Al-Arif Sons Travel — SME Case Study (UAE)

Al Arif Sons Travel was founded in 2005 and is considered a travel agency branch under Al Arif Group.

Al Arif Group was founded by Abdul Karim Al Arif and Abdul Razak Al Mutawa in 1975 as a construction company, and after several expansions in the market, is now known as Al Arif Group. Al Arif Sons Travel is located on Jumeirah Road in Dubai and despite it being categorized as a small business due to the range of Al-Arif Sons Travel Figure 5: Al Arif Sons Travel Logo its employees, between 10-49, it is well-known for its high standards in travelling services. Their services are dedicated to a specific segment of clients, which we will be discussed later. Furthermore, it serves a growing number of clients which is more than 150 corporations that are customized to meet the needs and the requirements of business and leisure travelers. The travel services provided by Al Arif Sons Travel comes in the form of packages to worldwide destinations with powerful connections and relations to other international travel airlines and agencies. Al Arif Sons Travel consists of a diverse nationality of experts in the travel industry and highly skilled travel consultants. Its staff is continuously provided with training and sent to required courses to ensure that they are up to date in the traveling field with the best standards to provide their services.

Vision Statement ¡ To provide total travel solutions to customers and exceed their expectations.

¡ Maintain a dynamic, pro-active organization capable to the changing environment.

¡ Use of technologies to enhance efficiency and be a leader in online travel solutions.

¡ Always get ahead of the market.

¡ To be a market leader in offering travel and affiliated services.

¡ To create an environment that develops a dynamic and motivated team.

¡ To achieve excellence in service, thus benefiting customers, investors, employees and the society as a whole.

Organizational Structure

The Al Arif Sons Travel chairman is Mr. Hamad Al Arif and the general manager is Faisal Al Awadi. As shown in the below image, has seven departments and 25

employees

Admin & IT-3 Finance-4 Corporate-4 Ticket Retail-4 Leisure Sales Out Bound, Inbound & Visa -4 Management-3 Sales & Marketing-3 Figure 6: Leadership Chart of Al Arif Sons Travel In an organization like the Al Arif Sons, a total of seven departments are there. Those are three departments with three managers in each, including the finance department manager, the sales and marketing department manager, and the administration and IT department manager. The finance department has four accountants who manage the financial and budgeting aspects and deal with the expenses and payments accounts.

The sales and marketing department has three employees who promote sales through their experience in the marketing schemes. The administration and IT department provides logistics support to other departments and has three employees with professional IT skills. The corporate department has four employees who handles the corporate accounts and any other matters. The department of leisure sales, outbound, inbound and visa has four employees who handle anything that matters to the travel and tourism facilities, from creating travel packages to issuing visas or travel insurance. Finally, the ticket retail department has four employees dedicated to handling the traveling tickets requirements.

Leadership The founders of this company are Abdul Karim N. Al Arif and Abdul Razak Al Mutawa. They started it as their family business 40 years ago. They ran their business with a strong relationship to clients. Hamad Al Arif and Faisal al Awadi are their successors, with the first being the current chairman and the second being the general manager.

The two founders formed a construction company named the Al Arif Group. This small family business faced different kinds of challenges a lot during its earlier stages, but eventually flourished and expanded as a big group that covers construction, maintenance, real estate, trading, the food sector, and tourism. Al Arif Sons Travel to serves elite customers with a 5-star level of service and customization according to their needs and requirements.

Al Arif Sons Travel chairman, Hamad Al Arif is a visionary leader who has the potential for success. Two if his

quotes are

“Today the world is moving towards innovation in digital technology and evolution of mobile communication.

All the countries in the globe were challenged due to globalization and liberalizations. Due to our feet firmly on the ground and our vision far beyond the horizon, we will continue to be a partner in the development of the United Arab Emirates.” “The flag of our growth starts in the year 1995. Our commitment to the community is to manage and exceed all expectations of quality, trust, and spirit of innovation with excellence. Al Arif Group is now set to expand its influence to the GCC as well as to other parts of the globe.” Al Arif Sons Travel’s general manager is Mr. Faisal Al Awadi. He admires his work and his employees and leads

them to the organization’s success. He commented that

“Al Arif Sons Travel’s success is built on being outward- looking, progressive, and being in tune with travel developments. We call this ‘evolutionary reform’ in order to develop and be globally competitive and visible.

