Azza Fahmy 2010

I. External Environment
A. Societal Environment
1. Economic
- High degree of economic growth (O)
- Largest population in the Arab world (O)
- Egypt is one of the three largest producers of jewelry in the Middle East (O)
- Most jewelry production in Egypt takes place in or around the country capital
(O)
- Fairly poor conditions for the average Egyptians (T)
- Raw materials for jewelry are all imported (T)
- Poor conditions for the average Egyptians (T)
- Local consumption has dropped following recent economic troubles. (T)
- Jewelry industry in Egypt is in a state of decline (T)

2. Technological
- The internet has become an important channel for jewelry distribution with
sellers such as Blue Nile conducting their business exclusively online (O)
- The Ministry of Trade and Industry has created a jewelry technology center.(O)

3. Political/Legal
- Western world as become wary of the Arab and Islamic regions and are less
willing to embrace their cultural heritage (T)
4. Sociocultural
- Domestic customers buy jewelry as a store of value instead of the depreciating
local currency (T)
- The purchase of jewelry is seasonal across the globe (T)
- Arab customers are more attracted to westernized styles (T)
- Silver jewelry with its subtle stones and creative designs is popular especially
with younger consumer.
B. Task Environment
- Entry Barriers
Countless imitations of this type of jewelry on the market. (T)
Cheaper raw materials (T)
Young jewelry designers trying to establish names for themselves in the
accessories market (T)
Jewelry technology center created by Egyptian Ministry of Trade and
Industry in collaboration with Milan-based Institute Di Moda Burgo to
enhance the skills of jewelry makers and designers and to promote
innovation in the sector. (O)
The highly artistic and unique designs of AF (O)
The Jewelry Technology Centre can facilitate entry into the industry (T)
- Substitute Products:
Competition from unrelated products such as consumer electronics, beauty
products and vacation packages. (T)
- Power of buyers:
The purchase of jewelry is seasonal across the globe (T)
There are around 35,000 jewelry retailers in the Egyptian market (?????)
Diminishing power of retailers: Online selling (O)
Retailers: Tiffany & Co. and Zale Corporation

- Rivalry among Existing Competitors:
Italy is still the most famous producer. Buccellati, Bulgari, Cartier, Chanel,
DeBeers, Dior. Harry Wintson renowned Jeweler to the Stars (T)
Other rivals like traditional jewelers (T)
Small boutiques selling eclectic pieces: rely on innovative designs and use
new marketing channels as online social networks (T)
Damas & LAzurde in the Arab world, high profile Arab pop stars (T)
AF is the only producer positioned as a luxury brand (O)
II. Internal Environment
A. Corporate Structure
- Family business
- CEO Azza Fahmy
- Managing Director: Fatma Ghaly (Daughter)
- Designers: Azza Fahmy, Amina Ghaly (Designer of the Fashion Line, Daughter)
- Departments such as marketing, human resources, management and quality control
added to organizational structure (S)
- The organizational structure is divided into four main departments: Finance,
Organizational Development, Operations and Marketing (S)
- With the help of consultants, the company embarked on a process of restructuring
in order to have more streamlined systematic operations. (S)
- In 2006, the second phase of transformation for AF: six executive levels of the
organization and four technical levels on the workmanship level (S)

B. Corporate Culture
- The company is committed to flexibility, continuously learning and readjusting its
structure to meet any unexpected changes (S)
- Resistance to structural change (W)
C. Corporate Resources
1. Marketing
- Made-to-order service (S)
- Rebranding efforts to reposition the brand into a global luxury brand (S)
- Advertising (S)
- Exhibitions & trade shows (S)
- Azza Fahmys products featured in famous movies (S)
- Distribution Channels: sold exclusively in upper-scale locations, both inside and
outside Egypt
- Outlets in 5-star hotels, 1
st
class malls, top international retailers (S)
- Steps underway to launch online sales (S)
- 12 outlets in nearby countries (S)
- Going global is among AFs priorities: Steering the company westward (S)
- Showcasing its pieces at high-end retailers such as Harvey Nichols in Dubai and
Kabiri in the UK (S)
- Collaboration with British fashion houses, designing special pieces to complement
their creations (S)
- Exports make up 30% of the companys total sales (S)
-
- Arab Gulf market is weary of products made in the Middle East (T)
- Considerable recognition in local and international press (S)
- Has not taken considerable steps in penetrating the US market (W)
- There are no AF-owned stores abroad (W)

2. Finance
- Decline in tourism rate (T)
- Arab Gulf market is weary of products made in the Middle East (T)
- Being a family-owned business, means that it faces many challenges in securing
adequate financing for marketing its products Abroad (W)
- Decline of tourism rate: 40% of sales inside Egypt is made to Tourists (W)

3. R&D
- Design elements and integration of cultural elements set her apart from other
designers in the country (S)
- Filigree, trade mark technique delicate and highly detailed lace-like designs (S)
- Silver inlaid with gold and stones which adds richness in texture and color (S)
- Azza Fahmy is on the board of the Jewelry Sector Steering Committee(S)
- Diversified portfolio (S)
- Customized pieces (S)
- Special pieces to complement those of the biggest British fashion houses
- The Fashion Line designs are updated several times during the year as inspired
by forthcoming fashion trends (S) Too costly
- Stimulation comes from different stimuli, successfully bridging the East and the
West (S)

4. Operations
- The highly artistic and unique designs of jewelry constitute AFs core
competencies and competitive advantage (S)

5. Human Resources
- Talented daughters
- Fatma and Amina Ghaly taking on more responsibilities in the organization will
lead to frequent organizational changes which could arouse resistance (W)
- Threat of losing important human resources who are resistant to organizational
change (W)
6. Information Systems