Only Eyoha Addis and Century Promotion expressed interest
A tender to organise the coming Ethiopian New Year's Bazaar at the Addis Abeba Exhibition & Marketing Development Centre has been cancelled, as only two companies expressed interest, below the minimum requirement of three bidders.
The Addis Abeba Chamber of Commerce & Sectoral Association (AACCSA), which has been managing the Centre since the mid-2000s, cancelled the tender last Wednesday, just a day after it had opened the bids from Eyoha Addis Entertainment & Event Plc and Century Promotion.
To resolve the opening of the bid without fulfilling the minimum requirements, the Chamber cancelled the bid before opening the financial offers of the bidding companies. Representatives of the companies insisted on their offers to remain unopened as it would affect their competitive edge.
"We want to give the bidders another chance to participate, also, to widen the Chamber's choices," said Tamrat Admasu, CEO of the Exhibition Centre, who claims that 315,000 people visit a single holiday bazaar on average.
One of the bidders, Eyoha, a seven-year-old company with an initial capital of 50,000 Br, won last year's New Year bazaar with the highest offer of 22 million Br for the Exhibition Centre that lies on 23,000sqm of land. Habesha Weekly Promotion gave the second highest offer of 20 million Br while Century proposed 19 million Br.
Eyoha, spent a total of 29 million Br for the Bazaar, with close to seven million Birr of this being used for promotion. During the Bazaar hosted this New Year, 450 exhibitors participated- increasing by 100 compared to the preceding year- where 30pc of these were from India, Turkey, and Syria. A nine square metre stall was rented for 35,000 to 85,000 Br.
"The number of companies willing to organise the Bazaar has been declining due to the rapidly increasing cost to host the event," said Tamrat. "We don't even have the least price requirement; it is the organisers who inflate the offers."
The highest offers to organise the Bazaars during the 2011 Easter and Christmas holidays were 1.8 million Br and 1.5 million Br, respectively. In 2012, it rose to 1.9 million Br for Easter and 2.86 million Br for Christmas.
The rise in these costs discouraged Habesha - which engages in the exhibition and promotion business and has 20 permanent employees - from taking part in the cancelled bid, according to Adonic Worku, general manager of the Company.
"We were unable to win consecutive bids," he said, "and now we have given up."
He added that as the offers appreciate, renting costs will follow and customers will be subjected to higher prices.
"Now that it has been re-floated though, we may participate," said Adonic, adding that it would help if the city Chamber considers technical evaluations while selecting organisers.
For a marketing expert, Alazar Ahmed, the cancellation would help the announcer as it will receive multiple offers and get a chance to choose the highest financial offer among them.
"When the number of bidders declines the announcer would lose its bargaining power," Alazar Ahmed, a private marketing expert and consultant.
Established almost three decades ago, the Centre is under the mandate of the City Administration, which later contracted it to the Chamber with an agreement to be renewed every half a decade.