Namibia: DBN Finances Brick-Making Plant Near Katima Mulilo

Recognising the current massive demand for bricks in the Zambezi Region, as evidenced by long waiting periods to receive orders, East End Frontier Holdings saw the sense and opportunity in another brick-making enterprise close to Katima Mulilo.

The enterprise was started by a local entrepreneur Frans Kwala who, after seeing a niche in the market - including a potential increase in demand driven by the need for low cost housing in the region - prepared a business plan to take the idea forward. He took the process a step further and assured himself of the viability of his idea by obtaining letters expressing intent to support the additional brick-making capacity from various stakeholders. These included the Zambezi Regional Council, the Mafwe Tribal Authority and several private sector entities in the regional construction industry.

After seeing a high degree of certainty that the enterprise would succeed, permission to occupy land of the Mafwe Tribal Authority was sought and he began to make plans to supply water, mine sand and electricity to the site to the envisaged plant. Kwala turned to Development Bank of Namibia (DBN) for asset finance, including a brick-making machine, moulds for bricks and interlocks, a front-end loader and a delivery truck to better serve clients.

Initially wary of the application due to existing brick-making capacity in the region, the bank investigated the viability of the business plan in terms of the market, access to utilities and availability of raw materials, employment creation and managerial capacity. The business plan, as well as the letters of intent to support the enterprise, enabled the bank to check all the boxes on the application and provide the finance.

What initially impressed the bank, says DBN senior communication manager Jerome Mutumba, is the detailed planning and forethought that became evident in the application. He adds that the entrepreneur impressed the bank by committing his own resources to the project, including obtaining land and initiating the process of obtaining water and electricity, where these utilities were not available. Mutumba adds that Kwala rapidly offered collateral, a further sign of confidence in the viability of the project.

Mutumba concluded by challenging entrepreneurs from the Zambezi Region to look at the available opportunities, develop detailed plans based on their ambition and approach DBN for possible finance. Zambezi, he says, has a high degree of potential for development of prosperous enterprises based on its growing economy, as well as its prime location for trade with neighbouring countries. The brick-making enterprise has already created approximately 30 new job opportunities.

Source: New Era.