Recommendations for Entering Saudi Arabia

I thoroughly enjoyed emerging myself in the Saudi Arabian culture. It was interesting to learn about their values, business etiquette and the cultural similarities and differences. There were many findings presented from my research of the country that I will present to the managers on my return to NZ. Furthermore I will give a discussion of my final recommendation regarding entering the into the market of Saudi Arabia.

Getting to Saudi Arabia (in terms of flights) is relatively expensive. Once there however, accommodation, food and transport all tend to be cheaper in price. There is not a lot of trouble involved when applying for a visa when heading over to Saudi Arabia however, once in the country the cultural policies will be hard to work with if I have not planned in advance. As I am a solo woman traveller I will either have to have a guardian to meet over in Saudi or bring a fellow business buddy along with me. The language in Saudi Arabia is Arabic which unfortunately I am not very fluent in. This means I will be needing to bring an Arabic dictionarie as well as have a translator in the country to minimise the language barrier.

It is also important I study up on cultural aspects of the country. As Saudi Arabia is a very religious country, it is important I follow all protocol to establish a sense of trust between Saudi citizens and to be respected within the country as well. A little study before my trip will go along way to help avoid any disrespectful run ins associated with business etiquette, the communication style and cultural differences.

Whilst over there I have decided to enter the market through a wholly owned market entrant strategy where I will have full control of the business on the start up of it. This will be the most beneficial market entrant strategy due to cultural differences and the product I am selling. Traditionally sheep are seen as sacrifices or food to Saudi Arabians and perhaps are not as valued as the merino sheep over in NZ. Therefore it is important to promote the features of the material to oil industry workers to ensure they hold a level of respect towards the product. Although exporting may save on costs as well as a joint venture, I believe these methods will not be as successful due to the cultural differences between countries and although a joint venture is typically similar to that of the wholly owned strategy, I believe problems will arise later down the track with the partner I join with due to disagreements on ideas and decision making.

In some aspects standardising the product could be very useful to help save on costs as the trip is already going to be relatively expensive, however for the best results I believe customising the product is the way to go which is again a result of the cultural differences between countries.

Ultimately I think the best idea is to stick with basing the merino clothing company in New Zealand. In terms of international expansion I am sure there are various other countries that would benefit from merino clothing being sold within their region which would in turn provide the company with huge success, however, I believe Saudi Arabia is not the country for this. Not only is it a risky and expensive business venture, but also it is also not entirely going to work out as a result of being a businesswoman in a country that has strict rules on women’s actions. As well as this there is also the complications of cultural differences that at first may seem easy to work around, however after two months in the country I personally think will affect the successfulness of the business venture. This is predominantly due to the large amount of time it takes for Saudi Arabian’s to warm up to new ideas and ensure trust is established before any action is taken.

So unfortunately planned expansion into the designated market did not pan out as expected but regardless I still had a great time looking into the country and learning about the ins and outs of international marketing.

وداعا لل الآن السعودية جزيره العرب – Bye for now Saudi Arabia!

 

Customisation vs Standardisation

As more organisations expand their business into the international market, it is important for them to adopt international marketing strategies to protect them against foreign competitors. Standardising and customising are two approaches that are often considered.

Standardisation is an approach that can adapt to work across different cultures and countries in order to promote products. Markets are becoming more similar and more internationally based making standardisation a key for survival. It is believed that standardisation of the marketing mix elements and creating one strategy for the global market can achieve consistency with customers and lower costs for the organisation.
As standardisation does not promote marketing strategies for different countries or regions, this means an organisation can save time and money in its marketing efforts. Standardisation in international markets generally means that the level of quality can be expected wherever you are in the world. This marketing strategy also enhances brand loyalty amongst consumers. As discussed, cost reduction is one of the key benefits for standardisation. The cost per unit can be reduced by selling large quantities of the same, non-adapted product(s) as well as buying products in bulk. Other advantages related to economies of scale are an improvement in research and development, lower costs of investments and operational costs associated with marketing. Standardisation also helps organisations to focus on a marketing mix that is uniformed, which means there is often room for product quality improvement. Despite the many benefits of standardisation, the marketing strategy also has its drawbacks. Selling a unified product in different international markets means there is no uniqueness and different markets generally have different preferences. This means competition can take advantage and customise their product to meet the needs of the market, ultimately affecting sales. Another disadvantage results from global manufacturing in various countries, which can pose as a threat as some countries implement trade barriers meaning an organisation’s products may not be able to be reached in some countries again affecting sales.
In terms of marketing to Saudi Arabia, a standardised marketing approach may cause some problems as merino sold in New Zealand is marketed as clothing for colder climates, as a fashion statement or for adventure sports. Saudi Arabia has a completely different geographic layout and climate to NZ so this approach will not be beneficial.

