Thursday, April 30, 2009

Business, The Du "Bhai" Way

The best of the brands are available in the Gulf like in any developed country. But there lies a difference. In Gulf the product owners do not decide on their strategy, they are just observers to the entire game that is run by the local exclusive agents.
Decades ago when the Gulf was not developed like the way it is now, but still then the rich locals had enough money to afford the luxuries, the companies in the name of spreading their reach gave exclusive distributorship to local companies. By decree it was also not possible to sell anything in the Gulf without a local partner – the rulers wanted to protect the interest of the locals, ala India till eighties.
All companies whether selling pins or luxurious automobiles had to have a local partner. And that agreement stuck to them like a constricted leather jacket till now. Look at Siemens, Toyota, Mercedes, BMW, GE all big guns in their own rights are now pawns to their local agents.
Toyota does not decide how many cars they should sell in Dubai; it’s decided by their agent Al Futtaim.
Al Gargash decides the marketing strategy of Mercedes in the Gulf, the promotions they should run and the prices they should offer in the market.
Can anyone believe that one has to wait for months to get hold of Honda Civic or Toyota Corolla in Dubai? While the fact is that if you drive down to the bordering country Oman, you can get it off the shelf.
It’s more of a sophisticated monopoly in all segments in the name of protecting the interests of the locals.
I believe Dubai or for that fact UAE is losing its competitiveness.
Take for example telecom, throughout UAE there is only one player – Etisalat like our own MTNL. They provide landline, mobile & cable service. Just relate to the services you can derive out of Etisalat, Its painful. Since Etisalat only had the rights to televise World Cup Football, they made the interested viewers cough out AED400 for a month and guaranteed a year’s viewer ship along with the deal.
This year after much criticize & public frustration a new provider has emerged, Du. But both Etisalat & Du are controlled by the rulers of Abu Dhabi & Dubai respectively. So one has to wait and see how competitive they are, given the fact that Du is using the existing infrastructure of Etisalat.
Moeller, one the renowned electrical & electronics product manufacturers from Germany in represented in UAE solely by Juma Al Majid. The products are available only for their consumption, that’s the way it is. Full stop. ABB had the same fate with Al Gandhi. It took them 8 years court battle and 30 million AED in compensation to get out of this exclusive agreement. Siemens is still trapped in the same fate.

But all distributors do not have the same philosophy. If they are business minded they can make fortunes. For example Jumbo, the sole distributors for Sony, They have taken the brand to such heights that they lead the market in most of the product segments they are present in. Jumbo has made the art of distribution to near perfect. They have a vast network of retailers and a huge logistics & distribution system. Jumbo has its own store in most localities but its more of brand promotion, new product introductions and the stuffs. Their prices are always higher than the retailers and the promotions always focus on the retailers.
The same is true for Nokia. No one knows the name of the sole distributor for Nokia. The market share for Nokia is more than 55% in UAE. It boasts of an excellent after sales service in every nook and corner of the city and has created an entry barrier to most of the competitors in terms of pricing & service.

So every coin has two sides, the heads & the tails. WTO has set a dateline for 2010 and most companies are waiting for that. UAE has also realized that it has to be competitive to make it in this competitive world. The government is trying to implement a law by which multinationals can open companies in UAE without a local partner. We all hope it’s for the betterment of the economy and the customers.