A powerful growth engine is fueled by the belief that there is a world out there that’s service-oriented. Our expansion is driven by an urge to excel in all areas of service to meet the requirement of elite clientele.”

The company of the Al Arif Sons Travel has not changed the structure of its business during COVID-19. However, because of the pandemic, the company has faced a sharp reduction of demand for its services as traveling has been prohibited because of lockdown. Therefore, a downsizing of the total number of employees, from 25 to 14 was a must. But because of this, the structure is the same.

Admin & IT-2 Finance-2 Corporate-2 Ticket Retail-2 Leisure Sales Out Bound, Inbound & Visa

• 2

Management-3 Sales & Marketing-1 Figure 7: A restructure suggestion from the author

Al Arif Sons Travel provides luxurious traveling services for a high-class clients with competitive promotions.

These services can be categorized as the following

International Services ¡ Travel packages such as honeymoon packages or holidays packages that are customized according to the client needs with high service standards.

¡ Issuing visas, including setting up embassy appointments, translation services and required documents preparations.

¡ Travel insurances with the most reliable and high level of standards to assure customers are comfortable.

¡ Luxury car rentals mainly for the customers inside the UAE and provide the best of what is available for them either full-time rental or pick up/drop off to and from their destination.

¡ Transportation tickets such as trains, subways and metros, according to the schedules of the trip.

¡ Events tickets with full devotion to give the clients the best experience of attending world events, such as football or business events. In addition, organizing meeting and conference requirements.

In-Country Tours and Excursions ¡ Sightseeing of famous landmarks and interesting places in the seven emirates.

¡ Adventures such as a fun desert drive, safari camps and mountains activities.

¡ Fun places like waterparks and theme parks.

¡ Fine dining in the best restaurants and cruise boats.

Al Arif Sons Travel’s business strategy is considered to be a differentiated products and services strategy.

Whereas mentioned before in the previous sections, it targets a market segment of a high-class clients and to provide them with quality, customized luxurious services, according to their needs. The main strategy of the business is to provide a vast range of services. As a result, it provides customers with airport assistance, cars on daily, weekly or hourly basis, and it has various kinds of holiday packages and most importantly, provides travel insurance for covering all the financial and medical expenses during the time of travelling.

Al Arif Sons Travel embraces a mix of operational

strategies which are explained in the below table

Operations Strategy Explanation Responsiveness We strive to quote very swiftly and also if a customer confirms we turn around with all documents.

Differentiation Services ¡ Provide unbiased product options.

¡ Flexibility of quote booking and payment.

¡ Superior customer services and value adds at the location.

Convenience Around-the-clock assistance at the destination through local partners and from the booking office.

Figure 8: Operational Strategies of Al Arif Sons Travel The business is very responsive to the clients and their demands. In case of any problems, our customer- handling teams are ready to provide adequate service.

Regarding the documents of travel insurance and airport documents, the company tries to provide its best service in case of any issue. The services are not of the same kind; rather there are various services that range from airport assistance to travel insurance. It has many local partners that help customers get car service in travel destinations all across the UAE.

Marketing Mix and Strategies ¡ Product: The company’s product is its services like airport assistance, with Marhaba Hospitality Services. It provides salon cars, big buses and vans to tourists and guests on a monthly, weekly, and hourly basis. There are various holiday packages based on nature of the tours, and it provides travel insurance. Apart from that, the company has a train ticket and visa booking service.

¡ Price: The main thing is that it provides all cost- effective solutions for travel arrangements to make leisure time free of stress. We value money tremendously.

¡ Promotion: The company promotes its business through social media platforms like Facebook.

¡ Place: The central location of the business is all the Emirates of the UAE, which is on Jumeirah Beach Road.

