Challenges and Impact of Procuring Mechanical & Electrical Materials in Ethiopian Market on Project Execution (Case A: NOC National Oil Headquarter Building and Case B: Shegole Bus Station)

Abstract

The procurement of Mechanical and Electrical (M&E) materials is a critical determinant of project success in Ethiopia’s construction sector, yet it poses significant challenges that adversely affect schedule, cost, and quality. Although procurement issues in developing economies are widely recognized, a specific research gap exists regarding M&E materials—distinguished by their technical complexity, certification requirements, and high import dependency. This study addresses this gap by investigating procurement challenges and their impacts through a comparative analysis of two project strategies: import-dependent versus locally sourced. Using a qualitative case study design with embedded quantitative analysis, the research examines the NOC National Oil Headquarter Building Project (import-based) and the Shegole Bus Station Project (locally sourced), supplemented by a survey of ten construction firms. Findings indicate that dependence on imported M&E materials introduces substantial risks, including customs delays, foreign currency shortages, and supply chain disruptions. In the NOC project, these factors led to a 4–5-month overall delay, with M&E procurement accounting for 82% of schedule overrun and a 12.3% cost overrun. Conversely, the Shegole project, using locally sourced materials, showed greater resilience, experiencing only a 2-month delay and a 3.4% cost variance, with challenges related mainly to weather and local market fluctuations. The study concludes that Ethiopia’s reliance on imported M&E components creates systemic vulnerabilities. To address this, the thesis proposes targeted recommendations: project managers should adopt hybrid sourcing and early procurement planning; policymakers should streamline customs and support local manufacturing; and suppliers should pursue quality certifications and collaborative forecasting. This research contributes context-specific insights to construction supply chain management in emerging economies, offering a practical framework to improve procurement efficiency and reduce external dependencies in Ethiopia’s infrastructure development.