Business, The Du "Bhai" Way

The best of the brands are available in the Gulf like in any developed country. But there lies a difference. In Gulf the product owners do not decide on their strategy, they are just observers to the entire game that is run by the local exclusive agents.
Decades ago when the Gulf was not developed like the way it is now, but still then the rich locals had enough money to afford the luxuries, the companies in the name of spreading their reach gave exclusive distributorship to local companies. By decree it was also not possible to sell anything in the Gulf without a local partner – the rulers wanted to protect the interest of the locals, ala India till eighties.
All companies whether selling pins or luxurious automobiles had to have a local partner. And that agreement stuck to them like a constricted leather jacket till now. Look at Siemens, Toyota, Mercedes, BMW, GE all big guns in their own rights are now pawns to their local agents.
Toyota does not decide how many cars they should sell in Dubai; it’s decided by their agent Al Futtaim.
Al Gargash decides the marketing strategy of Mercedes in the Gulf, the promotions they should run and the prices they should offer in the market.
Can anyone believe that one has to wait for months to get hold of Honda Civic or Toyota Corolla in Dubai? While the fact is that if you drive down to the bordering country Oman, you can get it off the shelf.
It’s more of a sophisticated monopoly in all segments in the name of protecting the interests of the locals.
I believe Dubai or for that fact UAE is losing its competitiveness.
Take for example telecom, throughout UAE there is only one player – Etisalat like our own MTNL. They provide landline, mobile & cable service. Just relate to the services you can derive out of Etisalat, Its painful. Since Etisalat only had the rights to televise World Cup Football, they made the interested viewers cough out AED400 for a month and guaranteed a year’s viewer ship along with the deal.
This year after much criticize & public frustration a new provider has emerged, Du. But both Etisalat & Du are controlled by the rulers of Abu Dhabi & Dubai respectively. So one has to wait and see how competitive they are, given the fact that Du is using the existing infrastructure of Etisalat.
Moeller, one the renowned electrical & electronics product manufacturers from Germany in represented in UAE solely by Juma Al Majid. The products are available only for their consumption, that’s the way it is. Full stop. ABB had the same fate with Al Gandhi. It took them 8 years court battle and 30 million AED in compensation to get out of this exclusive agreement. Siemens is still trapped in the same fate.

But all distributors do not have the same philosophy. If they are business minded they can make fortunes. For example Jumbo, the sole distributors for Sony, They have taken the brand to such heights that they lead the market in most of the product segments they are present in. Jumbo has made the art of distribution to near perfect. They have a vast network of retailers and a huge logistics & distribution system. Jumbo has its own store in most localities but its more of brand promotion, new product introductions and the stuffs. Their prices are always higher than the retailers and the promotions always focus on the retailers.
The same is true for Nokia. No one knows the name of the sole distributor for Nokia. The market share for Nokia is more than 55% in UAE. It boasts of an excellent after sales service in every nook and corner of the city and has created an entry barrier to most of the competitors in terms of pricing & service.

So every coin has two sides, the heads & the tails. WTO has set a dateline for 2010 and most companies are waiting for that. UAE has also realized that it has to be competitive to make it in this competitive world. The government is trying to implement a law by which multinationals can open companies in UAE without a local partner. We all hope it’s for the betterment of the economy and the customers.

When Winter Comes

Summer months are almost over. The temperature is on the decline. People in Dubai, they hold a record for short distance sprint between car park & home, are venturing out for fresh air and some breeze in the evening. Nights are getting longer and night life is getting more extravagant. The trade which gets subdued in summer has started flourishing. More Russian & Eastern European girls in the street. The “Shawarma” cones are getting bigger & thicker in anticipation of higher sales. Restaurant/Pub owners are decorating the “open air” area.
Agencies have started promotion for the “Desert Safari” and “Creek Tours”. Within months the beautifully light boats will be sailing around the creek and competition for share will become fierce. More people will be found jogging/walking along the corniche. People will come out of hibernation and first thing they will realize is that their waist line has increased, so run, run, and run.
Hotels will start hiking up their rates, tourists will flock in hoards, and Dubai will be fairer than in summer. In the malls Asians will not get the same attention they get in summer, more waggle to attract foreign tourists with cash. Bag packers will never visit malls, will head towards Fujairah and soak in the sun in the serene beaches.
Life will change dramatically. People will go to office early so that they can leave early (where they have flexi time). People, usually lazy like a crocodile in summer, will suddenly be rejuvenated and tend to overdo in anything they would try to do. Traffic will increase, more time in car, more stress related heart attacks and more assurance from the traffic department, that solution is just round the corner. Where the street bends in a corner is very difficult to find out.
Parks will be flooded with people, from people having a good time to some enjoying barbeque.
Sell of Playstation or X-Box will relatively go down as kids will be more involved in becoming Sachin Tendulkar or Ian Botham. Electricity bills will go down due to sparse use of air conditioning and women will try to spend the savings in shopping.
More young guys will go to the beaches, not for bathing but bird watching. Bare white flesh in golden sand like button mushrooms growing in negligence in the wilderness, scattered and not cared about, only watched from time to time by ones who can only dream but for them reality bites.
Flamingoes will come in the lagoon. The pink shades will merge into the blue of the ocean to create an illusion of sunset.
Dubai, the city of Gold, the paradise on Desert will be more gorgeous.
And I will be busy packing my bag to leave.

