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Sun 3 Jun 2012 08:39 AM

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Staying flexible

Perhaps the Gulf’s most famous entrepreneur, Fadi Ghandour recalls how he turned Aramex into a logistics giant

Staying flexible
Aramex founder Fadi Ghandour says succession planning is vital — any organisation that depends on one individual is an organisation in trouble

Thirty years ago Fadi Ghandour, founded Aramex in Jordan, with no idea the company would evolve into the largest courier company in the Middle East and North Africa.

“We decided to actually make the dream of a united Arab world true — instead of focusing on one country,’’ Ghandour says. “We went out to abolish borders, we said we were going to conquer our region, and own our region.” So instead of chasing five million inhabitants in Jordan, Aramex immediately targeted the more than 300 million people in the Arab world.

“There were massive hurdles from government — foreign investment laws were ridiculous,’’ Ghandour says, of the early days. “But understanding how to cope in those markets allowed us to go global.’’

Aramex forged a strategic alliance with Airborne Express which provided the technological know-how to operate and develop the courier company in line with its partner’s needs as well as its clients.  The company found a niche in the Middle East market by selling its services to global express players, where it became the outsourcing arm of these firms delivering their packages in the Arab world instead of them using competitors.

“Owning that market taught us that the best way forward was to learn from our clients — like FedEx,’’ Ghandour says. “Before they went out to regions like ours, they outsourced to us. We decided to take on a strategic alliance to go global. We didn’t have the cash to acquire, like the big boys. And that gave us geography — we were able to have a position in China without actually setting up there.’’

“Global means the world — not Europe, the US or China — you don’t have to be in those locations,” Ghandour adds. “You define that the moment you step outside your borders. We don’t know how to do business in the US — and we don’t want to do business in the US. You need to know what your core competency is and stick to it.”

Aramex now has $800m in revenues — “and it was a step-by-step process — we grew organically,’’ Ghandour points out. “We don’t do anything that our competitors do not offer — but we have a unique corporate culture that maybe our competitors don’t have. It’s about entrepreneurial spirit — and that is well-defined from the moment you arrive at Aramex.’’

Another important thing about going global, says Ghandour, is that success is about people rather than assets. He recalls that the first question he was often asked when trying to raise finance was about what assets Aramex owned. But many of those companies with buildings and other capital-intensive assets are actually in trouble today, he says.

Aramex is worth $700m on the Dubai Financial Market, with 12,300 staff in 353 different locations across 60 countries.

For the future, Ghandour says his impending departure at the end of this year, and succession plan — has taken a long time to implement. He says succession planning is vital — any organisation that depends on one individual is an organisation in trouble.

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