want customers and consumers to really say Alyasra is the best they can buy from, whether it is fashion or food, and really be wowed.

Our business is split into Alyasra Foods and Alyasra Fashion. On the food side, we have three types of businesses. The first is food services where we supply restaurants everything from chicken and meat to oil and rice. We have the food retail distribution which means we are distributing consumer brands in food like Kellogg’s, Pringles and Danone, etc. We have a third part which is our online direct consumer business where we take repeatable products, whether it is from consumer foods or from food service, and make them available for consumers online and through delivery. We also operate not only in Kuwait, but across the GCC. For example, in Saudi Arabia we also supply all the major coffee chains like Starbucks with all the croissants, cupcakes and sandwiches, which is a major operation. We have a joint venture in Iraq for producing dairy products with Al Safi Danone. We also have a meat cutting facility and a facility for roasting nuts and coffee in Kuwait as well. On the fashion side, we also operate across the region and the GCC. We have different types of businesses from watches to jewelry. We have our own concept for all these fashion watches such as Emporio Armani, Michael Kors, AIGNER, and so on. We also have what we call our fashion and footwear which includes brands like DKNY, Cole Haan and ECCO. Then we have our premium business which is concentrated in Kuwait which is brands like Max Mara, Kenzo, Jimmy Choo and Marc Jacobs. Then we have our value business which has a brand like Koton from Turkey and also our own brand called Basicxx that we created and operate in Saudi. Of course, we have our online businesses in fashion as well. It is quite a diverse portfolio which makes it a lot of fun.

What makes you different from the competition? What is your competitive advantage? How do you stand out from all of these other companies in the sector that are trying to do the same thing?

We believe in being the best. We know that we are not the best today, but we are always striving to be the best. We know that we are not the biggest, so we are always striving to be agile and focused. We believe in long term relationships with brands. That is why we believe in building a brand over time. That is why for most of the companies we work with, we have been working with them for 20, 30 years building their brand over time in the different territories. We are not the biggest when we look at the total region, but in Kuwait we are quite big. Across the region and in Kuwait, we do not focus on the size, we focus on agility and being the best in what we do. The rallying cry, or our mission that we communicate day in day out for our people, is that we want to wow the customer so that we can win. So, let’s focus on wowing the customer – whether it is a customer that is walking into one of our fashion stores or a customer who owns a restaurant or a hotel – we want them to say that we exceeded their expectations.

What are the investment opportunities in the sector and the company that we can look for in the future?

People are buying much more online and their expectations are very high. There is a lot of transparency and value and expectation of how fast you want the items to be delivered to you. There is also a lot of attention to food security. That is government driven and there is the want to produce more things locally or secure supply in a much more consistent way. The third element is that there is a drive for being more healthy, whether in food or whether in fashion, so athleisure and things that people would wear at home is something that started over the past year. Lastly, millennials are no longer a niche group that you want to target. Millennials are the bulk of consumption in the region. Tailoring our offering to them makes a lot of sense. You can take these trends that happened and think about what opportunities that came because of COVID. For example, in non-food items, I if go to a restaurant, can I offer them also what they need for hygiene or for cleaning or for sanitizers? If I am going to supply the restaurant with the food items anyway, can I also supply them with the rest of it? These are the kinds of COVID proof items where they will not be affected if the pandemic continues for a longer time.

What are some of your upcoming products or projects? What is your strategy or business model?

