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Pool Safety Industry in the United Arab Emirates Report

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Updated: Apr 17th, 2022

Introduction

A coral drowning detection system is an innovative product that gives pool owners peace of mind. It uses software and a camera to monitor pool activities and analyze underwater events in the pool. It can capture near-drowning events, and when they arise, it generates an alarm. It can also be connected to other alert systems such that when there is a potential drowning event, connected services, and people are all alerted. It falls within the pool safety industry. This report analyzes the pool safety industry in the United Arab Emirates. It purposefully refines its interest in drowning detection systems.

Industry’s Dominant Features

There are three general types of drowning detection systems. These three common types are noted by their functionality. The first category uses CCTV cameras and allows lifeguards to get additional underwater views. The second one uses CCTV cameras with computer monitoring and automatic alarms that provide easy detection of an appropriate size such as swimmers who are in possible difficulty underwater. The third category has wristband tags that have computer monitoring and automatic alarms. They help to detect other wristbands that are outside set depth. They rely on movement and time parameters and are useful for detecting swimmers in potential difficulty.

The respective markets for the three categories of drowning detection systems are measured by the size of the installation and the general sophistication of the equipment used. The first and second categories are for small and medium-sized pools with a limited number of personnel in charge at any time. The second category shall be the key focus of this report and can work independently. The third category that involves networked wristband tags is for situations that include many swimmers and lifeguards, mostly in large commercial pools (Sport England 1-4).

The drowning detection systems are marketed as safety features and installations. They are targeted at facilities and households seeking to improve the safety of their pools, especially for children. This implies that the product is for homes and facilities that already have pools. These locations of pools can be private or public, and in the respective areas, there are different social and economic dynamics in play. For homes, owning a pool is often a luxurious feature, which highlights the economic status of the family using the pool. Public pools can be community service installations or commercial installations by businesses seeking to offer a service where there is demand for swimming as a recreational service.

In the United Arab Emirates (UAE), swimming activities peak in summer. The country is known as a great tourist destination because of its sunlight throughout the year and high temperatures that are conducive to swimming. Its main cities have expansive, exotic hotels and holiday homes attracting millions of tourists. For residents, swimming is a common recreational activity. Most companies in the industry distribute branded products as licensees by foreign manufacturers.

Issues of concern in the Broad Macro-Environment

SWOT analysis

Strengths lie in the construction boom industry, which insists on standardized practices for safety, which also presents opportunities for the industry. Another opportunity is in the increased awareness of pool safety and the overall growth of the leisure industry in the UAE (AmusementLogic.es par. 1-3). A weakness is the lack of industry-specific regulations on the design of systems. This can lead to product safety or features liabilities that negatively affect the industry’s reputation. A threat to the industry is the increase in alternative leisure activities in the country that affect overall demand.

PESTEL analysis

Political

The UAE is divided into the Emirates that have local laws governing civil life in addition to federal laws. There are no political parties and royals rule the emirates. The country has a federal monarchy system of government.

Economic

The UAE has a high per capita income of about US 44,000 dollars for its citizens. The country has also been experiencing an increase in the cost of living, which will push wages higher. The country is a primary producer of oil, and its petrol prices are the fifth cheapest in the world. This has made priorities for spending for households different and allowed many homes and businesses as well the hospitality industry to consider making swimming pools and setting up cooling systems that are thermal or electricity-based.

Social

UAE ranks 30th globally in the 2015 Prosperity Index out of 142 analyzed countries (Legatum Institute par. 1). The country does not face significant social problems, and its ranking’s weakest factor is personal freedom. People in the UAE have to live within strict social rules that are guided by cultural and religious practices. The country is also home to many expatriate workers and tourists who present foreign cultures integration with the local culture. Even though foreigners have liberal lifestyles, laws, and social norms bind them, and this ends up affecting marketing opportunities and behavior.

Technological

The development of better camera technologies for CCTV implementation is a driving factor for the capabilities of drowning detection systems that sit underwater and connect to alert systems. Wireless technologies also affect the functionality of the equipment used and their connectivity. Many companies are taking advantage of fast data connectivity on 4G mobile networks to increase the connectivity of systems. Meanwhile, local deployments are also using local Wi-Fi technologies to connect different equipment into a common area network for easy coordination. Better material developments for the equipment to make them last long, detect faster, and offer accurate alerts continue to shape the competition.

Environmental

Many swimming pools are in private facilities in the UAE and are governed by local environmental laws of waste disposal. The drowning equipment lasts several years before requiring replacements and is subject to waste disposal laws. The country is connected to global environmental concerns and would be receptive to systems that use renewable energy forms or practices such as rechargeable batteries instead of disposable batteries. The government has been encouraging green business practices (Chan 1-4).