Earth Is Moving Again

Last few weeks were quiet eventful. There was a big dull for few months and that gave me a feeling that Earth has slowed down. How wrong I was. Not only did it get rejuvenated but covered up for most of the benumb period with a deluge of events.
North Korea went ahead against all the threats issued by US and went “Nuclear”. UN Council went gung-ho about the major crisis in the Far East. The balance of power got destabilized in the area and the “Nuclear” test has created a big threat to the neighboring countries (read South Korea). This is the first time UN was so fast in taking a decision – levying a sanction against North Korea. Iran got an impetus and is now running at the speed of light to go “Nuclear”. This is a new fad – “Go Nuclear” like “Go Vegetarian”. It’s good for the mind and spirit of individuals in the country. US have again started issuing empty threats. They never get tired, I salute them. They create all problems around the world and when the matter gets out of hand, they backtrack out by telling stories to the whole world and try to be the world peace keeper. In the 70’s during the Cold War to keep their sway in the oil market they only provided Iran with all the nuclear technology. Now they are shouting about balance of power. Funny no brainers these people are. What more can you say when they have surnames like “Bush”.
I am very skeptical about this word “Balance” like in balance of mind, balance of money, balance of power. What it really means is quite different. Balance of mind means when you stop thinking and do as others tell you, balance of money is that when you do not have money and borrow money from one who has aplenty, balance of power means when US has the only right of developing and stocking nuclear weapons and others are like observers. US has got an arsenal of 300-400 thousand nuclear warheads which exceeds their nearest competitor Russia by 100:1 and when the same country goes around crying for World Peace, isn’t it a dichotomy.
Bangladesh is basking under glory with Muhammad Yunus winning the Nobel Peace prize. As a Bengali I am also proud of him. I truly admire the way the Nobel committee works. There is no nomination process for the prize and hence no lobbying as it happens in most other ceremonial awards. There outlook is also quite different. World Peace is not only about mitigating conflicts, making peace processes between warring nations. This everyone thought as a defacto standard and hence all kinds of names were floating around like the Indonesian president. But Nobel committee turned everyone around and took all by surprise when they declared the winner. Peace is also about eliminating poverty, empty stomach leads people to commit crimes, go astray. Everyone does not want to be a millionaire, but want to have basic minimum for survival. That’s what Grameen Bank has given to people. They made individuals into businessmen, suppliers, traders – made them stand up on their feet and challenge the world of death and violence. Grameen Bank elevated “Micro credit” to such a macro level that Capitalism sounds micro in comparison.
I got a loveletter from my estate agent. They have increased the rent by 20%. I believe now people in Dubai will start working for HRA only rather than salary.

It's a different "BALLGAME"

Pakistan Cricket team is in total shambles. First was the “Ball” controversy. They thought that cricket can be played with any ball so long as it is round. So the bowlers replaced the hard ball with their own balls. That’s was also O.K with Darren Hayes. But when they kept on switching between their balls then the matter got out of control. Now someone has changed the urine samples of Sohaib Akthar and the nice guy got caught in doping test. This is sabotage, outright sabotage. Inzi is still suffering from the “ball” pain and now Sohaib is repenting for taking the “wrong” piss.
After Laloo Prasad Jadav delivered his first lecture in IIM, Ahmedabad, Bihar is getting management savvy. Now it’s the turn of the beggars. They have formed a union. The areas have been properly distributed among the members so that there is no collision or competition between two beggars. The minimum alms they have fixed are Rs1. Below that they don’t accept. Everyday the collections are combined and then equally distributed. They also have job rotations so that they understand the psyche of that area and develop their strategies for better profitability. Union has given them the strength to fight against local small time criminals and as a registered union they can launch complaints in the police against the goons. They take a weekly break on Thursdays to be with their family and pursue their other interests. After formation of the union they are a much better lot.

Overweight Rules !!

