Vision of the future in UAE construction

Dubai-based Ducon Industries’ Mohammed Al Farhan may have lost his ability to haggle during his extended stint in the United Kingdom, but he took a lot away from his experience of living in the country.

And for someone whose doctorate was in block factory management, this inevitably brought him into contact with British builders’ merchants – distributors of common lines of building materials including blocks, paving, sand and cement, sold either directly to building companies or to individual tradesmen.

Although there clearly are already successful builders’ merchants in the region (Rizwan Sajan’s Danube Group being among the most high-profile examples), Mr Al Farhan thinks there is room for more, with many contractors still dealing directly with individual manufacturers.

“I think builders’ merchants are something that has to come into this market.

“Many of the things we learnt in the UK, we come back here and we don’t find it. So we say, ‘OK, the market is moving in this direction.’ It’s like looking into the future.”

His firm has set up a programme, Ducon Authorised Dealerships, where it will work directly with individuals who want to set up franchised dealerships, offering them a standard contract, providing marketing support, sorting invoices and arranging delivery.

“We’re just trying to push further ahead,” he says. “We will work together with them, empower them, give them brand credibility and allow them to grow their own merchants.”

Currently, Ducon is providing its dealers with blocks, cement and a substantial range of paving, but Mr Al Farhan is keen to extend the product ranges offered in the future.

He says Ducon is currently working with 14 merchants – all of whom are “homegrown” businesses.

“Many of them did not exist when we started and I think in a few years they will become substantial businesses on their own.”

According the UK’s Builders’ Merchants Federation, a trade association, British builders merchants’ sales increased by 5.2 per cent year-on-year in 2016, to £5.44 billion (Dh24.41bn).

Sales increased by 5.5 per cent in the final quarter as warmer, drier British weather than the previous year allowed for more landscaping and external building work to be completed.

While Ducon says it is in a good place at the moment regarding its own performance, the UAE weather is unlikely to produce such sales variables.

mfahy@thenational.ae

Follow The National’s Business section on Twitter