How do you approach the Dubai market in terms of differentiating yourselves and the services you provide?
NAVIN M. VALRANI Originally, we were joint venture partners with the founders of Clima Uno Air Conditioning Industries, and we fully acquired the business in late 2015. We are currently operating out of medium-sized facilities in Dubai Industrial City, and we needed more capacity to scale up the business. Therefore, we invested in a factory that will be ready in 3Q2017. This brand has truly global potential, and our target market is far beyond the UAE. We will be rolling out globally and exporting products from our new factory all over the world. We will be participating in exhibitions in Italy and possibly the US. With Leminar Air Conditioning Industries going into India, potentially Clima Uno Air Conditioning Industries will be the next of our companies to enter that market.
TARIQ CHAUHAN Facility managers are expected to reduce operating costs, maintain and improve service standards, help clients maintain an environment of compliance, strengthen safety standards, and bring in more sustainable practices in terms of economics, energy, and labour. There needs to be an ecosystem of understanding to make facilities management a feasible and effective tool, and to reach that stage will require more compliance measures and a stronger regulatory mechanism around the construction and licensing process for buildings. This stronger understanding has to be held at the stakeholder level. The ultimate goal for all is to reduce cost through increased efficiency. We need to keep evolving and generate stronger convictions about the importance and value addition provided by facilities management. At the moment, there is a structural disconnect between how facilities management should be perceived, but we are trying to engage and educate people and clients on the importance of enabling facilities managers to achieve the goals of clients.
What should businesses be prepared for when doing business in Dubai?
NMV There are always places where you can manufacture with cheaper labour. Cheaper labour is a misnomer because you have to look at productivity. We find labour productivity rates in Dubai are extremely high, higher than in any other part of the region, and definitely higher than in India. This is largely because of the economic institutions that have been created by the government that make business easy to do here. You can set up a company in Dubai in less than a week. The approvals, licenses, and exporting procedures, along with the ports and airports infrastructure make life easy for business. On the face of it, you may feel you are paying a premium, but when you calculate your cost per unit of production, Dubai is one of the most competitive cities in the world.
TC There is a shortage of skilled resources in the technical field. More and more people are coming out of education and opting for desk jobs rather than field jobs. At the same time, the construction industry is experiencing exponential growth and there is the potential to leverage technology to reduce the number of people that are needed in the field. Finding employees with practical skills is a challenge, especially as there are more facilities management companies in the region now. The other thing to keep in mind is that for many years, aesthetics was the most important aspect for architects, then there was a move towards prioritizing a new building’s sustainability. The cost of managing both of these types of buildings is quite high. To reduce this, facilities management representatives should come in at the design stage and give critical operating cost and structural feasibility input, and how these can be made more sustainable from a facilities management point of view.
What are your prospects for the future?
NMV Al Shirawi Group’s latest addition is an acquisition we completed in November 2016, entering the parking business. We already have a big service side to our business activities, with Al Shirawi Facilities Management, which is the largest private, local facilities services company in the city of Dubai. We also have the largest chiller service company in a joint venture with US Chillers. We see parking as an industry that is set to grow in the city of Dubai, and we have global ambitions for that business.
TC Over the past two quarters, we have added a billion to our revenue stream. We had 100% client retention in 2016, and almost 25% of business has come through retained clients. In 2016 we will have grown 24%, but our contract backlog is growing by 32%. Challenges remain in the way facilities management is approached, but generally, the sector is on the right track.