We have different business units and each business unit has a leader where he or she acts as the COO of that business. So, they become experts in that business and they need to deliver the outcome results required from that business, whether it is sales, profit, cash, but also wow the customer and really give customer service that will make customers really want to stay and buy that brand. From a strategy standpoint, first, we think of our business in terms of “core, more, and explore”. Core is the core business that makes the bulk of sales and profit today, more is where we can get more business in the short term, and then explore are new ideas that we will explore. We will pilot and some of them will stick and some of them will not. But it does not matter because we treat them like a startup mentality. Also in that context, we think about the consumer, we think about the channels, we think about the different geographies that we are operating in or want to operate in in the future. Then, from a how to win standpoint there are many factors but two or three are critical. First is customer service orientation. The second is that we believe that sometimes people say people are one of your most important assets, but I personally believe that people are the most important asset. Lastly, I believe in happiness. We want our people to be happy. We want them to come to work every day happy. We want our people to always want to stay with us, especially if they are top performers, and they will never want to leave us. Last but not least, there is a sweet spot between innovation and productivity. You need to become productive all the time; otherwise, you are just adding cost that the customer or the consumer should not pay. And last, is to keep on innovating. It does not have to be things which are created for the first time in the world, but you can reapply from different industries, from different geographies, and make it in a nice way. With many of the things that we see today that are very successful, it is not that someone invented them, it is just that someone was able to take them and globalize them.

You are interested in both sides being satisfied and both sides feeling like they had a good experience?

Absolutely. There are companies that say to treat your customer like a guest. I say, no, we want to treat our customers like part of the family. Guests come and go. Family, you will always find a way to keep them close to you. Even if they are far away or living in a different state, you will still want them to be close to you. If things are not going well, you will find a way to mend the relationship. That is how we want to think about our customers.

You do business in many different countries within the region. How difficult is it to do business both in Kuwait but also trying to adapt to the different ways of running a business in Bahrain, UAE, all of these other areas where you are present?

The most difficult thing in working across a region like the GCC is the differences between the countries. The similarities are great because then it means you are able to build scale and scope across the area. But then, every country has a different rule. For example, with labor laws, if I have employees working in Kuwait and in Saudi and UAE, every employee I have to treat in a different way because of the local labor law. Then, when I move them from one country to another, I have to change their contracts. I need to calculate my timings in a different way because the time it takes to clear the port in Dubai is different from the time it takes in Kuwait and the regulation is different, etc. So, all of these create extra cost that at the end of the day the consumer pays for. Then, the pricing will be charged these incremental complexities because these complexities will mean you need to have more people handling these things. It is going to be difficult even to digitize some of them because they are different, or if you digitize them, you have to do a lot of tailored work. This is the biggest difficulty. The point is how can the GCC countries get to more homogeneous platforms?

Because you are present in all of these different areas and because you are adapting to each of them and tailoring to each of them, do you see yourself expanding that international reach?

Right now, we are recovering from COVID, or still in COVID, but hopefully things will get better very soon. It is important for us to consolidate our position this year to make sure we regain the strength we had before the pandemic. But, when you work in the Middle East, I always say that being in the GCC is very important. Building a big business in Saudi is very important. But, then the next obvious country to go to is Egypt. There are a lot of similarities and the population is big. Even if you come up with premium products and a very small percentage of the population can afford it, there are 100 million people there. So, it is the obvious next one, and being Egyptian myself, it makes it easy to say this. So, Egypt will be our next vision from an expansion standpoint.

What is your concern with the issue of food security in the region?

Food security is something on the top of the minds of all the governments across the region. There will be a lot of independent desire to make sure that the country has its own food security and local production. My plea to the governments is to do interdependency. So instead of, for example, producing chicken in every GCC country, produce chicken in one, meat in another, corn in another, and then exchange so we achieve interdependency instead of independence. The other factor is that it does not have always to be production. You can secure security through other means such as by having very clear contractual agreements with certain countries or establishing companies in certain other countries and so on, which is somewhat happening already. Food security was high on the agenda already. I remember in 2008, that happened several times. Also, we need the clarity of the strategy there. Building a scale across the GCC, or even across the Middle East, will be faster and more effective and will cost less for all the consumers across the region.

Do you think this is something that the government has to get onboard with and has to be the one that delegates or do you think it can be individual companies and producers?

