A TO Z TEXTILE MILLS LIMITED BORN TO LEAD

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A TO Z TEXTILE MILLS LIMITEDBORN TO
LEAD INTER COUNTRY WORKSHOP ON SCALING UP
ITN IMPLEMENTATION FOR CONTROL OF MALARIA AND
OTHER VECTOR BORNE DESEASES IN COUNRTIES OF
EMRABHA, KINGDOM OF SAUDI ARABIA, 18 20.OCT
2003 The challenges of Meeting Local Demands
for ITNS (With example of Tanzania)
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INTRODUCTION

• Although unable to attend, we are grateful indeed
  to be invited to this meeting
• A to Z Textile Mills Ltd is a fully integrated
  plant with spinning, knitting, weaving, dyeing,
  finishing, cutting and making departments.
• The factory is based in Arusha Tanzania (East
  Africa), established in 1966 as a small garment
  making enterprise, with few sewing machines.
• A to Z Textile Mills Ltd started manufacturing
  polyester mosquito net fabrics in mid 1970s
  which were sold locally.
• 1997 saw the start of A to Z manufacturing
  mosquito nets on a much larger scale.
• Ownership Privately owned by Shah Family based
  in Arusha Tanzania.
• Man Power A to Z is employing 1,500 people 85
  of whom are women.
• Capacity Current capacity is 5 million nets per
  annum, exporting to over 25 countries in Africa
• The projected capacity is over 8 million nets per
  annum by 2004.
• Product Line Mosquito net is number one product
  for A to Z, constituting 80 of total production.
• Conventional A to Z manufactures 100 Polyester
  Textured nets .

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Product Development

• (i) Olyset Net
• This is a Long Lasting Insecticide Treated Net
  made of polyethylene whereby the insecticide is
  already in the resin which is the main raw
  material, a technology received from SUMITOMO
  Japan.
• Olyset is permanently treated through out its
  life time without retreatment and it is the only
  LLITN which has currently passed WHOPES stage
  (Ref. WHO/IS/NI/331/2002).
• The estimated life time of an olyset net is four
  (4) years minimum.
• Olyset is the answer to low re-treatment levels.
• A to Z Textile Mills Ltd is the first company in
  Africa to receive this technology from SUMITOMO
  Japan to manufacture Olyset Nets.
• The first Olyset net rolled out of the production
  line in September 2003, and it will be followed
  by official launch soon.
• Initial capacity is estimated to be 30,000
  50,000 nets per month. This will increase
  according to demand.

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MANUFACTURING CHALLENGES

• Machinery and spares very expensive.
• Raw materials and other ITNS consumables are 100
  imported.
• Taxes and tariffs applicable on ITN raw
  materials 10 ID and 20 VAT whereas no taxes
  and tariffs on finished nets.
• Imported ITNS are duty and tax free thus,
  creating unfair competition.
• Uncontrolled raw material prices due to petrol
  price fluctuations.
• Power (hydro and thermo electricity) very
  expensive.

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MANUFACTURING CHALLENGES-2

• Labour cost is very high.
• Unstable power supply hence low production.
• Internal transportation very costly.
• Other operation costs.
• Generally cost of production is very high.
• DISTRIBUTION
• Institutional markets
• NGOs
• UN relief agencies
• MOH
• DMOs etc.
• Commercial markets
• Wholesalers in every big city e.g. Dar es Salaam,
  Mwanza, Mbeya, etc.
• Primary Agents (PA), one in every region.
  Tanzania has 26 regions including 5 in Zanzibar.
• Primary Agents supply to Secondary Agents and
  retailers / outlets.

