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Interview with iadvisor Rupert Sutton: Tips for Doing Business in the Middle East
New iadvisor Rupert Sutton, President of Exigo Marketing shares some tips with Singaporean companies on doing business in the Middle East.
What are some of the opportunities available for Singaporean businesses in the Middle East?
Despite headlines about the property and financial crunch in Dubai, the growth prospects for the Middle East remain strong not only because of the increasing importance of the region’s oil industry but also because like Singapore, cities like Dubai have become an important hub for regional business in markets like Saudi Arabia, Kuwait, Iran and also an entry point into Africa.
The consumer products and lifestyle industries in particular have continued to enjoy stable growth and with an ever increasing number of tourists there are opportunities for Singaporean food, beverage and lifestyle businesses.
Other industries where there are opportunities for Singaporean expertise are printing, publishing, media and the creative arts which although developing rapidly are continually looking for new innovations and expertise.
What are the main challenges Singaporean businesses may face when starting out in the Middle East, and how should they overcome them?
Although doing business in the Middle East is not necessarily complicated, for example English is widely spoken and countries like the UAE especially are keen to attract foreign investors. As a rule we would encourage only Singaporean firms who already have some experience of international business to consider this market seriously. Having a track record for entering several markets is an important sign of credibility and reliability that strong local partners will be looking for.
Secondly, as with any market, doing adequate market research is critical. For example understanding all the different channels to sell your product, consumer testing your products to ensure their taste and flavour meet local preferences, understanding the key rules and regulations and of greatest importance is to spend time meeting a variety of potential trade partners, visiting their premises and establishing trust, before finally deciding and committing.
Any additional tips for businesses looking to start out in the Middle East?
Based on our experience of working with Singaporean firms on the Exporter Development Programme in the UAE, we made the following observations:
1. Singaporean companies need to ask more questions at meetings rather than just trying to immediately sell their products, for example to understand better what are the typical trading terms in the industry. In first meetings, listening and probing to understand customer needs is key.
2. Companies are encouraged to explore further about their likely competitors, many of whom may be unknown to the Singaporean firms. Understanding the opposition and thinking through how they might react to your entry is critical. The competitive set in the Middle East will usually be different from those in South East Asia.
3. Whilst physically exporting from Singapore is an obvious business model, it is not the only one. Firms could explore licensing, local manufacturing or even joint ventures. In this sense Singaporean firms need to be prepared to ‘break their own rules’ and consider new ways of working if they wish to build a sustainable business in the Middle East.
All answers are provided to the best knowledge of the iadvisors at the point of answering, and are solely represented by the iadvisors, not IE Singapore.
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