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Manufacturing

ISSUE 3 | www.bus-ex.com/manufacturing

INCLUDING

emirates steel: seven up bottling co: hanseatic marine:

British American tobacco:

Sparking a chain reaction

Bernd Meyer discusses British American Tobacco’s adaptive global supply chain

At GSS we understand the importance of that ‘just like home’ feeling and try our best to recreate it for you even in the most remote locations. From the depths of the Iraqi desert to the wilderness of sub-Saharan Africa, GSS goes the distance to ensure your employees are well cared for. When you partner with GSS, you can trust us to deliver on our promise of bringing you quality of life no matter where you are in the world.

Delivering quality of life where it’s needed most www.gss-contracting.com

business excellence

Business John O’Hanlon Editor johanlon@bus-ex.com Will Daynes Editor wdaynes@bus-ex.com Matt Johnson Art Director mjohnson@bus-ex.com Louise Culling Production Designer lculling@bus-ex.com Richard Turner Director of Sales rturner@bus-ex.com Vince Kielty Director of Editorial Research vkielty@bus-ex.com

Business Excellence brings you content from leading business influencers and strategic thinkers providing inspiration and guidance to help you and your business grow.

We showcase some of the best examples of successful organisations from around the world giving you a unique insight into how they operate.

Sharon Rooke Administration & Operations srooke@bus-ex.com Matt Day Head of Technology mday@bus-ex.com Andy Turner Chief Executive aturner@bus-ex.com

Contributors Thomas R. Cutler TR Cutler, Inc

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George F. Brown, Jr. Consultant & Author

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features

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12 Kaizen

The Role of Expert System Integrators for Best Practice Kaizen is continuous improvement, not something that is done once a week, so the philosophy has to be taken on board at all times.

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18 strategy

Branded channels, revisited

The advantages of the new Internet-based branded channels are clear: additional advantages will emerge over time.

28 Operations

Picking Productivity Kept Simple

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When it comes to choosing a warehouse picking solution, accuracy beats complexity every time Pick-to-Light systems are easier to learn too

contents

34 operations

What’s the First Thing that Comes to Your Mind?

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Making the commitment to services a meaningful part of a company’s culture through measurement, review, and rewards.

40 supply chain

Reducing Customer Lead Time How implementing lean technologies into your supply chain can reduce lead times from 15 days to less than two.

46 top ten

automobile companies by market value

2013 has seen the automotive industry continue its recovery from the dark days following the global economic crisis. Here we identify the ten companies leading the way in terms of market value.

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business showcases

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europe: 54 british american tobacco

Sparking a chain reaction

The ability to change and adapt has always existed within BAT. Arguably no other area of its business better encapsulates this quality than its global supply chain.

76 Eti Aluminyum

Among the integrated elite

Eti Aluminyum has channelled a great deal of effort and capital into a comprehensive modernisation programme that is now set to bear fruit.

Middle east: 86 Emirates Steel

Shaping a low carbon future

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The unwavering dedication Emirates Steel has towards producing only the finest quality products also extends to the company’s commitment to health and safety, the environment and energy efficiency.

contents

Americas: 98 University of Kentucky – Lean Systems Program

2013 Lean Users Conference: Leaning in the right direction

Glenn Uminger discusses the 2013 Lean Users Conference, shares some of its success stories and reveals his early hopes for this year’s event.

98 114

104 Coresa

It’s in the bag

Managing director Jose Ignacio Arrate talks about Coresa’s range of plastic packaging solutions, and the company’s opportunities for expansion in South America.

Africa: 114 Country Bird Holdings Chicken and egg

A leading brand in South Africa with its sights set on growing markets across the continent.

138 Zambeef

Feeding a nation

Zambeef has grown from very humble beginnings to become one of the largest integrated agri-businesses in Zambia.

150 Seven-Up Bottling Company Making a difference

150

For more than 50 years Seven-Up Bottling Company has been a significant contributor towards the development of Nigeria, making it one of the country’s most admired businesses.

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business showcases

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160 BevPak PET Project

BevPak has successfully taken modern PET bottle technology into the challenging Nigerian market: now it is looking further afield.

170 Mumias Sugar Company The secret to sweet success Mumias Sugar Company is the largest sugar manufacturing operation in East Africa.

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180 Henkel South Africa

190

Sticking to what’s best

During the course of Henkel South Africa’s history it has consistently displayed a commitment to sustainability and its ever-growing importance to the Sub-Saharan market.

190 Ghana Rubber Estates Ltd The substance of tyres

With primary exports to the European market, Ghana Rubber Estates Ltd (GREL’s) international footprint and customer base is rapidly expanding.

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202 Waco Industries The perfect partner

Southern Africa’s largest manufacturer and distributor of industrial electrical products continues to play a vital role in the development of numerous countries and industries.

210 Beier Envirotec

The technical textiles of choice

The growth of Beier Envirotec and the company’s plans for future development, both in South Africa and further afield.

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220 Alpine Lounge

Alpine Lounge goes lean

South Africa’s premium furniture manufacturer is adopting best manufacturing practices more often associated with automobiles than luxury seating.

APAC: 232 Hanseatic Marine

A life of luxury

From the game-changing SILVER to the largest all-aluminium megayacht ever made in Australia, the Smeralda, Hanseatic Marine continues to revolutionise the world of luxury superyachts.

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SCHAEFFLER Schaeffler, with its INA, LuK, and FAG brands develops and manufactures precision products for everything that moves—in machines, equipment, and vehicles as well as in aviation and aerospace applications.

Innovations from Schaeffler make an important contribution to saving energy and conserving resources and, at the same time, increase performance and competitiveness of customers’ assets across the globe.

Heavy Industries (Subaru) and Nissan.

Toyota Motor Europe expressed their high level of satisfaction by awarding Schaeffer with “Certificate of Recognition”, whereas in the Ford Motor Company in the USA honoured Schaeffler for excellent cooperation between the two companies. By presenting the World Excellence Award 2012, Ford recognized Schaeffler’s ceaseless efforts towards achieving excellence that significantly contributed to their success. In For example, FAG split spherical roller Japan, Schaeffler has received the Nissan bearings simplify and speed up bearing Global Supplier Award for development of replacement, particularly in areas that the LuK multi-link chain for continuously are difficult to access such as shafts with variable transmission (CVT). Among the multiple supports. With over 20 validated series of awards received in China is the coating solutions—down to just a few Excellent Supplier Award from Shanghai’s microns—Schaeffler’s Centre of Competence Sanden Behr Automotive, which recognized for Surface Technology has developed a Schaeffler for high technological expertise, modular system to offer bearings with longer excellent quality and service. In South life for every type of requirement.

America, our INA and FAG brands ranked among the best suppliers for Brazil’s The Aerospace business operates under automotive replacement parts market by extremely high safety requirements. When receiving the Best of the Year Awards from it comes to engine bearings, leading aircraft Sindirepa. With a global footprint matching manufacturers place their trust in Schaeffler. customer requirements across the world, Schaeffler supplied the main shaft bearings for Schaeffler made its mark in Africa as well the Airbus 380’s engines as well as numerous by securing the first prize in General Motors rotationally symmetrical components, which South Africa’s Drive Train prize category. feature up to five different coatings.

These numerous awards around the Schaeffler received numerous awards world testify to Schaeffler’s power from customers all over the world. These of innovation, quality of service, and awards serve as a constant incentive for performance that helps the company Schaeffler to remain the top supplier of offer the best products and solutions to high-quality precision products for global customers around the world. customers. Among this year’s achievements are recognitions from Toyota, Ford, Fuji www.schaeffler.com

The ro Expert Integr for best

Kaizen is continuous imp that is done once a week to be taken on bo Words by

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Thom

Manufacturing

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Kaizen: Simply Tools with Lean Impacts Lightbox is just a tool to quickly generate design information that can create CNC produced part protection. This part protection considers part characteristics (Class A surface, odd appendages, weak/ strong points) and correct packaging materials to allow the part to flow and move through the facility with the least amount of risk.

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Shadow Boards, Kit Trays, Dunnage, Rails and Partition Trays are other elements to improve a material handling and manufacturing operation process.

Troligiq USA’s Luman Temby reported, “When parts are moved in the plant, damage can result from forklifts and transportation, people, other parts, or process. Custom packaging and part protection solutions provide answers to reduce risk in part movement and handling in all of those areas.”

Creating customized visual I.D. tool boards, error-proofing shadow board and part protection trays on the LightBox all are quality driven considerations that eliminating part damage and process errors.

Best practices are demonstrated in two specific areas of quality, part damage and process errors. Part damage results from parts not being sufficiently contained, protected, or packaged thus being subject to conditions that can impair quality (dents, scratches, and impacts). Process errors result from the wrong type or quantity of parts arriving to an operator that can cause process delays and losses.

Temby strongly suggested, “Designing integrated material flow, material presentation, and material protection LightBox

©2014 Trilogiq

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ny kaizen event will reveal how one small incremental process improvement can be worth significant bottomline impacts. Kaizen, Japanese for “improvement” or “change for the best,” refers to philosophy or practices that focus upon continuous improvement of processes in manufacturing, engineering, and business management. When used in the business sense and applied to the workplace, kaizen refers to activities that continually improve all functions, and involves all employees from the CEO to the assembly line workers. It also applies to processes, such as purchasing and logistics, which cross organizational boundaries into the supply chain. By improving standardized activities and processes, kaizen aims to eliminate waste (lean manufacturing). Kaizen was first implemented in several Japanese businesses after the Second World War, influenced in part by American business and quality management teachers who visited the country. It has since spread throughout the world and is now being implemented in environments driving productivity.

Manufacturing

“Designing integrated material flow, material presentation, and material protection systems using a variety of methods and materials is critical. The purpose of these systems is to consider how a part moves through a facility or value stream and reduce the risk of damage at each step” systems using a variety of methods and materials is critical. The purpose of these systems is to consider how a part moves through a facility or value stream and reduce the risk of damage at each step.”

The Role of Expert System Integrators for Best Practice Integrated solutions often falls to the systems integrator with whom the customer has built a trusted relationship. The full gamut of services based in wisdom and experience of potential solutions options is critical.

Sadly, the majority of system integrators in material handling can be described as order-takers. Rather than actively seeking all the possible integrated automation solutions for the enduser customer, products are ordered, delivered, and installed. Trilogiq USA, based in Livonia, Michigan, pioneered the holistic team consultative approach using an evaluation methodology.

Lean manufacturing is an elevated concept, yet much of the waste to be eliminated and continued process improvement can be made in the very smallest incremental improvements.

Strategically planning to work with a singular expert system integrator to analyze, assess, and acquire the best

overall integrated solutions may reveal something as simple as tubing selection to achieve lean best practice results.

Tubing Selection Driving Productivity Bob Rechul, a sales engineer with Trilogiq USA, brings nearly two decades in the tube and joint field where he processed reviews to reduce waste, improved manufacturing quality, reduce cost, and improved operator ergonomics. “Tubing is one area that manufacturers can immediately realize increased productivity while lowering manufacturing costs. Simply using the best tubing solution often results in a 12-15 percent increase per year in productivity,” shared Rechul.

