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Kuwait Report
Marcopolis presents the Kuwait Report focused on the investments, doing business, economy and other topics featuring interviews with Kuwaiti leaders. The sectors under review in this issue are industry, oil and gas sector, investments, banking sector, telecom sector and many more.
VideosApril 09, 2021
Kuwait Agro Holding: A Leading Retail and Distribution Company in Kuwait
- Published: April 09, 2021
Makram Malaeb, CEO at Kuwait Agro Holding, gives an overview of the retail and distribution company and explains what are its main verticals of the business.
"The distribution company was established a year ago. We have four verticals in this company. The first vertical is the brands that we represent. We are the agent of Chobani, the Greek yogurt brand. We are the agent of Hostess who makes Twinkies and cupcakes and other confections. We also represent Del Monte which is an international produce brand. We bring in a lot of produce from the US. We have twice a week shipments coming from California. We sell fresh produce from Del Monte, Driscoll's berries, all the fresh fruits and veggies that you see on your shelves such as celery, carrots, mushrooms, broccoli, potatoes, sweet potatoes, mini potatoes, all the American fruit and veggies that comes to the region we bring from the US. In addition to Hostess and Chobani, we acquired another seven brands last year from Australia, Holland, and the UK. We are investing now in a brand similar to Beyond Meat. It is a protein-based meat alternative. We have 10 brands in this vertical that we have developed just from last year. The second vertical is our own brands that we have developed. I created a brand called Chef Mak which stands for "Chef Makram." Chef Mak is the only in house brand that is more expensive than the leading brands on the shelf. For retailers, when they do private brands, such as with Walmart who has Great Value, Kroger, etc., usually their private label positioning is priced 10% to 20% below the leading brands. We did it the other way around. The packaging is black and shiny gold and we are venturing into categories that by nature are not commodities. I saw an opportunity in this area. We do not do the basic ketchup and salad dressings and the rice and the pasta. Rather, we went to categories which are very unique. The first product we did was a wagyu burger. Wagyu is the highest quality grade meat in the world. Each burger we sell for $6.50 USD for a single piece of frozen meat while you can buy 10 pieces of meat from the domestic market of Kuwait for $5 USD. This is by far our number one selling item now. It is the leader in the burgers category and in Kuwait. We are also doing smoked salmon from Spain, Manuka honey from New Zealand, etc. The brand proposition is very premium and it has been a great success. In addition to Chef Mak, we did Layla's Organic which is our house brand with a motto of "organic made affordable". The objective of this brand, the category, is still not developed in Kuwait because all the organic brands are very expensive in Kuwait. What we are trying to do in Layla's Organic is to be only 20% to 30% more expensive than the conventional product to make organic affordable to everyone. We are developing 100 items this year. We already have two items on the shelf, including organic eggs and olive oil from Spain with a very competitive price. So, we have one brand that is premium positioning, we have another organic which is also premium, but it is also competitive within its category. This is the second vertical of the trading. The third vertical is a very interesting one. In my previous company, the Sultan Center, we used to do a lot of imports from the US. Kuwait has one of the highest GDP per capita in the region. It is the second highest in the world, actually. There is a very good disposable income in Kuwait. Customers want the premium line; they want the high end. Kuwaitis travel a lot to the UK and to the US. When they go on holiday in summer, they go for two months. When they study abroad, they spend three or four years. When they come back, they want to see their American favorites. So, we created a brand called the American Truck. We created an actual truck. It is six meters or 24 feet in length, and eight feet in width. You can even turn it on and it moves. Inside, there is a very unique design but also, it is full of shelving. We have around 400 American products, all the products and the leading brands that you see in the US, such as Kraft mac and cheese, General Mills cereals, Kellogg's pop tarts, Hostess, Starbucks coffee, Dr. Pepper. We are bringing the American variety that is not available with the local vendors. We are implanting this truck in Co-ops, which are supermarkets developed by the government and managed by a board in the area where they operate. They represent around 55% of the retail sector. They are already there, but they do not know how to import. It is not in their DNA. We told them that we will bring the truck and we will implant it for them. We will manage the availability and the inventory and they just take their share of the sales. This has been very successful. We have opened four so far. We have an opening for the fifth and we are opening another three this month and in May. The first opening was very successful. The last vertical we are beginning to develop is a non-food division such as cosmetics and other products", says Makram Malaeb.
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