Abdullah Ibrahim Alkhorayef Presents Leading Saudi Conglomerate Alkhorayef Group

Interview with Abdullah Ibrahim Alkhorayef, CEO of Alkhorayef Commercial Company

Could you give us a detailed overview of the Alkhorayef Group, including its various sectors and the range of services and products you offer?

The Alkhorayef Group, like many family businesses both locally and internationally, started with a specific focus and then expanded over the years into a conglomerate. Initially, some growth was due to our involvement in specific industries, while other growth resulted from diversification. Today, the group comprises various sectors and companies.

In the oil and gas sector, we produce electrical submersible pumps and control panels. We manufacture, install, operate, and maintain these pumps, depending on the market requirements. This is one of our key sectors.

Another significant sector is Alkhorayef Industries, which serves as a hub for various products. We are a global player in irrigation systems, ranking between third and fourth worldwide. We operate in over 40 countries with offices on every continent, including Europe (Spain), Africa (Egypt and South Africa), the United States (Texas, San Antonio), and Australia. Our headquarters in Saudi Arabia covers the Middle East and some Asian countries.

Under Alkhorayef Industries, we also have a generator business, which started in early 2012. Today, we hold a strong market position with almost 30% market share in Saudi Arabia, thanks to local content initiatives.

We recently ventured into modular construction for quick building projects and are also involved in the spare parts business. Our water and power technologies sector operates as an infrastructure contractor with long-term contracts. This is a public company with a market cap of approximately 1.3 billion, where we still hold a majority stake.

Alkhorayef Lubricants is another key sector, where we have a joint venture with British Petroleum to produce and distribute Castrol oil in the region.

Additionally, Alkhorayef Printing Solutions has evolved from supplying pre-press machines to offering digital printing solutions, including various types of ink and supporting software.

In Alkhorayef Commercial, which I oversee, we have three main verticals. First, the agricultural equipment sector, where we have been a long-time distributor of John Deere equipment in Saudi Arabia. We also distribute generators and pivot systems.

Second, our Marine Division represents various brands and has recently started its first project as marine operators. Third, we are involved in material handling equipment, selling a range of equipment for large containers, ports, dry ports, and warehousing solutions, including diesel and electric vehicles. Additionally, we sell Yamaha motorcycles and ATVs as part of our Yamaha Land project.

We also have significant investments in other areas, including a major shareholding in ARASCO, an animal food company, and shares in Gulf Plastic Company. We have a joint venture with Abu Dhabi Islamic Bank in an installment house company and small-scale real estate developments, including a hotel in the Eastern Province and several warehouse and residential projects.

As a company, we are approaching 70 years of operation and are now introducing the fourth generation into the business. I am part of the third generation, and some of my cousins and their children are now joining the business.

Now, we would like you to focus on what matters most to you on the commercial side. Specifically, what do you think are the competitive advantages of the sectors you mentioned, such as agriculture equipment, generators, and marine material handling? How do you distinguish yourself from the competition in these areas?

First and foremost, we represent well-reputed and well-known brands. Our focus is heavily on after-sales services, supported by a network of service workshops and mobile service units. We believe this commitment to Class A service sets us apart in the market. Additionally, we offer e-commerce services and maintain strong, long-term relationships with our customers.

When we approach our customers, we do not just present ourselves as equipment providers; we position ourselves as solution providers. This often involves cross-selling, where we might sell a warehouse along with forklifts and standby or prime generators. In the marine sector, we offer not just marine engines, but also oil accessories, diving equipment, fishing gear, and more. We also engage in long-term contracts, providing standby equipment with SLA agreements.

We believe we have a very strong customer base, bolstered by our investments in CRM systems, after-sales services, and our e-store. Most importantly, we invest in our team. We have a highly educated, capable, and competent team that we are very proud of. Our success is no accident; it has been built over the years, and we take great pride in where we stand today.

Can you give us an example of a success story that illustrates your philosophy and approach, particularly in one of the areas you are very proud of?

Sure, let’s talk about Almarai, the largest dairy company in the region. We have had a long-lasting relationship with them, providing comprehensive solutions. We have supplied them with a wide range of equipment, including irrigation systems, tractors, combines, generators, and forklifts. Most of our product range is present in their facilities or farms.

With every contract we have with Almarai, we offer two key services. First, we educate and train their staff on preventive maintenance, overhauling, and train-the-trainer programs, ensuring they have full control over their after-sales services. Second, we provide them with consignment stock so they have fast consumables readily available at their farms or facilities. This allows them to operate independently, only needing us for monthly billing based on the parts they consume, which the system automatically invoices.

