Thursday, January 8, 2009

Learning Experience Dubai 1 - 1

As promised I will share the experience of Dubai with you.

The Dubai assignment was started 6 months ago. I have a very good client who is always talking about the Middle East market and how his product can penetrate the market. They manufacture carton boxes packaging. At the same time, SPJ was looking for IIP project for their students. I spoke to Prof Dalvi to have the student to do a market study.

I just arrived in Dubai this morning and in the course of the next 4 days (I leave on Thursday), I will share the various meetings and understanding I had with you on Dubai.

The learning experience will be focused on the cultural aspect of entering the Middle east market, I will not talk about the project specific as it is an IIP project which the students are still working on, you lot will understand.

1.Hard market to penetrate
Entering the middle east market is very difficult meaning making money in this environment is not easy. It is true Dubai and the rest of the UAE is booming with double digit growth in the last few years and there are many projects up for grab. As a foreign company coming into this market, you need to be very patient.

My first consultancy assignment here was with a Malaysian electrical installation contractor, who have heard of the many construction projects in Dubai and Abu Dhabi. I have been to the Middle East since the 1980's but this is the first assignment to set up a business in Dubai. Our first visit was tough. You need to understand the concept of Arabian time. You can come for a pre agreed 1 pm appointment and end up waiting for 2-3 hours and when you finally meet with the person, he does not feel bad about keeping your guest waiting :) In Singapore, the person would have walk out. Even during the meeting, the pace of conversation is very slow, there will be silence in a conversation....... You come to appreciate that you have to give allowance for your meeting and appointment :)

It was after six trips to Dubai to have finally landed with a project and after that things are alot easier. You need that first project to get you started. The total cost before we got our first project was about S$50,000 or 100,000 Dir. Imagine a small company wanting to start up oversea business and the kind of investment you have to put in. This exclude the manhour cost and cost of lost opportunity if we did not secure a project after six visits. Thankfully we did. Have we got our returns, the answer was Yes. The company is still operating in Dubai and have expanded to Doha as well. Expansion has its problem. That will be something we talk about next time.

There are several things I learn negotiating in middle east.
1. Never confrontation, reduce the eye to eye contact as much as possible. Arab client do not like to be cornered.
2. Have contingency option A,B, C.... even if you like option A and it give you the best return, give the Arab client what they want and eventually the follow-up work will come back to option A....
3. Never Hard Sell, I come to realize it never work. At the meeting we were proposing and hard selling a cheaper material and yet the client wants the most expensive. It is waste of money and we conceded.
4. Build relationship. Do not try selling all the time, get to know the client and more important the family..

To be continued.....

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