McDonald’s is an example of standardisation

 

Customisation is an international marketing strategy based on the idea that due to culture and other differences within countries, marketing should be tailored specifically to a country. This means the marketing mix of a product will vary from country to country. The benefits of customisation mean customers are getting exactly what they want essentially meaning sales for an organisation will increase. Customer satisfaction is a key aspect for most organisations. Like any strategy, customisation also has its drawbacks which are the costs associated with this strategy. More research is needed to explore various countries markets and because of this continuous adaption to a product can ensure many expenses.
Customisation will be the recommended approach when entering into the Saudi Arabian market. This is because Saudi Arabia has an entirely different culture to NZ, which means the marketing of merino clothing needs to be tailored to suit the different cultural circumstances. As I will be targeting workers in the oil industry, it is important that features of merino wool are displayed to appeal to oil workers. For example, the durability and acclimatising features of the fabric would be necessary to market for those working in the oil industry. This is compared to the warmth of the wool that is heavily marketed in NZ. Although this method of marketing can be costly, I believe it will be the most beneficial in a foreign market.

These phone cases are an example of customisation

For more information about customisation and standardisation, check out these links here.

http://successfulglobalmarketing.weebly.com/untitled/global-marketing-strategy-standardization-vs-adaptation

http://innovativemarketing-abhi.blogspot.co.nz/2010/05/customized-vs-standardized-marketing.html

http://smallbusiness.chron.com/global-standardization-marketing-25939.html

http://machinedesign.com/archive/customization-versus-standardization-striking-balance-erp-software

 

 

 

Identification of Three Different Market Entrant Strategies

The choice of a market entry strategy into an international market can be of crucial strategic importance and ultimately could be the result of the success or failure of the organisation. There are various ways to enter a foreign market with three options being:

• Exporting
• Wholly Owned
• Joint Ventures

Exporting is one of the most commonly used market entry strategies when transitioning into the international market. It is easy and cost effective to implement. Exporting can be defined as the marketing of goods produced in one country that is sold into another. There are two types of exporting, direct and indirect. Direct exporting is marketing, selling and delivering products directly to a client. By working directly with the client there is generally a higher return on investment, lower prices can be set and it is more competitive. The key point of direct exporting is that you are able to have a direct relationship with customers.

Indirect exporting is exporting through an intermediary, which means they manage the product, but at a cost, for example an agent or a foreign distributor.

There are many advantages to exporting which reflects the popularity of the market strategy. One advantage is that manufacturing is all based in the country of origin, which means there is less risk than if manufacturing, were to be based overseas as well as less of an investment. It also gives the opportunity to learn about foreign market(s) by trying out exporting on a smaller scale, allowing you to test strategies and plans without great commitment.

A wholly owned market entrant strategy is essentially what the title describes it as. It is a slower process where the organisation is set up from scratch in the international market. Initially it can be hard to determine the local market, which means it, may take some time to build up market presence but it means there is more control over the management of the company. The benefits of this strategy is that it eliminates any communication problems that may arise within other market entrant strategies where communication can at times be long distance and may be interrupted by language and cultural barriers. A disadvantage of this strategy is that risk exposure is high with the substantial costs involved to implement this.

I would recommend this market strategy as one to implement for the merino clothing company starting up in Saudi Arabia. As I have decided to target oil industry workers, it is beneficial to establish a physical organisation in Saudi Arabia that sells merino clothing. This is primarily due to communication and ease of access. Ensuring workers can be made aware of the benefits of merino wool in the oil industry will have substantial value. This minimises shipping costs, which would be significantly more costly for exporting. Although this method costs more than other methods, it provides the company with the beginnings of creating brand awareness on an international scale as well as offers the opportunity to become profitable within a short space of time, given merino clothing will be the most efficient clothing to wear while working in the oil industry.

