Product/Service Description: This is a project idea which intends to provide rental services of heavy duty machinery, equipment, and trucks. The machinery and equipment will include grades, bulldozers, compactors, rollers, lifts, concrete mixers. And other which can be used in all types of engineering works.
Market potential: Though the volume of wok deferens form region to region construction and building the works have been expanding at an unprecedented rate throughout the bridges, buildings of all types, and to some extent construction of small and large dams, installations of power generators and transmission lines, etc.. have been expanding. All these activities require heavy duty machinery, equipment and trucks. Some large engineering firms which undertake these construction, erection and installation works have the financial capacity to buy and use these heavy duty machinery, equipment and trucks. But many small and medium engineering firms do not have the required financial resources to buy and own these heavy duty machines. Hence they have to rent them for under taking their civil engineering works. At present due to shortages of the heavy duty machines, the cost of renting them is extremely high. In Addis Ababa, there are a few machinery rental firms which provide different types of heavy duty machines on rental basis.
The Amhara Region has its share of construction activities through the volume is not proportionate to the size of the Region in terms of area and population. There are small but/growing construction firms which undertake some of the small construction works being accomplished in the region. However, the large construction works of the Region are commissioned to outside construction firms. The regional construction firms are denied the opportunity of working on big engineering because they do not have all the necessary heavy duty machinery, equipment and trucks due to lack of sufficient financial resources. They can not rent them from Addis Ababa because the machines will be too expensive. To increase to capacity of the regional construction firms until such a time that they own all the machines they need, firms which rent these firms should be established in the region. Such firms could start business by renting a limited type of heavy duty machinery, equipment and trucks. For the first phase, they can start with a few large trucks and earth/moving equipment. As the volume of construction works increases, the range and volume of their rental services will also increase.
“Source of raw Material”: In the context of this project idea, the main inputs for the rental business are the heavy duty machinery, equipment and trucks. This input will be imported.
“Process and Technology”: Again for this Project Idea the “Process” is to study the market, establish the rental business, import the heavy duty machines, construct shade for the machines, employ operators and start the rental service business. “Technology have refers to the acquisition of the most appropriate types (price, fuel consumption, efficiency, capacity---) of heavy duty machinery, equipment and trucks.
Estimated Investment: For a rental business that will initially have two graders, two dozers and 4 heavy duty trucks, the investment cost will be:
§ Building/shade 200m2 at Br. 1000/m2 = 200,000
§ Machinery & Equipment 9,000,000
§ W. capital 500,000
9,700,000
Benefits: Improves the capacity of regional construction firms, facilitates the development of the construction industry, and saves financial resources of the Region.
Location: Bahir Dar, Dessie