October 2006 will be a month for me to remember. This is the first time when the number of overweight people in the world surpassed those who live below poverty line. As per the recent survey by the world health organization there are more than 1 billion overweight people in the world. 300 million are obese while there are 500 million people who can’t get a proper daily meal. This is something to celebrate. We have achieved proper distribution of health & wealth in the land of freedom, fortune, land of McDonalds, Coca Cola, Pepsi, KFC, TGIF and countless other junk food brands– the great United States of America (USA should be read as they declare the name of fighters in the boxing ring or in WWF). Maximum Overweight people hail from that great country.
But jokes apart, this is an alarming situation. We have all became soo lazy. It’s not always our fault. Nature is taking its toll. All the developments around us are meant to make our lives comfortable. Television has converted us into couch potatoes; all house appliance gadgets have reduced our efforts. Exercise has become a fashion. We need Nike sneakers, track suits to jog. We jog to find out who is looking at us rather than concentrating on weight loss or to keep fit. We can’t lose weight without going to gym or going through a dieting regime. That’s the “in” thing. Look at our earlier generation, were they overweight? They used to do more manual work, walked distances and had little bit of indulgences that kept them in shape. We never realized that we are born into nature and it will be too difficult to surpass the same.
Take myself as an example. When I arrived in Dubai the first 6 months before I obtained a driving license was totally different form the life I am leaving now. I used to walk around Bur Dubai, Karama by foot. We used to stroll down the Dubai creek in the evening, went to Meena Bazaar and did window shopping – life was fun. But now to go to Apsara Supermarket, which is 5 minutes walking distance from my house, I need a car. I have to think thrice before going to Meena Bazaar because it’s always a problem getting a parking slot there. So options are getting limited, go to shopping malls where there is plenty of parking, indulge yourselves in junk food and add to the statistics. Even in office we are confined to our own cubicles. Intercom solves all problems of communication. Earlier we used to go up to the fax machine, now that’s a story of the past. We transmit the documents we want to fax directly from our PC through the server. Life has become so simple and we are paying the price, overweight, obese leading to cardiac problems.
As per another study, constant use of mobile phones leads to infertility in men. Next time you call up your boyfriend, give it a thought.

GOODBYE DUBAI !!

As the days roll by I get the feeling of nostalgia gripping me tighter than ever. It looks just like yesterday, 15th of November, 2005 when I landed in the Dubai International Airport. The ride to the Hotel in the taxi left my jaw wide open, so much so that my boss had to hit me to get it fixed. This is what desert looks like? Sprawling high-rises, clean roads with disciplined traffic, greenery along the roadsides and so less people.
I am from India, so all these things, sort of comes as awkward to me. If the road is clean then for us the houses must be dirty – where else will they dispose their wastes?
I went straight to office, more so to get my jaw fixed. When I reached the team assistance came running and handed over my laptop and cell phone. Maybe he wanted to reduce his burden of responsibility. But for me it was like WOW!! And it did pain me in the jaw.
Only thing that is universally true was also true here – sitting space was in scarcity.
It took me time to come out of this make believe place and come in terms to reality. Inflation was trying to follow the Colombia space shuttle, house rent kept on changing like babies diapers, always new & improved ones.
Two years went past like my favorite Thai soup, leave it in front of me and next moment it’s gone. Hope the taste will keep on lingering.
Time is like an ever alluding illusion. We spent whole life, born and reborn only with a singular hope that some day we will catch up with time. We die with that hope and are reborn with the same hope.
Dubai was a place of contradictions – rich people, richer people and the richest ones. All towering over the poor laborers, who can make tea with their hot boiling blood, working at temperatures of 50 degree.
Malls are in abundance, all brands under the sun crowding in those malls. Poor Pilipino sales ladies, who can only touch those things, but never have them. People of all colors – white, black, brown, yellow and all derivatives, moving around but hardly touching shoulders. Colors decide the treatment and so does the treatment differentiate colors.
Work was sort off. Will leave with a sense of unfulfillment & unaccomplishment. That’s life after all. Had lots of good colleagues, but never a friend. My fault, only my fault. But work was always fun. Downloaded lots of songs from Multiply, filled up 30 GB on my iPod. Drank in seclusion, read with the agility of a tiger. Never thought will be able to finish so many books in such a short period of time.
Now its time to go back, time to kiss the earth where I was born, back to my mother & father, back to the little house that I can proudly call MY HOME. Home, sounds so sweet when you are away. Home, not a place to live, it’s a feeling of comfort, belonging and where you can always dream when you close your eyes.