A joint venture is an arrangement between two or more companies (often competing) to team up for the purposes of investment. Both companies have a share in the financial running and management of the organisation. Often joint ventures are an alternative to wholly owned manufacturing strategic methods. Joint ventures can reduce the cost and risk of international expansion as well as have a reduced risk compared to other market entrant strategies. The business can also be closely controlled with the idea that two heads work better than one and therefore market intelligence is increased.

The main disadvantage of joint ventures is partnership conflict where a partner may disagree with profit shares, amounts invested, different plans and processes etc.

All three of these market entrant strategies could significantly impact a merino clothing company and make it profitable however, considering the circumstances I believe the best strategy to use is the wholly owned market entrant strategy. And although this strategy may have the most risk on board, after all they do say go hard or go home.

 

For more information about market entrant strategies, check out these links here.

Exporting? Franchising? Joint Venture or Wholly Owned Subsidiary? Which international market entry method is right for your business?

http://www.canadabusiness.ca/eng/page/2696/

http://www.business.vic.gov.au/export/get-ready-to-export/choose-a-market-entry-strategy

Cultural Challenges within Saudi Arabia

Whilst conducting business in Saudi Arabia no doubt I will encounter some serious cultural challenges. Three main challenges I have identified are:

• The communication style
• The religious culture
• Gender considerations

The communication style is an obvious cultural barrier. Not only is there the issue of the language barrier with both parties speaking different languages, there is also the issue of accepting the differences when it comes to communicating. Generally communication in Saudi Arabia tends to be indirect and high context. Basically communication with Saudi Arabians relies more on body language and non-verbal cues such as the tone of voice as well as the use of silence. A direct ‘no’ is rarely used and contemplation is generally silence. When communicating with Saudi’s it is likely that they will converse with an individual whilst standing within personal space boundaries. Saudi’s don’t generally require as much personal space as Western cultures and because of this it may feel like personal space has been violated. As a woman, I probably won’t be talking to an individual one on one, but even if I were a man I would feel uncomfortable in this instance. Saudi’s will also spend a great deal of time getting to know an individual during a business meeting as they don’t like dealing with people that aren’t trusted. It is also important to note that Saudi’s do not like to rush into business agreements and I must not come across as impatient as this all interrelates with obtaining mutual trust between both parties. When greeting a Saudi here is a couple of meeting etiquette points to go by:

• Men shake hands and for business meetings the right hand should be used
• Women and men should not greet in public

The Saudi Arabian communication style is going to be very difficult to get used to, especially considering I am a woman and because of this I will not get to partake in a lot of the discussions, or be treated like a businessman (I will go into more detail about this further down the page). Even so, the thought of having to speak to a stranger that is within my personal space is going to be very alarming at first. Here’s hoping I get used to it!

The religious culture is going to be a one of the biggest cultural challenges for me personally. The closest I came to become religious was attending a church school holiday programme when I was 12, so I have never grown up with any kind of religious background. In saying this I do respect different religions and it will be a lot easier knowing I am prepared for the Islamic culture. Islam is a great ordeal in the Saudi Arabian society. It shapes rules and values concerning the way to behave around family, communities and business so it is key that I research this before I go. With religion there generally becomes prayers, which Saudi Arabians tend to do quite frequently. Saudi businessmen pray five times a day and exact prayer times can be found in the local paper. Western businessmen aren’t expected to engage during those prayer times however business activities will be interrupted as a result. How handy is it that I can plan in advance! There is also the cultural month of Ramadan, which noticeably slows down business. I will not be in Saudi Arabia during the month of Ramadan so business will be conducted efficiently (fingers crossed). However if I had planned to go during that time it would be expected that I do not eat in public or in the presence of those fasting. This is something I would struggle with. Thursday and Friday are the official days of rest. Friday is also classed as the Muslim holy day, so everything is closed on this day. I guess that means no late night shopping for the Saudi Arabian’s then.

Gender consideration is centred around the concept that women are prioritised differently to men. Having a slight feminist bone in my body, I am going to find this cultural challenge (ironically) challenging and it is something I am going to have to mentally prepare myself for, prior to the trip. Western businesswomen are accepted in Saudi Arabia however with that being said, that is with a lot of reservation. Public interactions between men and women in Saudi Arabia is severely limited, even in business settings. There are also set expectations around what Western businesswomen should wear in public, which is an Abaya, a robe like dress that covers most of the body. Indoors clothing should be loose fitting that cover elbows, the collarbone and knees. It is frowned upon for a businesswoman to meet with Saudi businessmen and on the rare occasion this is only permitted if there is a male within the party. Being a businesswoman in Saudi Arabia is going to be a lot harder than expected. Not only is there the business etiquette to follow, but also I must have a male guardian with me at all times in public and I am not allowed to drive. I can’t help but feel helpless in this Islamic society!

