German firm Stihl Group will later this month open its Kenyan office making Nairobi the company’s gateway to the East African market.
The firm that makes agricultural and construction equipment is banking on Kenya’s vast infrastructure, booming construction and agricultural sectors as a launch pad for its products to the neighbouring countries.
The company’s products include harvesters, chainsaws, tillers and sprayers.
Kenya is the region’s biggest economy, boasting a vast rail and road network that continues to attract multinational firms seeking to tap into the eastern and central African market.
“Our plan is to distribute our products from Kenya into the traditional East African Market which includes Tanzania, Uganda, Burundi, Rwanda, South Sudan, Ethiopia and the Horn of Africa countries,” said Stihl East Africa CEO Francois Marais.
The company is seeking to tap into the huge contribution of agriculture and other sectors including construction and the high population in the East African Community (EAC) combined economies to grow sales.
Agriculture contributes between 24 and 44 percent of the gross domestic product in the EAC partner states and accounts for the source of income for about 80 percent of the region’s population.
The region is also undertaking grand infrastructural projects including building roads, and railways, and upgrading ports, offering a ready market for Stihl’s products.
The region has a combined population of an estimated 300 million people following the admission of the Democratic Republic of Congo into the EAC last month.
Kenya has also the years been experiencing a boom in the construction industry further offering Stihl Group a ready market for its products.
Mr Marais added that the firm would use a dealership model to sell its product. Nairobi becomes the second hub of the German firm in Africa after the South African hub that was opened in 1996.
“Kenya is a stable and vibrant economy with a lot of growth potential, furthermore the local talent in Kenya has really allowed us to expand our business through their expertise and local insight,” Mr Marais added.
Nairobi also hosts other regional and international hubs for global firms highlighting why the German firm opted to set its hub in the capital.