By Ayo Alonge [email protected]
Kamaldeen Adefemi is the founder of Periscope Engineering Limited, a fast growing engineering and construction startup in the country.
In this interview, Adefemi discusses the tenets of road and building construction, while explaining how privatisation can improve engineering works and ultimately bolster growth of Small and Medium-scale Enterprises (SMEs).
I am a graduate in Civil Engineering from the University of Lagos. Well, it may also interest you to know that I am a senior legislative aide to the Speaker of the Federal Republic of Nigeria.
I was fortunate to get a placement in Federal Capital Development Authority (FCDA) in Abuja and I was attached to Dantata and Sawoe and we were given a project to develop. I love what I do and I have always loved civil engineering. Anytime I have the opportunity of leaving the LCDA, I got to some of my friends who are engineers too to see what I can learn. Some were earning N30,000 and I was always asking how they survive. Coming back to Lagos, I told myself I was not going to work for anybody. I started designing and would take it to them. I registered my business name first, got a laptop from the money my girlfriend gave me and that was how it all started. I later got an office space and that has been it.
You just need to keep updating yourself, as an engineer. It is not possible for the big companies alone to get all the jobs. We are doing pretty okay in Lagos and I can say that for sure. Lagos State has created that environment for small scale businesses to excels. When Fashola was on board, he said the housing constructions were for SMEs construction companies like us and he said he would make do with insurance bond. That was to encourage us. The present governor is following the same step. There was a lot of school renovation projects abandoned but he has mobilised us back to site. He rolled out projects for small scale contractors in all wards, just last year. Competition is tough in the business but Lagos State Government has made it less tough for us here. At the federal level too, we get some consulting jobs. even if the big companies get the bulk of the job there. In all, it is only for you to keep updating yourself and you will get there.
We are basically into engineering consulting and construction. We consult for Total Nigeria, Federal Ministry of Works, Lagos State, and many more. We get both road and building construction jobs. What makes us stand out is delivering what clients want. Engineering is about safety. Whatever you design or construct, you can’t but make it safe. Your clients want it good and safe facilities and cost is also what differentiates professionals from quacks. You can do a project cheaper than the bigger firms simply because you have a cheaper overhead. Once your clients can see that you can deliver the same quality and you have documents to prove, you are good to go. That is what Periscope is known for. We do it cheaper and time delivery is also key for us.
Getting the contracts is another thing. You need to have your PPA and you pay your tax. At the federal level, you must register with PENCOM, ITAF, NSITF, FIRS tax clearance and the rest. All theses, to me, are way too much for small scale businesses. Some of these things have to be renewed every year, whether or not you are getting the job. That is discouraging for SMEs. Maybe there should be a guarantee that you can get jobs when you pay all these monies. There is also the issue of nepotism and favouritism. We need to put round pegs in the round hole and the small scale companies must be duly recognised. States should reduce the burden on SMEs. For construction, you need to have all the equipment which are really very expensive to acquire. Lagos State has so many of these equipment that can be hired from Public Works. That makes it easier and you are encouraged as a small business owner. Don’t forget that we also pay salaries like the big companies. So, it trickles down.
Opportunity for new investors
Nigerian is a developing country with loads of opportunities. There is no how there won’t be the need for engineering works. For most entrepreneurs, everything is always about money but that is not supposed to be so. I am not saying money is not good but we need to acquire the requisite skills to equip ourselves. Success is when preparations meets opportunity. When the opportunity finally comes, everything flows in. Nigeria is the fastest growing country is sub Sahara. There is nothing like development without infrastructure and for Nigeria to grow, there must also be infrastructure. When we talk about infrastructure, we talk engineering. I know there is a percentage of local content that must be fulfilled before any contract execution. Once the bottlenecks and challenges are ameliorated, then it becomes better because the opportunities are there. The power sector is another issue. We should also depend on hydro for power generation. We may not be ripe for nuclear energy but we can have windmills to generate power and also have solar farms. We must have strategies to develop small businesses in the country. The National Assembly can also come up bills that will promote SMEs. Let’s put the right policies in place and watch investors rush in. Another problem is security. No investors will come to invest without considering security. I know a multinational construction giant that attached security operatives to all their expatriates in the country. If we can address all that, the sky is the limit for businesses in the country. When MTN came to Nigeria, they never believed they would make so much money. Let’s privatise some of these corporations and let’s not monopolise anything. Once there is competition, it drives down the price. Phone calls used to be charged at over N50 per minute but today, it is less than N5. That’s the power of privatisation. We really need to get our policies right and SMEs will be better for it.
Ease of doing business
It is common knowledge that doing business is cumbersome. It is more difficult getting projects. If not for Lagos State, other states make it very difficult. Elsewhere, you may need to know people. Forget the fact that you are a professional. A state like Lagos will give 40 percent mobilisation fee but others won’t. The financial organisations aren’t even ready to help. They are ready to give loans to others but not to engineering companies. In developed nations, banks have departments in charge of project execution . That makes it easy but here, banks still want to get collateral bigger than what you want to get from them. You also need to be ready to part with some percentage of your profit.