The real reasons behind why more than 35 small factories in Somaliland got busted!
By: Mohamed Ali,
Somalilandsun - The Government is ready and prepared to not only collaborate but support indigenous Somaliland owned small factories thus negate the myriad of problems that include lack of adequate water supply, high priced fuel and electricity as well as insufficient market etc.
This was informed recently by the Somaliland Minister of Industry; Mr. Abib met with Somaliland Union of Industry in an organized event in Hargeisa where he also revealed that so far 35 small factories to have closed due to the mentioned problems.
However, as a trained food engineer, I do not think the above factors are the main problems that challenge the sustainability of small factories in Somaliland, though they bear minor effects. So what exactly is the real or the main problems in our small factories? According to my own research done after visiting some factory's plant sites, I have found that two factors are responsible especially as to why many small factories mainly mineral water were closed after they became bankrupt
The two factors are as follows:-
1- Lack of industrial knowledge and proper training in factory's Management
Most of Somaliland factories are managed by the owner himself, who invested in the factory, and the owner doesn't have any experience knowledge in industry and product market and its sale service. Many small factories owners are business men, and they just think that managing factory is as simple as just managing whole sale or retailer shops!, some do not even have a potential knowledge to hire a qualified people, though in Somaliland, there are so many young talented food and chemical engineers who returned from abroad after completing education and industrial training.
Abyan beverages a local Drinks factory gone bustIn general managing factory is not easy task , it is just high risk high profitable business which needed a proper knowledge and experience to reduce risk, labor and cost in the factory's plant site, the manager has also several responsibilities include training employees; planning, assigning, and directing work; appraising performance; rewarding and disciplining employees; addressing complaints and resolving problems, in addition able to develop plans for efficient use of materials, machines, and employees, possessing knowledge in quality control is also essential.
When a management does not have the above capabilities thus non-adherence, the following problems may arise in the factory's plant site:-
• Excessive and frequent maintenance requirements in the factory plant
I have seen this problem, and it usually can happen when management doesn't aware what exactly he is doing, it also caused by the lack of attention during building the plant
• Large capital investment, with negative influence on product unit cost
• High electric cost, This is one of the most important that needs to be considered before investing such business or plant, one should consider and do calculation for power needed per hour, then see if the power cost is ok with the product intended to be produce
2- Lack of local engineers and technicians in the factory's plant site
Reasons behind small factories bust
Another factor that has a great effect in our industry is probably neglecting educated Somaliland engineers by preferring foreigners. Actually there are many foreigners who work in our small factories using the name ''engineer'' , these so called ''foreign engineers'' though its not clear they have true or fake qualifications, usually earn enormous salary, about three times greater salary than local engineers earn per month. Those foreign engineers work about 3 or 4 hours per day, and then go back to their residential places. It is clear that foreign engineer's higher salary is the second largest factor causing bankruptcy in some factories.SBI local coca cola producer has succeeded by utilizing proper management and utilization of expatriates as trainers of local personell
In Somaliland, dozens of Talented young engineers mainly food and chemical engineers came back from abroad soon after completed education, some have higher education degrees such as masters in engineering, while some others have both degree and industrial training. Most of local factories managers do not employ these engineers except very few, because they believe foreign engineers are smart or better than Somalilanders, it's just psychological problem, if we look the reality, it is easy to prove Somalilander engineer's qualifications and experience comparing to foreign engineers qualification, yet prefer non-Somali, thereby neglecting local engineers role in developing our industries
Many young Somaliland engineers actually leave Somaliland every day due to disappointments getting work in their beloved country, Somaliland; most of them go back abroad again to find jobs.
local graduates like these from Admas university are denied employment opportunities despite relevant skills
I believe if we reduce dependence on foreign workers and employ our young engineers both in the ministry of industry and factories; we will be able to solve so many problems that challenge the development and sustainability of Somaliland industries at the sometime.
Therefore I am encouraging Minister of industry to help our young engineers in finding jobs so that the above risks in our local factories could be reduced or completely eliminated.
In my idea, what we need is to invest our engineers graduating from local or abroad, and then establish functions of food engineers (trained specifically to solve engineering problems in the food industry) such as :-
• Technical Management of production
• Design of processing systems
• Operation Engineer
• Process Engineer
• Research and development of processes and products
• Management of product distribution to the consumers
And other specified engineers required in the industry
All these engineers can be trained specifically by the Minister of industry by collaborating with our local universities and factories; they can be given extra skills through in service training, or taking them abroad for short seminars or hiring foreigner experts for short training stints at home.
The Writer Eng Mohamed Ali at workOnce we do all this, we may able to solve so many internal problems in our industries and will be able to produce desired products with minimum cost in equipment, energy, human labor etc, on the other hand create many direct and indirect jobs in Somaliland
Mohamed Ali, Bsc. Industrial Biotech, Master Eng. (Chemical-Bioprocess), Malaysia
Area specialized: Research and development of food and Bioprocess products
Field of Interest: Consultant in Business related food and beverage industries