Legal

The Emirates Authority for Standardization & Metrology (par. 1-3) must approve goods sold in the UAE for safety. The rules affect goods manufactured in the country and those imported. For new companies seeking market entry, accreditation of their products can take three months or less for the regulator to approve. The regulation of new businesses is easy as the country has a high score of global regulatory efficiency. There are streamlined licensing procedures that allow new entrants and current businesses to set up new product lines easily (Heritage.org par. 4).

Porter’s Five Forces

The threat of Substitute Products

Three categories of drowning detection systems exist, and they are substitutable. Besides, owners of pools can rely on lifeguards alone to limit the risk of drowning. However, lifeguards are vulnerable to distractions and job fatigue. On the other hand, they are not prone to power failure while at work. Nevertheless, the power of substitute products is low because drowning detection systems are sold once rather than in a recurring way. The last several years before seeking a replacement. Substitutes can also compete concerning their responsiveness to social concerns such as materials used in making them, their recyclability, and the need for additional personnel to manage them. Cost is also a factor affecting the purchase of drowning detection systems and for price-sensitive segments of the market, substitute options have a high threat, but there are only options and no actual substitute product.

The intensity of Competitive Rivalry in the Industry (Current Competitors)

There are many suppliers of drowning detection systems in the UAE, and the intensity of rivalry is very high. Both local and international companies are in the market providing similar and differentiated products and accompanying solutions. Notable companies in the industry are Coral Drowning Detection System and Sontag Drowning Detection. Also, many suppliers are using various retail channels to sell their products in the market. People in the UAE also can order systems from abroad. Most distributors have exclusive rights for particular branded products from international companies and local companies in the region. An example is Bahri and Mozroei Trading Company which has the rights to distribute the products on swim safety made by Blue Fox, a Switzerland-based provider (Saseendran par. 3-4). Due to local ownership rules, most foreign companies rely on exporting models of entry into the UAE market.

The threat of New Entrants

Companies entering the UAE drowning detection systems market are attracted by the high number of people taking up swimming and the high access to swimming pools at home and in public. New companies are using advanced technologies to make their products different from those provided by incumbents. They are also relying on novel marketing techniques such as peer-to-peer marketing to introduce their products, without suffering significant market entry costs. The targeting of public pools where there must be lifeguards, and private pools where lifeguards may be absent is different. Technology advancements are giving new entrants the potential for upsetting markets with their advanced systems. However, the delays in approval or products by relevant authorities for safety can affect the execution of such strategies; therefore, it limits the chances of new entrants to pose a significant threat. Nevertheless, the nature of purchases also does not tie most buyers to a particular brand, which gives new entrants opportunities for upsetting the incumbents.

The Power of Buyers

Buyers are not organized. Therefore, they have limited power over the businesses that provide them with drowning detection systems. Institutional buyers are operating many pools in the country, but they are not organized into a group. At the same time, there are contractors of pools around the country that will often carry the role of installing safety features for pools before handing them to owners. Constructors have considerable bargain power as buyers because they have recurring projects and can plan their purchases. On the other hand, most drowning detection systems come as an afterthought after original construction is over and the pool is already in use. Therefore, this neutralizes the overall power of buyers. They lack the compelling power to dictate prices to businesses.

The Power of Suppliers

Suppliers are mainly supplied chain partners offering technologies and raw materials for the construction or assembly of the drowning detection system. They also include information technology companies that fit the systems with appropriate monitoring, networking, and alarm systems. The current equipment manufacturers and distributing businesses have to rely on existing technologies. They are vulnerable to changes in the pricing of technologies especially when they are using a patented system. Nevertheless, they have enough leeway with other component suppliers for their devices, which renders the power of suppliers moderate.

There have been dedicated campaigns on child safety in the UAE (Row). They will continue to impact overall awareness about drowning and promote the purchase and installation of drowning detection systems. Such campaigns can in the future be organized by the industry to increase overall awareness of products and, therefore, improve the demand in the country. Currently, suppliers rely on their websites and limited traditional marketing campaigns as well as their distribution networks to improve the demand for their products (Coral Pool Drowning Detection par. 1-3).

Resources and Capabilities

Supply Chain Analysis

The drowning detection systems market is characterized by a high transaction cost related to procurement, low learning curves for project processes, and several opportunities for lowering wastage. There are also limited opportunities for volume purchases at the local level, but they are existent at the national level where companies have national distribution deals.

There are manufacturers of the drowning detection systems who supply to the UAE market. From these levels, there are tier 1 distributors who take the systems from suppliers and sell them in the local market. They can directly cover consumers in the retail market such as supermarkets and large online stores. On the other hand, they can sell to wholesalers and specialty stores for pool constructions, maintenance, and safety. They can also sell to specialty businesses and organizations for children’s safety that then sells to end-users. Products also rely on after-sale services. These include the services by distributor’s personnel on installation and setting up of the system and linking it up to the auxiliary services for value addition. Besides, there are pool safety consultants that work independently or as employees of manufacturing and authorized distributor companies in the UAE market.

