Dangote Cement Plc is beating its chest for leading an initiative that crashed the price of cement by about 40 percent. The move by the market leader cut cement price from about N2,000 to N1,300.
The cement company explained the rationale behind its action on a day it empowered distributors with about 150 trucks. The trucks will aid the supply of cement to Dangote Cement Plc retailers. The 150 trucks represent the first phase of the trucks to be given to distributors.
Another set of 250 trucks will get to the market leader’s distributors, according to the Group Chief Marketing Officer of Dangote Group, Oare Ojeikere, under the second phase of the Truck Empowerment Scheme.
“The Truck Empowerment Programme was initiated to ease the challenge of delivering cement to the doorstep of our customers, big and small”, Group Managing Director, Dangote Cement Plc, Onne van dar Weijde, told Sunday Vanguard moments after unveiling the trucks.
The GMD added: “We only recently took a step to make cement affordable across the country. Cement price, at the beginning of the year, was hovering between N1,900 and N2,000 per bag. Today, we have crashed the price by about 40 percent. The provision of the trucks to our distributors is a follow up to the price crashing as it will enable the distributors get the product to the retailers with ease enroute to the end users.”
Addressing the gathering at the unveiling of the trucks, held at TBS, Lagos, Ojeikere said Dangote Cement Plc took the decision to lower the price of cement as part of its efforts to make the product affordable and consequently contribute to reducing the nation’s housing deficit of over 80 million.
The move, the Group Chief Marketing Officer stated, has also improved the profitability of Dangote Cement Plc distributors over the past six to eight months.
His words: “We have done a few things to improve the profitability of our partners over the past six to eight months.
“We came out with a scheme to ensure that those who worked aggressively have been rewarded for their diligence. The results have proved that we did the right thing. We also took a decision that it was time we made cement more affordable. Our view is that if we did this, we could reduce the nation’s housing deficit of over 80 million. It would also increase the quantity of cement that is sold. “We are proud to say that we led an initiative that crashed the price of cement from N2,000 or N1,900 to as low as N1,350 or N1,400 per bag. What that has done is that it has attracted significant growth by as much as 40 percent. October and November have been the best ever in terms of the quantity of cement that we have sold.
“We have made cement affordable and that has increased our rating. We know cement can be put into several other uses. This road here is made of concrete. It can be here for another 100 years. If we make cement more affordable, then we can give the people the opportunity to make use of it in the diverse ways”.
Speaking on why Dangote Cement Plc decided to give the trucks to the distributors, Ojeikere said: “We are committed to changing the ways we engage our partners. We want to make them an extension of our business and create a good atmosphere for their operations.
“This scheme is about empowering our partners, to ensure that they have what is required to service their customers. Our partners, sometimes, require very expensive items. Under the current dispensation in Nigeria, our exchange rate has ballooned out of proportion so much so that it is difficult for our partners to invest in new trucks. It is our business to assist them to get our products (cement) to the end users. We are in the business of selling cement and this requires trucks for our distributors to perform optimally”.
The Group Chief Marketing Officer told the distributors, drawn from the South-South, the South-East and Lagos: “The trucks are coming at no cost to you. All that we ask is that you use the trucks to service your retailers for three years and meet the targets, and you will get the trucks for keeps.
“The about 150 trucks we are giving out today represent the first phase of the empowerment scheme. Another 250 trucks are in the pipeline for distribution under the second phase. This scheme is about you and how to empower you and take you to the next level.”
Unfolding the market leader’s incentives for other stakeholders, he explained: “We are also trying to ensure that your retailers are also supported. When you visit them (retailers), what you see is that some of them have tarpaulin which they use outdoor or our posters. They sit on the bench or cement block.
“As the market leader, we believe that if we give them umbrellas, tables and chairs, we will also be seen to be doing something for them. We have no intention of serving retailers. That is not our business.
“Those people remain your (distributors) customers. We will continue to reach them through you. “And to put some icing on the cake, we also decided to launched a major consumer promotion. As I speak, we have announced 42 millionaires. 420 people have won N50,000 each. What I find particularly gratifying is that we made the calls to the winners in the presence of the industry regulator. Today, there are seven block makers who won N1 million each.
“And there are two labourers who also won N1 million each.
“One of them claimed to be an electrician who uses his spare time to work as a labourer. He made four entries and won N1 million. There is a student who also won N1 million. There are retailers who equally won N1 million each. The human angle stories are really touching. We are touching the lives of the people. And to say that those millions are rolling into people’s pockets at a time that things are so difficult in the country as a result of the downturn in the economy”.
One of the beneficiaries of the trucks, Mr Igwebuike Ikwueme, Managing Director of Nwa Ado Resources, and a distributor at Dangote Cement Plc plant at Obajana, was excited about the gesture.
“The empowerment scheme has the potential to move our business of distributing cement forward”, Ikwueme stated.
“I sell about 900 trucks of cement every month. But having now been empowered with the truck, I can do more and I am sure there will be improvement. Dangote has, by this initiative, proved that it is the market leader and is committed to changing peoples’ lives”.