CORE ACTIVITIES

Nigeria 2020 | REAL ESTATE & CONSTRUCTION | VIP INTERVIEW

TBY talks to Alaa Alghadban, Managing Director of Sana Group, on core activities, steel versus concrete, and competition.

What are your core activities in Nigeria, and what strategies allowed you to claim your position in the market today?

Sana Group is special because we keep raising the standard in all construction sectors we serve. Our activities in Nigeria's construction industry are in four distinct sectors. Currently, the first and main business focus is in the construction of factories, ranging from light industries and warehouses, to heavy industrial plants. Our turn-key activities include design and execution for the food industry leading to Sana Global Construction Ltd.'s recognition as the leader in this particularly specialized and demanding sector. Sana Global Construction Ltd (Sana Global) recently completed an expansion to the Kellogg factory located here in Lagos, which was also built by Sana Global. Both projects are good examples of our exceptional capability and performance. The client remarked that the execution and finishes exceed the brand's global standard. Through our work, we raised hygiene and operational standards. We are proud to have improved the standard of construction in the food industry sector. Sana Group's record for site health & safety and our reputation for excellence in project execution is recognised as world class. We strive to ensure that every factory we build, every project we execute is better than the previous one. Our second business focus as a group is in the manufacturing and trading of construction chemicals. Sana Group's third business focus is in the manufacturing of high-quality cement blocks. We, and the construction sector as a whole, have experienced poor construction resulting in buildings collapsing due to the failure of low-quality cement blocks. So, we introduced Sana Blocks, providing a much better- quality cement block product. The market already recognizes Sana Block for its superior block and services. The fourth sector Sana Group participates in is structural steel fabrication. Recognizing an unmet demand for high quality steel fabrication, we established Sana Building System (SBS), arguably the most important part of our business. SBS is a state-of-the-art pre-engineered building (PEB) and hot rolled steel structures (HRSS) design and fabrication company. With a highly professional staff strength, the company utilizes the latest technology. It is currently the only operation of its type in Nigeria.

How does the PEB system work?

Here are two basic types of steel structures. One is called hot rolled, HRSS, which involves buying mill-produced beams, cutting them, drilling them, and welding them. The other type is pre-engineered buildings, PEB. PEB is the efficient approach Sana Global uses for most factories here in Nigeria. Utilizing a “systems” approach, Sana Building System's PEB engineering programs analyse each component in a structure to identify levels of high stress and then produce custom designs optimizing steel content to absorb those forces. PEB design is an efficient inter-dependency between a building's steel frames, steel secondary components, and cladding. This results in an extremely competitive building solution compared to other construction options. Until the establishment of SBS, such structures were imported, mainly from the UAE, because this high efficiency product was not produced domestically. SBS imports only the needed raw material: high grade plates, sheets, and coils and fabricates them into engineered beams in our factory here in Nigeria. All engineering and design are performed in-house by Sana Building Systems' professional engineers. Because PEB is an engineered product, we employ the latest engineering software capable of designing buildings to the most demanding international standards. Engineers input the proposed building's dimensions and building loading, select the applicable building code, and a fully code-compliant design is generated. Skilled structural draftsmen produce detailed shop fabrication drawings, which SBS's experienced fabrication shop workforce follow to precisely cut plates and assemble the welded beams. This process is very efficient. It invariably results in a savings of at least 20-30%. This cost savings in fit-for-purpose PEB fabricated steel vs traditional hot rolled approach is a huge advantage. When compared to concrete construction, the PEB cost advantage is even greater. We are the first company providing this turnkey solution in Nigeria. This innovative product will be available when the Sana Buildings System's factory is commissioned in May 2020. SBS will virtually eliminate the need for expensive imported steel structures; thus, conserving Nigeria's hard currency. It is a high-tech product that also adds value to the general community. SBS invests in the latest technology and conducts continuous training to provide its well-educated technical staff the right skills to perform their demanding tasks.

What are the advantages of steel buildings when compared to concrete building?

