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Forex shortages hinder start-up

by Staff reporter
08 November 2018 | 712 Views
In 2006, Bike and Boat Bar (BBB), a Bulawayo company, started manufacturing motor cycles, a first for the country and the region. Soon after, however, the economy tanked as hyperinflation rendered the local currency worthless and the company could not afford to import key parts and parked the idea. Then came dollarisation in 2009, and BBB decided to try again, coming together with several local firms under the umbrella of Southern Africa Matabeleland Industrial Company (Samic).

NewsDay (ND) business reporter Mthandazo Nyoni caught up with the two people behind the project, Robyn Smith (RS) and Bruce Hampson (BH), who say so far they have sold about 3 000 motorcycles to the local market.

ND: May you tell us in brief about Bike and Boat Bar Company?

RS: Bike and Boat Bar was established in December 1993. Our core business is servicing and repairing all types of motorcycles, maintenance to fleets of motorcycles, refurbishment to antique bikes, engine overhauls, boat motor repairs and powder coating. Under this company, we have another one called Southern Africa Matabeleland Industrial Company (Samic) which consists of a conglomerate of businesses that have merged to produce the first locally manufactured motorcycle in Zimbabwe. These companies include United Spring and Forging, CT Bolts, Bike Bar Coaters, Leofree Tech, Rubber Products, Bike and Boat Bar and Dunlop Tyres.

Samic motorcycles has been a project of Bike and Boat Bar for over 15 years, where we have locally-assembled the motorcycles for sale on the local market. We wanted to produce the first motorcycle in Zimbabwe, locally manufactured. It has taken us 15 years to get the licenses for the Comesa and Sadc markets. We have now achieved this. We have produced the first locally-manufactured motorcycle in Zimbabwe. We have obtained a stamp of origin for Comesa and Sadc. We are the first in Africa to hold such a licence.

ND: Tell us more about Samic.

RS: Samic is an authentic industrial, ingenuity project, propagated by self determination to produce a bona fide genuine motorcycle for Africa.

Samic motorcycles are manufactured from only the highest quality of virgin materials. By using only the best products and components that are manufactured and produced by the fused companies in Bulawayo, Zimbabwe can proudly say our motorcycles are affordable, strong and durable, and can be used almost anywhere.

The engines are single cylinder, air-cooled, four stroke, five-speed gearbox, making them eco-friendly. These motorcycles engines have been modernised by removing the timing chain and replacing it with a pushrod system. By doing this, it makes the engine stronger and more reliable. We actually give a warranty of 20 000km on the engine and frame.

ND: You said it took you about 15 years to get the licences for Comesa and Sadc. Why?

RS: There was a lot of paperwork involved and you know the economy has been up and down. Now the things have come right and we were able to get the licence, which means we can now export to the whole of Africa duty-free. No one else has this licence in Africa.

BH: We want to compete against China and India because they have never been challenged by anyone in Africa. All they do is to just supply 100% of the motorcycle. There is no job creation, so we challenged that. We think this is a huge employment creation opportunity for Zimbabwe if government wants to partner with us.

We want to supply all the civil servants with loan facilities where they can take a motorcycle for a year and pay it off. Nobody can beat our prices, now because we are not paying import duties. We were exempt from taxes. We want to try and open Dunlop again, so I have linked them with the manufacturer of the new types of machines that make the tyres for motorcycles, and they should be able to do over 54 000 tyres a month.

RS: Basically, what we want to do is to create jobs.

ND: Exports?

RS: We want to start locally and are actively looking for government tenders, because we think it's a low-hanging fruit in terms of employment creation. It's all a conglomeration of companies that have come together to create this motorcycle, which can translate to jobs if they start working full time. We also want to get our tertiary institutions, such as the Bulawayo Polytechnic, involved in terms of engineering at the various stages involved in producing the motercycle.

ND: Let's talk about production. How many motorcycles are you targeting to make, say per month?

RS: If we take 10% of what is actually imported into the Comesa from China, it's 28 000 motorcycles a month. Imagine, if we could produce all that here?

ND: How is the local market doing?

RS: Government uses about 15 000 motorcycles per year. If we could sell such numbers to the government alone, it would be massive, even in terms of job creation.

BH: A government contract will kick-start our project. There is no other project like this in Africa and the quality is much higher, so we have got the whole of Africa to penetrate. We just need exposure of the project.

ND: How much of the components are imported?

RS: We import about 60% for the motorcycle, 40% is what we make locally, but we are trying to fight that at the moment because we want to manufacture at least 80% of the components locally, and we can do it. We have the companies; we have the people to do it.

ND: Any challenges that you have faced so far?

BH: The biggest challenge we face right now is forex. That is the biggest challenge because our suppliers want forex. I think that's now where the government can come in by way of communicating with the Reserve Bank of Zimbabwe so that we are allocated the foreign currency to kick-start this project.

ND: What opportunities are there in this sector?

RS: Well, we have got the whole of Africa, and I mean we have already hooked up with a lot of African companies. They are ready but they want the product on the ground.

Forex Zimbabwe Start up

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Source: newsday


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