SME profile: Ex British Army officer paddles to profitability in Abu Dhabi
For Mark Freeman, the owner and managing partner of Noukhada Adventure Company, it all came about from a love of sailing.
Working as a consultant in the UAE and a keen sailor, Mr Freeman came to Abu Dhabi hoping to take part in an ocean race.
“I met an American guy who needed crew and we went racing. We had a disastrous race but still came second,” says the former British army officer.
“We ended up chatting and he said I should set up a company to get people out enjoying the water. And we haven’t looked back.”
Today Mr Freeman’s company Noukhada, which is Arabic for “leader of the ship”, owns a fleet of 20 Hobie 16 sailing boats which it rents out from Yas Beach and six dragon boats.
It has what Mr Freeman describes as a “healthy” turnover and directly employs 14 staff and has expanded to have operations in Oman, Hungary and Zanzibar.
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“It is still my passion and we get a lot of sailing boat rents from the beach,” Mr Freeman says.
However, it is a much smaller craft which has helped Mr Freeman’s business to really grow. Noukhada can also boast a fleet of 100 kayaks and canoes which can be regularly seen transporting fun-seekers on trips of Abu Dhabi’s mangroves from a launch point close to the Eastern Mangroves Hotel & Spa on Salaam Street.
“It turned out that the sailing boats have been nowhere near as popular as the kayaking business,” Mr Freeman says. “Most sailors have generally been kayaking or canoeing, as we say in the UK. The kayaks cost around Dh4,000 to buy whereas a sailing boat will cost around four or five times as much. So kayaks are more accessible for people. And they are much easier to store.”
At the moment an hour-and- a-half’s tour of the Abu Dhabi mangroves with Noukhada costs Dh155 per adult and Dh120 per child.
However, Mr Freeman is frank about the difficulties he faced setting up Noukhada in the UAE.
“We had to overcome a lot of obstacles,” he says cheerfully.
One of the biggest problems, Mr Freeman says, was that very few people in the Abu Dhabi authorities charged with granting business licences actually knew what he was talking about when he said he wanted to set up a kayaking business.
“When we first started up the business and applied for our trade licence there was pretty much no understanding of what a kayak was, so we had to set up in a complete new field,” Mr Freeman says.
“Our trade licence doesn’t exactly match what it is that we do because there is no trade licence that exactly matches what we do, so getting all of that sorted was quite challenging.”
As an “onshore” company operating in the UAE, Noukhada had to comply with Abu Dhabi’s strict company requirements, which meant that it took at least six months to get the company up and running. It eventually obtained its trade licence in 2009.
“Anywhere else in the world we would have just been operating from a shed on the beach, but here we had to rent a property in order to set up the business,” Mr Freeman says. “There were a lot of frustrations running around Abu Dhabi at the time, getting cars registered and that sort of thing.”
The large number of upfront fees required for small businesses also added to the company’s high start-up costs.
“Although we don’t have to pay tax on our profits, you could argue that we have to pay a lot of fees and these are always up front. In some ways it would be easier to just pay tax on profits,” Mr Freeman says.
However, Mr Freeman says that he was lucky to “sail” through another of the challenges facing many small businesses in the UAE, the task of finding a local partner.
“My partner and I met out kayaking so he’s a big kayaking enthusiast too and also happens to be my next-door neighbour and friend. He is certainly not the classic silent partner and takes an active role in the business. In fact he has set up our business in Oman,” Mr Freeman says.
Recruitment is also a headache for Noukhada.
“It’s not easy to find staff in Abu Dhabi, so often we have to import talent,” Mr Freeman says. “Our latest recruit is a Hungarian kayaking coach who we brought in from Hungary. It probably costs us around Dh8,000 just to bring one person into the country – that’s for visas, deposits, flights etc. It’s one of the blocks to expanding our business.”
Yet despite the difficulties navigating complex bureaucracy and the day-to-day struggles with running a small business in the UAE, Mr Freeman says that it has all been worth it.
“The weather conditions here are fantastic. For eight months of the year the weather is lovely – so much so that we attract Olympic teams from all around the world,” Mr Freeman says.
“Also the conditions in the mangroves are great. We’re in the sea but we’re also eight kilometres inland. And there are 40 square miles of mangrove swamps to explore where we were the first – and often only – people to explore them.”
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Updated: October 31, 2015 04:00 AM