Steel buildings are in high demand. Due to the 8 long months of rain, Nigeria requires structures to be built and finished quickly. Since you cannot construct a concrete building in the rain, weather interference disrupts project timelines resulting in expensive delays. The steel building solution ensures a much shorter construction cycle, saving time. In addition, by supplying the steel building locally, SBS saves the client money, especially through phased delivery/phased payment and compressed timelines which reduce interest payments to banks. Reduced construction lead times shortening the time needed to put clients' products on the market, enabling them to generate revenue earlier. Steel construction is always going to be a faster and less expensive option compared to traditional concrete construction. It is important to note that because steel framed buildings will always be lighter than concrete structures, there is additional savings on building foundations. Another clear advantage of steel construction is that you can build higher and wider with steel compared to concrete. In some applications, steel is the only solution, for structures such as aircraft hangars or other structures that need a clear-span roof measuring 50-60 meters or more. In terms of quality, steel provides greater security and peace of mind vs concrete. Concrete is usually mixed at site as opposed to the quality-controlled environment of a factory. You can also expand or move a steel building more easily than you can a concrete one; you can add a plate, replace a plate, or build a new addition much more easily. Occasionally critics raise concerns about fire safety; some people claim steel cannot match concrete as a fireproof structure. But modern techniques can be used to provide adequate fireproofing for steel structures, as required by their end-use. All in all, there is rarely a true advantage in choosing concrete over steel. But I can assure you there are plenty of advantages in choosing the steel solution.

Considering your vast experience, what would you recommend other indigenous companies to do to position themselves at a competitive level in the industry?

There are several factors to consider. Firstly, products need to be of high quality. This goes for all goods, not just construction products, across all segments of the economy. We find that companies producing high quality goods here in Nigeria are thriving. Similarly, services need to be high quality. There are construction companies here that claim to do what we do at cheaper cost, but clients still choose us. They see that Sana Group companies consistently perform to the highest standards and demonstrate staying power in the market. The second recommendation is to grow with an R&D program focused on innovation. This is often missing in Nigeria. A sincere focus on continuous improvement and quality should be the next step for indigenous companies. My initial thoughts were to conduct R&D in a different country, but after a meeting with a civil engineer in Nigeria, I changed my mind. The way he communicated and explained what he knew, and the fact that he used technology sourced from abroad because it was not available in Nigeria, inspired me to build an R&D infrastructure here. We have intelligent people here. Sana Group uses in-country resources to develop our R&D capabilities which only occasionally need to be supplemented with overseas resources. The lack of commitment to promote R&D facilities and employ the right people to staff them is one of the reasons why innovation in this country is slow.

What are Sana Group's key priorities for the year ahead?

First, we want both Sana Building Systems and Sana Blocks to be considered the preferred choices within their target markets. We expect that they will set quality benchmarks here in Nigeria. SBS will be heavily promoted to be preferred building solution for virtually every project. This is our aim in 2020. Nigeria has an existing and growing demand for our products. SBS's capacity and pricing will stop, or greatly reduce, the importation of steel buildings. Customers will be able to source the same high quality associated with imported steel locally from Sana Building Systems. The market needs to know and be educated about the many advantages of our products. Still today, many people do not know that premium, factory produced quality-controlled blocks, are available in Nigeria or even that a building can be made of steel. Another priority for Sana Group is to expand our market share in the road-works construction sector. We recently completed high-profile road-work projects in a mixed-use free zone. Nigeria has needs for new roadway construction and an ongoing need for the replacement or restoration of existing road infrastructure. Sana Group is positioning itself to actively participate in this sector with the same commitment to quality and reliability that has brought us to market leadership in our other market sectors. We also have additional investments planned. Following the launch of Sana Building Systems, we intend to enter the low cost, affordable housing market. Currently in this sector, many homes are constructed using wood as the traditional framing material. Wood deteriorates quickly, after five or six years, particularly in the tropical climate we have here and throughout West Africa. We will be presenting a steel solution for these homes in 2020. These homes will be affordable and will help to raise the standard of living in our communities.