Strategy Bites: Hani Weiss, CEO, Majid Al Futtaim Retail
Hani Weiss, CEO of Majid Al Futtaim Retail, on how the enterprise has supported modernizing the retail sector and building KSA's digital infrastructure.
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Strategy Bites is a series of interviews that LIRA Strategy Partners founder and Managing Director Raffaella Campagnoli is conducting with some of Saudi Arabia's most notable business executives for Entrepreneur.com. In this edition, she talks to Hani Weiss, CEO, Majid Al Futtaim Retail.
Can you start by giving us an introduction to Majid Al Futtaim, as well as its plans and objectives in the Kingdom of Saudi Arabia?
Founded in 1992, Majid Al Futtaim is the leading shopping mall, communities, retail and leisure pioneer across the Middle East, Africa, and Asia. The launch of Carrefour in Riyadh initiated the company's expansion into Saudi Arabia in 2004, and today, Carrefour operates 25 hypermarkets and supermarkets, employing more than 3,000 colleagues in the Kingdom. This growth trajectory also included opening an automated fulfilment center at the Carrefour store in Jeddah's Al-Sulaymaniyah, a first-of-its-kind in the Kingdom. Responding to the changing market demands locally, the digitized storage picking facility automates managing orders, significantly reducing the processing time by up to 50%.
Further, in the wake of the COVID-19 pandemic, Carrefour KSA recorded a 285% increase in online sales in 2020, which led the business to accelerate its online growth plans. As a result, Majid Al Futtaim opened its biggest online Fulfilment Centre in Riyadh in a record six weeks and activated nine stores to fulfil online orders. Spanning 9,000 sq. m., the Riyadh fulfilment center has been set up to ensure the quick and efficient preparation and delivery of products to online shoppers across the capital. Today, over 500 colleagues fulfil customers' needs with a range of over 12,000 essential grocery products, fresh fruits and vegetables, cleaning products, and more, delivered through 150 refrigerated trucks.
Most recently, we opened another Carrefour Fulfilment Centre in Dammam to cover the Eastern Province. This 6,000 sq. m. facility processes 2,500 daily orders to serve the Eastern Province. Looking ahead, our 2022 targets for the Kingdom include opening around 10 more Carrefour stores, and over 20 "dark" stores to fulfil online orders, as we cater for this seismic shift in customer purchase behavior in the Kingdom.
As an enterprise with a focus on Saudi Arabia, how are you and your entity embracing the Kingdom's Vision 2030?
Majid Al Futtaim has tailored Carrefour's offering in each country to ensure that customers across the region experience international standard grocery retail that is locally inspired.
In Saudi Arabia, this commitment includes operating in accordance with Vision 2030 and supporting the broader ambitions of the nation, and digital transformation is a unique part of that commitment. The recent opening of our automated fulfilment centers in the Kingdom has supported modernizing the retail sector and building the nation's digital infrastructure, bolstering digital transformation, and helping the sector further contribute to the country's gross domestic product.
Majid Al Futtaim recognizes that the private sector plays a vital role in shaping the nation's goals and enabling Saudi society to reap the benefits of advanced technological solutions that have become integral to how we work and live. Our adoption of the latest cutting-edge applications of artificial intelligence, machine learning, and robotics support the Kingdom's efforts in this regard. As always, we remain focused on delivering exceptional value for our customers through every new experience, a philosophy that we believe embraces the Vision 2030 ethos and contributes to the long-term development of Saudi Arabia.
Introducing more Saudis into the private workforce and investing in their upskilling and development is another key ambition of the Kingdom's Vision 2030 that we are actively contributing to. We are proud to have Saudi nationals as store managers in multiple locations, and most of our latest recruits are Saudi. For us, investing in the upskilling of Saudi talent is as important as hiring them in the first place, and so we aim to recruit and develop 130 Saudi managers over the next 18 months.
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What are the key changes you are seeing when it comes to the business landscape in Saudi Arabia?
Saudi Arabia, the largest country in the Arabian Peninsula, is witnessing the creation of a diversified and robust economy capable of sustainable growth for the Kingdom
Majid Al Futtaim supports this transformation and contributes to the retail sector's progress through several key initiatives and new launches. Underpinning Carrefour's commitment to supporting Saudi Arabia's evolving business landscape includes accelerating the use of automated technologies and robots to help fulfil customers' orders faster, while minimizing errors and utilizing our colleagues' skills to serve our customers better.
Further, Carrefour automated fulfilment centers use artificial intelligence to pick customers' orders from the optimum storage location, while autonomous mobile robots assist human colleagues in retrieving items and maintaining stock levels as products leave the facility. Through this technology, all orders are prepared within five minutes, cutting the average time between order placement and dispatch in half, and guaranteeing that up to 200 accurate orders are sent out every hour to get products to customers in nearby communities on time and in perfect condition.
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What impresses you most about Saudi Arabia's plans for the future? Have you noticed any particular changes in the retail landscape over the last couple of years?
Long-range economic development that has been directed through a series of five-year plans has led to Saudi Arabia maintaining a robust development track record. As the largest Arab economy, and through growing integration into the global economy, the Kingdom is poised for more economic development as we look to the future. Further, under ambitious targets set by the nation's leadership, the country is witnessing tangible economic prosperity and progress across all socio-economic metrics. This is clearly evident in the rapid transformation of the retail sector– uplifting the market in line with best practices and international standards while also becoming a testing ground for innovative new ideas and technologies.
At Majid Al Futtaim, we adhere to certain principles that have remained constant throughout the 25-year history of Carrefour in the region and have been essential to our success. As we continue to grow our overall footprint in the Kingdom of Saudi Arabia, with developments like the Mall of Saudi, which broke ground in Riyadh recently, we are dedicated to continuing this commitment to innovation and industry firsts, including developments such as Scan & Go and Click & Collect at Carrefour. We believe that innovation is a continual process that remains essential to market leadership- one that Majid Al Futtaim is proudly pursuing in Saudi Arabia and across this region.
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