Founded in 1980 and headquartered in Dubai, the SwitzGroup of companies promotes value throughout the baking industry – from manufacturing through to distribution & retail.
The story of SwitzGroup is a story of a family business that started in the harsh desert environment of Saudi Arabia and learnt how anti-fragility could create business value. “Saudi Arabia is where my grandfather started the business, where my father grew and where I was born, and the country continues to represent our largest business area,” said Executive Director Mr Adel Khorakiwala.
“We owe a lot of our success to this business environment and cultural heritage. The desert needs to remain patient until rain occurs when the opportunity for life finally appears. Bedouins are generous with their limited resources to ensure that they minimise conflict and maximise mutual collaboration possibilities. There is a humility in the Arab culture that comes from their religion, an acceptance of things that are out of one’s control.”
Pursuing this philosophy has supported the group’s expansion across the bakery value chain, with successful operations in egg farming and processing, the trade and manufacture of bakery ingredients, production and distribution of bakery packaged goods as well as the development of dynamic and varied chains of retail formats across different geographies.
The company that today employs over 4,500 people in numerous countries has demonstrated that values, strategy, and a drive for knowledge have a universal appeal across cultures and nations, fostering growth and positive development.
Family of Anti-fragile Companies
Today SwitzGroup is present in the countries of the Middle East and in India, Turkey, Greece, Philippines, Australia, and Sri Lanka with its businesses operating as independent entities, with local suppliers and local customers. “The companies benefit from the group’s knowledge, which helps to protect them from market turbulence as well as to identify sustainable opportunities,” explained Adel Khorakiwala.
The business was founded by Mr Khorakiwala’s father in 1980 from a bakery that was set up in 1977 by his grandfather. “Coming from a multi-generational family of entrepreneurs that have started businesses in India and in other parts of the world, my father developed the Dubai-headquartered branch into what SwitzGroup is today,” he stated.
“The fact that we operate across the whole value chain of the industry makes us different from other bakery-focused businesses. We understand the entire value chain,” he further remarked, adding that rather than focusing on creating a robust and resilient business structure with firm systems and procedures, the group’s companies operate independently, and are developed to be ‘anti-fragile’ – able to deal with challenges and in fact improve through every criris.
Innovating for Well-Being
This approach has worked very well, as demonstrated by the group development of the last few years.
SwitzGroup has not only survived the pandemic but has emerged stronger than before – the business has grown by 50% compared to the 2019 pre-pandemic level pushed by both organic and acquisition-led growth, with some companies achieving growth as high as 60% – a remarkable performance.
How has this been achieved? “I think the reason is that we’ve kept each business small in their thinking. We have not corporatized the entire business and we have been dynamic. Keeping our companies anti-fragile has proven to be the best approach. Not only have we managed to retain all our employees during the pandemic, but we have also managed to increase our market share.”
He pointed out that as the well-being trend was magnified during the pandemic, SwitzGroup has also increased its focus on healthier options. “As a large group, we are constantly engaged with the scientific community, the R&D community, and have recently invested in enzyme technology, focusing on organic ingredients that can replace emulsifiers and E numbers in our products. That is the most promising part of making our products clean label.”
Supporting Local Character
Mr Khorakiwala affirmed that as a family-owned business, SwitzGroup considers its investments from a long-term perspective. “Typically, we try and find respected food cultures with established bakery habits, specifically in locations of challenged or negative macro-economic trends. There we usually find attractive investment opportunities – very high-quality, mature, well-established family companies that are looking for a partner with a steady hand to hold on to.“
“We like to find like-minded people who appreciate the benefits we can provide. Capital is something that can be provided by many. But it’s that ecosystem of bakery knowledge and global perspective that we can offer on top of the capital, and that’s what make us very attractive.”
He noted that Greece and Turkey have been a particularly fruitful area of the group’s investment in the last seven years. “Typically, we’re not necessarily looking to buy 100% of any business, we’re trying to get a significant majority with options for the managing partners to slowly let go of their equity over a period of time, while having some financial security and reward for their hard work over the years.”
Similar in Diversity
Mr Khorakiwala further ack-nowledged that one of the reasons the group has been so successful is the set of values on which the business has been developed: family spirit, teamwork, a learning organisation, and execution.
“Working as family members, teamwork is at the heart of a great enterprise – we encourage our leaders always to be humble and mindful, appreciating their teams and their people engagement. We also strive to be a learning organisation, creating a safe environment for people to be transparent and open, empowering them to grow and develop. Last but not least, execution ties the previous three principles together – keeping everyone grounded to results.”
“Those values are clear across any culture, and they mean the same thing to Filipinos, Indians, Australians, Greeks or Arabs. They resonate with people with the right character, and we invest significantly in our leaders and managers, carefully chosen for their integrity, competence and energy, to pass those values on to their staff.”
Enriching Partnerships
Looking back at the company’s history and its development, Mr Khorakiwala reflected that there is an attitude in all his family’s generations that has been followed through challenges and prosperity – intentionally going from a place of comfort to a place of discomfort.
“Wherever we see adversity & challenge in the world, we become more curious. Right now, Turkey is a place of extreme challenge; it is also a place of great importance culturally and historically – a good example of a location that we would consider for expansion. Whenever we see this dichotomy of civilisational value with an economic challenge, we get very excited, because we know that we will find people of great character and a great consumer market.”
He stressed that it is not just about profits. “We’re not trying to take one brand and one product and spread it all over the world. We strive to create value. We work with what the business has and develop it in line with the local culture. We bring a global perspective to local business brands, creating value for them. This in turn enhances our knowledge and creates value for SwitzGroup.”
