Arafa Holding’s strategy is the strength behind its business model: Integrating operational activities within targeted market segments, capitalizing on opportunities domestically, regionally and globally, and focusing on quality have all led to a company well-positioned for long-term structural growth.
The ultimate goal of Arafa Holding is to become a major player in the global fashion industry. A key move towards realizing this goal is the shift in focus from an activity-based approach to a market sector-based approach to operations.
Thus, conceptually, rather than viewing the company as one which combines three vertically integrated segments (Textiles, Apparel & Tailoring, and Retail & Distribution) to serve three key markets (Luxury, Formal and Casual wear); it can instead be viewed as a company serving three key markets, each of which benefits from vertical integration of the three segments.
By concentrating on the three key fashion lines of luxury wear, formal wear, and casual wear―while continuing to grow volumes and capabilities across the three main activity segments―textiles, apparel & tailoring, and retail & distribution―the company will solidify the platform to grow geographically as well as operationally, bringing it one step closer to realizing its ultimate goal.
New Products and Lines
Another milestone in transforming Arafa Holding into a global fashion powerhouse is the addition of cotton and cotton-based products to the company’s lineup. Arafa Holding started the production of luxury cotton shirts via the new 50-50 joint venture with Ermenegildo Zegna to form the high quality, luxury shirt manufacturing company Camegit, with state-of-the-art production facilities located in the Beni Suef Governorate.
Arafa Holding is also producing, through its company Cristall, top-quality casual cotton shirts for export primarily to the European market.
The company also plans on expanding its casual wear business line into cotton-based products. Leveraging the extensive distribution network of both the luxury and casual business lines, Arafa Holding anticipates strong growth in this sector.
Our focus is mainly on growing manufacturing in the luxury market, as well as expanding our retail network through partnerships with established global retailers. Partnerships in the formal and casual segments are considered within the scope of shifting manufacturing facilities to Egypt to benefit from the advantages offered by the country. We are continuously working on developing the current size of the business, as well as growing volumes for all of our three market segments.
Arafa Holding’s diversified retail and distribution network ensures the company can serve the different needs of its clients in each market. This wide network insulates the company against any potential downturn in any market.
Each business line has its own focus for distribution: The Luxury wear line currently focuses on Egypt and Europe―specifically through Italy which you can give all the world (although the new joint venture with Ermenegildo Zegna will see it branching into the key Asian markets of China and Japan). The Formal wear line is focused on England and the Iberian Peninsula, while the Casual wear line is focused mostly on major retailers in the US and the EU.
Management is continuously looking to expand the retail and distribution arms of all three business lines via new joint ventures and acquisitions. New potential markets that are currently under study include Germany, France and Turkey. In addition, the company is planning further expansions in Portugal and Spain.
The company is also examining the opportunities to expand the reach of its existing brands Concrete and Pal Zileri. Concrete, now very well established in Egypt as a leading men’s Luxury wear retail shop, is looking to become an international Brand. This process will be facilitated by the company’s existing strategic relationships in Italy and the UK, as well as the cost advantages inherent in Concrete’s home market of Egypt. Meanwhile, Pal Zileri, which already has a retail network of more than 70 stores in Europe, will be opening new retail outlets in select high-growth markets.