It can be done by the producer, but the government role is to make sure that the regulatory framework is there to enable this. For example, if someone who is producing chicken cannot export to a neighboring country or it takes a longer time to clear the borders, then this is the regulatory framework that we need. All of these things the government can do and then they leave the private sector to determine where to put the factory. People think about factories as the place where you can create more jobs, but in reality, for every one factory job, you create 5 to 10 commercial jobs depending on the industry. So, actually, if a country has the factory, but the commercial jobs are created in a different country, the country that has the commercial jobs got that much better deal from an employment standpoint. If the objective is more employment, the country that has the commercial jobs is much better off.

Project yourself into the medium term, three to five years. What do you want to achieve for the company? What is your vision?

I have a plan on three levels. First, on a customer level, I want customers and consumers to really say Alyasra is the best they can buy from, whether it is fashion or food, and really be wowed. On a shareholder level, this company has been around for 30 years. Our role now is to prepare to move from a family run business to an institution that will stay for the next 50, 100 years. That is my and my leadership team’s role. I hope in the next two to three years, we will see that it is an institution that can stay for a very long time, still with family involvement but with clear institutional management in place. The third point is that the people of Alyasra are people who are very well regarded in the industry. People want to hire them in other companies because they think very highly of them, but they are so happy that they want to stick around and stay working with Alyasra. It is not always about money only. It is the whole package altogether: the money you make, the culture that you are working in, your colleagues. How does the company treat you, not in good times, but in bad times also is very important as well. You need to have a combination of everything. You need to end up being really content and really happy with what you are doing and feeling respected and valued where you are working. It is not just about money. It is about whether you are enjoying your life because work is the biggest part of your life and if you are not enjoying it, then you do not have a life. I have the alarm clock test, which is when the alarm goes off, do you actually wake up before it goes off? Or as soon as it goes off, do you wake up? Or do you wait 10 minutes and then 20 minutes before you wake up? If you are moving towards the 10 and 20 minutes, then you know that there is something wrong at work.

What inspires you? What is your drive to do what you do?

My inspiration has always been my dad. I remember seeing him when I joined P&G right out of university and I looked at the pride in his eyes. His face said, “Wow, my son made it out of university and is now having a job.” Seeing that was just wonderful. Now, unfortunately, he passed back in 1990. So, a long time ago and I was just very young. When I look back, I always say I want to do better because of him. He has been an inspiration for me all the time. So, whenever I am in a difficult time, I always ask myself, “What would he do? How would he feel when I succeed?” I have three things in life which are very important that I want to achieve. First, I want my sons to be better than me. The second, which is a very low benchmark, is that I always believe in helping others succeed. So, I am very generous with my time for people who want advice on how to progress and how to get ahead. The third one is that I want to help my country. I believe that for anyone who has above average education and experience level, at a certain point in their career and in their life, they need to give back to the country. That is why I am thinking about maybe going into government in the future because God gave me a career and experience that I want to give back to my country. The third piece which is an inspiration for me is just that I get intrigued by learning. Learning something new inspires me and there are many things I learned and I just keep them for later. I do not know when I am going to use them. For example, I am still old fashioned. I still work a lot with these old notebooks and I have many of them. I always write in them and then I go back to them and note an idea that I am going to do later. I also get influenced a lot by praise. I have what I call my “good book”. This is full of all the nice notes I got from people from 1989 until now. So, this is a 32 year old book. Every time someone sends me something nice, motivating, saying you’ve helped me in this or good job on a document from my boss, I keep that in this book. So, whenever I feel down, I go back to this and I read them and remember that there is someone who believes in me. This gives me a lot of inspiration, as well. I am a big believer in being clear on where you are going. This is my vision for myself, which I wrote in 1990. It is in my drawer here all the time, right next to me. I always look at it and see where I am versus that. I also learned a few years back to be clear on what I want to do, because then I am committed to it. Declaring it puts pressure on you to make it happen because just telling yourself in my book is not good enough. You have to declare it to people around you, so they are kind of your conscience when you are not moving in the right direction.

For more information, please visit: www.alyasrafoods.com and www.alyasra.com.

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