Faculty of Management Sciences

MKT_202: Marketing Analysis & Planning

Orascom Development (Owest)

Instructor: Dr. Omneya A. Marzouk

TA: Dr. Israa Yasser

Group members: -

Name ID Lecture group

Nouran Ashraf 210461 A
Nour Khaled 210241 A
Mohamed Khaled Marei 212991 A
Seif Islam 210273 A

Fall 2022

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 1- Introduction
1.1) Brief history about Orascom

Onsi Sawiris founded and owned OC in Egypt in 1950. It owned and

ran cement manufacturing facilities with a combined annual production
capacity of 21 million tones in Egypt, Algeria, Turkey, Pakistan, Iraq,
North Korea, and Spain. Orascom Building Materials Holding
(OBMH), the holding company for the assets of the cement group
owned by OC, was sold to the French Lafarge in December 2007. A
$450 million bid was won by Orascom Construction in Saudi Arabia in
July 2011. Orascom Construction increased its presence in the US in
September 2012 by acquiring The Weitz Company and constructing a
nitrogen fertilizer facility in Iowa. Cascade Investment made a $1
billion investment in Orascom Construction in 2013. OCI NV, a
business based in the Netherlands, was established as a result of this
transaction Shares of Orascom Construction began trading at the Cairo
Egyptian Exchange and Dubai Financial Market in March 2015. The
biggest wind farm in Egypt was being constructed by Orascom
Construction and Engie as of July (Orascom, 2018). The contract to
develop two monorail lines in Cairo was awarded to the partnership of
Bombardier Inc., Orascom Construction, and Arab Contractors in May
2019.
Orascom traces its roots back to year 1950 when Eng. Onsi Sawiris, the
founder of Orascom Group and the owner of Orascom Trading
Company, first founded a construction company with few friends in
Upper Egypt. By digging waterways and paving roads, he built his
business into one of Egypt’s largest general contractors.

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 1.2) Orascom projects & services list
 Services:

1. Concessions investments: -
a. Wastewater Treatment: Orasqualia
b. Renewable Energy: Ras Ghareb Wind Farm
c. Wastewater Treatment: Dammam West Independent Sewage Treatment
Plant

2. O&M Facilities Management: -

a. Facilities Management: Contrack FM
b. Water Treatment Plant: Bahr El-Baqr Water Treatment Plant
c. Wastewater Treatment: Abu Rawash Wastewater Treatment Plant
d. Transportation: The First Monorail in Egypt & Greater Cairo Metro
e. Industrial development: Suez Industrial Development Company

3. Construction: -

 Infrastructure:

o Water
o Transportation
o Highways and roads

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 o Power

 Industrial:

o Data centers
o Fertilizers
o Cement
o Petrochemicals

 Commercial:
o Healthcare
o Grand Egyptian Museum
o Student Housing and Senior Living
o New cities
o Buildings

4. Building Materials: -
a. Nation Steel Fabrication
b. Alico Egypt
c. United Holding Company
d. United Paints & Chemicals
e. National Pipe Company
f. SCIB Chemicals

5. Equipment Services: -

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 a. Orascom Services

 Projects:
o Grand Egyptian Museum
o Egypt’s Monorail
o Greater Cairo Metro
o Burullus Power Plant
o Magdi Yacoub Global Heart Centre
o New Assiut Barrage and Hydropower Plant
o Abu Rawash Wastewater Treatment Plant
o Port Said Tunnels
o Marassi
o Egyptian Cement Company
o Mall of Egypt
o New Alamein City
o New Administrative Capital
o Smart Village
o Borg El-Arab International Airport
And lots more…

1.3) Owest Compound: -

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The Owest masterplan is a one-of-a-kind proposal created by the renowned
architecture firm HOK. The corporation has several landscapes, and buildings are
built all around these green elements. The property is modelled on the Al Gouna
lifestyle and incorporates luxurious services, yet it is located in the heart of
October 6. The complex is built 3o to 50 meters higher above the surrounding area
to provide residents with clean air and a healthy environment free of pollutants. O
West by Orascom is located on Wahat Road and spans 4.2 million square meters
(1000 acres). Units are expected to be delivered by the end of 2022.

