Regional VP of Western Union Money Transfer Jean Claude Farah”Yemen continues to surprise us by its remarkable growth” [Archives:2007/1021/Business & Economy]
Interviewed by: Raidan Al-Saqqaf
[email protected]
Yemen is considered to be among the least developed markets in the region, several international companies have ventured into Yemen and achieved significant growth in operations. They've had their share of reaping the fruits by being early entrants into Yemen's virgin market. One such company is Western Union Money Transfers. Yemen Times met with the Regional Vice President of Western Union, Jean Claude Farah and had the following conversation regarding Western Union's progress in Yemen.
Firstly Jean Claude Farah, we would like to welcome you to Yemen and wish you a successful visit here. Is this your first visit to Yemen?
Allow me to thank you for your kind welcoming remarks, this is my fourth visit to Yemen. I wanted to visit to stimulate our activities here. Actually it had slipped my memory how beautiful Yemen is and how hospitable and kind the people of Yemen are, so this visit triggered some lovely memories.
What is the span of Western Union's operations in the region and how successful have you been in the regional market?
Western Union has a history of over 150 years in transmitting money and it is the global market leader in electronic wire transfers. Western Union's market share of money transfers has rose from 10 percent in 2003 to 15 percent in 2005 and has grown an additional 3 percent in 2006 to reach 18 percent of all such activities on a global scale. Therefore, you can see that our operations are growing rapidly and we look forward to more growth in the near future. Our annual turnover reached $4 billion per annum, and we have around 4,000 employees working for us as well as over 300,000 service points worldwide.
Tell us about your growth in developing countries including this region.
Western Union is growing on a global scale in terms of size of operations as well as market share, but to address your question, our growth in developing countries correlates with their national growth levels considering that many developing countries in Asia and in this region achieved remarkable growth in recent years, we are very optimistic about growth in the Middle East region, which includes Yemen, in spite of the relatively smaller size of transactions compared to North America.
Please tell us about the objectives and motivations behind this visit to Yemen and the expected outcome.
In addition to being in love with Yemen, my agenda includes visiting many of our respectable clients, which we are associated with, and to further strengthen out business partnership. Today we are visiting the International Bank of Yemen, which was our first client in Yemen. So therefore we are interested in reviewing the preparations for 2007 as well as reviewing performances of 2006, and also congratulate our clients on the remarkable outcomes exceeding our expectations.
How would you describe your relationship with the International Bank of Yemen, your first client in Yemen?
We have an exceptional relationship with the International Bank of Yemen, we wish that our relationship with our other clients in Yemen and outside of Yemen be as good as our relationship with the people and management of the International Bank of Yemen. So far in cooperation with the International Bank of Yemen and our other clients we have achieved a strong presence in various parts of the country, however this is only the beginning because we can further establish our presence in Yemen and move closer to our customers and we will also increase the number of offers we provide for our Yemeni consumers.
I'd like to ask for more details about your strategy in the country and in the region and how you deal with your competition.
Before answering your question I will give you an example to illustrate the difference between us and our competition: If we say we would like to travel by road from Sana'a to Hodeida, would the journey in a Mercedes be the same as the journey in a Kia? The same distinction applies also to any other competitors competing with Western Union quality wise, consider an Indian expatriate who would like to send cash to his family in India; we have 35,000 service centers in India while none of our competition has a number that would even come to ten percent of that. Even in this region, if you would like to send cash to neighboring Saudi Arabia, we have over 140 service centers while our nearest competition has only 10 service points. There is a huge gap between us and our competition, we reject the notion that competing in the field of money transfer is strictly a cost issue or a price war, as we offer a complete package that includes far more than what our clients can offer in terms of convenience, and this also applies to our international strategy as well as our strategy in Yemen.
Western Union offers a set of services which are not available in Yemen, such as home delivery of cash transfers.
I can give you a few more of the services Western Union may provide to ensure convenience of our customers, Home delivery of transfers is by no means a replacement for service centers, but it is an additional option in selected locations. This service and others may be brought to Yemen as we consider Yemen to be a virgin market with a lot of potential, and if you ask me about the growth limitations of the Yemeni market I would be untruthful to you if I tell you that I know what those limitations are. Yemen continues to surprise us time and again by its remarkable growth and size of the market; the money transfers by Yemenis in the gulf region or in the United States exceed expectations and indicate that there is a lot of business to be done with and in the Yemeni market.
Tell us about your market saturation in Yemen.
We have over 200 service points in Yemen and growing, we also have several clients in Yemen including four of the main banks. Our partners are chosen through a careful criterion especially after the events of Sept. 11. Because of new issues such as money laundering, compliance of partner clients with regulations; we have invested over $40 million in the company in order to develop a compliance department to detect cases of money laundering. Therefore any client who would like to work with us has to comply to the requirements from several perspectives, was it goodwill, adhering to business ethics, as well as having good saturation in the market and financial resources and cash flow that permits the partner client to respond to customers.
If we discuss your marketing strategy in Yemen, I understand that you formulate your communication in several languages such as Amharic, Hindi and Filipino. Is it in your strategy to target foreign communities in the region?
With regards to our marketing and communications strategy, that strategy has two parts, first the generic communication which is to inform you about the range of services Western Union provides and that is either in English or in Arabic. The other part is to make sure that the whole world knows of the services of Western Union, including foreign communities and expatriates. For example I'd like to see Omar read about Western Union in his own language, I want a Filipino person to read in Tagalog about the service, I want the Ethiopian to recognize our brand in Amharic. The same norm is applied to other countries which have Arab communities, we do publish advertisements about Western Union in Arabic in the United States and so fourth, it is a diversion of ethnic marketing we pursue on a global scale.
Can you tell us about the ratio of transfers from Yemen to abroad and vice-versa?
Yemen is one of those countries continuously surprising us. Our previous perceptions about Yemen is that it would be more of a recipient country, forecasting our operations to be 85 percent paying out remittance from abroad and 15 percent sending remittance to abroad, but we were wrong. Our operations today are 50 percent remitting to abroad and 50 percent receiving. Apparently there are large foreign expatriate communities working in Yemen and sending money overseas. I do not have precise numbers at the moment about the size of activity, but I know that our operations in Yemen are very active in sending and receiving money.
From your experience, what are the secrets of success of Western Union?
I must say that the most important factor in the success of Western Union is its commitment and fulfillment of the promises it makes. Our commitment raises confidence in our brand and strengthens our relationship further with our clients and this is our secret for over 150 years of continues success.
With your bold expansion plans in Yemen, how do you view your future relationship and partnership with your first Yemeni client, the International Bank of Yemen?
When I first came to Yemen I met with the management of the International Bank of Yemen in its previous headquarters and its current offices were still under construction. We have seen the International Bank of Yemen achieve giant leaps in progress and development and we have also witnessed our relationship growing stronger and moving towards more progress and I look forward to the further growth and prosperity of the International Bank of Yemen as I am sure that our mutual relationship will grow and new milestones will be achieved in our partnership in Yemen.
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