Figure 9: Photo of the Al Arif Group Building Al Arif Sons Travel uses a different marketing strategy

from business to business, including the following

o Social Media Marketing: By promoting travelling services and promotions.

o Account Based Marketing: By providing special offers for certain accounts, such as governmental sectors and specific firms.

o Industry Events: By sponsoring specific events such as events organized by the Dubai Islamic Affairs and Charitable Activities Department and other entities as well.

It also uses different marketing strategies when it comes

to business to clients, as shown below

o Social Networks and Viral Marketing: By promoting travelling services and promotions in it.

o Email Marketing: By keeping in touch with existenting clients about new offers, travelling promotions and new destinations.

o Direct Selling: Via its head office on Jumeirah Beach Road.

o Co-Branding, Affinity, and Cause Marketing: By promoting the Al Arif Sons Travel brand with Al Arif Group.

In general, businesses suffer challenges when there is an overall crisis, natural disaster, or epidemic because the travel and tourism sector will be the first sector that is affected. Moreover, when clients do not follow prompt payments and default with bounce cheques, the travel business firm needs to take legal action.

From the below SWOT analysis and PESTELE analysis, we can analyze the kind of challenges Al Arif Son Travel

is facing

¡ SWOT analysis

Strengths

• Professional and expert employees in travel and

tourism.

• Part of a strong investor group.
• Experts in handling large government institutions for

their global events.

• Customized luxurious services for UAE families.
• Strong, vast, and local/international relations and

connection with other destination partners, hotel chains and airline companies.

• Able to negotiate price.
• Get more value added to clients due to the strong

relationship.

• Able to be flexible at the time of uncertainties in

travel.

• Able to provide high level services.
• Able to stand during eventualities by being in the

business during rough times like this pandemic.

Weakness

• Expansion is limited at this moment and there is no

presence in more places.

• Limited marketing budget.
• Yet to have more online automation.
• Limited affiliations with international representations

of travel management companies in some countries Opportunities

• New large movement-based institution to handle the

services through the existing clients’ reference.

• The UAE generally and Dubai specifically as a tourism

destination.

• The UAE citizens and residents have a cultural norm

to travel during summer.

Threats

• Other travel agency competition.
• COVID-19 pandemic.
• Global Economic Depression.
• Losing out to the larger travel management

companies.

• Business is growing in the online segment and the

company may get a reduced market share due to a late entry.

Figure 10: SWOT Analysis Table ¡ PESTELE analysis: How the below factors affect Al

Arif Sons Travel

o Political: The UAE is one of the most tolerant and peace-promoting countries in the world which grants it the most powerful position to attract visitors and investors in the country. In addition to that, this policy authorized citizens to travel for more than 170 countries around the globe without visa.

o Economic: Dubai has a strong reputation as a tourism attraction. Meanwhile, a lot of locals and foreigners demand a luxurious lifestyle. As a result, a strong and stable economy formed except during the COVID-19 world pandemic.

o Social: The norm in the UAE culture among the locals and the residents is to travel during the holidays and especially in the summer season.

o Technological: Integration eCommerce solutions and adopting social media to promote and enhance services.

o Environmental: The area has a lovely winter with a variety of activities and geological diversity; and sunny summers with golden sands beaches, plus well air conditioned premises attract people all over the globe and gives them diverse choices to travel to and from the UAE.

o Legal: Strong rules and high level of safety all over the UAE.

o Ethical: People of the UAE are considered to be welcoming with a high tolerance for other people from different nations.

Challenges and How to Overcome Them Al Arif Sons Travel had a major catastrophe of cancellations during the beginning of the pandemic, where they paid on behalf of clients. Later when airlines and hotels were cancelled, these suppliers applied charges plus they delayed refunds. However, Al Arif Sons Travel worked day and night to retrieve its funds from the suppliers and return back to the client promptly.

¡ As a company, it has faced various challenges, and successfully overcome all those challenges.

¡ Since its primary business location is the UAE only, it has a shortage of new places in this location.

¡ Undoubtedly, the UAE is the most famous tourist destination worldwide, but less expansion is a real- time challenge.

¡ Moreover, the company lacks automation services in its business process.

The success of Al Arif Son Travel was driven from the extreme strive of the founders and good leadership.

