Market potential

Rural: The monthly income in rural locations typically average between 200 and 1,000 Egyptian Pounds (LE) for the vast majority of the population. This equals USD 35-185 per month.

Urban: In the low income urban areas surrounding Cairo, the average income tends to be slightly higher ranging from LE 200 to 2,000 (USD 35-360). Income in the urban areas is primarily driven by women, since most poor men are without a job. 45 pct. of the urban population living in the slum areas of Masakan el Zelzal and Ezbet Khair Allah have a monthly income between LE 200 and 250.

Consumer culture

Saving money is especially for the poor not a common part of the consumer culture. In the low income areas money is spend when you have it. Therefore, very few products are bought for long term utilisation or rationalisation.

Some companies have adapted their product portfolio to the Egyptian logic of spending by selling products as 'one-day sachets', for example one diaper, one cigarette, one-day sachet of detergents etc.

Furthermore, people prefer buying on instalments, and even small quantities of goods (worth down to LE 10-20) are bought on instalments of for instance LE 5 per day for a given period.

A phone card of LE 10 is mostly sold in three rates of LE 5 - that is 50 pct. added to the final price. Nevertheless, consumers often prefer this payment scheme.

This kind of day-to-day spending habits and 'instalment economy' must be taken into consideration when establishing a business in Egypt.

Price level

The price level of accessible commodities in the rural areas is striking. Commodities in rural areas are just as expensive, if not even more, as comparable products in urban areas. The main difference is that the quality is significantly lower and the brands unknown.

In other words, poor people in rural areas pay more for basic goods than people in urban areas.

The key factor explaining the high prices is the added transportation costs to the rural markets caused by the poor infrastructure, which impacts the price level for the consumers.

Product availability

Despite the general low quality of products available in the poor areas of Egypt, there is a large variety of products. Everything from products serving the basic needs (food, water, detergents etc.) to 'luxury products' (toys, candy, soda, cigarettes etc.) are available.