Almarai is entirely integrated into the food services industry, diversifying its products for dairy, baby, oven, and meat products. Innovative approaches in the company are one of the determinants of strategic activity. Given the challenging climatic conditions in the regions of Saudi Arabia where the company operates, Almarai is excellent at managing aridity, providing cows with water, and scaling up production (Mohamad & Asfour, 2020). Since 2009, the company has launched a particular R&D project, which annually sells new products for the company’s brands (Almarai – Research & Development, 2021). It can be argued that Almarai uses vertical integration since its expansion activities are aimed simultaneously at all brands and product categories at once. Vertical diversification is used in the company, as Almarai produces energy for themselves and recycled product packaging (Almarai – Sustainability, 2021). Almarai enters the international market using a takeover strategy to maintain a specific advantage – for example, the Bakemart company in the UAE and Bahrain was bought out (Osland, 2021). While some of the company’s brands are known worldwide, this also goes to international suppliers and retailers, while Almarai is more focused on manufacturing and scaling.
The organizational design, as well as the structure and control of operations, are entirely consistent with the mission and vision of the company. Almarai ensures the production of quality products, caring for animals and the environment, and solving the problems of global warming (Almarai – Sustainability, 2021). The organizational structure of the company reflects the diversification of Almarai products and operations. For each category of goods, the production sector has its department with a responsible person: finance and marketing, bakery and farming (Almarai – Senior Management, 2021). Consequently, the company has a well-thought-out organizational structure, but at the same time, it depends on the board of directors and investors who have a significant stake in Almarai. However, the complete structure of the company, the rights and obligations of each stakeholder, quality criteria, and standards of professional ethics are spelled out in a separate code that governs activities within Almarai (Almarai – Corporate Governance Code, 2021). As a result, the corporate governance strategy in the company is built quite competently.
Almarai – Corporate Governance Code. (2021). Web.
Almarai – Research & Development. (2021). Web.
Almarai – Senior Management. (2021). Web.
Almarai – Sustainability. (2021). Web.
Mohamad, K. A., & Asfour, A. M. (2020). Is the Business in Saudi Market Sustainable? Case Study of Almarai. IIUM Journal of Case Studies in Management, 11(2), 7-14.
Osland, A. (2021). Saudi Arabia: Almarai and Vision 2030. SAGE Publications: SAGE Business Cases Originals.