2- Four levels of marketing competition: -

2.1) Product form competition:

They are identical products in terms of value and functionality (Twins).
a. Hyde Park
b. Villette

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c. Palm hills
d. Mivida

2.2) Product category Competition:

They are items with comparable characteristics.

a. Dar Masr
b. Janna
2.3) Generic competition:
Products that meet the same consumer requirements.

a. Kempinski Hotel
b. Steigenberger Hotel

2.4) Budget Competition:

The products compete for the same budget.

a. Luxury Cars
Audi A8
Lexus LS
BMW 7 Series
BMW M4
Range of prices
between (88,000$ -
100,000$)

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3) SWOT Analysis: -

Strength:
 a diverse commercial presence
 Significant order backlog
 EBITDA and net income have grown steadily throughout the years.
 It is present in more than 25 countries.

Weaknesses:
 Litigation tarnishes the company's reputation.
 Increased debt and interest expense

Opportunities:
 Growing construction in the Asian region
 In Europe, there is a growing emphasis on achieving energy efficiency.
 Expansion into emerging markets has the potential to propel the company
even further.

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Threats:
 European nations' debt burden is increasing.
 Construction material prices are rising.
 Unfavorable government policies might result in operational inefficiencies.

4) Strategies relative to competitors: -

4.1) Market Leader:

A market leader is a corporation that has the biggest market share and also dictates
price and basis of competition for other enterprises in the sector. In the engineering
and construction contractor industry, The Arab Contractors was the market leader.
Arab Contractors, founded in 1955, is one of the leading construction companies in
the Middle East and Africa, employing 77,000 people across 29 countries. Arab
Contractors were involved in the construction of the Aswan Dam as well as many
other national projects.

4.2) Market Challenger:

A market challenger is a company that wants to increase its market share and steal
it from the market leader, while also threatening the other firms in the market. Imar
is the market challenger as it is trying to steal the market share from the leader.

4.3) Market Follower:

A market follower is a corporation or organization that is a follower of the market
leader and does not want to take the leader's market share because it does not want

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to rock the boat. In our case, Dorra Group are the market follower, because they
don’t seek for differentiation.

4.4) Market Nicher:

Market nichers are companies or firms that produce specialized goods and services
for a specific target market. Orascom is the A market niche as it targets a specific
segment, the luxurious segment.

5) Aggregate Category: -

5.1) Market Size:

Market size is the total number of highest sales or units in a market. It is normally
measured once a year. The size of the construction market amounted to 6.4 trillion
U.S. dollars in 2020, and it is expected to reach 14.4 trillion in 2030. (Statista,
2022)

5.2) Market Growth:

Market growth is defined as a rise in the demand for a service or item in a market.
Constructions are a bit lower those days because of the high costs that we are
facing nowadays.

5.3) Seasonality:

Not applicable for construction industry.

5.4) Sales Cyclicity:

Sales cyclicity refers to oscillations in sales caused by changes in demand over

unexpected time periods. In our industry, it happens only with the economic

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changes, as in the covid-19 pandemic, sales stopped due the pandemic then it
became better.

5.5) Profit Levels:

Profit variability refers to the fluctuations in profit over time. The construction
business has a high profit level, but it is volatile owing to variations in the dollar
currency exchange rate.

5.6) Product Life Cycle:

Growth stage succeeded as it is the best of all stages. Constructions are the industry
that never lose.

6) Competitive factors: -

6.1) Threat of New Entrants:

The threat of new entrants denotes the ability of new enterprises to enter a new
industry. In the construction industry, the threat of new entrants is high, cause each
and every company compete to take the highest share as also their high efforts in
their marketing advertisements.

6.2) Threat of Substitutes:

Threat of substitute means that other products are available outside of an industry
that meet the same needs as a product within that industry and that customers can
purchase. In our industry, it is low, since there aren't many goods that meet the
same building demand.
6.3) Buyer Bargaining Power:
Buyer bargaining power is the extent to which a client may put pressure on a firm
to deliver lower costs, higher product quality, and so on. For the construction

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industry, Buyer bargaining power is considerable since buyers are highly informed
and there are numerous rivals.

6.4) Supplier Bargaining Power:

Supplier bargaining power is the extent to which suppliers may exert pressure on
firms by raising prices, lowering product quality, and so on. In the construction
industry, it is low, as there is a little difference between each compound for
example as in their services or its location as well.