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Demand creation /Promotion

• DEMAND CREATION / PROMOTION
• Given the high cost of production, it is
  impossible for us to allocate the budget for
  demand creation because the margins on bed nets
  are very slim.
• PSI- Population Services International are doing
  the sensitization work on ITN usage in Tanzania
  through printed media, radios and T.Vs, Road
  Shows, etc. but still not sufficient.
• Cost of advertisement is very high and if added
  to the ITN cost the product will not be
  affordable to the end user.
• A to Z in collaboration with PSI Tanzania are
  currently running lotteries in promotion of our
  Safi Net brand and the insecticide kits namely
  Ngao ya Maji supplied by PSI, in order to
  increase ITN usage.
• More education on ITN usage is still required to
  most people especially in the rural areas.
• PUBLIC PRIVATE SECTOR PARTNERSHIP.
• Malaria Programs in Tanzania
• A to Z has been instrumental in the scaling up
  of ITNs in Tanzania from the beginning.
• A to Z has been a member of the Task Force on
  voucher scheme - second meeting on voucher scheme
  held on 10th July 2003.
• A to Z is a member of the National Scaling up of
  ITNs in Tanzania
• A to Z and PSI Tanzania have entered an agreement
  to bundle all the Safi Nets sold in the local
  market with insecticide branded NGAO. PSI
  supplies treatment kits to A to Z for 100
  bundling with the nets. The same applies to the
  other two ITN manufacturers in Tanzania.

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Future Plans of A to Z

• To establish manufacturing units in other African
  countries e.g. Cameroon and Angola.
• To increase the manufacturing capacity of Olyset
  Nets in Tanzania.
• Global fund Private Sector Partnership. (
  Effectiveness of Private Sector)
• By involving commercial sector in Global Fund ITN
  programs the following results are imminent
• i. Supply Supply of ITNs will be
  increased to meet the increasing demand to be
  created by
• Global Fund
  through promotion and sensitization programs.
• ii. Incentive The program is an
  incentive for the private sector expansion as it
  encourages
• competition.
• iii. Price Subsidy Unlike product subsidy
  programs, Global Fund ITN program supports price
• subsidy which
  creates a better environment to the private
  sector by not
• interfering
  with the commercial market. This in turn will
  lead to
• growth in the
  entire distribution chain i.e. wholesale and
  retail levels.
• iv. Sustainability By supporting the
  commercial sector the program will be
  sustainable, after the program period is
  over, unlike other programmes, which collapsed
  after the facilitators have pulled out.
• v. Accessibility By private sector
  controlling distribution and sales of ITNs, it
  makes ITNs
• accessible and
  available due to the increased competition.

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Working with Global Fund ITN Program is Unique

• i. Global Fund is willing to fund and take risk
  on untested programs on a national scale, thus
• creating a wider playing field for the
  private sector as opposed to other programs which
  have to
• go for pilot areas/projects (e.g. regions
  or districts for testing).
• ii. All commercial partners will benefit through
  increased sales because the Global Fund Program
• fully integrates into the commercial
  market.
• iii. The Global Fund program, models and
  complements on the existing ITN programs.
• iv. If the program is implemented properly this
  will lead to an increase in the capacity building
  of
• net manufacturing through the increased
  demand for the ITNs.
• v. We believe that the voucher scheme will lead
  to guaranteed demand by targeting specific sector
  
• (pregnant women) which in return will be
  an incentive for the private sector to develop
  rural
• marketing. Currently there is no
  effective rural marketing and / or supply.
• vi. The Global Fund will not only help in
  creating sales from the targeted sector (pregnant
  women) but will also have a SPIN OFF effect
  into the fully paid commercial market.

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Conclusion

• To Summarize -
• Global Fund Concept will help to increase the
  distribution of ITNs to rural Tanzania and in
  particular the current underserved areas.
• Will lead to the creation of both direct and
  indirect employment opportunities.
• More pregnant women and children under the age
  of five to be protected from the risk of
  malaria.
• On behalf of A to Z Textile Mills Ltd I wish to
  thank WHO/EMRO for inviting us to this meeting
  and we look forward to working hand in hand with
  their Programs on ITNs in the Region.
• Address
• P.O Box 945, Ungalimited
  Industrial Area
• Arusha Tanzania, East Africa
• Tel [phone]
• 2548895 / 2548139/ 2502375
• Fax [phone]
• E-mail azpfl_at_yako.habari.co.tz
• Contact 1. Anuj Shah - Executive
  Director
• 2. Binesh Haria - Production Director
  
• 3. Sylvester Kazi - Export
  Manager