For buyers, Iran is shrouded in a certain mystic. It holds both a sense of fear and opportunity. Most don’t know whether the opportunity is worth the risk and as such are potentially missing out on those potentially significant opportunities. There are fearful that the country is only one small step away from sanctions being re-imposed and that they will be left hanging once again.
The sourcing opportunities are many and varied. The country itself boasts vast reserves of natural resources, while its population and supply base is both creative and and well educated. With this in mind, many CPOs see this as an opportunity not to be missed and even suggest that risk here has been over-emphasised.
During his tenure as a senior procurement manager at a large European technology manufacturer, François Roblin, now CPO at disability aids manufacturer Handicare, led a buyers’ mission to source copper from Iran in the mid-2000s.
"The first thing to understand is the Iranian mentality; it is very special. For them, they are the ones representing one of the most prestigious empires in world history. They are proud of their country, proud of Persian culture and are very distinct from Arabic people,” he tells Procurement Leaders in the latest issue of the magazine.
“They say God blessed them not only with uranium, but oil, gold, diamonds and copper: everything underneath Iran is valuable,” he explains.
He advice to buyers considering sourcing from Iran is not to be put off by public perception of the country and the way it is often portrayed by the media.
"What I felt and saw was different from the representation in western media. I’ve been to other Islamic countries and in Iran the people, generally, are much freer. It’s no comparison with Qatar or Saudi Arabia. It’s a very friendly, helpful country."
Together with natural resources, the people represent one of Iran’s strengths, he says. "At least around Tehran, the people I met were highly educated and many spoke English. There is a good understanding of technology and they like to do business."
However, Iran has long suffered under western sanctions and sorely needs foreign investment, he says.
"The infrastructure development stopped at the end of the 1970s. A lot of it needs work or renovation. It is like being in the beginning of the 1980s."
While it may well be difficult to shake off completely, overcoming that fear may well be the ticket to huge rewards that keep the function and the business that precious one step ahead of the competition.
Members can read more of our analysis of sourcing from new markets in Issue 61 here and on the website here
This article is a piece of independent writing by a member of Procurement Leaders’ content team.