Tubing expertise is one of the shortest paths toward lean results. Holistic material handling experts often define the elimination of poor choices and rapid identification of best options.

Rechul worked to implement 5S and ran kaizen events at General Motors, Ford, and Chrysler as well as many aerospace, medical device and, food service industries.

Any vendor can sell tubes and joints; tubing improvements must be combined with all of the elements of efficient material handling elements

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©2014 Trilogiq

Triloqiq TUBES

for holistic process improvement; the product approach is not a lean bestpractice. A partnership approach with the customer from conception to long after the execution is required to ensure products and solutions surpass the needs of manufacturing customers.

Quality Assurance is best achieved when tube fittings are designed, manufactured, quality controlled and distributed to be totally “interchangeable.” The precision manufacturing of products to stringent tolerances under rigid quality control procedures ensures the safety, performance and reliability of service.

The extrusion process is the critical part of ensuring the integrity of a complete solution. The quality of this plastic coating (extrusion) is dependent on the raw plastic chosen for its durometer.

The plastic must be suitable to the fittings used for the complete assembled

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solution. If improper plastic material is to extrude the tubes, the fittings will not properly or safely adhere to the extrusion. The thermoplastic extrusion process to coat their steel tube must provide several strength improvements over powder coating and other coating alternatives. Damaged tubes cost big money, requiring diagnosis, replacement, and repair. This downtime is a huge waste that can be easily avoided. Tubing connectors with a non-slip nub, which grips the thermoplastic coating, is considerably better without marking or damaging the tube. Inspection is always an import job by tube and connector suppliers.

Tube fittings are often manufactured in accordance to conform to the ISO 9001:2000 Quality Standard.

From tubing, to CNC, to Lightboxes, a holistic approach can be observed, quantified, and measured in quality. In material handling, the three functional areas are material f low, material presentation, and material protection.

Tube and joint solutions typically function in the first two areas where

“A partnership approach with the customer from conception to long after the execution is required to ensure products and solutions surpass the needs of manufacturing customers”

Manufacturing

CNC and Lightbox solutions work in the third. The impact on quality, specifically part quality, is different in each area.

Material flow is measured when parts are moved in the plant; damage can result from forklifts and transportation, people, other parts, or process. Tube and joint solutions (along with Automated Guided Carts (AGCs), autonomous driverless mobile robots, and integrated part protection) help to address each of those causes of errors by right sizing the material flow and better containing the parts when moved.

Material presentation is critical because when parts are not presented to the operator at the line in a safe, ergonomic fashion, damage can often result when the parts are moved awkwardly. Tube and joint structures provide the best ergonomic presentation of parts. They not only to improve environmental, health, and safety (EH&S) measures, but also to allow the operator to handle parts in the easiest way to respect the part’s quality integrity.

Material protection is the most valuable area of part quality that holistic integrated lean solutions providers can implement. This discipline can exist independently, or work in

“Material protection is the most valuable area of part quality that holistic integrated lean solutions providers can implement” conjunction with material flow and material presentation. Experienced and thoughtful systems integrators consider how parts are best packaged, moved, and presented until they are finally used. Most of the damage to parts inside of a manufacturing facility occurs due to poor protection and packaging design at some point in the process.

Kaizen is a daily process, the purpose of which goes beyond simple productivity improvement. It is also a process that, when done correctly, humanizes the workplace, eliminates overly hard work (“muri”), and teaches people how to perform experiments on their work using the scientific method and how to learn to spot and eliminate waste in business processes. The process suggests a humanized approach to workers and to increasing productivity.

About the author Thomas R. Cutler is the President & CEO of Fort Lauderdale, Florida-based, TR Cutler, Inc. Cutler is the founder of the Manufacturing Media Consortium including more than 5,000 journalists, editors, and economists writing about trends in manufacturing, industry, material handling, and process improvement. Cutler authors more than 500 feature articles annually regarding the manufacturing sector. Cutler is the most published freelance industrial journalist worldwide and can be contacted at trcutler@trcutlerinc.com and can be followed on Twitter @ThomasRCutler. www.trcutlerinc.com

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Branded chann

The advantages of the new Int are clear: additional advan Words by

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George

Strategy

nels, revisited

ternet-based branded channels ntages will emerge over time

e F. Brown Jr. BE Manufacturing

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A

lmost twenty years ago, I had the opportunity to work with a major automotive parts supplier that was looking to significantly expand their business in the repair parts aftermarket.

They saw this as a global opportunity, and one of the assignments I had was to describe the aftermarket environment as it evolved from the then-embryonic markets of countries like China and India to the differentiated markets of southern Europe and Brazil to the highly efficient and organized markets of North America and Japan. The distinctions as you moved along those stages of evolution were indeed many. One of the important ones was a phenomenon which I called the development of “branded channels” in the most mature markets, strong and significant channel organizations (retailers, distributors, etc.) that had achieved levels of power and prominence at least the equal of the major parts manufacturers. In the North American automotive aftermarket, those organizations are familiar to most of us – companies like NAPA, Advance Auto, Pep Boys, and O’Reilly are examples.

“Branded channels” are quite different than “channel brands”. The latter have been around for a long time in most business and consumer markets, historically positioned as the “value brands” at the Good end of the GoodBetter-Best spectrum, targeting the pure price buyer. “Branded channels” are organizations that have developed abilities, attributes and associations linked to the channel itself, as opposed to the products that it sells. When

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successful, the abilities, associations and attributes linked to a branded channel heavily influence the purchase decisions of customers, much as product brand abilities, attributes and associations do.

Several years later, working with a client in the paint and coatings industry, the importance of branded channels was reinforced. As part of this project, I had lengthy meetings with senior executives in a number of the Big Box home center organizations, which had by then become a major force in the North American landscape. One of these executives used the following story to make a point: “Let’s say that next Saturday morning, as you are pouring your coffee, your wife announces that the kitchen needs to be repainted. So after some grumbling and perhaps a few extra cups of coffee, you two get into your car and shortly afterwards, pull into your local [name of his firm’s home center], or perhaps you get lost and by mistake pull into the [competitor home center] lot.

“From our perspective, at that point, as you walk into the store, you’ve made the only brand decision that will matter that

Strategy

“When successful, the abilities, associations and attributes linked to a branded channel heavily influence the purchase decisions of customers, much as product brand abilities, attributes and associations do” day. Whichever of those home centers you walked into, a short time later, you are going to push a cart with paint and other supplies out the door and load it into your car. The odds are extremely high that you will buy paint there, choosing from across the rather rich selection of options and price points that you will find available in that home center.”

My own experience and quite a bit of data accumulated across many industries leads me to conclude that he is right. Once you have made a choice of a channel, be it a retail home center as in that example or an industrial distributor or an office supplies firm or a supermarket, you are extremely likely to make your purchases there.

In discussions with clients, I often give them the following pair of statements in the context of manufacturer-channel organization interactions: 1. “You know how important our product is to you, that our products bring a lot of customers to you.”

2. “You know how important our channel is to you, that our firm attracts the customers that are candidates to buy your product.”

The former of those statements is one spoken by a manufacturing

firm executive to his counterpart in the channel organization. The latter statement is one spoken by the channel organization executive to his manufacturing firm counterpart.

In almost every manufacturer-channel relationship that I have observed, while it’s true that to some extent both statements are true at least on some occasions and for some customer segments, in the vast majority of instances, one of the two statements is far more true than the other. And that “more true” statement is the elephant in the room, the fact that dominates conversations, negotiations, pricing and margins, and relationships.

The former statement is the one that manufacturers make when their product brand is so critical to customers that it is a significant driver of their purchase decisions. Such customers will only consider channels that carry the product they favor.

The latter statement is the one that is made by channel organizations that have successfully made the transition to becoming a “branded channel”.

Their customers will choose among the products that are available from that channel organization. Years ago, I found far more instances in which the former statement was the “more true” one. Today, I find that the balance has

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“The manufacturer knows that if a channel organization has achieved a strong branded channel position, that organization has considerable leverage in negotiations and pricing” shifted considerably towards the latter statement being the “more true” one.

While certainly not the only important factor, the concept and implications of branded channels have become in recent years important factors in both manufacturers’ channel strategy and in the competitive positioning of channel organizations. Some of the reasons for this are probably obvious from the examples above.

The manufacturer knows that if a channel organization has achieved a strong branded channel position, that organization has considerable leverage in negotiations and pricing. Even more concerning, such channels have the ability to successfully introduce other products that compete with those produced by the manufacturer. Many branded channels have in fact done so with their own channel brands and private labels, as anyone visiting a Staples or a Michaels’ can attest, and, in more and more cases, such channel brands are being introduced to compete at the “Better” and sometimes even the “Best” positions on the GoodBetter-Best spectrum.

From the channel organization’s perspective, in numerous discussions, I’ve heard long-term executives say things like “When I first took this job years ago, my positioning strategy was heavily based

on the products that we carried. We tried to build a strong product portfolio and ride on those brand coattails.

But today, all of our positioning is about us. Our in-store service. Our delivery and installation capabilities. Our convenience. Our expertise. Our price commitments. Our loyalty program. It’s all about us, and for our competitors, it’s all about them.

Times have changed.” Another familiar example of this change again draws upon the automotive industry. Not too long ago, every car ad on television or in the newspaper was product centered, communicating why a certain brand of car was the one to buy. Today, you can see a TV ad for CarMax, Auto Nation, or even some of the major “auto malls” that never mention a single make or model, that simply promote themselves as the place to go to buy your next car. Times have indeed changed.

All of the above considerations remain important factors for manufacturers and channel organizations, along the lines briefly outlined above. But my reason for including “Revisited” in the title of

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this article is that significant changes are continuing to occur that make another dimension of the “branded channel” concept one that must take center stage in the strategy decisions of both manufacturers and channel organizations.

My perspective on these changes and their significance was first motivated by the work I have done along with my colleague David Hartman on the changing competitive environment. In a series of articles, we have argued that the future competitive landscape will be dominated by firms from emerging markets like China that have learned in the middle markets of their home countries how to produce “almost-as-good products at a great price point”. Many of these firms have global ambitions, and many are finding that that competency not only enables them to gain market share at home and in other emerging markets, but that it also enables success in the developed markets of North America, Europe, and Japan. It is a global truth that there are large middle market segments everywhere that are attracted to “almost-as-good products at a great price point”. For those that aren’t yet studying the success stories of emerging market firms like Huawei, Mindray, Sany, Haier, and others, we point to the much more familiar success story of Southwest Airlines, another firm that has figured out the “almost-as-good product at a great price point” formula. We believe

that these competitors will become a dominant force in market after market for years to come, even in those industries where they haven’t yet today established a significant beachhead.

One of the factors that will determine the speed and degree of success of firms from emerging markets will be their ability to find channels to market. A few of them got a head start by becoming contract manufacturers for channel organizations, producing to spec the channel brands and private label products mentioned earlier.

More and more of them are taking steps to go beyond that position, to either establish their own product brands or to convert their relationships from contract manufacturers to legitimate suppliers of branded products.

The willingness of channel organizations to embrace such offers is a key determinant of success for such firms, and it is the branded channels that are most likely to be open to such discussions.

