Rwanda's Phone Assembling Company Hit By Low Sales

Mergers, Acquisitions and Financial Results

A-Link Technologies, a Chinese firm that assembles mobile phone handsets has been hit by low sales, attributed to external shocks of the global economic crisis on the Rwandan economy. Due to low demand for mobile handsets, officials said that the firm has laid-off half of its staff.

Currently, the firm is employing 15 people as compared to the 30 that were originally employed at the Telecom House. "This year our sales have been very bad, every month we are operating with no profit. This has forced us to cut down our expenses by reducing the workers," Edward Yin, the Chief Executive Officer of A-Link Technologies told Business Times last week.

"Comparing our sales with last year, the global financial crisis has had an impact because sales have been going down. Our partners in China were also affected though the situation is now improving," Yin said.

With an initial investment of $0.5 million (Rwf283.7 million), Yin says his company is now producing less than 200 handsets daily as contrary to 200-300 handsets produced last year when it launched its operations.

However, Yin also attributed the low sales to affordable phones on promotion availed by telecom operators. "It is difficult to compete with operators who can afford to sale the phones cheaply with an intention of having more subscribers. Our strategy is to bring in dual SIM phones at affordable prices to stay in business," he added.

According to Yin, A-Link is expecting to receive the first batch of affordable dual SIM card phones next week, with the price ranging between Rwf19, 900 and Rwf80, 000 depending on the features installed on the phone. Yin also added that he has hopes that dual SIM phones would boost sales because it is expensive for people to make calls on different networks.

'The dual SIM handsets will reduce the costs and help us to make profit," he said.

The company has also started exporting handsets to Uganda through a sub-dealer. Since April the company has exported about 200 phones.

Government in the 2009 /10 budget slashed the import duty on phone handsets to Zero percent from 18 percent. A-Link is an affiliate to China link Digital and Technology Company Limited, also a Chinese based electronics company.

New Times