Foreign Military Sales: An Assessment of how to Raise Business Capacity for Local Saudi Aviation Companies

Abstract

The business opportunities associated with Foreign Military Sales (FMS) have been increasing year on year from the time the FMS was established in the United States of America (USA). Using publicly created policies the (USA) has been supplying military products and services to allied countries. As a consequence the manufacturing base as well as the economic value accrued to the US has been estimated to over US$ 36bn as at 2008, and has kept increasing. Even though the industrial base for the Kingdom of Saudi Arabia is not as sophisticated as that of the (USA) and the international community, the business prospects with the (FMS) remain highly lucrative such that local Saudi firms have identified the (FMS) manufacturing and supplying as the niche that they need to develop. However local firms could only enter and expand their capacity in the (FMS) industry if they are able to change the business strategies in order to approach the government as well as prepare the private sector to support the industry. Considering all, the main purpose of this study to develop a structured approach to improving the capacity of local businesses in the aviation industry of Saudi Arabia so that they can start gaining contracts through the foreign military sales (FMS) program.
The research was driven by a positivist philosophy, hence a quantitative research methodology was adopted. Using primary data collected through a questionnaire survey the main finding of the research has been that local Saudi firms are ready to expand their operations within the (FMS) industry. The other key finding is that local companies are weak when it comes to requesting for government intervention; meaning that local firms are sluggish in pushing for policy change as well as the deployment of ideal business strategies that could influence change. Third major finding from the research has been that there was a need for local firms to partner international ones in order for them to operate within the stringent security, quality and performance standards that typify the (FMS). The research recommends the use of the business models that could act as catalysts in the process of engaging government as well as other local players on the market.