Realtors tie up to get bulk supplies at low rates

MUMBAI: Amid allegations of cartelisation by some steel and cement companies, real estate developers are joining hands to source raw materials in bulk from manufacturers at preferred rates as a cost saving measure to tide over the crisis. Developers estimate collective orders to get supplies will fetch at least 5-7% cost benefit. Apart from large developers who already reap scale benefits, even smaller and mid-size entities will be able to get cost efficiency once this collective bargaining initiative rolls-on.“We are planning to execute this at city and region level as each of these pockets will have different challenges in terms of payment terms, brand preferences, credibility of material suppliers and developers. We will be passing on cost benefit to homebuyers,” said Satish Magar, president of realty developers’ body CREDAI National.Bulk procurement will be used for most input materials. Cement and steel manufacturers who have bulk supply arrangements with developers will be out of this arrangement for now. “The idea is to connect the disconnected and derive benefits for all. This will ultimately help in pushing demand and the economy ,” said Niranjan Hiranandani, president, Naredco, that is also encouraging sharing resources and materials.

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