Tractor in the Desert
Tractor in the Desert

Supporting Up-and-Coming Contractors

New business owners face a lot of hurdles. In the Middle East, Cat Dealer Zahid Tractor is on its way to changing that. Their new program is making new machines purchases easier for small companies just getting their start.

By Caterpillar | Posted: February 8, 2021 | Revised: March 28, 2022

Starting out in the construction industry can be tough, especially in the Middle East. However, Saudi Arabian Cat® dealer, Zahid Tractor, is well on its way to changing that.

The brainchild of Zahid Chairman, Talal Y. Zahid, the Future Contractors Program (FCP) began in June 2012 as a corporate social responsibility initiative. “The idea was to help make it easier for individuals and small establishments, of up to 10 employees, to purchase machines. That is often the biggest hurdle to becoming part of the construction industry, mostly because banks don’t want to take the financial risk,” said Mahmoud Tbaileh, Marketing Manager for Zahid Tractor.

FCP, however, focuses on providing financing at a reduced rate so participants can take delivery of smaller machines, such as backhoes, wheel loaders and BCP equipment, faster and easier. Through the FCP, financing of up to $250,000 is possible with as little as 10 percent down and terms from three to four years.

In creating the program, Zahid knew there might be additional risk involved, but they dedicated funds to the program and the results are positive. In fact, the initiative has blossomed into a significant part of Zahid’s machine sales.

“Our numbers have shown that there is no significant difference in risk between large customers, core customers and FCP customers,” added Mahmoud. Our dealership saw 26 percent of its medium HEX sales go through FCP, as well as 16 percent of our skid steer loader sales and 9 percent of backhoe loader sales.” Overall, Zahid’s program has resulted in the delivery of more than 2,400 machines and has served over 1,100 new contractors.

“This is a great opportunity for small and emerging contractors to establish themselves as contractors or to become subcontractors and take their machine(s) and work on any number of projects and gain the experience and knowledge to go out and get their own contracts. We can even help with machine training and maintenance,” said Mahmoud.

To help potential contractors find out about the program, Zahid has developed some marketing such as flyers and brochures along with information on the dealer’s website. Word-of-mouth about the FCP has also helped boost recognition and interest.

The FCP has become quite a success for Zahid. “We have what we call ‘FCP Champions’ covering the three major regions of the country so future contractors can hear and learn about the program first-hand.”

Several contractors who benefited from the program said they decided to become part of this program due to the expansion in the construction field and because Zahid Tractor makes it much easier to acquire a machine. The program made it much easier for them to buy, rather than rent. The flexibility and fast processing helped them gain more trust from a main contractor and get more business. The total process was designed not to take more than 10 days.

The ultimate goal is to help Zahid Tractor play a bigger, more important role in the development of Saudi Arabia’s economy by helping aspiring contractors and creating more jobs while contributing to the country’s overall growth. The program also ties in with Saudi Vision 2030, an effort to reduce the country’s dependence on oil and create a more diversified economy.

Feedback for the program has been positive. Even though the FCP began before Mahmoud started working at Zahid, he, and many other people, have worked hard to help ensure the program’s success. “When you see that you’ve helped small contractors get a bigger share of the cake in the construction industry, it definitely makes us proud and demonstrates that we have created a good program that is helping people,” he said with a smile.

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