VRIO Analysis

The resource-based view theory, which anchors the VRIO analysis, pushes companies to seek unique competitive advantages. Looking at Coral Drowning Detection, the system has various features that fit the Value, Rarity, Imitability, and Firm-Organized. The system is rare in its technology because it combined a system and design for a patent-pending technology. It is capable of offering underwater views and alarms that are not comparable to the competition. Its integration with smartphones and tablets makes it a valuable product to consumers. It is easy to imitate as a product except that rivals have to find substitutes for its patent-pending software. Also, the designing elements will take time to copy, which gives the company significant “Rarity” value.

It comes with auto-activation and does not stop working. It can work with in-ground and above-ground private pools. It is also easy to install and use without requiring professional assistance. This advantage makes it more useful and harder to defeat in the market with rival products that require professional installation and continued service support. On the other hand, given that it is a safe product, some consumers may want assurances that the systems are monitored to prevent faults. The other systems that offer a combined human service with the automated system, therefore, have a better value to such consumers. However, Coral can easily match these competencies by increasing its support staff. Nevertheless, the businesses with support staff also come with varied company traditions and cultures that affect their performance in the market. Another source of competitive advantage is the use of unique market training for distributors such that rivals do not easily imitate the innovative marketing strategies in the UAE. Culture, in general, is a hard element in the organization for rivals to imitate because of the inherent uniqueness of individuals (Boxall 265).

Final Analysis and Final Questions

The market for drowning detection systems in the UAE is not very well developed. There are no known groups of suppliers or buyers, and the laws governing the industry are mainly targeting general business and safety practices. The dominant forces in the industry are the rivalry of existing companies caused by external business factors. These external factors are technology advancements and the socio-economic development features of the country that have increased suppliers’ capabilities and increased overall demand for the drowning detection systems in the UAE.

These factors affect the nature of the supply chain. They have resulted in parallel features for product development and distribution. On one part, manufacturers are dealing directly with the consumers and rely on their contracted support staff. On the other hand, there is a traditional supply chain with different elements and levels of suppliers and distributors, with varied control on prices and product features along the supply chain. Marketing happens independently for all manufacturers and distributors, and this has also resulted in different information sources for consumers and non-organized demand data for the industry. Most companies are small and medium enterprises privately owned. Their primary sources of information are their websites while news coverage makes up for most consumer awareness.

Narrowing down on the category of the drowning detection system and then looking at the point of installation is important in understanding the industry. The point of installation can be during pool construction or after. It can also be for public commercial pools or in private household pools. The number of users of a pool and the social, economic level of the owners determines the demand for sophisticated or simple solutions. As a result, there are different niches in the industry, with various businesses targeting these niches.

The critical success factors are an extensive and responsive distribution system, adequate consumer targeting, and investment in the latest technologies and design for the drowning detection systems. As more consumers become aware of child safety, and as technologies become cheaper, the competition for drowning detection systems will increase. On the other hand, prices will reduce, and the market will be growing due to the increase in the construction of swimming pools around the country. Another trend that will shape the industry is the influx of expatriates in the UAE, which will improve the overall appreciation of swimming as a leisure activity and influence the overall country’s outlook on leisure to remove most cultural limitations. Therefore, the demand for drowning detection systems will increase. The preferred market entry strategy will continue to be licensing of distributors instead of setting up own operations.

References

AmusementLogic.es. “Leisure Boom in the Emirates.” 2015. Web.

Boxall, Peter. “Achieving Competitive Advantage through Human Resource Strategy: Towards a Theory of Industry Dynamics.” Human Resource Management Review 8.3 (1998): 265-288. Print.

Chan, Kai L. “United Arab Emirates: Best Practices in Competitiveness Policy.” Regional Innovation GFCC Annual Meeting. Alberta, Canada, 2014. Web.

Coral Pool Drowning Detection. “Coral Drowning Detection System.” 2015. Web.

Emirates Authority for Standardization & Metrology. FAQs. 2015. Web.

Heritage.org. Heritage.org. 2015. Web.

Legatum Institute. 2015 the Legatum Prosperity Index. 2015. Web.

Row, Shantesh. “Child safety Gulf News (United Arab Emirates).” World Economic Forum. 2011. Web.

Saseendran, Sajila. “New Pool Safety Device On Hand Launched in the UAE.” Khaleej Times, 2014. Web.

Sport England. “Drowning Detection Systems for Public Swimming Pools.” Sport England, 2011. Web.

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IvyPanda. "Pool Safety Industry in the United Arab Emirates." April 17, 2022. https://ivypanda.com/essays/pool-safety-industry-in-the-united-arab-emirates/.

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IvyPanda. 2022. "Pool Safety Industry in the United Arab Emirates." April 17, 2022. https://ivypanda.com/essays/pool-safety-industry-in-the-united-arab-emirates/.

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