This example shows how we establish long-term strategies with our customers. In the public sector, like with the Coast Guard, we face different challenges due to their reliance on tenders. Here, we ensure that the end users, such as the Coast Guard or Navy, are competent in maintaining and overhauling our products through comprehensive training programs.

Moreover, we have created a unique solution with the Coast Guard, where retired employees get the first right of refusal to become our distributors in their areas. This means in remote areas, we do not need our own service workshops. Instead, retired Coast Guard employees run their own branches, supported by us with parts, diagnostic tools, and training. This ecosystem not only supports our brand but also turns these retired employees into advocates who promote our products.

These examples highlight our philosophy of long-term partnership, customer education, and local empowerment, demonstrating how we distinguish ourselves in the market.

What are you working on at the moment? What are the key projects you need to achieve in the next month or two?

Currently, we are working on a project with the Saudi Electricity Company to provide mobile generators. This project was initiated by them but engineered and executed by us. We have developed two different types of mobile power stations: a truck and a tugged truck, which include tanks, control panels, wiring, cabling—everything necessary for operation. These mobile stations can be placed anywhere, offering flexible power solutions. We are continuing to provide various solutions to them as part of this ongoing project.

Secondly, we are closely collaborating with Neom on a concept called power parks. Power parks are a new idea they developed. Together, we are engineering a 10,000 square meter area that can be dismantled and reinstalled within a week. These plug-and-play parks will provide about five megawatts of power using diesel engines. This project is in the engineering phase, and we are excited about its potential.

How does Alkhorayef Group approach corporate social responsibility, and what is your strategy in this aspect?

Our CSR strategy revolves around individuals and corporate initiatives. In the marine sector, for instance, we have been sponsoring the first and second jet ski racers for the past five years or more. In the motorcycle realm, we have two categories. Similarly, in the motorcycle category, we support an academy for young riders and sponsor a racer in Saudi Arabia.

In the agriculture sector, we support the small-scale farming industry by collaborating with a well-known influencer who is a farmer. We provide him with a tractor and conduct regular online training sessions with him and his audience. This partnership ensures that we remain engaged and accessible within this sector, allowing him to guide our efforts effectively.

On the corporate side, under Alkhorayef Commercial, we engage in various activities. We participate in events related to the Coast Guard and support employment initiatives by the Ministry of Human Resources. We also have special programs with universities, offering internships and co-op opportunities. For example, we were the first to sign with Princess Nourah University, providing training to the first batch of female engineers. We currently have four of them in our training program, attending classes and working at our office.

Our CSR initiatives are diverse and tailored to fit our budget. We aim to create a positive ecosystem where we not only educate society but also contribute to the well-being of others.

How do you envision developing Alkhorayef Group in the medium term? What is your dream for the future?

Currently, we are in the midst of a strategic project for the group, where we have identified several key areas for growth. By 2030, we anticipate expansion into three to five new business lines that we are actively studying. Internally, we aim to enhance our operations within existing companies. Additionally, we are transitioning from a pure trading model, exemplified by Alkhorayef Commercial, to becoming service providers offering end-to-end solutions.

To illustrate, let’s consider our sale of John Deere turf equipment for golf courses and our involvement in developing large parks like King Salman Park and Al Urubah Park. These ventures will necessitate high-level operation and maintenance services. We are currently exploring this domain with consultants to expand our commercial business.

In fact, just before this meeting, we were discussing the need to change the name of Alkhorayef Commercial Company to something like “Alkhorayef Equipment Solution Provider” or “Alkhorayef Equipment Solution Company.” This reflects our shift towards offering comprehensive services beyond equipment sales, collaborating closely with other OEMs to provide full-fledged solutions. While we are still in the study phase, this represents our medium and long-term strategy within the group.

What is your personal philosophy? While you come from a family with a strong business legacy, you have your own unique approach. Could you elaborate on that?

Absolutely. I consider myself a giving person. I find fulfillment in sharing knowledge and offering assistance through my connections and volunteer work, contributing to the community on an individual level. Currently, I hold several volunteer positions, including Chairman of the Industrial Committee, Vice Chairman of the National Local Content Committee, Vice President of the Riyadh Economic Forum, and a board member of the Riyadh Chamber of Commerce. These roles allow me to leverage my relationships to support others, whether it is helping young entrepreneurs kickstart their businesses or advocating for industries with government entities.

On a personal level, I am deeply involved in community initiatives, always striving to lend a helping hand wherever I can. Financially, I support various causes and organizations, serving as Chairman on five boards with a diverse range of industries. I chair a company specializing in financial services, funds, and brokerage, as well as a real estate development company. These roles not only allow me to apply my expertise but also enable me to harvest the benefits of my connections and experiences, furthering my impact as a leader in these organizations.

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