Local Woman-Owned Companies Win A Large Manufacturing Contract that Will Benefit Afghanistan
In 2008 Peace Dividend Trust (PDT) was approached by an international buyer’s head of contracting in Afghanistan to put together a conference for women-owned businesses. The Female Business Leaders Conference that was held in November 2008 was a great success, and it even drove discussion within the buyer’s contracting office about setting aside business opportunities for Afghan women-owned businesses in key sectors. As a result of these discussions, the contracting office announced in 2009 that they wanted to set aside a portion of the contracts that they had to manufacture textiles for an Afghan organization. Only local, woman-owned companies would be eligible to bid on the contract.
When the announcement was made, there were some skeptics, as many believed that such companies didn’t even exist, let alone would they have the capacity to manufacture the textiles. Despite these reservations, the set-aside was designed and the contracting process pushed forward, with the dual purpose of increasing the capacity of Afghan woman-owned businesses, while creating a shorter supply chain for the buyer. The contracting body overseeing the solicitation approached PDT to identify companies that would be eligible to bid for the contract. Dozens of Afghan woman-owed companies then identified and made them aware of the tender.
The first round of bids for the contracts were not up to standard, but this didn’t slow down the contracting agency. They realized that the common deficiencies in the proposals stemmed from a lack of understanding in the bidding process, and decided to put the contract up for bid a second time.
In order to improve the businesses chances the second time, PDT helped organize several pre-performance seminars where businesswomen could meet the contracting officers and have the bid explained to them in detail. Over 60 participants from 35 different companies attended these events. In addition, PDT distributed samples of the equipment to bidding companies so that they could ensure that they were making the same quality of product for their sample submission.
PDT also advised the businesses on how they could improve their bids the next round, for example by hiring a project manager or partnering in a joint venture. PDT met with potential partners who were interested in collaborating, collated their information and presented it to the local businesses that expressed interest in joint venturing. In the end, dozens of high-quality bids were submitted for the project.
The first round of contracts have been awarded and all have gone to PDT-sourced suppliers, either as a unique company bid or joint venture. Three companies won two separate groups of contracts that have a base year initial purchase of $54.3 million total. This contract is slated to be renewed yearly for five years, and the total contract ceiling on the option years is over a billion dollars.
One of the winning companies credits PDT as being instrumental in winning the bid. PDT alerted them to the project, provided them samples, and helped them connect with another company to create a joint venture. The company’s CEO says that “all in all, PDT was critical to our success”.
The company expects to hire at least 300 people, mostly women, as a result of this contract. They will also be able to develop their manufacturing capabilities, supply chain management abilities, and will increase their past performance to be in a better position to win bids in the future. The CEO states that
“As women, it is not always easy to operate in the private sector because most business happens through old networks which we never had access to in the past. This will give us a great opportunity to get on our feet to be a bigger player in the business community. Our job is now to deliver according to our contract and prove that we can provide quality products … proudly made by Afghans. In this way we can contribute to the stability and security of our country. It’s a win-win. We are grateful to PDT … for encouraging Afghan women entrepreneurs and we hope they plan to have more programs for women in the future.”
PDT’s support will not end now that the contracts have been awarded, there are plans to further support the businesses through networking and additional resources. With any luck the project will do more than just create jobs and put locally-made clothing on the backs of Afghans. It will build the capacity of local women-owned companies to develop their companies into businesses that are viable with or without contracts from the international community.