Elaraby Group

About the Founder

Mahmoud Ibrahim Elaraby was born in 1932 in Abu Raqaba village in Menoufiya, rural Egypt.^[3] Most of the village’s residents were poor, simple farmers who relied on bartering rather than money.^[4] His father, Ibrahim, a tenant farmer, died when Mahmoud was 16 due to dysentery.^[5] His mother, Hanim, cared for the farm after her husband’s death.^[6] Mahmoud had two siblings, Mohamed and Abdel Gayed.^[7]

Mahmoud, whose education had ended at grade four because the family could no longer afford his schooling,^[8] showed an early aptitude for selling. Before he even turned six, his father helped him buy toys and sell them to others in the village.^[9] When he turned ten, he moved to Cairo and worked in various shops amid the Battle of El Alamein in 1942.^[10] The British war effort in El Alamein strained Egypt’s economy, as many resources were diverted for military use. Mahmoud describes endless bread lines and bombs falling on the city.^[11]

He worked at a perfume shop in Cairo’s El Mosky neighborhood for a month, sealing perfume bottles, but left to find a job in sales. One of his brothers got him a job at a busy trinket shop near Sayyidna Al-Hussein mosque, where the owner’s strategy of low margins and high sales volume taught Mahmoud a key business lesson.^[12] Despite the modest salary, he worked in the store from 1942 to 1949. After working nonstop on the busiest night of the year and earning 40 pounds, Mahmoud was disheartened when the owner took all the money, prompting him to quit and pursue a career in wholesale trade.^[13]

Working at Al Nasr Trading, under Hajj Abdel Fattah Abu Shalib, Mahmoud learned wholesale trade skills.^[14] He stayed with Al Nasr for over a decade, while serving in the military for three years, returning to the job during his leaves and then when his service ended.^[15] When Mahmoud turned 18 in 1950, he married Hanim, with whom he had eight children: Mona, Mamdouh, Mohamed, Magda, Mostafa, Mansour (who passed away before turning one), Medhat, and Mohyielden.^[16]

Founding Story

In 1958, Mahmoud met Antar Abdel Wahab, a work colleague who quickly became a friend. They shared the vision of starting their own business. They wanted to open a store that sold ‘all kinds of goods so that traders from Cairo and elsewhere could find everything they needed.’ In 1964, Mahmoud and Antar’s dream took shape. They pitched their business idea to a pair of long-term clients: the Abbas brothers, traders in Upper Egypt who often sourced their goods from Al Nasr Trading in Cairo. The Abbas brothers invested 4,000 Egyptian pounds, forming an equal partnership in which each of the four men was entitled to 25% of the profits. They secured a shop in Jawhar Al-Qa’id Street in Cairo, leaving operations to Mahmoud and Antar.^[17]

Mahmoud and Antar adhered to a simple strategy: keep profit margins low and focus on rapid turnover. On April 15, 1964, they opened their first store, naming it Elaraby after Mahmoud’s family name. The business was an immediate success, but two days after its opening, Antar fell ill and never returned to work. He passed away two years later. Mahmoud poured all his energy into running the store, supported by his brothers.^[18]

After Antar’s death, the Abbas brothers refused to let his heirs inherit his share. They spread claims that they were solely responsible for its success and later ambushed Mahmoud in the store with thugs. Following a lawsuit, Mahmoud sold off the inventory, settled debts, and shut down the business. In early 1967, Mahmoud and his brothers, along with Antar’s sons, bought a new store, but the Abbas brothers once again challenged the ownership. This time, the Abbas brothers sought mediation from Hajj Abdel Fattah Abu Shalib, who brokered a settlement under which Mahmoud paid the brothers a sum to end the partnership. Later, the Abbas brothers struggled to manage the first store, which they had acquired through the settlement, and offered to sell it back. With Hajj Abdel Fattah’s support, Mahmoud repurchased it, ultimately ending up with two stores instead of one.^[19] Eventually, Antar’s sons took their share of the profits and left the partnership.^[20]

Growth Phase

Following the success of his stationery and hardware business, Mahmoud wanted to venture into manufacturing. In 1966, an import ban led him to start producing colorful wax crayons branded Al-lakhbata. Its animated TV advertisement became a hit among schoolchildren, and demand for the crayons grew. The family established the Artistic Company for School Colors Manufacturing and set up a small factory in Cairo’s Al Mugharbalin district.^[21]