I offer another example from the automotive industry. For those old enough to remember, it took quite a while for Volkswagen to establish its position in North America. A bit later, Japanese carmakers like Toyota and Honda also arrived in North America, and while they were more quickly successful than Volkswagen had been, it was still a long climb. More recently, Hyundai moved at what must have appeared as lightning speed to the people from Volkswagen and

“One of the factors that will determine the speed and degree of success of firms from emerging markets will be their ability to find channels to market” 24 |

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Toyota. As in the earlier examples, there were quite a few forces at work, but I think all would agree that the ability to develop dealer channels was among the important factors in shaping Hyundai’s relatively quick success.

It was far easier for Hyundai to sell the owners of an auto mall on adding a Hyundai storefront than it was for Volkswagen or Toyota to build a dealer base in the era of “Chevy dealers” and “Ford dealers”.

The branded channels, including the auto malls in the above example, have good reason to be open to new suppliers.

They know that it is their own abilities, attributes, and associations that are driving customer purchase decisions, and that they can bring in new product brands (or substitute new product brands for ones previously carried) with relatively low risk. If those new product brands are attractive from the perspective of allowing the branded channel to make more money, they will get a hearing. And those emerging market firms that can produce “almost-as-good products at a great price point” have a very compelling story to tell to the branded channel. The existence of strong branded channels in market after market is among the reasons why we see frequent quick successes for these emerging market competitors.

But that’s just part of the equation in terms of the growing importance of branded channels. In the past, reflecting on the automotive aftermarket and painting

and coating industry examples I provided earlier, all of the players involved were in fact “part of the industry”, or, as one client commented, “were on the usual suspects list”: Sometimes such firms were new market entrants, but in most industries, the new retailers and distributors were a lot like their counterparts already in the industry. Even the Big Box home centers shared a lot of characteristics with longterm industry players like hardware stores and lumberyards. The new entrants (and some evolving long-term players) all had new value propositions that they hoped would propel them to leadership positions, and many of those that have successfully became branded channels did in fact have winning ideas about what to do differently.

That familiar faces and “usual suspects” reality has changed radically.

I think that most business executives, if asked to reflect and come up with a list of the most significant branded channels of today and tomorrow, would come up with a list that includes Amazon, eBay, Alibaba in China, and, in business markets, firms like Amazon Supply and Google

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Shopping for Suppliers. None of these firms were, for most market segments, at least until very recently, “on the list of usual suspects”. But they are now often on the short list of competitive worries for many manufacturers and channel organizations, each with a different set of concerns, but all with concerns that are rooted in the competencies and strengths of branded channels and amplified by the emergence of new firms able to produce “almost-as-good products at a great price point” that have the potential to become the partners of these branded channels, in many cases sharing a similar perspective about pricing.

Manufacturers and other suppliers contemplating meetings with these new Internet-based branded channels know that the elephant in the room will be wearing a banner reading “You know how important our channel is to you, that our firm attracts the customers that are candidates to buy your product.” This is true whether the product to be discussed

is baseball cards (2,829,297 listings on eBay, with the usual suspects (card stores and card shows) on the endangered species list) or nail guns (469 products on AmazonSupply.com vs. 95 shown in the Grainger catalog). The list of such frightening comparisons grows daily.

The power and potential of these new branded channel firms cannot be underestimated. In an earlier article, I cited examples of the appeal that these non-traditional competitors have, drawing upon learning from other market environments, seizing leadership advantages in the use of Big Data concepts, developing best-in-class logistics capabilities, developing Internet tools that offer a superior customer experience, and putting together a supplier base and business model that enables them to not only compete on price, but that in many instances denies the old adage “Better, Cheaper, Faster – Pick Any Two”. I have talked with many customers of these new branded channel competitors that have said “I didn’t have to choose, they gave me all three”. These firms are not just building upon the branded channel concept. They are in fact in many ways redefining it.

For quite some time, I have believed that the branded channel phenomenon is one that is critical to strategy and competitive positioning, for both manufacturers and

“For quite some time, I have believed that the branded channel phenomenon is one that is critical to strategy and competitive positioning, for both manufacturers and channel organizations” 26 |

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“Most of the manufacturers and channel organizations that I work with are still debating whether these new branded channel participants in their markets are friend or foe” channel organizations. My “revisited” perspective not only reinforces that belief, but raises it higher on the list of themes that must be addressed in order to ensure future success.

Most of the manufacturers and channel organizations that I work with are still debating whether these new branded channel participants in their markets are friend or foe. There are already enough examples to allow a quick answer of “both”, but I see more and more examples that fall on the foe side, despite some friendly offerings such as eBay’s stores and Amazon’s thirdparty marketplaces. Many of the foe examples that I see achieve that status by a combination of the ability of these new branded channel entrants to own end customer relationships, their out-in-front competencies in areas like Big Data and best-in-class customer experience, and their ability to win on price. In the future, I think more foe outcomes will occur as these new branded channels pair with new suppliers that offer “almost-as-good

products at a great price point”, making the price competition even more intense for the “usual suspects”. The advantages of the new Internet-based branded channels are already clear, with many examples already visible. The additional advantages that will be built upon relationships with emerging market suppliers are ones we will see more and more often in the future, rather than significant current realities.

I think that over time, examples will surface in different industries and for different customer market segments that will fall into both the friend and the foe categories, but to me, that possibility further underscores the need to figure out how these new branded channels fit into strategy and go-to-market plans, identifying those situations in which they can make a contribution to growth and profitability as a friend and those other situations in which a response is required to avoid losing badly to a powerful new foe. My advice is to put that consideration high on the planning agenda.

About the author George F. Brown, Jr. consults with industrial firms on growth strategy. He is the coauthor of CoDestiny: Overcome Your Growth Challenges by Helping Your Customers Overcome Theirs (Greenleaf Book Group Press of Austin, TX) and the cofounder of Blue Canyon Partners, Inc. George has published frequently on topics relating to strategy in business markets, including articles in Industry Week, Industrial Distribution, Chief Executive, Business Excellence, Employment Relations Today, iP Frontline, Industrial Engineer, Industry Today, and many others.

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Picking productivi

When it comes to choosing a wareho complexity every time - Pick-to-Lig Words by

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Thom

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ity Kept Simple

ouse picking solution, accuracy beats ght systems are easier to learn too

mas R. Cutler BE Manufacturing

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dentify the characteristics most needed for an effective picking solution may seem obvious.

Indeed high visibility, robust order pick displays, flexible mounting method allowing the system to easily adapt/ grow with warehousing operation and simple intuitive software must be part of the mix. Obviously highly accurate order assembly, orders handled by barcode scanning or manual selection and picking data interfaced with ERP/ WMS for real-time visibility are also must-have requirements.

These characteristics for picking solutions are a great starting point for finding a cost-effective and efficient solution. More is not better in the picking world. All the bells and whistles of costly complex solutions completely miss the actual value, picking the right product, at the right place, at the right time.

Very large multi-facility warehouses implement very costly WMS (warehouse management systems) often customized to their particular operation. More than 90% of all distribution center locations are single operations with less than 100,000 square feet. They cannot justify high-end multi-million dollar technology solutions to enhance warehouse productivity, accuracy, and exploding SKUs (stock keeping unit).

The need is just as great among these smaller distribution centers and single warehouse operators; too often these executives attempt to patch together a best-of-breed picking solution at an affordable price with mixed results.

Antonio Rodrigues, a senior manager at Pcdata, based in East Granby,

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“One size fits all certainly does not apply to getting the highest productivity out of a warehouse operation.

Different technologies are better-suited depending on the SKUs order frequency and value.”

Connecticut, suggested, “One size fits all certainly does not apply to getting the highest productivity out of a warehouse operation. Different technologies are better-suited depending on the SKUs order frequency and value.”

Analysis of most warehouse orders will show a Pareto curve, where a small amount of the SKUs being processed account for a large percentage of the orders. These fast-moving items are the “A” parts. Any small amount of efficiency gains in picking these “A” parts will have a relatively large impact on the overall productivity of the entire operation.

Too often vendors of picking products are wedded to (and clearly invested in selling) just their solution, whether it is (or is not) the right fit for the distribution center, 3PL (third party logistics), or warehouse. Comparing pick technologies, side by side, often reveals that Pick-to-Light solutions have a clear edge over other solutions when measuring picking accuracy. The light indicators make it difficult to pick from the wrong location, or the incorrect amount, when the light is both the pick instruction and location indicator.

There is also a clear cost-advantage

Units ordered

Units ordered/SKUs

SKUs A-parts (fast movers)

B-parts

C- and D-parts

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“Replacing a paper-based picking process with a single technology helps deliver significant improvements with efficiency and accuracy” and scalability to Pick-to-Light solutions according to Rodrigues who suggested, “The system’s cost is determined by the number of SKUs, as a display is required for each SKU picked. With voice or RF scanning equipment, the variable cost is determined by the number of operators picking.”

Better than Paper Replacing a paper-based picking process with a single technology helps deliver significant improvements with efficiency and accuracy. However to optimize warehouse productivity, deploying hybrid solutions in which Pick-to-Light is used for fast moving products, delivers the best possible operational solution.

Too many vendors have ignored the single warehousing operation because there was no reasonable ROI (return-oninvestment) for the proposed technology.

Investigating PickStar, Pcdata’s next generation Pick-to-Light solution, the company has designed an installation model with minimal operational impact; bottom-line ease of use and operational simplicity was the company focus will provided a rapid ROI. Most of the 550 systems installed worldwide in 30 countries (100 in North America) required nothing more than basic user involvement due to the intuitive GUI (graphical user interface.) By observing employees at full capability in days, rather than months, the cost-justification becomes clear (especially without the need for IT engineering staff.)

Whse Technology Comparison Chart Labor

$/SKU

Cost

Errors

Paper

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100% RF/Voice

Hybrid w P-t-L

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Pick Strategy by Order Volume Picks/ manhr

0

100

200

300

400

A

500

600

700

800

900

1000

1100

Fully Automated Picking Solutions

A,B

Pick-to-Light Pick-to-Light

A,B,C C,D

Paper Picking

C,D

RF Picking Pallet Racking / Static Locations

Flowracks / Conveyors

Exponential Growth of SKUs With exponential growth in SKUs, the permutations of one product can be complex.

That variety and variability does not need to translate into the design, deployment, and maintenance of an effective picking solution. Rodrigues noted, “It is best when the hardware components are modular and user replaceable, minimizing maintenance and support costs. We have seen that in the right environment these Pick-toLight systems will outperform typical voice, RF scanning or paper based picking and order assembly processes.�

The industry sectors that are often

Automatic Transport Systems, Carrousels, Mini Loads, Robots, Sorters

most impacted by these simple, ready-toinstall, out-of-the box solutions, are fast moving item picks at any warehouse.

Assembly line processes are complex, particularly in food logistics, e-commerce business-to-consumer organizations, spare parts assemblies, and a wide variety of consumer goods distribution centers.

Low IT requirements, does not mean ineffective picking solutions.

Too many picking solutions require high powered servers or complex network infrastructure. Running from a standard Windows platform, allows the existing IT landscape to be utilized.

