Taking a chance on Saudi Arabia

GCLA's principle Geoff Sanderson

Green Concepts Landscape Architects (GCLA) has moved to Saudi Arabia in these desperate times, but was it a desperate measure? CW asks GCLA’s principle Geoff Sanderson.

What projects are you working on in Saudi Arabia?

In Jeddah we’re working on the metropolitan park, part of the proposed open space network, which is an east west park network that connects Jeddah’s waterfront to the mountains on the other side of the city.

The part we are working on is 12km and we’re doing that in joint venture with Zuhiar Fayez, a very large consultancy in KSA. We’re also doing three other sizable projects in Riyadh at the moment. That’s a fair start and these projects have all come in the last three months.

Did your company make the move to Saudi Arabia as a result of the slow down?

Not as a result of the slow down, we planned this a long time ago in anticipation of a significant slowdown in Dubai and started our move here before that actually happened, hence we’re already up and running. Our office is almost ready to open in Riyadh; we may also open an office in Jeddah and in Bahrain in the long term.

Our company is part of the Packer Group in Australia and so we are well managed and well financed. We just started a major project in Tunisia and so there is also a chance of opening an office there as well. Our resources were such that a move to Saudi Arabia was not only manageable, but it was a logical step for us to take.

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How has your business been affected by the slowdown?

Some of our staff is currently on leave because 18 out of our 22 projects in Dubai were put on hold and that had an awful effect, except that some of our really big projects were outside Dubai. None the less we had to downsize to a small extent, but we’re now rebuilding again and will be hiring some new staff next month.

Do you have any advice for people coming to the region on difficulties they may face in setting up here?

The reason it took us quite a while to come into the Saudi market is that we took our time trying to find the right sponsor. You must find a sponsor that is compatible with your business and highly regarded in the market. Our sponsor is the Abunayyan Group and they are just delightful people.

I had meetings with managers of some of the companies that they already sponsored and everyone spoke very highly of them. Those companies were also very successful and enthusiastic. I met with so many others that were only half interested and I knew that their agenda didn’t match ours. That’s the key piece of advice. Those that are hasty to get into the market might make very expense mistakes when it comes to choosing a sponsor. Our sponsor has opened so many doors for us and made it relatively easy for us in a way.

And what about one’s finances?

It’s not an easy market unless you’re very well financed – you have to spend money to make money. You’ve got to expect to spend a lot of time without a cash flow forging new relationships and making contacts. There may be some small or medium sized consulting firms that think this is the new Makkah, but it comes with a lot of risk, the same as setting up in North Africa or Eastern Europe.

Have there been any unexpected challenges setting up in Saudi Arabia?

No, because I’ve been so long in this region I was prepared for it. The relative novices may not expect it to be quite as difficult to penetrate. The other thing they won’t expect is that the fees are considerably less than what we are used to in the UAE. You must expect lesser fees and reduce your margins, you can’t expect to trade based on the margins that we were used to in the healthy days in Dubai and we’ve had to adjust our services accordingly.

On the positive side your overheads are much less in Saudi - rentals are much less, petrol is half the price, salaries for most people are less, food prices are less – nearly everything that you are going to pay for in Saudi is going to be less than the UAE. So our costs come down and we can provide a competitive service, but in total it is more than a client is used to paying for what they’ve had in the past from an engineering company.

CV

Geoff Sanderson obtained his Master of Science in Horticulture from Melbourne University Australia and also completed a Bachelor of Landscape Architecture at RMIT and the Australian Institute of Landscape Architects, of which he is a past president. He practiced as a landscape architect, mainly in private enterprise, since 1972 and as a horticulturist since 1967. He has worked for 19 years in the Arabian Gulf region - six years in Bahrain and 13 in the UAE.