Business for Estonian refugee home builders foiled by unreliable partners

Social housing by Akso-Haus OÜ. (Akso-Haus OÜ)
9/18/2016 4:01 PM
Source: BNS
Category: Business

Estonian manufacturers of wooden and module houses have been unable to get a boost to their business from the arrival of large numbers of asylum-seekers in Europe mostly due to the unreliability of potential partners in Western Europe and volumes far exceeding the capacities of Estonian businesses.

"There have been very many offers for us to come and build," Lauri Kivil, project manager at the Estonian Woodhouse Association, told BNS. Since the beginning of the migration crisis, the Estonian Woodhouse Assocation and individual manufacturers alike have been receiving proposals from Scandinavia and Germany on a daily basis.

Save for a few exceptions, however, deals have not materialized, as the parties making the offers have often been speculators wishing to become rich quick during the crisis.

"At the same time, this is a business which requires experience and know-how," explained Kivil. "That's why it's possible to fail badly with such developers and resellers." He added that fortunately Estonian businesses had not suffered much.

Module house manufacturer Akso-Haus OÜ, which had announced over the summer that they had exported over 60 module homes for refugees in Germany, saw its business there grind to a halt due to its local partner there.

"We had big plans in Germany, but the developer there managed to mess everything up and our cooperation came to a halt," Andres Samarüütel, a board member at Akso-Haus, told BNS.

"Our partner there won tenders, but proved unable to organize and complete things," Samarüütel explained. "This what things were like in construction here during the boom years." Several other Estonian companies experienced trouble with the same partner as well, he added.

Akso-Haus has since set its sights entirely on the Scandinavian market, where it plans to start marketing module schools and kindergartens. Sweden, for instance, is a much safer and more familiar market, noted Samarüütel.

Kivil noted that another reason why Estonian companies were unable to gain from the surge in demand was that requests were often made for too big amounts.

"Our companies have plenty of work already; volumes are based on an in-depth analysis and there's little in terms of untapped potential," explained Kivil.

He said that the sector was now doing its work as usual and serving mostly typical markets.

Editor: Aili Vahtla

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