Meraas Company is a cloth-based business that has been recognized as one of the most promising ventures in Dubai. In the recent days, many businesspersons have been traveling from all over the world to purchase clothes from this particular organization since it operates as the primary distributor. A survey conducted in 2014 revealed that it was ranked as the leading company in the clothing industry. The company was initiated as a family business and later started involving the public in purchasing shares. As a result, a half of its total equity is owned by the public today. Meraas Company provides equal job opportunities by advertising the vacancies in the local dailies. Such approach has helped the organization to improve its public perception. In addition, its management and human resource department have always portrayed high standards of professionalism.
Challenges Facing the Business
Over the course of its operation, the company has encountered some problems during the summer season. One of the biggest challenges is the small number of customers because most of the people in the region usually spend their summer in other countries. As a result, the sales decrease thus reducing the profit margin. During the early periods of the company’s existence, the human resource department was made to reduce the amount of employees working for the company in order to retain the same profit. Although the public considered this move as inappropriate, the company was able to survive during the recession period.
Another obstacle that the company faces is the change of weather patterns. During the summer period, most people prefer rather light clothing as compared to winter. Consequently, the clothes designed for the cold weather remain unsold for months. It was noted that in the last summer season the company lost approximately $0.9 million because of the unsold stock. In response to the state, the human resource department decided to cut the wage of employees for the company to continue its operation. Such decision was considered appropriate since the reduction of wage rate of workers appeared more sensible than carrying out retrenchment (Pirzada, Hayat, Ikram, Ayub & Waheed, 2013).
Another challenge that the business faces is low customers turnout during the month of Ramadan, when most people spend their time praying in mosques. At the same time, many employees feel that the job occupies the majority of their time at the expense of spending it in the place of worship. Therefore, the HR section allocated more time for the Muslim employees to attend the mosque. The approach has helped Meraas company to gain a good image among both Muslims and the Christians.
In addition, Hajj has been a major hindrance to Meraas Company. During the summer period, most of the employees travel to Mecca, in such a way distracting the daily operation of the business and resulting in low turnover rate of the workers. As the head of human department to resolve the problem, the company introduced incentives such as bonuses for the workers who were willing to work during the summer season. The idea will encourage many employees to continue offering their services during this period.
Strategies to Overcome the Challenges
In a move to overcome the challenges in the business, the HR section suggested various strategies. One of them is to design light clothes during the summer period, which is bound to increase demand during this season. The company will be able to avoid huge stock that further lowers the number of sales as well as the profit. Another incentive is to assign bonuses to the employees who work overtime and during holidays. In addition, the HR found that since there is a small number of customers during the summer period, it would be economical to employ temporary workers who will be retrenched during this period.
Such initiatives will help the company to avoid experiencing budget overrun resulting from the sales and wages expenses, and their successful implementation will give Meraas a competitive advantage over its rivals. In the UAE, many businesses in clothing industry do not operate during the summer times because of inappropriate methodologies applied in overcoming the obstacles. Implementation of these strategies will not only help the company to attain its objectives but will also guarantee job security to its employees. Many workers fail to fully offer their loyalty to a company because they are not secure of their job (Pirzada, Hayat, Ikram, Ayub & Waheed, 2013).
In conclusion, for any company to succeed there is a need to identify the key hindrances as well as their suitable solutions. In the case of Meraas Company, the HR departments managed to find the solutions to the problems which have been the obstacles for the company for a long time. Since weather plays an important role in the clothing industry of the United Arab Emirates, the management of the discussed venture develops the technique to overcome the problem and avoid the liquidation of the business. Other challenges such as vacations are inevitable since the government cannot enact traveling barriers. Therefore, to deal with such cases, the business can control the production level and in such a way reduce the cost. In the region, many businesses have embraced the technique, which has helped to boost the economy of the UAE making it one of the leading regions in the world.
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