Each of these cultural challenges could work as a drawback when it comes to conducting business over in Saudi Arabia. This is why it is important for appropriate research to take place before the trip commences to ensure I am well prepared for whatever cultural shock Saudi Arabia throws at me.

To read more into other interesting cultural differences, refer to these links.

http://www.commisceo-global.com/country-guides/saudi-arabia-guide

http://www.ibtimes.com/business-saudi-arabia-culture-differences-watch-406450

Challenges of Doing Business in Saudi Arabia

A Cultural Profile of Saudi Arabia

The culture profile of Saudi Arabia is very different to that of New Zealand. This is why its important to realise the differences to effective sell my merino clothing in a foreign country. A simple way to compare some features of culture is to use the Hofstede culture comparison chart.

Power distance is a dimension dealing with the hierarchical nature of a country. Saudi Arabia has a score of 95 for this dimension meaning they accept that there is a hierarchical order in the country and this order does not need to be justified. This is almost the exact opposite to New Zealand as we Kiwi’s are very relaxed in terms of living in a non-hierarchical lifestyle. Any hierarchies that are established in NZ are usually in organisations and this is purely for convenience.

Individualism as a dimension describes the degree of independence a society has among its members. Individualistic societies tend to look after themselves and immediate families, which are seen in NZ. Kiwi’s are very independent which is probably a reason as to why we are referred to as Kiwis’ (a small, nocturnal, flightless bird that scavenges around by itself at night to feed its young). A collectivist society is where people belong to groups and take care of everyone in exchange for loyalty. This is seen in Saudi Arabia where loyalty is a strong aspect of the Saudi culture and often overrides rules in society. This relates back to the strict rules on women and is largely to do with the collectivism in within their culture.

Both New Zealand and Saudi Arabia are classed as masculine cultures. This is due to the fact that both countries are driven by competition, with success defined as being the best out of everyone. Both countries have strong work ethics engraved into their culture, which is reflective of the masculine dimension.

Uncertainty avoidance focuses on fear of the unknown, essentially not knowing what the future has to offer. Saudi Arabia score high on this dimension and because of this tend to stick to what they know to avoid any future problems. Innovation is avoided, as it does not follow the norm. NZ is neither similar nor different as they show they have no preference for this dimension.

Long term orientation is the way a country maintains links with the past as well as dealing with challenges of the present and future. Saudi Arabia is classed as normative for this dimension as they respect traditions and follow through with them however has a suspicion for societal change. NZ are also normative in this dimension. They typically don’t tend to save for the future and focus on achieving quick results, very much like Saudi Arabia.

Indulgence is the “extent to which people try to control desires and impulses”. Saudi Arabia does not have a clear preference on the scale and therefore are neither indulgent nor restrained. NZ however is very much an indulgent society which means people generally give in to their desires/impulses and place a higher degree of importance on leisure time.

Saudi Arabia has taken their customs, values and traditions, which date back to 1932 and have adapted them to the modern world. This is similar to NZ and its Maori culture in the sense that values and traditions have been held onto since 1642. However, Maori culture is slowly fading out of NZ society and instead various other cultures have had an impact on the current culture established in NZ today. Saudi Arabia’s culture has had minimal influences from other cultures and has predominantly been shaped by Islamic heritage.

The beginning of the Muslim era has been estimated to take place in the year AD 622. This year was significant for the flight of the Prophet Muhammad from his hometown of Mecca to Medina where he organised his followers before launching a successful campaign to recapture Mecca. This significant event has formed the event Hajj.

Saudi traditions are taught from a young age both in school and from family. Islamic teachings and Arab customs are also supported in these traditions. There are many cultural highlights throughout the year, some of these being Ramadan and Hajj. Ramadan is a holy month where Muslims fast from dusk to dawn, essentially being a month spent for purifying the soul. Hajj season is where Muslims from around the world come to Mecca, which is the birthplace of the Prophet Muhammad. Both these cultural events are very significant to Saudi Arabia and don’t really compare to anything of that in New Zealand.

