The FINANCIAL -- Interview with Mr B. Sajiv, General Director of GeoSteel
Founded in 2007, GeoSteel is the largest steel manufacturer in Georgia producing reinforcement bars (“Rebars”) for the local Georgian market. The company started commercial production in 2010. Since its start, the company has been backed by the European Bank for Reconstruction and Development. Geosteel primarily produces and supplies Rebars for the local market, but regularly exports to neighbouring countries such as Azerbaijan, Turkey, Turkmenistan and Uzbekistan.
The FINANCIAL interviewed Mr B. Sajiv, General Director of GeoSteel.
Q. Looking back, what have been the company’s principal achievements in the time that you have been operating here?
A. We believe that one of our principal achievements has been to prove that products made in Georgia are world-class and competitive. GeoSteel has been successfully exporting “Made in Georgia” Rebars regularly since 2010. GeoSteel is the only country in the Caucasus region which has the UK CARES certification for its Rebars. CARES is a voluntary certification specifically for Rebars only, but is regarded as one of the most difficult accreditations to achieve and maintain (due to its regular audits). It requires a consistent and genuine commitment to maintaining quality parameters at every step of the manufacturing process.
When we started our production in 2010, we wished to sell all of our Rebars in the local market (and help to reduce the country’s 100% dependence on imports). Unfortunately, we met a lot of resistance from customers who believed that good quality Rebars could not be made in Georgia. In working to change this mindset, we made Rebars which were and are superior to imports; and we reduced the cost of the Rebars in the market. These measures convinced major construction companies to start buying and using GeoSteel. This also had the additional effect of increasing the size of the overall Rebar market in Georgia. By reducing the cost of Rebars available in Georgia, without compromising the quality, we enabled more entrepreneurs to enter into the construction and real-estate development sectors over the last several years.
Many of the initiatives that we have undertaken over the years have their origin in the concept of “Inclusive Growth”. For example, when GeoSteel was first being constructed in 2008 Rustavi was a shadow of its former self. However, today the city is a lively and thriving city in which there is development across the whole city. We believe that GeoSteel has positively contributed to the revival of the city; and helped to involve a significant share of the population in the course of that development. We continue to take steps to further make meaningful and genuine contributions to both Rustavi and Georgia. In this way, every town or city can have a scalable and sustainable means by which it can grow and uplift the living standards of its citizens over the coming years.
Q. What can you tell our readers about the challenges you’ve experienced?
A. Today the major challenge that we are facing is that Georgia is being flooded with cheap imports from abroad of Rebars which are of questionable quality. The Government has introduced new standards to help regulate the quality of the materials used in construction (including Rebars). Nevertheless, unscrupulous people are sharing the wrong information in the market and customers are being misled. Therefore, we are working to educate our customers on what to look for and test when checking if a Rebar is of good quality. For instance, we highlight that every meter of each GeoSteel Rebar is stamped with the company name and logo.
Short-term imports of cheap but questionable Rebars are a threat to the country’s development. Using a cheap product that may not be fit for use is not a sustainable way to build or develop the country.
Q. What do you think differentiates you from the competition?
A. One of our defining characteristics is our honest and transparent dealings with our customers. We have found that that honesty has been remembered and valued later on. We believe that if a company is to sustain, it must have transparent dealings with all of its partners.
Our ongoing focus on quality means that we are always trying to improve our Rebars. In practice, our Rebars are produced to always be within the quality standards demanded by the customer.
We have developed a reputation as being a reliable and trustworthy partner of Rebars, especially when it comes to short-notice orders. We have developed relations with several transportation providers to facilitate and support our customers with timely deliveries to their sites. The fact that we can start loading Rebars onto vehicles immediately after receiving an order has helped support our customers when they really need it. By reducing lead times and delivery times, GeoSteel customers have a competitive advantage to complete their projects faster and cheaper than their competitors (whilst maintaining high quality Rebars). The net result: accelerating Georgia’s economic growth and development around the country.
Q. Where do you source your materials from?
A. GeoSteel uses the majority of its input materials from within Georgia. By involving local suppliers, we aim to encourage investments within Georgia to improve quality and become more competitive. This will certainly benefit us but will more importantly help create more employment and drive more sustainable economic growth for the future.
For items which are not available in Georgia, we are forced to import them.
Q. Please name some of the most distinguished projects you have implemented in Georgia.
A. We have had the privilege of being selected by the largest and most prestigious projects in Georgia. For instance, the Green Diamond project in Tbilisi; the Tbilisi Hills Golf Club and Residences; the HausArt Plaza tower by renowned architect David Gochiashvili; the Ambassadori hotel in Batumi; the Coca-Cola plant in Natakhtari; the Paravani Hydro-Power Plant; the Tbilisi-Gori Highway; and the Tbilisi-Rustavi Highway.
GeoSteel is supplying special grade Rebars for ongoing strategic road projects which will be crucial to help connect the country and foster economic development and growth in the regions.
By Eva Bolkvadze