Local leader sees strength in diversity
Abdulaziz AlAbdulrazzaq, CEO, AlAbdulrazzaq Group, sets diversification and globalisation as pillars for one of Kuwait’s oldest family-run businesses.
AlAbdulrazzaq Group is a diversified business born in Kuwait that now operates in seven nations and eight sectors, including engineering, manufacturing, interior design, construction, real estate and food and beverage. The family company has spanned four generations, beginning before the GCC oil boom with local-centric investments in trade between Kuwait and the GCC region and India. The company has remained strong throughout the Kuwait stock crisis in the 1980s, the invasion of Iraq in the 1990s and the global oil crisis in 2008. In 2019, under the leadership of the company’s current CEO, Abdulaziz AlAbdulrazzaq, the company has successfully turned its investment focus towards the global stage, moving beyond the GCC to the European and American markets.
The company’s local diversification strategy falls cleanly within the Kuwaiti government’s Vision 2035 initiative that aims to transform the nation into a regional commercial and financial hub through the enabling of the private sector and actively developing human capital. The current five-year national plan under the far-reaching programme intends to increase investment in infrastructure development by more than 11%, create more than 3,500 new small businesses and raise capacities for students in the education sector by more than 40,000 through more than 13 new colleges. “The private sector is extremely ready; they just need the opportunity,” said AlAbdulrazzaq. “There is an important entrepreneurial culture in Kuwait.”
The company has recently promoted the local services sector through subsidiary AlAbdulrazzaq Food Company’s acquisition of the GCC franchise rights for Alfred, a concept café established in Los Angeles, USA, in 2013.
The franchise has successfully been inaugurated at its flagship Alfred coffee restaurant in Yarmouk and Kuwait City, while having our third location currently under construction located in Kaifan.
The company first location outside Kuwait is located in Riyadh, Saudi Arabia, which will open in Q4 2022. AlAbdulrazzaq Food Company, (AFC) plan is to grow up to 200 stories around the region in 10 years.
AlAbdulrazzaq explains the desire for such a venue: “Alfred is a destination; it is not where you get your coffee and go to work in the morning. Kuwait is a small country, so everyone knows everyone. People do business and meet friends around coffee.”
“In five years, we will be fully diversified globally in different sectors and regions”
AlAbdulrazzaq Group’s recent acquisitions showcase the company’s ambitions to grow untraditional sectors and diversify employment options for Kuwaiti citizens.
“In the past, we have been involved in the government’s heavy projects, however it depends on how the oil sector is doing and state sponsorship,” said AlAbdulrazzaq.
“We have done many projects with the government, who are amazing partners. However, priorities can shift, which is unsustainable for any single private company.”
The CEO also described challenges facing competitors in the local market. With a population of 1.5 million, only around 400,000-500,000 are generally seen as clients, given that the larger part of the population is of an younger generation. The company, he posits, must remain highly competitive to drive its market share of those willing to spend. AlAbdulrazzaq explains his strategy: “Nowadays when I look at things, I look at how a business will behave during a recession or during difficult times.”
While the multinational has hands in many pockets and is actively broadening its global operations, it remains a family company at heart. “I was raised with the idea that money comes and goes,” said AlAbdulrazzaq.
“It is about people – how you treat people and how you are as a person. That is what we have been doing for the past 70 years with our employees; we are all a family. Our average employee life is 18 years, which I believe sends a strong message.”
AlAbdulrazzaq Group’s growth is not expected to slow down. “In five years, we will be fully diversified globally in different sectors and regions,” said AlAbdulrazzaq. “Our investment arm in the US is preparing for more investments. It is in times of crisis where you can get the best returns.” The holding group recently joined the US market in 2018 through its luxury real estate company, Razzaq.