From Hofstede’s culture comparison chart it is easy to see the cultural differences between both countries. On the scale of things, NZ and Saudi Arabia are not hugely different excluding the power distance and individualistic dimensions. Despite the small differences on the Hofstede comparison chart, I believe I will still find it a huge culture shock entering into Saudi Arabia, especially considering I come from no religious background.

In that case I best do my research!

To read more about Hofstede’s culture comparison chart between Saudi Arabia and NZ and Saudi Arabia’s extensive cultural background, click on these links.

https://geert-hofstede.com/new-zealand.html

http://www.worldtravelguide.net/saudi-arabia/history-language-culture

https://www.saudiembassy.net/about/country-information/culture_art/

 

Key Industries, Geographic Insights and Legal Issues Regarding Saudi Arabia

Key Industries
Saudi Arabia is known as one of the world’s most effective business hubs. Although this isn’t a key industry to the country, they are still known as an attractive place to do business. This is because the Saudi Riyal currency is one of the most stable currencies in the world as there have been no significant changes in its exchange value throughout the past three decades.

Saudi Arabia is also one of the largest economies in the world and is the largest economy in the North Africa and Middle East Region. It is one of the fastest growing countries worldwide as well as offers substantial cost advantages in terms of saving costs on energy and industrial land, due to subsidies and incentives. Essentially Saudi Arabia is creating great opportunities for investors and exporters, which sounds like great news so far for my merino wool clothing company.

In terms of specific key industries, Saudi Arabia has many that boost their economy. These include the energy, education, construction, healthcare and ICT sectors.

Industrialisation in Saudi Arabia is fairly recent and is being implemented into the economy to help the government reach its goals for the country. Saudi Arabia’s economy is dominated by the oil industry however they are finding ways to constantly diversify the economy. Today Saudi Arabia is well known for the production of many industries, which include: crude oil production, petroleum refining, ammonia, industrial gases, cement, plastics, metals, construction, commercial ship and aircraft repair. They are very much dominated by petrochemicals and petrochemical based products, which make up more than 90% of Saudi’s non-oil exports. The energy sector primarily fuels this industrialisation for current facilities as well as set to fuel the expansion of existing facilities.

Education in Saudi Arabia has proved to be an important industry as they are the 8^th highest education spender in the world. Saudi Arabia has recently reformed their current education system in an attempt to educate Saudis’ to help fill jobs being offered by expatriates. It is important to put a priority on funding education in order to attract a significant amount of foreign investment in education to support increasing growth demands.

Saudi Arabia is one of the largest construction markets in the Middle East and fastest growing construction market in the world. There are always constant improvements to make regarding infrastructure, transport, education and real estate in which a considerable amount of money is injected into these projects.

Healthcare in Saudi Arabia is a key industry as it is important to fund considering the rapidly growing population. Saudi is known for being the largest market of medical equipment and healthcare products in the Middle East and provide the opportunity to meet unmet demands with any issues surrounding healthcare.

Saudi Arabia’s ICT industry was valued at a significant $3.6 billion (USD) in 2011 and since then has only increased. This figure alone depicts how key the ICT industry is to the country. There are huge opportunities surrounding the industry of ICT in Saudi Arabia and as the economy continues to grow, so does the industry to keep up with rapid changing demands.

In terms of starting up a merino clothing company, the merino made clothes could be targeted to any one of these sectors due to the versatility of the material. However, I believe it would be best targeted towards the oil industry sector due to the unique properties in the material that would help with physical work.

Geographic Layout
Saudi Arabia’s geographic layout is largely desert land and is well known for popular deserts such as Rub’ Al Khali desert and An-Nafud Desert where sand dunes can be found to be 100 ft or higher. Land rises in the west and southwest to form hills and mountains along the Red Sea. There are no continuing lakes or rivers in Saudi Arabia and the country occupies most of the Arabian Peninsula making it the largest country based on area in the Middle East.

The average temperature in Saudi Arabia is 25.7 degrees Celsius obviously meaning the country tends to be warm all year round. The hottest month is August with a mean temperature of 35.1 degrees Celsius whereas the coldest month is January with a mean temperature of 14 degrees Celsius.