6.5) Rivalry Among Existing Firms:

Rivalry among existing firms refers to the extent to which enterprises compete
with each other in the industry, limiting each other's capacity to make profit. In
construction industry, rivalry among existing firms is high due to offering similar
service but a little difference in the locations.

7) Environmental Factors (PESTR):

7.1) Political factors:

Government expenditure is a major political element influencing the worldwide

building sector. Increased government infrastructure investment may raise demand
for construction services. This results in a greater need for trained personnel and
more prospects for construction firms. Every year, billions of dollars are spent in
the United States on the construction of public buildings such as bridges, roads,
educational institutions, and health care facilities.
7.2) Economic Factors:
There are many factors that may affect Orascom, Specific factors affecting
Orascom include lower capitalization of financing costs, the depreciation of the

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Egyptian currency, but also investment impairments and a review of its taxation,
according to the company. Economic downturns and uncertainty have a significant
impact on the building business. Construction downturns can result in fewer jobs
and lower compensation for construction employees. People will be more ready to
acquire houses during prosperous economic times, which increases demand in the
building business.

7.3) Social Factors:

Sustainable development is about enhancing people's lives today and for future
generations. Orascom Construction PLC believes that the way they operate and the
services they provide assist to improve people's quality of life and build a brighter
future in the communities in which they operate. The consideration of social
aspects is an important aspect of the PESTR building industry study. Many
individuals want to possess their own private properties, which increases demand
for the building business. On the other hand, poverty in some parts of society
means that many individuals are unable to own their own homes.
-
7.4) Technological Factors:
Automation is a critical component of today's construction sector. Customers are
growing more demanding of productivity and efficiency as technology advances.
Companies must therefore devise strategies to meet these demands while keeping
costs low in order to maintain their market share. Automation can undoubtedly
play a significant role in the productivity and efficiency debate. As also making
smart homes makes construction companies compete.
7.5) Regulatory Factors:
The regulatory environment is the final topic included in the PESTR examination
of the construction sector. Many legislations, such as the Health and Safety at
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Work Act 1974 and the Construction (Design and Management) Regulations 2015,
can be applied to the Egyptian construction sector. For safety and environmental
concerns, the worldwide construction sector is heavily controlled. However, how
laws are implemented differs from country to country. Certainly, regulations may
have a positive impact on the sector by strengthening safety measures and industry
standards; nevertheless, regulatory compliance can be costly and time-consuming,
limiting a company's growth.

8) BCG Matrix for Orascom: -

8.1) Star:
The Greater Cairo Metro could be counted as star as it is always developed and its
profits is unstoppable as each and every segment could reach it and it also has high

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market share and high market growth. For its star items, the corporation should
employ a harvest strategy that minimizes investment while maximizing cash flow.

8.2) Cash Cows:

New Al Alamein City could be the cash cow as it has very high market share but
its market growth is not as well because it’s prices that is targeting a specific
segment.

8.3) Dog:
Solar Power Plant and Desalination in Burj Al Arab has a low market share and
market growth as well.

8.4) Question Mark:

Egypt’s Monorail has a very high market growth but a low market share as well as
Owest Compound... will they be worth it?

9) 7 PS: -

9.1) Product:
Orascom is always known with its perfect projects that fulfils the customer needs
and its variety too. Orascom development also working on new projects beside the
old projects that is being developed although it is not targeting all segments but it
is useful for the targeted segment as well.
9.2) Price:

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Orascom prices varies from services to another, it has a large market share with a
plenty of competitors, so their prices are always set to be incomparable due to their
high quality of services.

9.3) Promotion:
The feeling that guests will experience at the Orascom Group's Egyptian holiday
destination is best summed up by the town's motto "Life as it should be": dream
beaches, a casual urban lifestyle, great hotels and culinary highlights, a lively
nightlife, and plenty of sports, leisure, and shopping opportunities. This was one of
their advertising wordings to capture customers souls.

9.4) Place:
Orascom is found in over 20 countries all over the world as it owns over 200
running projects.