In 1970, Anwar El Sadat became president of Egypt. During the early years of his rule, Egypt’s involvement in the Arab-Israeli war led to a halt in trade. The family business was unable to cover rising costs and eventually faced a severe financial crisis. Just as its debts were becoming unsustainable, a new opportunity emerged: traders began importing electrical appliances into Egypt through Libya, Kuwait, and Saudi Arabia. Televisions and radios from brands like National Panasonic, Sanyo, and Sony were in high demand.^[22]

In the early 1970s, Mahmoud and his brothers met Shigeru Ando, a Japanese businessman studying Arabic in Egypt whom Toshiba had sent to conduct a market study and find an Egyptian partner. He established a strong rapport with the Elaraby brothers, whom we identified as good candidates for Toshiba’s dealership in Egypt. Together, they tested the demand for Toshiba products by distributing some shipments at the Elaraby store, which proved successful. In 1974, Toshiba executives arrived unannounced to inspect the business. They were surprised by Mahmoud’s modest setup—no office, secretary, or specialized focus on electronics, as the store also sold clothing, hardware, and toys. After Toshiba turned them down, Ando pressed Elaraby’s case, arguing that their deep market reach mattered more than a prestigious office. After much persuasive effort, Toshiba granted them a one-year trial as a distributor. Selling Toshiba televisions, fans, and cassette players, they quickly outperformed their competitors.^[23] Between 1971 and 1973, their electronics sales became more profitable than the stationery business. ^[24]

In 1975, Mahmoud visited Japan at Toshiba’s invitation. The experience reshaped his vision—Elaraby would not just import, but one day manufacture world-class products in Egypt.^[25] To that end, Mahmoud organized the purchase of factory land in the city of Bahna. Despite Toshiba’s initial refusal to collaborate on manufacturing, Elaraby pressed on, confident in the growing potential for industrial production. Toshiba’s board of directors eventually approved the manufacturing plan. With this agreement, Elaraby successfully transitioned from trade to manufacturing—at first, fans, radios, and cassette players; later, TVs as well. In 1994, Toshiba approved the construction of a branded TV factory in Banha, which was operating at full capacity by the following year.^[26]

In early 1999, Elaraby established the Quesna Industrial Complex, which would grow to house several major production facilities, including factories for Toshiba and Sharp refrigerators, washing machines, televisions, plastics, fans, glass, air conditioning, spare parts, molds, electronic circuits, foam, die-casting, and gas stoves under the Tornado brand.^[27] In 2002, Elaraby Group partnered with the Japanese electronics manufacturer Sharp. Following this collaboration, the company established successful global partnerships with major brands, including Japan’s Hitachi, NEC, Seiko, Alba, and Sony, as well as Italy’s La Germania, Hoover, and Candy.^[28] In 2009, Japanese emperor Akihito awarded Mahmoud Elaraby the Medal of the Rising Sun for his contributions.^[29]

In 2020, Elaraby’s workforce exceeded 40,000 employees.^[30] A year later, Mahmoud Elaraby died at the age of 89, leaving his heirs to take over the business.^[31] In September 2022, Elaraby announced a partnership with Rechi, a Taiwanese company, to produce air conditioning compressors, with an investment of $33 million.^[32]

Today

The company is still family owned, with the founder’s sons Ibrahim Mahmoud Elaraby serving as chairman and Mohamed Mahmoud Elaraby as CEO.^[33] Many of Mahmoud’s grandsons are also involved in the business, including Mohamed Magdy Elaraby, who joined in 2006 and now serves as chief technology officer; Mahmoud Magdy Elaraby, who joined in 2009 and is now brand management director; and Islam Elaraby, who joined in 2014 and is now head of modern trade.^[34]

Elaraby Group employs over 45,000 people across 15 companies. Its facilities span over one million square meters, including 36 factories. The company maintains a 90% localization ratio, turning out products in 43 categories with 2,000 variations. Elaraby’s distribution network includes over 3,000 authorized distributors, 38 sales branches, and more than 500 service centers. It operates in over 60 countries across Africa, the Middle East, and Eastern Europe, partnering with 16 global brands and over 500 suppliers.^[35]