Capital constraints thwart NEA exports drive
ONE of Bulawayo’s leading manufacturers of hard wood furniture, New Era Adventures’ is seeking an excess of $50 000 to retool and produce quality products that can compete on the export market.
NEA managing director Mr Paul Chigariro said the company was targeting the export market but production has been low due to funding challenges.
“We can even explore the European market because there is a high demand for decking and floor in that market. We however, need adequate working capital to embark on exports. Access to finance from local financial institutions has proved to be a challenge largely due to the high interest rates,” said Mr Chigariro.
“We need about $50 000 to purchase modern equipment which will enable us to improve on efficiency as well as the quality of our products so as to ensure they are competitive enough on the international markets.”
He said the company’s capacity utilisation has dropped drastically largely due to the prevailing liquidity crunch and low household disposable income. The company specialises in manufacturing a wide range of furniture made from indigenous timber such as teak, mukwa, mahogany and rose wood for use mostly by the tourism and hospitality industry.
“At the moment business is subdued largely because of low disposable income by potential consumers as they prioritise buying food and other necessities instead of buying furniture. Of course apart from selling to individuals, we draw most of our clients from hotels, lodges and bars but of late orders have also been depressed,” Mr Chigariro.
He said the company, if funding is obtained, will prioritise exports.
“Our market has always been local since we started our operations but we are looking forward to tap into the regional market targeting mostly the tourism sector. There is a lot of hive of activity in Southern Africa’s tourism sector with a number of infrastructural developments taking place and thus we stand to benefit from this.”
He also said the influx of cheap imported furniture ware mostly from China had impacted negatively on furniture manufacturers.
NEA sources its timber from logging companies operating in Tsholotsho, Lupane and Nkayi districts.
“Local authorities’ royalties are high and as a result logging companies pass on the expense on the timber they sell to us and this affects our competitiveness. We have to import ironmongery products, vanishes, wood treatment pesticides, saws and plainer blades from South Africa because we can’t get these locally. We also do (import) the same for our machinery’s back up spares,” said Mr Chigariro.