Al Musbah Group (AMG)

Introduction

Al Musbah Group (AMG) is a network of companies in Saudi Arabia that are successful in various businesses. Founded as a retailer of perfumes, the Group has since expanded into different sectors, such as travel retail, retail, construction, information technology, food and beverage, hospitality, parking management, and automotive industries. AMG’s employees are trained to be in tune with customer needs through regular seminars, workshops, and training and are empowered to exercise initiative.

Question 1

Al Musbah Group (AMG) is a global brand and organization focusing on diverse businesses across Saudi Arabia. Their main products and activities include Travel Retail, Retail, Construction, IT, Food & Beverage, Hospitality, Parking management & Automotive. They are also renowned for their retail of perfumes. AMG has become a thriving network of companies with nearly 6000 employees, given the power to exercise initiative, regular seminars, training, and workshops to meet customer needs (Oboh & Omolehinwa, 2022).

Question 2

Being a global organization means that a company operates in multiple countries and can be defined as having a “global presence.” Al Musbah Group is a global organization because it operates in multiple countries, including Saudi Arabia, United Arab Emirates, and Qatar, and has a presence in over 20 countries. It is a multi-sector organization with operations in travel retail, retail, construction, IT, food & beverage, hospitality, parking management & automotive (Farjaudon et al., 2022).

This global presence of Al Musbah Group is supported by the theories discussed in our course material. The Theory of Comparative Advantage states that countries have different economic advantages and disadvantages, which can be used to contribute to their global success. By operating in multiple countries, Al Musbah Group can tap into the unique advantages of each country and leverage them to its benefit. The Theory of International Business also states that companies can gain competitive advantages by expanding into international markets (Harvey, 2022). By doing so, Al Musbah Group can benefit from a more extensive customer base and access to new markets, which they would not have had access to if they had stayed solely in their domestic market.

Question 3

Low-growth domestic markets: Companies in low-growth domestic markets may need help generating sufficient growth and may have to look for new growth markets. This is the case with AMG, which has identified new markets in Saudi Arabia with high growth potential and has been able to capitalize on them (Harvey, 2022).

Saturated domestic markets: Expanding across international boundaries is a crucial strategy for many organizations, especially those facing saturated domestic markets. This is the case with Al Musbah Group (AMG), which has expanded its business across Saudi Arabia to maximize opportunities in other markets. The Group has become a significant player in the Travel Retail, Retail, Construction, IT, Food & Beverage, Hospitality, Parking management & Automotive sectors.

Customer drivers: Organizations may expand internationally to follow their customers and provide them with better services. This is the case with AMG, which has been able to expand its services to customers in other countries.

Small domestic markets: Companies in small domestic markets often need help to achieve economies of scale and look for new markets to expand. This is the case with AMG, which has been able to tap into larger international markets, thus enabling it to benefit from economies of scale (Harvey, 2022).

Competitive forces: Organizations may also expand internationally to stay ahead of competitors. This is the case with AMG, which has established a strong presence in multiple markets and stays ahead of the competition.

Portfolio balance: Organizations may also expand internationally to balance their portfolios. This is the case with AMG, which has diversified its business across different sectors and markets to reduce risk and increase profits (Almuhawas et al., 2021).

Cost factors: Organizations may also decide to expand internationally in order to reduce costs. This is the case with AMG, which has reduced costs by taking advantage of cheaper labor, materials, and other resources in other markets.

Question 4

The main success factors of Al Musbah Group can be attributed to its diversification of businesses and its focus on customer service. The Group has built a reputation for providing quality products and services at competitive prices while also offering a wide range of services and products to meet the needs of its customers (Harvey, 2022).

The Group’s marketing strategy focuses on creating customer loyalty by providing a user-friendly website, providing timely and accurate customer service, and offering discounts and promotions. Furthermore, Al Musbah Group has leveraged its network to expand its reach and visibility in the market. The Group also uses social media to promote its products and services (Almuhawas et al., 2021).

The Group’s competitors include other regional retail networks, such as Lulu Group, Carrefour, Al-Raya, and Alfa Market. Al Musbah Group’s competitive advantage lies in its diversification of businesses and its focus on customer service. The Group also has an advantage over its competitors in terms of its network and ability to reach customers through its various channels. Additionally, the Group has developed strong relationships with its suppliers, enabling it to secure better prices and quality products (Harvey, 2022).