I will be staying in Saudi Arabia during the peak of their summer so acclimatising to the new weather conditions is going to be hard considering Dunedin weather is generally so cold. The consistent warm weather mixed with the desert landscape makes a great selling point for merino clothing as it can cool down a person due to the active fibres in the wool as well as provide odour resisting wear.

Legal Issues
One significant legal issue in Saudi Arabia is all women regardless of age are required to have a male guardian with them. Considering I am a female with intentions of emerging a merino wool clothing company, this is going to prove very hard to do even impossible if I do not have a male associate with me at all times. Women are also not allowed to drive on the road in Saudi Arabia, which makes sourcing transportation difficult. Although there are no physical laws in place surrounding women and their independence, it is frowned upon under Islamic beliefs so it is best to follow these rules regardless of whether its legal or not.

There is an anti cover up law in place which means any non Saudi resident must have a foreign capital investment license issued by SAGIA in order to conduct or invest in any business in Saudi Arabia. If caught in a cover up arrangement there is a consequence of being deported from Saudi Arabia and being banned from doing future business there.

It is also required that a visa is obtained in advance of travels to Saudi Arabia in order to be able to enter the country.

There are many more legal issues surrounding business in Saudi Arabia and you can read more about them here – https://www.lw.com/upload/pubcontent/_pdf/pub3507_1.pdf

For more information about the topics discussed, refer to the links below.

http://www.worldatlas.com/webimage/countrys/asia/saudiarabia/saland.htm

http://www.theweek.co.uk/60339/eleven-things-women-in-saudi-arabia-cant-do

https://www.saudiembassy.net/about/country-information/economy_global_trade/industrial_cities.aspx

http://www.economywatch.com/world_economy/saudi_arabia/industry-sector-industries.html

http://www.saudiarabia.doingbusinessguide.co.uk/the-guide/opportunities-in-saudi-arabia/

http://travel.nationalgeographic.com/travel/countries/saudi-arabia-facts/

The Economic Profile of Saudi Arabia

 

Saudi Arabia can be classed as a country that has a high income for their economic cohort, which is largely due to the success of the oil industry. The oil industry is also reflective of the countries GDP (Gross Domestic Product) that is 753 billion USD. Over the past five years, the Saudi Arabian economy has expanded at an annual rate of 5%. Now there has been a focus on diversifying the current economy and enhancing private-sector employment growth, which you can read more about here http://www.heritage.org/index/country/saudiarabia.

Saudi Arabia has a healthy inflation rate of 2.67% set in 2014. As mentioned in my previous post Saudi Arabia has an unemployment rate of 5.6%, however what’s astounding about this is the male unemployment rate is 3.1% whereas females make up 55.7% of this rate. I think being a female and being able to do business in this country is going to be a lot harder than I thought.

The ease of doing business in Saudi is ranked 82^nd according to the World Bank’s Ease of Doing Business rankings. This is measured on the ability to do business in and out of the country, which is classed as mediocre business, but the system is improving rapidly.

Fingers crossed the economics of the country don’t affect my business too much!

 

For more information on Saudi Arabia’s economy, check out these links.

http://country-facts.findthedata.com/l/15/Saudi-Arabia

http://www.indexmundi.com/saudi_arabia/economy_profile.html

The Demographic Profile of Saudi Arabia

Saudi Arabia’s population is estimated to be 31,935,738 and this figure has increased significantly over the past few decades. Now that’s a lot of people compared to New Zealand! This figure includes an estimate of 8.4 million people that are classed as foreign residents. This significantly large population holds a median age of approximately 28.6 years.

The official language of Saudi Arabia is Arabic, however due to many factors such as their lucrative oil industry and considering the official business language is English, Saudi Arabia have recently adapted English as a second language. With this being said, residents of the country prefer speaking and writing in Arabic and will only communicate in English when necessary. I guess that means I better touch up on my Arabic reading, writing and speaking skills if I want to get along with the locals.

The capital of Saudi Arabia is Riyadh and it is the biggest city in the country with a population of 5.2 million.

Other important demographics to note for Saudi Arabia are:

• The average income per person – $24,407
• The life expectancy rate – 74 years
• The unemployment rate – 5.6%
• The adult literacy rate – 94.43%

The demographic profile of Saudi Arabia is going to have an impact on my merino business in Riyadh, as it’s a lot different to New Zealand. It’s important that I use different demographics to my advantage.

