Currently, the company is building its fifth ibis hotel in Mayotte with plans to build more in Réunion. Therefore, it’s taking its first step to expand and establish itself in the Indian Ocean. CEO Luigi Chiantella and a member of Business Club Africa expect to finish the construction project by September 2022.
But why did a medium-size construction company like Makinen expand into remote regions? What makes its Indian Ocean expansion so unique? The answers might surprise you.
Potential for Success
Notably, Colas is a mega construction company with ongoing projects on the islands. Still, it’s a giant corporation working on projects with multi-million euros budgets. On the other hand, Makinen works in the 5-30 million euro range. So, there’s no competition.
In addition to Makinen Mayotte, the company also established another branch in Réunion. Thus, it’s planting deep roots in the Indian Ocean. Therefore, the potential for success in nearby locations is high.
How Makinen Is Addressing the Workforce Shortage
Furthermore, the company is training local engineers, plumbers, and electricians to meet the workforce shortage. As a result, it creates jobs and attracts new talents.
Currently, 45 employees are working on the 3000-square meters ibis Styles hotel in Mayotte. Makinen will need to add more people to speed up the project.
What’s more, the September 2022 deadline is coming soon. So, Makinen is racing against time to finish the project on time. Logistics and lack of talent are always massive challenges that cause construction delays, but the company found a shortcut.
It’s hiring European technicians and flying them to Mayotte. It’s an additional cost because the company has to pay for their transportation, food, and shelter. Furthermore, it pays international rate salaries for European talent.
On the other hand, European and local employees exchange experiences while working together. As a result, they bring the construction project to fruition faster without additional costs. Qualified, experienced European employees also add a new view to reinforcing local engineers on the ground.
The Risks of the Indian Ocean Expansion
Logistics is a nightmare during the COVID-19 crisis. For example, transportation and shipping building materials are challenging. However, Makinen has most of the materials on site now.
Soon, more construction companies and contractors will follow Makinen to the Indian Ocean. But will they? For now, Makinen could expand his presence in the Indian Ocean construction market before others jump the wagon.
The company has already established itself with a legally registered entity in Mayotte and in Reunion, hiring 50% local and 50% European talents. It also has other projects in the pipeline. The ibis hotel is only the beginning for Makinen in the Indian Ocean.