During the earlier stages of the UAE foundation and when the business was booming in Dubai, Al Arif Group could see opportunity in a small family business in construction and ride the wave to achieve its trusted brand name in the market and form a big group umbrella that covers several business sectors beneath it. Similarly, after forming Al Arif Sons Travel in 2005, and according to the founders, best practices, and the newest trends, the best idea would be to ride on innovative services and evolutionary smart devices, and new social media promotes globalization to other levels. Therefore, introducing a travel and tourism agency with innovative, quality, and customized services for the certain segment of clients was a smart aim for the management to achieve.

¡ The company has ethical guidelines in its business process, and this is an inspiration for it to be more dedicated to customers.

¡ The company is very useful for supporting customers in all means.

¡ We always try to step into the places where others fear stepping in with the utmost level of ethics and professionalism.

Al Arif Sons Travel did make some wrong choices like investing in the international market like India. In addition, it ended up losing a few experienced resources due to the pandemic. The main thing is that in the wake of the COVID-19 pandemic, the company has faced massive failure. Scheduled customers had to cancel their trips because of the pandemic. Due to this reason, the management of this company faced massive financial loss as all of their investments in hotels, cars, visas, and other kinds of luxury services went into vain. Since, the COVID-19 pandemic, the organizations’ business in this industry were massively affected. Due to this reason, Al Arif Son has also faced a downturn.

¡ The management has faced problems by investing in the wrong market.

¡ The COVID-19 pandemic has caused massive failure.

¡ The depression in the global economy also caused failures in the business.

In the beginning of the business, the system of Al Arif Sons had some problems with its payment system and because of this, it faced problems like delay in the payments. This used to create a massive negative impact on the investment process of this company. The management of this company, including the general manager and the chairperson, mainly focused on the luxury leisure of the clients. This provided an opportunity to earn a high net income to this respective company.

¡ In the Early Stages of the Business In the earlier days, Al Arif Sons Travel had a greater number of corporations which did impact the business.

As a result, there was more delay in payments and defaults because the yield ratios versus investments were low. Furthermore, leisure holiday business and inbound business were limited. As a result, the scope for expansion was affected.

¡ After the Succession of the Business After the succession in management of the current GM and COO, more focus was given to high income net worth clients and luxury leisure. Also, controlled credit to corporate companies brought a decrease in interest levels paid and further increased the profits. As a result, the scope for expansion was achieved by adding more major government institutional accounts, as well as new technical and cost effective marketing methods being used to get more clients.

After analyzing the SWOT and PESTELE analysis, I came up with the below recommendations for Al Arif Sons Travel. Apart from the SWOT and PESTEL analysis, the four P’s of the marketing mix of this company have also been conducted. Based on these analyses, I have

provided some recommendations and those are

¡ To utilize expertise in applying innovative services based on the smart technologies.

¡ To achieve financial sustainability by entering different markets to back up the core business in circumstances such as the current pandemic.

¡ To open new branches with different segment targets of clients.

¡ To focus on the most profitable destination countries and expand there.

¡ To invest more in online services to compete with current companies that are considered a threat.

¡ To discover more profitable destination countries and promote traveling services there.

¡ To find innovative ways to gain more clients to visit the UAE.

¡ To remember the most important thing is that automation technologies must be included in the services of this company.

¡ To utilize smart ways of taking advance money from clients to avoid financial loss in case of cancellations.

¡ Business enhancement requires good leadership and the best management approaches.

¡ Technology takes business to higher levels of succession.

¡ Innovative services that meet the needs and the requirements of the clients attract more clients.

¡ Maintaining a good relationship with the shareholders will eventually result in being mutually beneficial.

¡ Businesses need to seek and create a secondary financial resource.

¡ Smart technologies including automation are required.

¡ The process of taking advance money is also required.

Al Arif Sons Travel is a successful small business that strives to provide its clients with the most satisfied traveling and tourism services. It is considered to be categorized as a differentiated business because of its customized travel packages. Its style of management is astonishing and allowed it to survive during the peak of the market crises. Despite being a small company, Al Arif Son is considered one of the most important companies in the sector of travel and tourism in countries like the UAE.