The Amazon of the Middle East
Before going on our one-week trip to Dubai, my classmates and I learned about strategic frameworks, family business structures and innovative strategies within a classroom environment. We applied these frameworks to our case studies based on different family businesses. We had thorough discussions on each case and dissected each case to focus on the root issues. Coming from a family business myself, I was completely unaware about the many challenges that businesses in today’s competitive business environment face. Even before going on the trip, my whole perception on family businesses changed. The depth of my knowledge increased after being exposed and enriched with the many unreal experiences in Abu Dhabi and Dubai. One of which included meeting the CEO and co-founder of Souq.com.
The timing of our visit to souq.com was impeccable. Souq.com was the second business we visited and we were all excited to meet the double husky — Ronaldo Mouchawar. We were made aware to not ask Mr. Mouchawar questions about Amazon and anything to do with their relationship with the American company. However, I think we can all agree that we did not expect that a week after visiting the business, the company would be all over the news headlines for being acquired by Amazon for $800M.
As soon as we walked into his conference room, Mr. Mouchawar made us all introduce ourselves and sat on a chair at the same level as us, which made the entire meeting feel more personal and conversational. He was extremely knowledgeable about all aspects of his business and knew the function of each department within his business thoroughly. Mr. Mouchawar is not only a businessman but is truly a strategist. He knows exactly what to do in order to keep up with the fast-paced changing business environment. He stressed the need for souq.com to focus more on fashion and how that could be the most popular products on the website. He joked about how his lack of understanding of women and their fast changing sense of style. Moreover, his insight on innovation and technology, especially the switch to mobile e-commerce, was very interesting. He emphasized that everything is moving towards and focusing on mobile e-commerce and the mobile platform could potentially be next big thing for the business. Mr. Mouchawar’s ability to innovate has been the key to Souq’s success, he has localized and arabized e-commerce. He mentioned how he is driven by customers, innovation and long-term thinking and that these factors are taken into consideration when making any business decision.
Souq.com was by far one of my favorite businesses that we visited from the entire trip. I was extremely impressed by Ronaldo Mouchawar and the change that he is bringing to the Middle East. He started the business in the early 2000’s when the term “e-commerce” was still unknown to the majority. Over the past 12 years, he has made the company the largest e-commerce platform in the Arab world. He described his expansion tactics similar to that of Alexander the Great. The company currently delivers to the UAE, Saudi Arabia, Kuwait, Egypt, Bahrain, Oman and Qatar. He was very open about the challenges the company faces due to the lack of strong infrastructure in the region. To address the underdeveloped logistics infrastructure issue in the region, he developed a Souq-owned local delivery system, which delivers to places with no mail service or postal address, along with investing and building strong relationships with local couriers. He has adapted operations to tackle the challenges in the region. For example, in Egypt 10% of the population uses credit cards, and in countries such as Bahrain and Saudi Arabia only 60% of online purchases are paid for via cash on delivery. To deal with this issue he developed prepaid cards that can be purchased in real life and then can be used online. Since there are a lot of small shops and merchants in the Middle East, he explained how empowering e-commerce could be to people — by connecting them through the Internet. I was curious to know how he initially marketed this platform to the public. He explained in detail about how he strategically marketed the company and how the company also got a lot of free publicity from various newspapers in its earlier days. Since the company was initially founded through Maktoob, Souq.com got some media attention due to the association with the company.
Since the trip was based on family businesses and the current issues that family businesses in the Middle East face, I asked Mr. Mouchawar whether he currently has any family members in the business or would he consider having any. To my surprise, his answer was a firm no. He believes that family and work should be separated to avoid any conflicts.
Every day I was even more impressed by the businesses we were meeting and I had the “ I have to pinch myself” moments countless times. Each CEO we met was extremely welcoming, down to earth and was truly excited to meet us. The biggest thing I took away from this trip was what the definition of success and a leader truly means. We tend to perceive success as the amount of money we earn; however, it is more than just a quantifiable measure. Success is also measured by how you impact the stakeholders associated with your business and whether you overall leave a positive mark on the world. None of the CEO’s focused on the amount of revenue their business generated; however, each of them spoke about how they were creating a positive change in the region. Mr. Mouchawar is just one of the great people we met on this trip. He focused his business in the Middle East with the belief that he could improve the Arab world by exploiting the empowering possibilities of technology. He completely localized his business and focused on the resources that could strengthen his business. He did not let the challenges in the region inhibit him from achieving success. He is truly a smart, grounded individual who sees value in everything he does and acts with truth. He is open-minded and has the ability to take risks making him a great entrepreneur.