References:

http://country-facts.findthedata.com/l/15/Saudi-Arabia

http://countrymeters.info/en/Saudi_Arabia

The Cost of Living in Riyadh

Fortunately it is very cheap to live and work in Saudi Arabia, especially in Riyadh, as there is not a lot to spend money on (in terms of attractions, cost of food and transportation). So here’s hoping I can make some money and save it too.

Saudi Arabia does not overly promote tourism therefore finding accommodation without knowing someone in Saudi Arabia is tricky. Accommodation in Riyadh can be categorised into two types, compounds and local accommodation. Local accommodation is classed as (town) houses whereas compounds are similar but are generally aimed at businessmen and are westernised providing amenities such as pools, gyms, restaurants etc. To stay in a one-bedroom apartment in a Western compound can cost around $2200 NZD a month. To stay in decent local accommodation, that is still very basic (provides windows, necessary furnishing) costs around $1030 NZD a month. I will opt to stay in decent local accommodation, which will cost me just over $2000 NZD (if not less) for the duration of my stay in Riyadh. The reason for staying in semi decent accommodation is that it is still reasonably affordable and spending two months in a studio room with no windows may become a bit tedious.

Another bonus of temporarily living in Saudi Arabia is the cost of food is heavily subsidised. Fruits and vegetables tend to be a lot cheaper than those in Western countries as well as a lot of other foods. For example here are the following costs of some foods:

• A kg of bananas $2.17 NZD
• A kg of apples $2.63 NZD
• A kg of oranges $1.86 NZD
• A kg of potatoes $1.38 NZD
• A kg of onions $1.36 NZD
• A kg of lettuce $1.38 NZD
• A loaf of white bread (500g) $0.96 NZD
• A litre of milk (regular) $1.72 NZD
• A kg of boneless and skinless chicken breast $7.97 NZD
• A kg of beef $14.91 NZD
• A basic lunchtime meal with a drink in the business area $15 NZD
• A combo meal at a fast food restaurant $9 NZD

Check out the prices of other popular food items here – http://www.numbeo.com/cost-of-living/city_result.jsp?country=Saudi+Arabia&city=Riyadh&displayCurrency=NZD

With these prices in mind, I will budget for $1200 NZD (3,045 SAR) on food, predominantly buying groceries from a local supermarket with the occasion to have a meal out every now and then.

Fuel in Saudi Arabia is also extremely cheap with grade 91 petrol costing just 10 cents a litre! However due to the fact women are not allowed to drive on public roads means I will have to opt for public transport or taxis. Taxis roughly cost around $5-$6 NZD when travelling within a reasonable distance.
Hopefully I will be able to find a place close to town to save on transportation.

In terms of spending money I will use what I earn over there because lets be honest, this is a business venture.

For more information on the cost of living in Saudi Arabia refer to this blog http://www.bankerinthesun.com/2014/05/cost-living-saudi-arabia/

Visa Requirements for Saudi Arabia

Saudi Arabia requires any international travellers entering into the country to have a Saudi Arabia visa. There are two types of visas, a Saudi Arabia Tourist Visa or a Saudi Arabia Business Visa. As I will be travelling to the country for the purpose of business I will need to apply for a Saudi Arabia Business Visa within three months before my intended arrival date. Fees for a Saudi Arabian visa is $74.00 NZD for a single entry and $182.00 NZD for multiple entries. Despite being in Saudi Arabia for 60 days, for the purpose of business I would purchase a multiple entry visa to ensure if I did need to go back to Saudi Arabia after the 60 days I would be able to do so.

There are multiple requirements when applying for a business visit Visa, which includes having a valid passport for at least 6 months prior to the intended date of departure in the visiting country, and it cannot already have a Saudi Visa attached to it. For more information on Saudi Arabia Visa requirements have a look at this website http://universalservices.co.nz/saudi-visa/temporary-work-visit-visa/.

As a result of Saudi Arabia’s strict requirements, as a woman I will not be allowed into the country unless I can prove I have a valid sponsor in the country meeting me. This sponsor must be acknowledged by a Saudi Arabian business, which needs to be proved by an invitation letter certified by a Saudi Chamber of Commerce and the Ministry of Foreign Affairs.

This creates a lot of preparation before shipping off to Saudi Arabia for business affairs!