04 February 2019

Exporting to over 70 countries: An Interview with Ghassan Nuqul

What are the most recent updates regarding the Nuqul Group's aggressive growth strategy?

In 2015, the idea was to have a five-year business plan with specific KPIs and milestones for accelerating growth and achieving the business plan on a larger scale than anticipated. In May 2015, we increased our capital by bringing in some investors, namely Standard Chartered Private Equity. The idea is to be IPO ready; everything we do—every system, procedure, plan, and department—we are calling it IPO readiness. Whether we have an IPO in the end, merge with a conglomerate, or buy a number of players in the region, there will be some sort of an exit at least for the private equity team. What has happened in the industry and region has caught everybody by surprise. Pulp prices went up for 18 months in a row to historical highs, and prices of finished products went down. That was coupled with the removal of subsidies in some markets in the Gulf and other places, which also weakened purchasing power, so consumers were migrating away from our top-tier brands to a second and third or even fourth tier. All of this put pressure on everybody, and our plan became a continued aggressive approach and continue to explore organic and inorganic growth.GhassanNuqul-Chairma...

What innovations and product solutions do you have in the pipeline as part of your comprehensive strategy?

The first step is de-commoditizing the tissue. We are coming up with interesting propositions for different types of consumers whereby we do not only compete on price but on value, features, and enhanced customer satisfaction. We have already identified certain products within the tissue business that are totally different and disruptive to the industry. One small example we are test marketing is in Egypt in what we call Dueto. When you buy toilet paper you can ask for it soft or hard, but both options include the hollow cardboard core inside. You end up paying for the air inside at all stages—shipping, shelf space, and consumer use. We removed this core and inserted an extra small wrapped roll. The consumer just pops it out and can use whenever, wherever he/she needs. This innovation is an extra benefit; the consumer does not pay a single penny extra for it but gets an extra roll inside. That is creative and disruptive and is one example of many lines we are expanding within our existing business segments.

What role does technology and e-commerce play in this disruption?

Technology has two facets. One is e-commerce and online B2B and B2C, and we are the first to launch the B2B online store. All hospitals and hotels can actually book online and are connected to our enterprise resource planning system. The other element of e-commerce and online business is integrating with souq.com, Amazon, and many platforms. The other facet is our department for digital transformation, which is separate from the IT department and is in charge of these developments in addition to internal developments for our sales people, merchandisers, and staff members who can do everything online and utilize technology. Our fleets will be connected with the smart solutions where you control driving habits, savings, and route optimization, among other things. Our machines are state of the art; everything is being digitized and computerized as we speak. We are also starting to work with artificial intelligence (AI) to improve our in-store availability and shelf location, monitoring consumer habits and using analytics. We are at the forefront of technology as technology is the major platform and the tool that will enable us to move forward, both toward disruption and expansion. If you are not part of the future, you will be out.

In terms of increasing exports, what are your key markets?

We export to more than 70 countries between both raw materials and finished products. For target markets for expansion, Africa as a whole would definitely be one; there is also Pakistan and India. India and Pakistan are new markets for us in terms of finished products that we are looking at in addition to the markets we penetrated in 2018 such as Europe, the US, and others. We have strategies in place depending on the market, whether we want to enter through a distributor, franchise, or joint venture. The most important thing that differentiates Nuqul Group and Fine as a partner is our code of conduct and our values. At the end of the day, you can have people who are progressive, who have the means and the vision to do things that are important, but if they do not adhere to values and codes of conduct and ethics, it does not make good business sense.

What are the current opportunities in Jordan?

There are great opportunities. We have a new generation of brilliant Jordanians who are creative and at the forefront of technology. From my experience, what we need is the enabling environment, so if you create the right environment, then ideas will come. Renewable energy, mobile applications, smart phones, technology, and IoT will all develop as these young Jordanians come up with the ideas themselves. We need fewer unproductive taxes on them, and by unproductive taxes I mean taxes to cover the budget deficit. Government expenses are like a leaky bucket. However, the fact that a businessman can go and see five ministers in one week in Jordan tells you that the government is willing to listen. The issue is our ability to remove the excuses that we always use as obstacles such as “in Jordan it does not work” or “we have a budget deficit so we cannot do it now.” For example, the government is up to its neck in debt, but if you are in business, then this is the time to take more loans to spend on the capital investments in Jordan. But, we have to address all the issues comprehensively and on a long-term basis. We certainly need an economic plan with milestones, KPIs, timeframe, and accountability. Second, this plan should be trans-governance so no government whoever they may be can change it except when you go to a specific predetermined mechanism because things change. Third, we need a major mindset transformation, from a country that looks at collecting taxes to government that stimulates growth. We need to be bold and tackle these issues head on. Nonetheless, there are tools we can use to find innovative solutions.

To read the original interview, click here