Police investigate 46 million birr soap purchase

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Police are looking into a transaction made between the Ethiopian Industrial Input Development Enterprise (EIIDE) and End Global Food Processing P.L.C. after it received a tip about low quality delivery from a production manager at the latter’s factory.
Police opened the investigation the day after receiving information. They then searched the warehouse where the soap was stored. Police took 40 packet samples from the store and banned the rest which is over 24,000 packs.
Last Thursday police reviewed the situation with the Ethiopian Conformity Assessment Enterprise (ECAE) and opened the warehouse after receiving results from ECAE but still banned the soap from being distributed.
The soap failed to meet grade one standards and the results are being used as evidence for the investigation process, a source close to the case told Capital.
End Global signed an agreement to deliver grade one quality soap to EIIDE after winning the competitive bid at the end of September 2017.
The procurement attracted four detergent production companies. Only three returned the bid document. Among the three EIIDE has chosen two companies to supply the detergent where Toria soap and Detergent Industries failed to supply reasoning the devaluation of birr to be a barrier.
The Enterprise confiscated its 100,000 birr security bond from Toria, and proceeds deals with End Global which was willing to meet its commitment.
End Global promised to deliver the soap within six months starting October 2017, which was later extended to eight months, but they delivered only 17% by May 2018.
The company, established with an investment license nine years to process food, changed its investment to detergent production. Unfortunately it was not able to change its name because of the delay in the government procedure, according to Liyu Yemeshaw, the CEO of the company.
Mesgena Welday, owner of End Global, argues that it is not the first time the soap has failed the quality tests rather it’s its second time. He said the failure in the agreed quality is normal and falling the grade one requirements didn’t mean that its harmful, rather it’s in the permitted range of grade two in the nation.
He said that when the ECAE said it didn’t meet the first grade the soaps were sold in Merkato and replaced with the grade one. “The failure and replacement procedure is normal not only for our delivery but we also saw other companies which were taking out goods which didn’t meet the standards,” he said.
Inderis Negus, the Acting CEO of the EIIDE shares Mesgna’s Idea that returning the products which don’t fit the requirement is normal. “We return many other items not only soap when they fail the requirement,” he told Capital.
He also explains that after the goods are delivered to the warehouse we will wait for the ECAE result to accept the delivery. “Whenever there is a defect in quality we will return the goods back,” Inderis said.
He admits that the company is suffering from the returning defecting products as it consumes extra time but it is our commitment to our customers.
Inderis also argues that the EIIDE goes further to meet the standard expectation of the consumers even beyond what other government organizations want. “This is the main reason why we are suffering from the returning back of goods,” he adds.
The EIIDE emerged after absorbing Merchandise Wholesale Import & Trade Enterprise (MWITE) two years ago. The MWITE was formed in 1993 with the merger of the Ethiopian Domestic Distribution Corporation (EDDC) and Ethiopian Import Export Corporation (EIEC) following the change in the regime and economic reform.