About the author Thomas R. Cutler is the President & CEO of Fort Lauderdale, Florida-based, TR Cutler, Inc., (www.trcutlerinc.com). Cutler is the founder of the Manufacturing Media Consortium including more than 4000 journalists, editors, and economists writing about trends in manufacturing, industry, material handling, and process improvement. Cutler is a member of the Society of Professional Journalists, Online News Association, American Society of Business Publication Editors, and Committee of Concerned Journalists, as well as author of more than 500 feature articles annually regarding the manufacturing sector. Cutler is the most published freelance industrial journalist worldwide and can be contacted at: trcutler@trcutlerinc.com

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What first thi Comes Your Mi

Making the commi meaningful part of a through measurement Words by

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George

Operations

t’s the ing that es to Mind?

itment to services a a company’s culture t, review, and rewards

e F. Brown, Jr.

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O

n various occasions, virtually all of us have thought about the associations that are linked to our companies and our brands. We’ve observed situations in which positive associations have helped companies grow and prosper, creating equity in the process. We’ve also observed situations in which negative associations proved to be too great a hurdle for some companies to overcome. And we’ve all spent time thinking about the associations to which we aspire. That is something that we do as individuals as well as business leaders.

Recently, at a conference sponsored by the Institute for the Study of Business Markets, the program included a panel of three manufacturing company CEOs who shared their perspectives as to the most significant challenges facing firms like theirs in the coming years. One of the questions posed to the panel focused on their goals as to how customers thought about their companies. The answers were quite interesting. One of the CEOs said that he wanted his customers to see his firm as “helpful” and a source of “positive surprises”. A second hoped that customers saw his firm as the “#1 call when there was a problem”. And the third hoped his customers saw a “relentless aim to please”.

What makes those answers, all of which focused on the service relationship that

“The goal as a company is to have customer service that is not just the best but legendary” 36 |

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the firm has with its customers, even more remarkable is that all three of the firms have strong records of innovation, emphasize investments in new product development, and offer products that are used in highly demanding settings. Roberto Clemente, the great right fielder for the Pittsburgh Pirates, once said “I want to be remembered as a ballplayer who gave all I had to give.”

These CEOs said they want their firms to be remembered for their commitment to and excellence in customer service – they wanted their firms to give all they had to give in terms of service.

In many ways, it’s not surprising to hear executives tout the importance of services. Sam Walton said that “The goal as a company is to have customer service that is not just the best but legendary.”

Jeff Bezos similarly said that “It’s our job every day to make every important aspect of the customer experience a little bit better.” But for manufacturing companies like those represented on the panel mentioned above, building strong service competencies is a major challenge, one that requires active leadership involvement. Services are different from manufacturing, along multiple dimensions, and delivering legendary services is a rarely-reached accomplishment, regardless of the industry in which you operate.

Certainly compared to the everyday service demands on companies like WalMart and Amazon, many of the service demands on manufacturing companies are unpredictable and often unprecedented, with requests arising at unexpected times and usually involving a high degree of urgency. To respond to such requests

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often requires the manufacturing firm to draw upon company resources that probably have a “full-time day job” that isn’t centered on customer support.

Many service requests are ill-structured, with customers often unable to define their needs clearly, sometimes only able to communicate that they have a problem requiring attention. Responses to such requests frequently require 24x7 resources and processes. And the problems that spark such requests are frequently unbounded, with many service requests having little (and sometimes nothing) to do with the products made by the company.

Meeting these service-related challenges requires active leadership involvement, particularly in the manufacturing environment where the focus on services is a relatively new phenomenon. It was not too long ago when as many manufacturing executives viewed services as “the hole in the income statement out of which profits drain” as there were executives who saw services as a key basis of differentiation and competitive advantage.

The perspective on services has changed, but there is still a long way to go in terms of realizing the potential that exists for value creation and capture. There are several key steps that executives can take to help their firm ensure that services are among the positive associations in the minds of their customers.

The first challenge that a firm’s leaders must address often involves selling the importance of services throughout the organization. My research into the challenges of changing a firm’s business model, as reported in an article in

“Meeting these service-related challenges requires active leadership involvement” the September 2011 issue of Business Excellence, concluded that the two most frequent causes of failed attempts to introduce a new business model are “Internal resistance to the new business model” and “Implementation process was poorly managed”. Both of these situations can derail efforts to incorporate services into a firm’s offering.

Making services an important part of your firm’s offer typically implies a major change to most manufacturers’ business model, with its typical emphasis on the processes that are associated with the firm’s products. The concept that customers must think of services as a top-of-mind association with the firm has to be sold, over and over again, and the selling has to be lead from the top of the organization. Not everyone in the organization will see services as a good idea, and others will implicitly offer resistance through some combination of ignorance, errors, lack of skills, and conflicts between service delivery and their other goals and priorities.

Avoiding failures associated with a poorly managed implementation process starts with a commitment to avoid the “ridiculous resourcing decisions” that have been reported in far too many organizations. More than in any other business function, I’ve seen underresourcing of service delivery by such a

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substantial margin that failure should have been easily predicted.

If service delivery is to become one of the positive associations linked to your firm, you must give the service delivery team a chance to succeed by providing the right level of resources and the right competencies. This is especially true when existing business units that are being asked to add services to their roster of responsibilities. Most likely, those units are already stretched by their current responsibilities, and equally likely, the people in them don’t come from a background of service delivery. The challenge is not only ensuring that there are enough resources, but also that the right resources are in place.

Most manufacturing companies have strong quality programs, and know that “if it isn’t measured, it doesn’t matter”. Yet far too often, these same firms fail to establish clear performance metrics for services.

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“The challenge is not only ensuring that there are enough resources, but also that the right resources are in place” Successful service delivery requires the same thoughtful decisions as to standards as are given other business functions.

Achieving success requires setting goals, measuring results carefully and frequently, and giving leadership attention to the attainment of those goals. Meeting the service goals must be seen as being of consequence throughout the organization.

That not only means reviewing results against goals and taking actions to correct shortfalls, but it also requires that achieving goals makes a difference to the firm’s employees in terms of incentives, promotions, and business reviews.

I recently worked with a manufacturing client that was part of a relatively compact industry, including a few major players along with a few niche specialists. Most customers were extremely loyal to one of the major competitors, with only about one-fourth of the customers regularly considering more than one brand when making a purchase. The rest were regular, repeat customers, buying the products of their preferred manufacturer. As part of the work with this client, interviews were conducted with a substantial number of the customers in this market, including ones that preferred a specific manufacturer and ones that were in the “willing to switch” category.

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What was remarkable about what had created loyalty in the first group and what drove choices in the second group was that the messages from the market in both cases were centered on services.

When “product” came up, the typical message was that all of the major firms in the industry were “pretty comparable” and “had good products and a good product line”. When “price” came up, the common message was that “the industry was competitive, and you could count on getting a fair, competitive price”. But when “services” were discussed, the comments of the interviewees often became passionate.

Customer after customer underscored the importance that they gave to the services that surrounded the products that they were buying. Excellence in service delivery was for many customers the basis for their loyalty to a supplier, and, in other cases, it was the factor that separated the winner from the losers in competitive situations.

Services can become an important means by which manufacturing firms create value for customers and capture it for their shareholders. As the CEO comments that I summarized at the start of this article suggested, they are frequently so important to the customer that they create long-lasting memories that shape, for better or worse, the

“Customers underscored the importance that they gave to the services of the products they were buying” customer’s impression of the company and their willingness to do business with it.

Aspiring to have “great services” become the first thing that comes to customers’ minds is a quite worthy goal.

But knowing of the importance of services is only the first step in the process.

Service success stories don’t come easily, and usually only emerge in firms where there is active leadership attention to the task of creating a strong service culture within the firm. That reason alone, in addition to the significant difference between service delivery and traditional manufacturing-related activities, calls for active leadership involvement to communicate the importance of services throughout the firm, to resource and implement programs that have a realistic chance of succeeding, and to making the commitment to services a meaningful part of the company’s culture through measurement, review, and rewards.

About the author George F. Brown, Jr. consults with industrial firms on growth strategy. He is the coauthor of CoDestiny: Overcome Your Growth Challenges by Helping Your Customers Overcome Theirs (Greenleaf Book Group Press of Austin, TX) and the cofounder of Blue Canyon Partners, Inc. George has published frequently on topics relating to strategy in business markets, including articles in Industry Week, Industrial Distribution, Chief Executive, Business Excellence, Employment Relations Today, iP Frontline, Industrial Engineer, Industry Today, and many others.

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Supply chain

Reducing Customer Lead Time <<<<<<<<<<<<<<<<<<<<<<<<<

How implementing lean technologies into your supply chain can reduce lead times from 15 days to less than two Words by

Thomas R. Cutler

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T

he future of lean technologies indicates that supply chain solutions will be increasingly required to meet the demands of the marketplace. Collaborative Supply Portal (CSP) must manage raw material replenishment, Lean Factory Management (LFM) will manage shop-floor schedules, and Collaborative Demand Portal (CDP) will be required to service distribution centers, dealers and OEMs all focus on the execution side of the factory floor. Lean planning must cross-over to procurement as well in the form of a collaborative request for quote (RFQ) module.

RFQ technology allows buyers and suppliers to collaborate easily and effectively in a bidding process. The iterative process tracks and traces the bids in real time until a winning bid is converted into a purchase order. The collaborative Planning Module integrates planning data with execution and establishes a feedback loop.

It is all about leaning the supply chain.

In the past manufacturing was vertically integrated and the suppliers were located within a short radius. Manufacturing today is less integrated and the suppliers are global. Only through supplier collaboration, and real-time flow of order, shipment and receipt information can be controlled and automatically computed.

The result is the next important step of lean—kaizen, or continuous improvement.

As a manufacturing journalist it was a pleasure to interview Narayan Laksham, Ultriva founder and CEO. He founded the company 1999 with a vision of building an organization that develops customer driven solutions which guarantee high value, quick deployment, and measurable return on investment. Laksham has written articles on several lean topics including “When Push comes to Pull Kanban wins.”

He is also a co-inventor of the patent pending “Inventory Optimization Tool.”

This recent conversation revealed how much has changed in the supply chain during the intervening conversation, when first interviewed six years ago.

Manufacturing is more competitive than ever with shorter lead times, higher service levels, exploding numbers of finished good SKUs (stock keeping units) and thinning margins. Laksham points out, “The focus of leaning in manufacturing was concentrated on streamlining the factory floor, alignment of production lines, optimization of space, and standardizing of operating procedures.

One key area which was not touched was the supply chain material replenishment.

Given that purchase parts could be as high as 60 percent of manufacturing costs, applying lean methodologies to this process is critical. As excess inventory eats the margins, part shortages reduce customer service levels and result in lost revenues.”