9.5) People:
In the fiscal year ending 2020, Orascom Construction Group had around 63.9
thousand employees, of whom approximately 20.8 thousand were permanently
employed and 43.1 thousand were temporarily engaged. This was a significant
decrease from 2018, when over 87.2 thousand people were working, representing a
26.7 percent decrease in total employment. Orascom Construction Group's
employment had been continuously expanding since the end of fiscal year 2015
until dropping in 2019. However, cumulative employment increased again in 2020,
increasing by 4,123 people. Orascom Construction believes that the Group's
success is dependent on its employees. They are always looking for people with
talent, passion, and drive.
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9.6) Process:
Customers usually uses their services because their luxurious offering as well as
they easily contact Orascom to register in their website to make an appointment to
go and enjoy their new home later on. Orascom have a high degree of technology.

9.7) Physical Environment:

Customers always got a good impression from Orascom services however its
variety that makes them a little comfy. Orascom offers great physical environment
to its customers.

10) Decision Making Model: -

A family consists of Mohammed who is going to get married and his parents.
Mohammed told his father he wanted a new home for him and his bride. His sister
decided to convince is father with the idea until he accepted. The visited Owest and
he booked a villa for his son to receive it in 2025.

Initiator: Mohammed who wanted the new home.

Influencer: His sister who convinced his father buying the villa.
Decider: The father who has the final decision and decided to buy the villa
Purchaser: The father is the one who bought him the villa.
User: Mohammed is the user; he is the one who is going to live in it.

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References: -

 Zuo, J., Zillante, G., Wilson, L., Davidson, K., & Pullen, S. (2012).
Sustainability policy of construction contractors: a review. Renewable and
Sustainable Energy Reviews, 16(6), 3910-3916
 PLC, O. C. (2018). IT IS RESOLVED THAT.
 Daily, N. P. (2008). US Bechtel wins Egypt nuclear power contract: Nuclear
Power Daily, December 22.(Accessed December 29, 2009, at http://www.
nuclearpowerdaily. com/reports/US_Bechtel_wins_Egypt_
nuclear_power_contract_999. html.) Orascom Construction Industries, 2009,
OCI announces solid FY 2008 results and declares cash dividend: Cairo,
Egypt, Orascom Construction Industries press release, March 16, 3 p.
Organization of Arab Petroleum Exporting Countries, 2009, Annual
statistical report 2009: Safat, Kuwait, Organization .... Renewable Energy
Development, 87.
 Amboldt, L. (2006). Orascom on the rise: The exceptional growth of
Orascom Construction Industries has catapulted it into the leading producer
slot in the Middle East. INTERNATIONAL CEMENT REVIEW, 32.
 Sakr, A., & Halaby, Y. E. (2015). Market efficiency and arbitrage
opportunities: The case of Egyptian global depository receipts. European
Journal of Business and Management, 7(8), 127-132.
 Nield, R. (2004). Concrete plans: boosted by the regional building boom, the
cement industry is enjoying heady times. Egypt's Orascom is one of the
companies making hay while the sun shines. MEED Middle East Economic
Digest, 48(51), 40-43.

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  Daily, N. P. (2008). US Bechtel wins Egypt nuclear power contract: Nuclear
Power Daily, December 22.(Accessed December 29, 2009, at http://www.
nuclearpowerdaily. com/reports/US_Bechtel_wins_Egypt_
nuclear_power_contract_999. html.) Orascom Construction Industries, 2009,
OCI announces solid FY 2008 results and declares cash dividend: Cairo,
Egypt, Orascom Construction Industries press release, March 16, 3 p.
Organization of Arab Petroleum Exporting Countries, 2009, Annual
statistical report 2009: Safat, Kuwait, Organization .... Renewable Energy
Development, 87.
 ICR Research. (2007). Building on success: Orascom Construction
Industries is expanding its influence with projects for new capacity around
the globe. ICR charts the quick rise of this Egyptian producer and its
appetite for new markets. INTERNATIONAL CEMENT REVIEW, 100, 38.
 Shafik, T. (2009). Energy Effeciency In Buildings-Challenges of Green
Construction In Egypt. Cairo: Orascom Construction Industries.
 Elgizawy, S., Nassar, K., & El-Haggar, S. (2016, June). Quantification of
construction waste: Egypt case study. In 4th International Conference on
Sustainable Solid Waste Management (pp. 23-25).

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