Story: Egyptian textile businesses embrace agility in the face of COVID-19

1 June 2021
ITC News

Although medical doctor Ali El Nawawi is an experienced professional in the areas of international cooperation and health, COVID-19 presented him with a completely new challenge. During the pandemic, El Nawawi found himself working not as a health professional but as an entrepreneur running a small enterprise, Scarabaeus Sacer, in Egypt's clothing sector.

El Nawawi and psychologist May Kassem created Scarabaeus Sacer in 2018 to build a sustainable and ethical Egyptian clothing brand that advocates for social and environmental causes.

In Egypt, the textiles and clothing sector is the second biggest industrial sector after the agro-industry. Exports consist mainly of ready-made garments and home textiles.  The industry was among the most affected by the COVID-19 outbreak. According to the Apparel Export Council of Egypt, exports dropped by 29% in the first semester of the year, with a decline in production reaching 40%. Companies also faced severe financial issues as international companies started to cancel orders, delayed in payments and deliveries. By the fourth quarter of 2020, exports began to pick up, and the year closed with “only” a 14% decline in total exports.

Following the government's guidelines to keep employees safe and in good health, Scarabaeus Sacer shifted the production to ethical, sustainable and affordable protective facial masks. The new production line showed impressive results.

"The impact of COVID-19 on our business was surprisingly positive. We managed to reorient our production to manufacture cloth masks while continuing with our product line of casual clothes for men and women. We sold our products in the local and international market," said El Nawawi.

May Kassem explained that navigating the pandemic, as a small business, was more manageable than for a large company with many employees. "Our size allowed us to be agile; it allowed us much more flexibility, quicker decision making and higher efficiency to improve, for example, our online presence."

"After the input of the International Trade Centre, we completely revamped our website to make it more user-friendly. We updated the content and pages to cater to both direct customers and make the B2B section more prominent with an evident value proposition," says El Nawawi.

The co-founder acknowledges the importance of the trainings and coaching sessions provided by the International Trade Centre’s GTEX/MENATEX project. For him, these activities have been crucial in understanding and addressing the trends, gaining market access and catering to the needs of present and future clients.

“We increased our overall sales by 20% compared to 2019. On B2B, we sold over 30,000 pieces to local and international markets. Export orders included boxer shorts, t-shirts and pyjamas, while we sold t-shirts on the local market,” concludes de the medical doctor.

Scarabaeus Sacer has significantly increased its online presence, having received over 2,000 new B2C orders for masks and t-shirts from the local market. In addition, the company is also in negotiation with international buyers from Germany and the United Arab Emirates. “We are currently selling our products at New York City and soon in other major cities across the globe. Our new e-commerce strategy focuses on good communication and visual identity to show our manufacturing facility and the concept of being an ethical, sustainable and eco-friendly brand. Traceability in clothing production and transparency are key to the core of our company. It is also essential to open our opportunities and business globally," says May Kassem.

El Nawawi and May Kassem believe that virtual reality and online shopping will be the new norm with technological advancement. In ancient Egyptian belief, the Scarabaeus Sacer or the Sacred Scarab represents a symbol of rebirth and resurrection; likewise, the two clothing entrepreneurs saw the COVID-19 crisis as an opportunity to reinvent themselves and their businesses.

The GTEX programme is funded by the Government of Switzerland and the MENATEX is funded by the Government of Sweden for the MENA region. ITC, in close collaboration with the Swiss State Secretariat of Economics Affairs (SECO) and the Swedish International Development Cooperation Agency (Sida). In Egypt, the project also counts with the support from the Ministry of Trade and Industry.