Stiff competition ahead

Bedros Bambokian, group general manager for Harwal Group, talks about the future of the region’s construction market and how the company will fare.

Can you give us an idea of which countries are the strongest in terms of sales for your group?

Harwal Group is an international investment and management company specialising in various manufacturing technologies.

Our group companies in the region include Cosmoplast, Interplast, Intermetal, TSSC, Technomec, Emirates Recycling, Union Beverages Factory and Harwal Containers Manufacturing.

Collectively they cater to diverse market sectors with a customer base spanning the Middle East, Europe, the US, Asia Pacific, Africa and the CIS countries.

In the GCC, Harwal Group is the largest converter of plastic, wood and metals into finished products. Our product range include building materials such as electrical products, plumbing systems, doors and windows, kitchens, fencing and railing.

We also manufacture factory-built homes and shelters, refrigeration systems, composite panels, cladding and storage systems. In addition to this, we also produce and supply a complete range of pipeline systems in PVC, HDPE and GRP for infrastructural developments such as water distribution networks, district cooling systems, oil and gas distribution and sewerage.

For the consumer sector, we produce and supply a wide range of packaging products, enclosures, bags and PET preforms used for bottle manufacturing. We also manufacture furniture, both for indoor and outdoor use and plastic home improvement items. The latest addition to our operations is the bottling of juice under the brand name of Maaza in our plant in Jebel Ali.

The Gulf is our largest market. Through our distribution centers in strategic locations within the GCC, we ensure that our customers across the GCC are provided with the same range of products and excellent service that our UAE customers are offered. To serve them better, we are now commissioning two new factories in Riyadh, Saudi Arabia.

We also have distribution centers spread across Europe and the US and have established new factories in Russia. Our goal is to be an international manufacturing conglomerate with our headquarters in the UAE.

What trends do you see emerging within the regional building materials industry?

During this period of economic turmoil, we expect to see increased competition and a temporary slowdown. We believe the building boom in the region will continue in the medium term, as the population of the region grows. In the short term, manufacturers will face challenging times due to the global economic uncertainties.

As far as Harwal Group is concerned, our economies of scale, production efficiencies and product diversification will see us through this difficult period. Leading companies shall emerge stronger and the weaker competitors will withdraw.

Which industry sectors offer the group the greatest promise for continued growth?

All the industry sectors that we serve promise sustainable growth, be it the infrastructure development, building construction, oil and gas, consumer durables, home improvements, hospitality industry or FMCG. We have a well-balanced product portfolio, where all the industry sectors that we cater to play an important role in the growth of the group.

How does the group maintain quality in this notoriously fickle region?

Since inception, our group of companies have laid great emphasis on our core values such as quality, service and dependability in order to achieve our objective of manufacturing innovative and high quality products for our customers.

All our companies are ISO 9001:2000 certified and follow stringent quality parameters in manufacturing goods that meet international product specifications and standards. Our dedication to quality is evident from the various certifications that our products have obtained.

We constantly benchmark and improve our offerings in order to ensure that our customers are more than satisfied with our quality standards and services. Our ultimate objective is to provide our customers with a wide variety of products under one roof, excellent service and become a valuable partner.

This is evident from the diversified range of products we manufacture and the spectrum of industries we serve. Our expertise in manufacturing technologies is our core competence which helps us innovate and diversify.

Are there any plans to expand your manufacturing capabilities elsewhere in the region?

We are currently expanding our operations. In the UAE, we have recently begun production in our new facilities in the Dubai Investment Park for Cosmoplast, Interplast, TSSC and Intermetal.

In Abu Dhabi Cosmoplast's new facility manufactures glass reinforced plastic, PVC, Reinforced Thermoplastic and HDPE pipes.

Our other expansion plans within the GCC include the setting up of new plants in Saudi Arabia for Cosmoplast, Interplast and TSSC.

Production in these plants shall start by early 2009.

In order to tap into the potential of emerging markets, we are also venturing into India and expanding our operations in Russia.

How do you view business trends for 2009? Is it looking up?

The business environment for 2009 looks somewhat uncertain. We believe that infrastructural developments will not be affected by the present crisis but the residential developments might see a dip or slowdown. There are many ongoing projects that need years to be completed and so in the short term we will feel the effects of the slowdown.

However, in the long term, business in the region shall continue at the pace experienced in the past few years.

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