The emergence of SMEs in the UAE and how does Zawdeh plan to boost the entrepreneurial community. A candid interview with Peter Aziz, Co-founder and Marketing Manager of Zawdeh.
Could you tell us something about the history of Zawdeh? When did it form and what was the thought behind building this organization?
Zawdeh was established in Dec 2015 by entrepreneurs with a vast experience in managing SMEs. The idea and concept emerged from our struggle to have the best value for our money when it came to monthly expenditure on overheads and assets purchased. The constant struggle brought forth an important question – How can we boost our business by decreasing our cost without compromising on quantity and quality while increasing our revenues?
So, we created the SME business community evolving around the economies of scale theory to group SMEs together into one buying power. Here, SMEs can trade with our selective partners benefiting from great deals and discounts that will allow them to decrease their operating cost by up to 20%. At Zawdeh, we try to minimize their cost without compromising the primary requirements; companies can purchase whatever they need, with the highest quality and at the lowest price.
But why stop at decreasing cost? Using the SME business community allows the SMEs to have their own platform to promote special offers to other Zawdeh members as well as the public which increases their sales and brand recognition.
What are some of the biggest challenges faced by the SMEs in UAE?
I can name a few that can make or break an SME in the UAE market; however, the most important one is managing cash flow. Companies need funds to survive, and if it is unavailable and banks do not facilitate then, they either go for drastic cost cutting or shut down altogether.
Also, client acquisition at the lowest sales and marketing cost allow them to have competitive pricing and a good profit margin at the same time.
Why should the government, corporations, and individuals invest in SMEs? What are the advantages of working with them and how is it beneficial to the economic growth of the country?
SMEs are considered the heart and soul of any economy. Take UAE as an example. The UAE market is 94% SMEs and employs more than 86% of the private sector’s workforce (Source: http://www.kippreport.com/fcs/smes-represent-95-per-cent-of-uae-businesses/).
Certain points differentiate SMEs from larger organizations and could be considered as USPs for them. Firstly, small businesses are driven by the aspirations of their founders. They will invest more time and energy to grow and produce results, and they will motivate their teams to excel and achieve the high goal (it’s never a 9-6 job for an SME). Secondly, when you are working with an SME, you are in direct contact with all the stakeholders in the company, which makes work easier, faster and more efficient. Last but not the least, SMEs are flexible. Business owners have the authority to agree on deals, tailor products, and scope of work and approvals are somehow acquired easily and faster than larger corporations.
In the past couple of years, there has been a rise in the number of business communities and platforms targeted towards SMEs. How would you differentiate Zawdeh from the rest in the market?
At Zawdeh, we always try to be different. No one thought about increasing the net profit of SMEs through cost reduction (not cost cutting); we did. Even when we thought about helping SMEs enhance their sales and revenues, we created a marketplace that was unique. SMEs don’t just list themselves on the portal like our peers; they advertise a special B2B offer for the benefit of the other members of the community and the public. It gives them the competitive edge and attracts more customers.
The global economy is not in a very stable position, and the projection for 2017 is far from robust. How do the SMEs survive in such situations and what would be Zawdeh’s strategy in helping SMEs pass through this phase?
Think outside the box. SMEs need to start changing the way they do business. Knocking on doors and cold calling is not working anymore; they need to find a way to generate leads, convey their value proposition and secure the deals in the most cost effective way.
When the market is down, SMEs need to start working together to survive; affinity marketing is the current trend, and it is working. Tie up with people who will introduce you to your target audience, seek new partnerships and find the right influencers who will open doors for your business to grow.
Cut unnecessary cost, and always find the most cost effective solutions for your overheads. Zawdeh helps SMEs do all that; we help you connect with other members, open new doors for business and decrease your cost without compromising the quality or quantity of your purchases.
Which are the sectors where the SME growth has been exponential? Are there any areas which are currently showing a slow growth but looks promising in the next five years?
Anything digital. E-commerce will grow exponentially in the coming years; mobile applications are the go-to business solution at the moment, and they will continue growing.
How does Zawdeh align itself with the vision of His Highness Sheikh Mohammed bin Rashid Al Maktoum’s of making Dubai the ‘happiest city on the planet’ and what are its strategies for the Expo 2020?
Helping SME owners boost their business by joining Zawdeh’s SME business community will ease up the degree of challenges they face in operating their businesses. It will lead to a better working environment and a prosperous outcome that will cascade down to the workforce in their segments.
Our Community platform will help SMEs live up to their obligations while fulfilling Expo 2020 requirements.