At an APICS (Association for Operations Management) meeting in Van Nuys,

“Manufacturing is more competitive than ever with shorter lead times, higher service levels, exploding numbers of finished good SKUs and thinning margins” 42 |

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Supply chain

CA, late last fall, Nicole Smith of Zurn SKUs are being manufactured using this Wilkins (a Rexnord Company) shared advanced process.” the company’s experience of reducing After the initial process, Rexnord customer lead time from fifteen days implemented the supplier kanban modules to less than two days. She also shared across several plants in the US, to ensure how the company was able to reduce the that the raw materials were available to raw material and WIP (work in process) meet demand. More than 22,000 parts inventory by twenty percent. are being replenished by 178 suppliers Rexnord is a diversified multi-platform across these plants. Finally Rexnord industrial company that manufactures implemented internal kanban to set up and markets power transmission and a pull system from its final assembly to water management products. Revenue upstream work centers. last year was $1.3 billion and the firm In an effort to better understand why employs nearly 7,000 people. supply chain managers are frequently Ultriva, based in Cupertino, CA, broadsided with wrong size inventory, implemented a demand driven Laksham explained, “The inability manufacturing model by providing full of current supply chain management visibility, scheduling, and sequencing systems to support true collaboration of production of customer orders at the and execution between manufacturers cell level for one of the Rexnord plant in and their supply chain partners result Indianapolis. Previously it took ten days in supplier whiplash, poor delivery before the order reached the factory floor; performance, and lost revenue.” orders were scheduled on a weekly basis, The mission of providing greater causing an overall lead time of fifteen days.

L a k s h a m commented about the • RYG dashboard indicators show inventory health Rexnord situation, • Built-in workflow & noting, “We facilitated business rules engine the orders to be • Complete order tracking directly dropped at the manufacturing cells within 15 minutes of receipt. If the order was received before 2 pm it was manufactured and shipped on the same • Automated email alerts based on pre-set business rules day; if after 2 pm, it • Daily/monthly business proces routines was shipped the next • Single version of the truth - buyers day. Currently over & suppliers see the same view from their perspective 30,000 finished goods

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transparency and visibility between manufacturers and supply chain partners allows manufacturing customers to experience an average 35 percent increase in inventory velocity. The across-the-board improvements in employee productivity and supply chain decision making has delivered even greater value through ultraresponsive, demand-driven supply chains.

Scott Harvey, vice president of Operations at CareFusion, another enthusiastic user of the technology remarked, “The cloud-based platform has a low barrier to entry and allows for an incredibly high level of standardization across all of our suppliers, which made it the obvious solution. As a medical device company working in a highly regulated industry, it is imperative that we maintain a high level of transparency and accountability.”

During the extensive interview with Laksham, he concluded that the shift for most manufacturing companies is becoming demand responsive. “Returning

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“The shift for most manufacturing companies is becoming demand responsive” to a more basic question of the objective of supply chain management is vital. The goal is to source, make and deliver the product from the point of origin to the point of consumption in the least amount of time at the lowest cost. Given that goal, the two most important attributes of supply chain management are responsiveness to the velocity of product flow, and the ability to move products quickly and with agility. These attributes enable the transition from push-based replenishment to pull-based replenishment. To focus on these attributes, it is vital to look toward the customer, the customer’s customer, or the end-user of the product.”

Since few companies can source material and produce all products in the volume required to meet a day’s production, the solution lies in consumption-based replenishment.

Consumption-based replenishment has its roots in lean manufacturing and “kanban” replenishment—a Japanese term for a card used to signal the need for inventory replenishment. Kanban now describes the “pull” method of keeping production lines optimally stocked with parts at the exact time and quantity needed. A simple analogy: Think of a carton of milk in the supermarket—as one carton is pulled off the shelf, another carton slides into its place, immediately restocking the inventory.

Supply chain

The cloud-based supply chain solutions streamline the production schedules with customer demand and synchronize the supply with shop-floor consumption. It uses the consumption-driven replenishment model to establish a true pull process across the value chain. The primary goal of the system is to right-size the inventory whether it is finished goods, work in process, or raw materials. Using a unique supply chain loop based architecture, manufacturing companies can establish real-time collaboration with their customers and suppliers. This collaboration allows manufacturers to carry the right mix of inventory at the distribution center, shorten the lead time to their customers and improve the service levels through elimination of part shortages.

The kanban principle can be effectively implemented with the use of technology, as consumption-based replenishment has evolved from its simple card-based roots into highly sophisticated software applications. These applications can help manufacturers determine the most optimal inventory levels for operations, and can rapidly recalculate efficient replenishment trigger points as demand

â&#x20AC;&#x153;The cloud-based supply chain solutions streamline the production schedules with customer demand and synchronize the supply with shop-floor consumptionâ&#x20AC;? varies over time. By taking a customercentric approach to daily operations, manufacturers focus investments on enabling operations to build only what is needed to replenish what the customer has ordered. This paradigm shift results in companies embracing a goal of delivering the products customers want, when they want them, and in the quantities they want.

Now, and for the next decade, efforts to eliminate waste will start by applying lean principles to supplier and customer collaboration. This combination will result in sensing demand changes and synchronizing supply resulting in rightsizing of inventory across the respective transaction points.

About the author Thomas R. Cutler is the President & CEO of Fort Lauderdale, Florida-based, TR Cutler, Inc., (www.trcutlerinc.com). Cutler is the founder of the Manufacturing Media Consortium including more than 4,000 journalists, editors, and economists writing about trends in manufacturing, industry, material handling, and process improvement. Cutler is a member of the Society of Professional Journalists, Online News Association, American Society of Business Publication Editors, and Committee of Concerned Journalists, as well as author of more than 500 feature articles annually regarding the manufacturing sector. Cutler is the most published freelance industrial journalist worldwide and can be contacted at: trcutler@trcutlerinc.com

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top ten automobile companies by market value

2013 has seen the automotive industry continue its recovery from the dark days following the global economic crisis. Here we identify the ten companies leading the way in terms of market value Edited by: Will Daynes

Top Ten

10 nikshor / Shutterstock.com

SAIC Motors $26.7 billion

Headquartered in Shanghai, SAIC Motor Corporation Limited is a Chinese state-owned automotive manufacturing company, with origins dating back to the 1940s. One of China’s socalled “Big Four” automakers, the company boasted the largest production volume of any of its rivals in 2012, producing more than 4.5 million units, 76 percent of which were passenger vehicles. Today, SAIC sells vehicles under a variety of brand names such as MG and Roewe, and share joint venture partnerships with Volkswagen and General Motors.

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9 General Motors $38.5 billion

For 77 consecutive years, from 1931 to 2007, General Motors led the way in global vehicle sales and remains to this day one of the world’s largest automakers by vehicle unit sales. Headquartered in Motor City itself, Detroit, Michigan, the company employs some 212,000 people and does business in approximately 157 countries worldwide. In 37 of these countries it produces vehicles under twelve distinct brands, including Chevrolet, Buick, GMC, Cadillac, Baojun, Holden, HSV, Jie Fang, Opel, Vauxhall, UzDaewoo, and Wuling.

auto companies

8 Hyundai Motor Company $41.5 billion

Founded in 1967, the Hyundai Motor Company is a South Korean multinational automaker, which, along with its 32.8 percent owned subsidiary, Kia Motors, together comprises the Hyundai Motor Group, the world’s fifth largest automaker based on annual vehicle sales in 2012. Hyundai operates the world’s largest integrated automobile manufacturing facility, located in Ulsan, South Korea, which boasts an annual production capacity of some 1.6 billion units.

Hyundai’s vehicles are today sold in 193 countries through a network of more than 6,000 dealerships and showrooms.

7 Nissan Motors $43.4 billion

While the Nissan name has been in use since the 1930s its origins can be traced back several decades further giving the Japanese automaker a legacy that dates back more the a century. Today the company’s headquarters are situated in Nishi-ku, Yokohama and it is from here that its directors steer a business responsible for selling over 4.9 million vehicles in 2012 alone. In July 2013, the company announced the relaunch of its Datsun brand in an effort to target emerging markets, with initial results suggesting that its position on this list could well rise come next year.

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Top Ten

5 BMW Group $60 billion

6 Ford Motor Company $51.8 billion

Very much a part of American automotive history, the Ford Motor Company was of course founded by Henry Ford in 1903. Described

by Forbes Magazine as “the most important industrial company in the history of the United States”, Ford was responsible for introducing to the world methods for large-scale manufacturing of cars and large-scale management of an industrial workforce using elaborately engineered manufacturing sequences typified by moving assembly lines. In 2012, the company sold 2.25 million vehicles in the US alone, and today has manufacturing operations throughout the world, from the UK and Germany, to China, Brazil, Australia and South Africa.

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Bayerische Motoren Werke AG, or BMW to you and me, was founded in 1916 and makes its home in Munich, Germany. BMW is part of the so called “German Big Three” luxury automakers, together with Audi and Mercedes-Benz, which make up the three bestselling luxury automakers in the world. The parent company of Rolls-Royce Motor Cars, BMW also owns and produces Mini cars, while its global operations are supplemented by overseas subsidiaries in the US, Canada, China, Japan, India, Egypt and South Africa.

In June 2002, Forbes.com placed BMW at number one in its list of the most reputable companies in the world.

auto companies

3 Honda Motor Company $72.4 billion

4 Daimler AG $61.4 billion

Like BMW, Daimler calls Germany its home, specifically Stuttgart where its headquarters are based, and remains one of the most covered status symbol brands for the rich and powerful. By unit sales the company is the thirteenth largest car manufacturer and second largest truck manufacturer in the world. As of the beginning of 2013, the company provided employment for some 275,000 people and today owns or has shares in a number of marques including Mercedes-Benz, Smart, Beijing Automotive Group, Tesla Motors and Renault-Nissan Alliance.

With a global line-up of models that include the Civic, Accord, Insight, CR-V, CR-Z and two versions of the Odyssey, Hondaâ&#x20AC;&#x2122;s automotive manufacturing legacy can be traced back to the early 1960s. In the decades since it has grown into Japanâ&#x20AC;&#x2122;s second largest manufacturer by volume, and the eight largest globally. Today its line-up varies from country to country, while its efforts in the field of producing hybrid electric vehicles has seen it emerge as a direct competitor to the Toyota Prius. As of this year the company continues to invest billions of dollars of its own revenues into research and development.

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Top Ten

2

Volkswagen Group $94.4 billion

In German, Volkswagen literally means “people’s car”, and the people of Germany have every right to be proud of a home grown enterprise that has become the largest automotive company in the world by revenue alone. For over two decades the company has maintained the largest market share in Europe and in 2012 it produced the third latest number of vehicles of any company in the world. Volkswagen Group sells passenger cars under the Audi, Bentley, Bugatti, Lamborghini, Porsche, SEAT, Škoda and Volkswagen marques, and commercial vehicles under the MAN, Scania and Volkswagen Commercial Vehicles marques. While the company remains fiercely proud of its European heritage, its operations in China have grown incredibly over the last decade making this its largest market.

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auto companies

1 Toyota Motor Corporation $167.2 billion

Founded in 1937 by Kiichiro Toyoda and headquartered in Toyota, Aichi, Japan, Toyota Motor Corporation was the largest automobile manufacturer by production in 2012, with the 200-millionth vehicle rolling off its production line in July of that year. The company, which today employs over 333,000 people, has factories across the globe from which it manufactures and assembles a range of vehicles, from a list of over 70 different models sold under its namesake brand, for local markets. Among the best known of Toyotaâ&#x20AC;&#x2122;s brands one will today find Lexus, Scion, Daihatsu and Hino Motors. From hatchbacks and SUVs to sedans and hybrids, Toyota reach continues to expand making it every bit the definition of a multinational corporation.

