Mawani Al Myaah is a trader and distributor of bottled drinking water. They have distributed 4 million cartons of water from various brands last year using their distribution team of over 400 people. Mawani has recently launched its own brand called "Naqa" and have been outsourcing the product production to a local manufacturer.
Having now built their own brand and looking at a steady flow of orders, Mawani wanted to establish their own water packaging plant to produce "Naqa" water in-house.
Much like any other commodity, water is:
Therefore, to generate profits traditionally, Mawani would have to trade in large volumes to generate significant profits.
Alternatively, given the standing of their own brand “Naqa” in the market, in-house manufacturing would have allowed Mawani to vertically integrate and increase the overall profitability of the group. In addition, in-house production would allow them to generate additional revenue streams and profits through contract manufacturing for other water brands.
Mawani had already leased land in Al Kharj Industrial City for the purpose of building a factory. Mawani had been gradually self-funding some of the work through their profits, but progress was slow. The administration building works were completed and so were the majority of earthworks, but the next phase of construction needed the purchase of high-cost items such as:
In total, Mawani needed materials on credit worth SAR 3,900,000. “We were ready and eager to capitalise on the opportunity quickly but it was a tricky situation in terms of cash flow,” said the CEO Majed Alrifdi.
After a thorough assessment of their needs, Buildnow agreed to extend a credit facility of the full amount in two separate parts.
This enabled Mawani to:
This meant timely availability of the materials at the right time in the project life cycle, enabling much faster completion of the factory which will enable Mawani to produce their water in-house. This strategy serves as a testament to Mawani’s growth mindset and their ability to capitalise on new tools to fuel their ambitions and improve their business.
