GENERAL Beltings Limited plans to acquire a US$3 million steel cord conveyor belt manufacturing plant as the company angles to increase its market share that is being threatened by the influx of cheap imports.
The company’s general manager, Mr Joseph Gunda, said the move was part of the organisation’s strategy to spur growth.
He said though the company’s main thrust was securing funds for the purchase of raw materials, machinery maintenance and to cover a salary backlog, new state-of-the art machinery was needed to compete favourably on the market.
“We are satisfied with the machinery that we have, but definitely we are not going to stop investing in new technology. We understand that there are companies that use steel cord conveyor belts that we are not producing and that needs to be addressed for us to boost business,” he said.
Mr Gunda pointed out that the rubber product manufacturing plant would increase the company’s competitiveness on the market.
“Purchasing of this machine is a project that is in line at the moment so that we keep abreast with technology advancement. We expect to invest more than US$2 million in the process,” said Mr Gunda.
Funds for the purchase, he said, would be sourced from financial institutions.
“Let me stress that procurement of the machine will depend on funding. We have gone back to CABS for a line of credit. We want the institution to fulfil the initial requirements of our application,” he said.
General Beltings received US$500 000 from the Distressed and Marginalised Areas Fund to recapitalise its business from the US$2 million it had applied for.
Mr Gunda added that the company had adopted operating strategies that would, together with the support from Government, help the operation increase capacity utilisation.
“If it was possible, we would need 100 percent protection from Government. We have experienced challenges just like any other company, but we believe with the initiatives that we have put in place and Governments’ support inasfar as procurement laws such as import tariffs on conveyor belts and rubber is concerned, we are on the right track to turn around the company,” explained Mr Gunda.
Despite the prevailing economic challenges, General Beltings says it has tried to maintain its workforce.
“General Beltings has not necessarily forced workers to leave the company. Over the years, we have lost part of our workforce, but a good number of them have left due to retirement. When they retire, we simply don’t replace them,” said Mr Gunda.
The company is presently operating at around 30 percent capacity against a peak of 90 percent in the late 1990s.
But the rubber division is expected to benefit from the resurgence of the mining sector as demand for conveyor belts is expected to improve with the reopening of old mines and the establishment of new ones.
At one point, the company used to be among the biggest suppliers of conveyor belts in the region, but its export balance has since dropped to around 5 percent.
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