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British American Tobacco

Sparking a chain reaction

The ability to change and adapt has always existed within British American Tobacco.

Arguably no other area of its business better encapsulates this quality than its Global Supply Chain

written by: Will Daynes research by: Vincent Kielty

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Bernd Meyer, Group Head of Supply Chain

British American Tobacco

B

ritish American Tobacco has never been afraid to embrace change. This is a quality it shares with the most successful businesses throughout history and has been a major contributing factor in the Group’s success over the past 112 years since it was formed in 1902. In recognising the need to move with the times, British American Tobacco has itself evolved into one of the world’s leading tobacco groups, with more than 200 brands sold in over 180 markets, utilising 44 cigarette factories in 39 countries, and a global workforce numbering more than 55,000.

One employee, Bernd Meyer, is as in touch with the concept of change and its importance as any other within British American Tobacco. Meyer successfully transformed South Africa’s Heidelberg cigarette factory from an underperforming operation based on manual labour to a highly automated and high performing state-of-the-art factory.

Since then, Meyer has held the position of Global Head of Plan, Logistics and Service for a period of more than a year, and is now almost a year into his current role as Group Head of Supply Chain.

“As you can imagine,” Meyer says, “taking on what was my first global role in 2011 as Global Head of Plan, Logistics and Service involved quite a significant culture change for me, as before my focus was centred on a particular region and area, Southern Africa.

What you appreciate first and foremost is the sheer scope of the work at hand. This inevitably means that instead of having a hand in every little detail on an area level, the

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SOLVAY ACETOW

Rhodia FilterSorb™

1 | BE 60 | BEWEEKLY Manufacturing

An important element of almost every cigarette is the filter, mostly composed of cellulose acetate filter tow. Solvay Acetow is one of the leading producers of cellulose acetate tow for cigarette filters. Headquartered in Freiburg (Germany), Solvay Acetow has five production sites on four continents. Two of these production sites are located in South America and the CIS, making Solvay Acetow the only cellulose acetate producer in these regions.

Solvay Acetow is a previous member of the French chemical and pharmaceutical group Rhône-Poulenc which deposited the first patents for cellulose acetate in 1911. Solvay Acetow’s key product is Rhodia® Filter Tow, a cellulose acetate filter tow available in a wide range of technical specifications to cover all possible designs for cigarette filters: from standard cigarette filters to other tobacco applications such as roll-your-own, cigarillos, pipes, slim filters etc. Recently Solvay Acetow has developed and launched three new and innovative products to provide filter solutions which enable our customers to always be one step ahead. All these products provide a reliable performance, something that Rhodia® Filter Tow

British American Tobacco

is known for, and can be used with existing filter makers: Rhodia Coloured Tow™ offers endless possibilities in combining colours and different shapes of acetate filter rods and is therefore a unique opportunity for the market to customize cigarette filters. Rhodia DETow™ is a more environmentally friendly cellulose acetate tow solution which uses the synergy between enhanced photodegradation and biodegradation.

It degrades in the environment five-1toten times faster than a standard filter tow. In October 2013, Solvay Acetow won the ICIS* Best Product Innovation Award 2013 for its new product Rhodia DE-Tow™. Rhodia FilterSorb™ is an innovative filtration additive from Solvay Acetow. This unique silica based granule in a cellulose acetate matrix, adds a second filtration step to a standard filter to provide optimized filtration without loss of flavour. All in all, Rhodia® Filter Tow has the widest product offering in the industry with a priority given to innovative products, customer service and cost efficiency.

E. silke.zaulig@solvay.com www.solvay.com

Rhodia Coloured Tow™

BE WEEKLY | | 612 BE Manufacturing

“I believe bringing agreed processes and solutions into British American Tobacco’s global supply chain can benefit the business both in the short and long term” scale of the global task now requires the need to adopt a matrix management structure of working. This remains the case when it comes to my role as Group Head of Supply Chain.”

One particular cultural and professional

62 | BE Manufacturing

change that Meyer would also have soon encountered upon moving into a global role is just how much more challenging it is to put one’s own stamp on things. Fortunately, his recognition of the importance of having

British American Tobacco

Manufacturing facilities in Brazil

a matrix management system in place has helped make this task a little bit easier.

“For this particular department to operate at its best it is absolutely vital that we provide the people who report to us throughout the business with the appropriate levels of direction and focus,” Meyer explains.

“This creates a situation where everybody possesses a clear understanding of what our priorities, objectives and targets are as a department, and as a business. This is the first way that one can put his or her marker down and easily spread the message about

what you want to achieve now and in the future. This approach also extends to our relationship with our suppliers and in many ways helps to create a strong degree of transparency between all parties.”

Of course implementing change is never easy, particularly within an organisation the size of British American Tobacco. Nevertheless, what Meyer has done in his relatively short time in charge of the Global Supply Chain is identify several areas within the Group that would benefit from a different approach.

The first of these areas is what he refers to as

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British American Tobacco the federalism that continues SWM INTERNATIONAL to exist within British As a premier specialty fine paper company, we are a global American Tobacco. “We leader of engineered solutions for the tobacco industry have a situation within the worldwide, including our groundbreaking Alginex® waterorganisation where we have based and Glucigen™ starch based technologies. We different regions undertaking benefit from our global commercial and industrial footprint, certain processes in different employing close to 2800 people at 12 different locations on 4 continents. We pride ourselves on our long-standing ways,” Meyer states. “While business relationships with our customers. Together, in this this can be the right thing to ever changing market, we are poised to write a new page by do in some isolated instances, supporting the industry in 2014 and beyond. in most cases it proves more www.swmintl.com efficient to apply the same standards globally, thus creating synergies for the business. One significant example would be having one shared methodology behind how we calculate and determine inventory levels, or on a bigger scale how we apply manufacturing, logistics and procurement processes in our factories and supply chains. This is just two instances among many where I believe bringing agreed processes and solutions into British American Tobacco’s global supply chain can benefit the business both in the short and long term.”

The current implementation of a common SAP system across the world within BAT will finally enable common processes and procedures and also will be a significant milestone when it comes to aggregated,

55,000+ British American Tobacco’s global workforce Technician at the nursery in Brazil

BE Manufacturing | 65

112 years Since British American Tobacco was established

Dried leaves at the Nigerian facilities

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real-time information, faster availability of data and finally additional benefits by avoiding duplication of efforts and having bespoke systems that are not interlinked with each other. This is, Meyer enthuses, a true example of a company and supply chain unlocking the potential of its global scale.

While the primary objective for British American Tobacco’s supply chain, providing value to the business, has remained the same for some time, it has arguably never been more important than today for it to achieve its mission. In a time of global financial uncertainty it has become the goal of the supply chain to achieve savings where possible and in ways that are in no way detrimental to the quality of the Group’s products or the service it provides to its customers and consumers. “In many ways,” Meyer highlights, “the supply chain is increasingly acting as something of a value chain to the business.”

That statement goes some way to encapsulating how the supply chain has evolved in recent times. “I believe that the key to a successful supply chain today is achieving synergy and the best way to do this is through aggregation,” Meyer continues. “The aim of this basically revolves around creating a single

British American Tobacco

Finished products before packing at the Ceylon Tobacco Company

drum beat which the department works to, one aligned process if you will, that helps rid the business of the inefficiencies that stem from the multiplication or replication of data and processes. What we have seen in the short time since we began pushing for this model to be embraced is a greater coming together of local and regional supply chains than we have witnessed in the past.

Today there are clear signs that a better flow

of communication now exits and this has resulted in agreements over shared standards and priorities, things that ultimate benefit everyone concerned.”

Another development that Meyer has witnessed within British American Tobacco has been the way the business rolls out innovations. “We are trying to focus more and more on big ticket items, rolling out big innovations faster at a larger pace,”

“At the very heart of British American Tobacco is the belief that in order to grow as a business it must operate sustainably” BE Manufacturing | 67

WE WELCOME THE CHALLENGES OF THE FUTURE Celanese provides a broad range of products essential to everyday living â&#x20AC;&#x201C; including components for countless conveniences you enjoy, and materials helping to advance innovation.

Behind these innovations are people. Celanese is made up of world-class chemists, material and polymer scientists, engineers, operators and professionals across the globe representing diverse backgrounds and cultures. Many are industry experts, recognized as among the best for their contributions toward creating breakthrough technologies and solutions.

Our customers come to us to help them address a problem, accelerate product development or deliver a new solution for their customers.

Meeting these challenges is what makes Celanese the firstchoice chemistry solution source for our customers.

British American Tobacco he highlights. “Instead of trying to invent something Celanese Corporation is a global technology leader in in a single end market, what the production of differentiated chemistry solutions and we are doing now involves specialty materials used in most major industries and developing innovations and consumer applications. With sales almost equally divided creating products that we between North America, Europe and Asia, the company can roll out with speed, while uses the full breadth of its global chemistry, technology and business expertise to create value for customers making full use of our global and the corporation. Celanese partners with customers presence. Such an approach to solve their most critical needs while making a positive didn’t exist in the past, but impact on its communities and the world. Based in Dallas, what it shows is how we Texas, Celanese employs approximately 7,600 employees are increasingly thinking worldwide and had 2012 net sales of $6.4 billion. For more globally about what is information about Celanese Corporation and its product right for the Group.” offerings, visit www.celanese.com or our blog at www.celaneseblog.com While the aforementioned developments have made significant positive impacts on British American Tobacco’s business in their own rights, arguably the most significant evolution to occur within the Group’s supply chain in the last several years has revolved around the concept of having one fully integrated supply chain within the Group rather than having supply chains led by different functions, for instance operations and trade marketing and distribution.

“One of the things we are currently embarking on is the integration of both the primary and secondary supply chains, which

Celanese Corporation

44 Quality checks are performed on the tobacco before it goes through to be sorted

British American Tobacco cigarette factories today found in 39 countries

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â&#x20AC;&#x153;We have a situation within the organisation where we have different regions undertaking certain processes in different waysâ&#x20AC;?

Leaf sorting at BAT Souza Cruz

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British American Tobacco have in the past been split into two separate parts,” Meyer says. “While still a work in progress, this supply chain integration programme is now fully in motion and is achieving further synergies throughout the end to end supply chain.”

At the very heart of British American Tobacco is the belief that in order to grow as a business it must operate sustainably, creating value for not only its shareholders, but also society as a whole, and as Meyer is keen to point out, the global supply chain of the Group Production line at Ceylon Tobacco Company plays a hugely important also considers the long-term role in achieving this aim.

“Throughout the world our impact on the surrounding factories are constantly area of the project in question.

“Long-term thinking has working on achieving always been a core facet of improvements in areas Number of brands sold by British American Tobacco,” such as energy efficiency, British American Tobacco Meyer enthuses. “The simple power generation, health fact that we have been and safety, environmental protection and how we can around as a business for best manage resources, particularly water.” well over 100 years and plan to be around Furthermore, when it comes to every for well over a hundred more says a lot, in single investment decision British American my opinion, about what our thought process Tobacco makes, the Group ensures that it is, and without doubt this has influenced always carries out evaluations in regards the way we look at how our activities to the sustainability of the business. For influence the world around us.”

