– Established with three staff, it now employs 27 –
Small and Medium sized Enterprises (SMEs) are the backbone of regional and local economies. They create jobs, pay taxes, offer social insurance to their employees and meet the demands of citizens locally. Sometimes, finding enough clients or customers, locally within the Soum, can be a problem. But not in Khanbogd! Small and Medium sized businesses have a ready market, thanks to the close location of Oyu Tolgoi, which will be one of the largest mines in the world. While Oyu Tolgoi requires very high standards from its suppliers, thanks to the hard work and dedication of local firms, they are meeting those requirements. As Mongolian’s say: Luck is the companion of hard work.
Argal Khet LLC is just one of over 200 small and medium sized businesses in the Umnugobi Aimag who supply goods and services to Oyu Tolgoi. They were recognised as one of the mine’s nine best suppliers in 2012.
Argal Khet’s sewing workshop began producing safety uniforms, sample bags and seating covers in November 2011. Argal Khet has felt many benefits from being a partner of one of the world’s biggest mining projects. They have been able to build a bigger and more sustainable operation by investing in equipment, stockpiling materials and securing working capital. As a result, the company has gained additional customers and providing excellent customer service. They even designed and developed a new design of summer uniforms that meet the high safety standards required by Oyu Tolgoi.
Following further expansion in 2012, the business which started with just three seamstresses, now employs a total of 27 staff including sewers, cutters and assistants. Argal Khet LLC Director, D.Ariuntungalag said: “We recently went to the Labour and Social Welfare Department of Governor’s Office and got a list of the unemployed residents of Khanbogd soum. As a result, we created four training positions and jobs. We’ve also recently hired new workers from the nearby Dalanzadgad soum.
Local SMEs often lack knowledge and experience in the financial and managerial elements of business. Argal Khet asked Oyu Tolgoi to provide them with training in these and other areas. Members of the company’s staff attended various Oyu Tolgoi sessions including on tax, finance and accounting.
D.Ariuntungalag continued: “We are currently supplying Oyu Tolgoi with about ten different varieties of products. As well as being a customer, Oyu Tolgoi also work closely with us to help make our business more efficient and to increase our capacity. We are extremely grateful for their ongoing support and contribution to the growth and development of our company.”
This is just one example of a small, soum based company, developing and growing in partnership with a world class mining company.
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