Question 5

Globalization is the process of integrating the global economy with particular reference to integrating markets for goods and services, capital, labor, and technology. It refers to the increasing interdependence of countries in terms of economic, social, cultural, and technological activities. On the other hand, customization refers to tailoring products, services, and marketing programs to meet the specific needs of local customers.

AMG has adopted a globalization and customization strategy to recognize that offerings and communication should be adapted to local preferences and conditions. It has implemented various activities to ensure its products are customized for local customers. For instance, AMG has introduced a range of products that cater to local tastes and preferences, such as local food and beverage products, local-style travel retail outlets, and local construction services. In addition, AMG has also customized its marketing and communication strategies to suit local needs (Harvey, 2022). For example, the company has launched regional advertising campaigns that feature local celebrities and themes, as well as localized websites and social media accounts.

These strategies employed by AMG align with the theories of globalization and customization discussed in the course material. The concept of globalization is based on the idea that customer needs and preferences are becoming increasingly similar across countries, leading to the emergence of “global markets.” However, the concept of customization is based on the idea that customer needs and preferences still vary significantly across regions and countries and must be tailored to local conditions (Almuhawas et al., 2021). Therefore, AMG’s strategy of globalization and customization is suitable for recognizing that offerings and communication should be adapted to local preferences and conditions.

Question 6

Consumer protection: In different countries, there are different levels of consumer protection. This means that it is essential for a global organization to understand the local regulations and adhere to the standards in place. This can be achieved using a centralized system to ensure that all products and services meet the same standards, regardless of where they are offered or sold (Abu Sulaib, 2022).

Exporting of consumerism: A global organization needs to be aware of the effects of marketing on different cultures. Understanding the local customs and values is essential, ensuring marketing messages align with these values. This can be done through understanding the local market, conducting research, and engaging with the local population. Furthermore, global organizations need to be aware of the impact of their activities on the environment (Harvey, 2022).

Targeting lower-income consumers in developing countries: Global organizations must know their responsibilities when marketing to developing countries. This includes understanding the local market and the needs and wants of the local population. It may also be necessary to provide appropriate, affordable products and services to the local population (Almuhawas et al., 2021).

Geographical segregation of business operations: A global organization needs to ensure that all its business operations are conducted in a way that is consistent with its ethical standards. This means that all operations must adhere to the same ethical standards regardless of location. This can be achieved by setting clear policies for all global operations and ensuring that all employees are aware of these policies and adhere to them.

Question 7

The post-COVID-19 challenges that Al Musbah Group may face include decreasing demand for nonessential services such as travel, retail, and hospitality. This could cause a decrease in revenue and the number of customers. Additionally, the organization may face increased costs due to the need for additional safety measures to protect employees. Furthermore, there is likely to be a shift in consumer behavior due to the pandemic, with more people opting for online shopping and a decrease in the demand for physical stores (Almuhawas et al., 2021). This could lead to a decrease in sales and a need for the organization to diversify its portfolio of services and products.

However, the organization could also capitalize on the post-COVID-19 environment. For example, the organization could invest in digital transformation, utilizing technology to enhance customer experience and increase efficiency. Additionally, Al Musbah Group could explore new sectors, such as e-commerce, healthcare, and logistics, which may benefit from increased demand due to the pandemic (Hernandez et al., 2022).

Overall, the post-COVID-19 environment presents challenges and opportunities for the Al Musbah Group. Therefore, it is essential for the organization to be proactive in responding to the situation and to develop strategies to capitalize on the opportunities presented.

Conclusion

In conclusion, Al Musbah Group (AMG) is a global organization that has been successful in various businesses across Saudi Arabia. It has become a significant player in the Travel Retail, Retail, Construction, IT, Food & Beverage, Hospitality, Parking management & Automotive sectors through its diversification of businesses and its focus on customer service. The organization has adopted a globalization and customization strategy to recognize that offerings and communication should be adapted to local preferences and conditions. With the onset of the COVID-19 pandemic, AMG has to face new challenges and opportunities. The organization must respond proactively and develop strategies to capitalize on the opportunities presented.

References

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Harvey, C. S. (2022). Differences in Attitudes Towards Ethical-Decision Making, Work Experience and Business Ethics Education Among MBA Graduates (Doctoral dissertation, Grand Canyon University).

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Oboh, C. S., & Omolehinwa, E. O. (2022). Sociodemographic variables and ethical decision-making: a survey of professional accountants in Nigeria. RAUSP Management Journal, pp. 57, 131–148.

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