As Meyer approaches a year in his role as example, if the Group decides to build a new factory it will first conduct an extensive Global Head of Supply Chain, it seems as good environmental impact assessment which a time as any to ask him what he believes

200

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ENHANCED EMBOSSING DRESS UP YOUR BR AND

www.boegli.ch bg@boegli.ch

British American Tobacco

Production line after sorting

“One of the things we are currently embarking on is the integration of both the primary and secondary supply chains” the immediate and long-term future holds for British American Tobacco’s supply chain. Understandably he has several predictions about what will influence his department going forward, the first of those being changing international regulations that target tobacco products.

“Our product’s quality, its taste, has never been more important and has become the biggest differentiator in the market. From

a supply chain perspective this puts even more focus on sourcing the best tobacco, the best materials, and developing and producing the best blend that our consumers demand. This attention to detail when it comes to the finished product is one of the main reasons why we stand head and shoulders above our competitors.”

Continued innovation, both in terms of new products released to market and

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Retail outlet in Lagos, Nigeria

British American Tobacco internal processes will also factor heavily on the future efforts of the supply chain.

New product categories that gain significant traction amongst consumers, e-cigarettes for example, require almost an entirely unique supply chain in themselves compared to traditional, combustible products, while advances in technology within the Group’s existing infrastructure are helping make vital information more readily available.

Quick access to facts and figures covering everything from consumption levels to the use of parts in individual factories is also contributing to faster, more accurate decisions being made at local, regional and global levels.

In many ways this all harks back to that key word, integration. “As a global company it is imperative that we work hard to eliminate inefficiencies at a local level, and the best way to do this in my opinion is for us all to be singing from the same hymn sheet as it were,” Meyer concludes. “Personally, I would very much like it if we were able altogether to stop talking about separate regional and local supply chains, and instead focus on the fact that we have an integrated global supply chain. At the end of the day a company like ours should be one where every man and woman shares the same core objectives and targets, and these centre on providing the best products, made to the highest quality, at the best cost to our consumers.”

For more information about British American Tobacco visit: www.bat.com

BE Manufacturing | 75

76 | BE Manufacturing

Eti Aluminyum

Among the integrated elite Since it was privatised is 2005, Eti Aluminyum has channelled a great deal of effort and capital into a comprehensive modernisation programme that is now set to bear fruit

written by: Will Daynes research by: Abi Abagun

BE Manufacturing | 77

T

he world’s second most used metal after steel, aluminium is blessed with a host of positive characteristics that have made its use invaluable to the modern world.

The most common metal found in the earth’s crust, it possesses a remarkably low weight-tostrength ratio, high resistance to corrosion, is easy to shape and is 100 percent recyclable.

Despite aluminium’s importance to several multi-billion dollar sectors, including the aerospace, transportation, medical and construction industries, surprisingly there remain only a handful of integrated aluminium producers in existence today. One of the elite few is Turkey’s Eti Aluminyum.

Eti Aluminyum was originally established in 1962 by the Turkish government, with 15 years passing before it reached full capacity production in 1977. More recently the company embarked on a transition into the private sector when it was acquired in 2005 by the Turkish construction, energy and mining group Cengiz Holding. This event kick started a comprehensive modernization process for the company, one that continues to this day.

Eti Aluminyum is Turkey’s only producer of liquid aluminium and it is the country’s only fully integrated producer which takes in untreated ore downstream and then has the capacity to fulfil every process requirement to the finished product. The company has its own bauxite ore mines located just 20 kilometres away from the factory and this is the starting point of its operations—the chemistry of aluminium means it is always found combined in other minerals, most frequently bauxite ore.

78 | BE Manufacturing

Eti Aluminyum

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Combined with Cytec’s unmatched R&D capabilities and world-class application expertise, we con the right level of performance. To learn more about how the premier supplier of mining specialty tomorrow, visit cytec.com/specialty-chemicals/alumina-processing.htm

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formance and Possibilities

ng products with the breadth and depth to advance all stages in the Bayer Process. Our MAX HT® ntly received the Environmental Protection Agency’s Presidential Green Chemistry award. Our rich

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CYTEC A leading supplier of chemical reagents to the mining industry for nearly 100 years, Cytec enables customers to improve productivity and reduce operating costs while meeting complex economic, environmental and metallurgical challenges.

As the demands of the industry are changing, Cytec is partnering with mining companies around the world to deliver reagent solutions for the recovery and production of copper, alumina, gold, nickel/ cobalt, polymetallic ores and many other metals and minerals.

Cytec Industries provides the alumina industry with value-adding, efficiencyenhancing technology for all stages in Bayer Process alumina production. Cytec’s technological innovations for alumina processing began with programs for the solid-liquid separation processes and the introduction of synthetic polyacrylate flocculants to replace starch.

Cytec developed the HX flocculants over 20 years ago and since then has remained the premier supplier to the mining industry.

Our flocculants are constantly improved to better meet the industry’s requirements and CYFLOC® ULTRA Series, is the latest advancement in flocculant. The performance benefits includes: • Allows difficult to handle bauxite (high silica >5%) to be processed economically.

• Process variability is reduced due to steadier operation in the clarification section

82 | BE Manufacturing

• Overflow suspended solids are reduced by 50% or more over polyacrylate flocculants, resulting in significant improvements in filtration.

• Gives superior results over existing HXPAMS at reduced dosage requirements • Rapid settling rates allow for high throughput in settler operation.

• High mud densities combined with improved rheological properties of the underflow solids results in less torque on the thickener rake system.

• If the product becomes frozen its performance is fully restored when thaw and mixed All of Cytec’s initiatives in alumina are supported by a global team of field engineers - and a vertically integrated supply chain - to support today’s programs and technologies with an eye on future industry needs. www.cytec.com

Eti Aluminyum

Hot rolling mill

Using the technology of today there are two main production phases. These are bauxite primary ways of producing aluminium, the mining, aluminium production, liquid first being from ore, creating what is known aluminium production, the alloying and as primary aluminium, and the other being casting of the liquid aluminium, and the from scrap, creating secondary aluminium. last but by no means least, the production Eti Aluminyumâ&#x20AC;&#x2122;s SeydiĹ&#x;ehir Aluminium Plant, of semi and/or end products through the located in the Central Anatolia region of Turkey, use of the aforementioned casting, rolling is an integrated primary and extrusion processes. aluminium production plant.

Today Eti Aluminyum From here the company is provides employment for more than 1,300 individuals, able to convert aluminium while its plant possesses the ore into metallic aluminium capacity to process some by first processing the ore and then shaping it through 460,000 tonnes of bauxite ore Processing capacity the use of casting, rolling and each year and 60,000 tons of at Etiâ&#x20AC;&#x2122;s Seydisehir aluminium per annum. There extrusion systems.

Aluminium Plant of is also an on-site casting The integrated production bauxite ore per year facility with a capacity of process itself consists of five

460,000 tonnes

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75,000 tons a year. Eti Aluminyum produces primary and cast aluminium products as well as wet and dry aluminium hydroxide, calcined alumina and a small quantity of high Mg-alloyed plates. In addition, the company’s facilities are also equipped to handle the production and commercial sale of aluminium hydrate, alumina, and aluminium sulphate and vanadium sludge.

The aluminium hydroxide product is used by aluminium sulphate, poly aluminium chloride (PAC), zeolite and other special hydrate producers. The metallurgical alumina product is used mainly by the smelter department internally, as well as by refractory, ceramic and other special alumina producers. The casting products consist of re-melt ingot, alloyed and non-alloyed ingots, billets and slabs. Here, re-melt ingots are used by billet and slab producers while the alloyed and non-alloyed ingots are used by piston producers, cable manufacturers, etc. Billets are used by extrusion producers and slabs are used internally by the rolling plant. Meanwhile, the high Mg-alloyed plates that the plant produces are typically used by machinery builders, ship builders and the defence industry.

Since its privatisation, modernising the legacy of Eti Aluminyum’s plant and related

facilities has been a key priority. While its existing infrastructure has undoubtedly served the company well for almost 40 years, a comprehensive upgrade was nevertheless of paramount importance if it was to be able to increase equipment and process efficiency, plant productive, improve work conditions and safety, and reduce emissions.

Making all of this a reality was always going to be quite the challenge and it is one that the

“Machinery used throughout Eti Aluminyum’s operations is being systematically brought into line with new technology and regulations” 84 | BE Manufacturing

Eti Aluminyum

company is continuing to face meeting around 15 percent of up to as we enter 2014. As Turkey’s annual aluminium well as upgrading all of the demand. Therefore it stands equipment and infrastructure to reason that many within relating to its two methods the country are waiting Of Turkey’s annual excitedly for the company’s of aluminium production, aluminium demand machinery used throughout modernisation plans to is provided by Eti Eti Aluminyum’s operations is bring about an increase Aluminyum being systematically brought in its plant’s production into line with new technology output from 60,000 to and regulations, while great 75,000 tonnes of aluminium progress continues to be made towards the by early 2014, a target that appears well construction of a new coal powered steam within its reach. boiler plant and the installation of a more modern smelter. Both the latter undertakings For more information about are expected to be completed in 2014.

Eti Aluminyum visit: Eti Aluminyum’s Seydişehir Aluminium www.etialuminyum.com Plant is estimated to be responsible for

15%

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86 | BE Manufacturing

Emirates Steel

Shaping a low carbon future The unwavering dedication Emirates Steel has towards producing only the finest quality products also extends to the companyâ&#x20AC;&#x2122;s commitment to health and safety, the environment and energy efficiency

written by: Will Daynes research by: Candice Nice

BE Manufacturing | 87

H

istorically known for its large hydrocarbon wealth, which gives it one of the highest GDPs per capita in the world, the UAE’s decision in recent years to diversify its economic plans marked an important shift in the growth of the GCC country. It has subsequently proven to be a hugely successful move, with the country’s non-oil and gas GDP outstripping that attributed to the energy sector, accounting for 64 percent of its total GDP. This trend is reflected in Abu Dhabi, the wealthiest emirate of the UAE, with substantial new investment being made in industry, real estate, tourism and retail through the Abu Dhabi government’s industrial diversification policy.

A driving force for implementing this policy is Emirates Steel. Wholly owned by Senaat, the UAE’s largest industrial conglomerate, Emirates Steel is the only integrated steel plant in the UAE, utilising the latest technology to produce high quality rebar, wire rod and heavy sections.

Established in 1998, Emirates Steel grew in a relatively short period of time from a simple re-roller of imported steel billets to a complex integrated manufacturing plant, using modern solutions to meet market demand and generate value for its various stakeholders. In 2012, the company achieved a capacity of 3.5 million tons, following two expansions and an investment of $3 billion.

One of the core objectives at the heart of Emirates Steel today is its desire to meet market demand by producing steel in a safe and sustainable way. Amongst its

88 | BE Manufacturing

CEO of Emirates Steel His Excellency Saeed G Al Romaithi

Emirates Steel

Emirates Steel is the largest steelmaker in the Middle East to produce structural steel up to a million tons a year

most important sustainable development priorities the company endeavours to provide the necessary training and personal protective equipment to maintain the safety of its employees. Also included in these priorities is Emirates Steel’s on-going efforts to utilise the CO2 it generates during the iron reduction process at its DRP plants, and its work to promote environment and resource conservation.

