This blog post provides an excerpt of an article I wrote for a newly launched online magazine in Canada – Canadian Business Strategist Magazine. You can find the link to the article here: http://thecbsa.org/magazine/2013/02/business-opportunities/ (and if you should want to quote or cite these opinions, please cite the article, not the blog post)
Business Opportunities for Canadian Companies
As both a market in itself, and as a doorway to a larger regional market, the United Arab Emirates is a good place for Canadian entrepreneurs and established businesses to diversify their sales and operations. While the industries the Canadian government has identified are the established and known opportunities, there are many untapped opportunities in health care, adventure and eco-tourism, metals, convenience stores, fashion and food and beverage. Canadian firms have some distinct competitive advantages in these areas which will translate to business success.
The prevalence of obesity and diabetes amongst the Emirati population is very high – which ranks it among the top 10 and top 2 countries in the world respectively. There is universal healthcare provided for Emirati citizens and professional workers are usually provided with heath care from their employers. There are currently heavy investment in the area from well-known American brands such as the Cleveland Clinic and there is a growing demand for more specialised clinics, e.g. for obesity treatment; knee, hip and joint replacement; cardio-vascular and diabetic care. The pharmaceutical industry is also growing much higher than GDP and population – Reuters has estimated an annual growth rate in spending of nearly 10% – and spending in this industry expected to reach over $2.2 billion in 2014.
Adventure and Eco-Tourism
Dubai and Abu Dhabi now run two of the largest and fastest growing airlines in the world with Emirates and Etihad. Aggressive marketing, sales and collaborative projects have increased traffic and tourism in these cities. Millions of passengers transit through Abu Dhabi and Dubai – many taking advantage of short-term visas for shopping and relaxation at the five star luxury hotels. However, there are UNESCO World Heritage sites in Al Ain including sites from the iron age at Hili. Eco-tourism plays a very small role, and yet there are many opportunities in the unique heritage, ecological and cultural sites, as well as mountains, wadis and sand dunes for adventure seeking tourists.
Aluminum SME manufacturers
The UAE is a big player in the aluminum industry and is currently in the top 10 countries in the world, and once production is at full capacity it should take its place as the fifth largest producer after China, Russia, Canada and Australia. Relatively inexpensive electricity, a growing aerospace industry and the role as a regional and international hub provide an environment waiting for experts in aluminum manufacturing to partner with enterprising individuals and groups from the UAE.
In the UAE the convenience store industry is dominated by independently run and operated stores. Recent government regulations implemented in 2012 in Abu Dhabi have seen hundreds of these small stores close as they do not meet the new standards. In the capital of Abu Dhabi alone there were over 1,300 small shops in operation in 2012, and with the new standards and new investments needed by small shop owners, the need for future consolidation is evident.
Fashion and Food and Beverage
From the success of brands such as Second Cup and Tim Horton’s in food and beverage and the ever present fashion retail outlets such as Aldo, Spring and Garage – Canadian companies and brands have demonstrated that they have a distinct competitive advantage in the UAE. At the high end of the market, limited edition, unique quality brands are key selling points. In mid-range these same aspects are important – and fashion retailers such as H&M have implemented the “limited edition” clothing lines to great success in the region.
While first mover advantage is an important factor in the UAE – there is still room for established Western brands to make inroads in a market that looks for new, unique, consistent, good quality and fair priced coffee and fast food outlets. While there are some modifications to menus to account for local regulations for halal products, and as delivery is almost a necessity for fast food chains, walking into a Tim Horton’s or a Second Cup is much the same experience in Abu Dhabi or Cold Lake, Alberta.