Ethiopia’s Derba Midroc Cement Factory, which is reportedly set to start production shortly, is to sell cement on a credit basis and provide delivery services.
The factory is to give 60-day credit to contractors who place a 50 per cent down payment and back up the remainder with an unconditional bank guarantee. This is not merely a one-time deal, as contractors can keep using it as long as the guarantee is in place, according to Haile Assegedie, CEO of Derba.
“It is hard for people to get loans these days,” he told Fortune. “As long as the unconditional guarantee is in place, they can buy cement, paying half of the cost.”
This is an offer that is open to individuals as well. Derba, 80pc of which is owned by Mohammed Al-Amoudi (Shiekh) and the remaining by MIDROC Ethiopia, is to give the service to employees, as long as the companies or institutions they work for put up similar guarantees.
Derba is also to deliver cement to clients within five days, to places located in 600km radius of Addis Abeba in the first two months.
“We will expand our radius after that,” Haile told Fortune. “Our aim is to deliver to any place in the country.”
This service is to be provided through 1000 Volvo trucks, of which 750 have already arrived. The service is to be managed by Derba Transport Plc, a company that is under organisation.