In November this year Abu Dhabi National Oil Company (ADNOC) and Masdar, the

nation’s renewable energy company created a joint venture company to develop commercialscale projects for carbon capture, usage and storage (CCUS). It will build a $123 million CO2 compression facility and a 50 kilometre pipeline, along which CO2 will be pumped to ADNOC’s oilfields.

Emirates Steel is a key partner in this project – the CO 2 its plants generate will feed the project when it goes operational in 2016 and the compression plant will be located close to its premises. The project

“Wholly owned by Senaat, the UAE’s largest industrial conglomerate, Emirates Steel is the only integrated steel plant in the UAE” 90 | BE Manufacturing

Emirates Steel

800,000 tons Emirates Steel will free issue the captured CO2 to Masdar will sequester up to 800,000 tonnes of CO2 annually – a massive contribution to Emirates Steel’s carbon footprint, which at the same time will improve ADNOC’s oil recovery.

“CCUS presents a viable technology for energy-intensive industries to lower their carbon footprint,” said His Excellency Saeed G Al Romaithi, CEO of Emirates Steel.

“By capturing and eventually storing our CO2 stream, Emirates Steel sets an example of supporting Abu Dhabi’s sustainability objectives through operating environmental friendly heavy industries within the emirate of Abu Dhabi.”

This is far from the first time that gas has been pumped underground to improve oil recovery, and in the past the UAE has used surplus hydrocarbon gases for this purpose.

However, with the nation’s rise in its energy demand, this CCUS project will allow the UAE to preserve its natural gas for domestic electricity generation. The feed from the Emirates Steel plant, containing 90 per cent CO2 , will be transferred to a common compression and dehydration facility at the project site in Mussafah. The feed stream will be compressed into dense phase; delivering a CO2 stream through 50 kilometres of pipeline network, to be injected in an onshore field, operated by ADCO. It is worth noting that

Fourth steelmaker in the world licensed to manufacture nuclear grade steel

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Emirates Steel is the first steelmaker in the world to capture its CO2 emissions on this scale, with the possible exception of some North American projects.

Protection of the environment has always been a key priority when it comes to Emirates Steel’s operations, with the company maintaining the belief that the steel production industry will only be able to show sustained development if it

can help minimize negative impact on the environment. It is this thought process that underlines the company’s ecological policy. “It is also for this reason that we are committed to continued compliance to all environmental regulations, to protect present and future human well-being in our local environment,” Al Romaithi added.

Emirates Steel’s environmental protection activities are based on a series of principles.

“Emirates Steel is the first steelmaker in the world to capture its CO2 emissions on this scale outside North America”

3,500 trees are to be planted all around the steelmaking complex

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Emirates Steel

Monitoring the environment is a key priority

These involve conducting business in a socially and environmentally responsible manner, using best available techniques, preventing environmental pollution, having an environmentally friendly approach at all times and reducing the generation and accumulation of waste products. The result of these actions helps to reduce the impact on the environment from the companyâ&#x20AC;&#x2122;s production activities, while at the same time aiming to provide a favourable living environment for the UAE community.

June 2009 saw the company put into action a comprehensive Environmental Monitoring Plan. Designed to fulfil the requirements of Abu Dhabiâ&#x20AC;&#x2122;s Environmental Agency, the plan involves the monitoring of effluent, WTP sludge, stack

emissions, ambient air quality, groundwater, ambient marine water, sediment, and noise emissions. An approved independent laboratory carries out the required measurements and monitoring reports are prepared and reviewed against regulatory limits.

Emirates Steel conducts regular stack monitoring for SOx, NOx, CO and PM to meet the requirements as set out by the Environment Agency of Abu Dhabi.

Meanwhile, the company has installed state of the art technologies such as low NOx burners and dry de-dusting units across its operations to minimise emissions. This has helped the company to achieve regulatory compliance consistently according to the monitored parameters.

BE Manufacturing | 93

â&#x20AC;&#x153;the steel production industry will only be able to show sustained development if it can help minimize negative impact on the environmentâ&#x20AC;?

When it comes to ambient air quality, a real time ambient air quality and meteorology monitoring station has been commissioned at the industrial City of Abu Dhabi. Owned by Emirates Steel, it is operated and maintained by the Higher Corporation for Specialized Economic Zones (ZonesCorp), the industrial sector regulatory authority.

94 | BE Manufacturing

The process of non-contact cooling in the steel making process sees the use of both seawater and fresh water. In its role of an environmentally conscious business, Emirates Steel has operations in place to ensure that the wastewater generated from the process undergoes different stages of treatment prior to reuse and discharge.

Furthermore, in its attempt to achieve

Emirates Steel

Green belt project: A responsible business

excellence in the field of by-product recycling, constant efforts have been made to match the rates of recycling and generation for oxide fines, iron fines, slag, refractory, and mill scale. In addition, efforts have also been made to improve production processes and reduce waste.

Arguably one of the strongest examples of Emirate Steelâ&#x20AC;&#x2122;s commitment to sustainability and responsible business is its Green Belt Project. This undertaking has seen the company initiate a treeplanting program around the perimeter of operations. In one area in particular, 150 palm trees have been planted together with more than 2,000 Conocarpus Erectus trees, also known as Damas trees, in addition to

grass and ground cover. In total, an area of approximately 15,000 square metres has been planted. These new trees and other green areas are irrigated by the treated wastewater that previously would have been discharged back into the sea.

Protecting the environment with sustainable landscaping is a key priority at Emirates Steel. The company wants to be sure that it can minimize its environmental impact by drawing water very carefully from local sources. During Phase 1 of the Green Belt Project Emirates Steel has sought ways to embellish the surroundings by embarking on a green belt and associated road network project.

As part of this project, the company

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Emirates Steel The Emirates Steel Industrial Complex

is planting 3,500 trees around the main boundary fence and surrounding its stockyard. In addition to enhancing the green areas, the project helps the company to control dust emissions from plant activity and improves road safety. It is also used as a bunker for more storage space and as a controlled area for materials. The long-term plans of Emirates Steel from an environmental perspective revolve around building on the impressive efforts it has already made.

Naturally this will involve an increase in environmental investments, which will enable the company to rank among the best GCC companies in terms of environmental protection, thus strengthening its competitive advantage and contributing to its own sustainable development.

The proof is there to see. Over the years, the company has striven to improve its processes and controls, has invested capital to increase efficiency and decrease energy use, and fostered a culture of resourcefulness and accountability.

As it looks to the future, Emirates Steel will soon become one of the first steel companies in the world to sequestrate CO2 on a large scale. Together with other energy reduction initiatives, it is believed that this will provide the company with one of the lowest carbon footprints compared to any integrated steel plant in the world, a fact of which it can be immensely proud.

For more information about Emirates Steel visit: www.emiratessteel.com

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University of Kentucky - Lean Systems Program

2013 Lean Users Conference:

Leaning in the right direction The University of Kentuckyâ&#x20AC;&#x2122;s Lean Systems Program Director, Glenn Uminger discusses the 2013 Lean Users Conference, shares some of its success stories and reveals his early hopes for this yearâ&#x20AC;&#x2122;s event

written by: Will Daynes research by: Vince Kielty

98 | BE Manufacturing

W

hile the theme of the conference remains mostly the same, the finale of a year’s worth of hard work, what we do hope to do is mature the event and the presentations that take place each year,” states Lean Program Director, Glenn Uminger. The conference he is referring to is the University of Kentucky’s Lean Systems Program, 2013 Users Conference, held on 10-11 September, 2013.

“While this conference is still in its infancy, what with 2013 being only its third year, we are greatly encouraged by the increase in attendance that we have witnessed compared to previous years,” Uminger explains. “Even more importantly is that we continue to see a growing number of strong examples of Lean applications being adopted by businesses from a wide range of industries.”

This increase in examples led to this year’s conference being typified by the sheer volume of rich and meaningful presentations that took place, each of which highlighted the success individuals and businesses have had when it comes to the implementation of Lean processes, and the subsequent results of this.

“There were certainly a number of key themes that consistently appeared during the

Pete Gritton, retired Toyota Human Resources VP and Lean instructor leads a discussion at the 2013 Users Conference

conference,” Uminger highlights, “from the reinforcement of just how critical hands-on, decisive leadership is to Lean transformation to the importance of setting out a clear plan from the offset. Tying in to the latter point was the idea of enduring consistency, whereby companies must realise that adopting Lean is a test of endurance and one that requires flexibility and adaptability. Last, but by no means least, it is about people and aligning the behaviour and performance of people to your business’ plans.”

As one would expect, these themes helped make up the building blocks of some of the more impressive case studies showcased at

“We continue to see a growing number of strong examples of Lean applications being adopted by a wide range of industries” 100 | BE Manufacturing

University of Kentucky - Lean Systems Program

“What Uminger has seen has clearly given him even greater optimism about the future adoption of Lean processes” this year’s conference. Two of the standout examples that immediately come to Uminger’s mind involve the healthcare sector, specifically the efforts of T.J. Samson Community Hospital and Dr William Thornbury.

In the case of T.J. Samson Community Hospital, what it has done is apply Lean thinking to the way in which it delivers patient care, both from a day clinic and overnight care perspective. Recognising the need to expand their operations, the hospital acquired an abandoned former Wal-Mart building and meticulously went about redesigning it into a dedicated clinic.

“What the hospital did,” Uminger says, “is compartmentalise the functions of the clinic to deliver a quick, fluid service to all who visit it, making the process of arriving, receiving treatment and leaving a streamlined one. The success of the clinic has also led to the main hospital itself being able to better clarify its own function, services and processes as well.”

As far as Dr Thornbury, whose brother Neil is in fact COO of T.J. Samson Community Hospital, is concerned, his presentation focused on how he has been using Lean thinking to deliver as much service to as many patients as possible. Dr Thornbury’s answer was to develop and implement a revolutionary e-visit service dubbed Me-Visit. Designed to

strengthen the relationship between patients and their physician, Me-Visit helps patients connect with their medical provider using mobile technology.

“This device that Dr Thornbury has implemented allows his patients to contact him via their mobile device, upon which he can utilise his knowledge of the patient, their history and various symptoms to diagnose and prescribe treatment quickly and

Brandon Spencer, Kentucky Chick fil A manager, discusses how they have incorporated lean principles to running the kitchen side of things in their stores

BE Manufacturing | 101

Jenny Cerwinski, Lean Coordinator at T J Samson Community Hospital explaining how consideration of flow, positively affected their new clinic setup

Dr. Neil Thornbury, COO, des lean transition underway at

“Like Lean itself the very adoption of the process is about constant improvement” efficiently,” Uminger enthuses. “Furthermore, he can attach all the necessary documents and information about the diagnosis and treatment at the same time. What that essentially means is he is providing the patient with more information and support in a matter of minutes than would be achieved through a face-to-face visit. This is something that really encapsulates what Lean is all

102 | BE Manufacturing

about and it is something that he is working to promote across the country.”

With the 2013 Users Conference behind us, thoughts have already turned to 2014’s event, occurring on 30 September and 1 October this year. “Our early hopes for this year’s event are that we will hear examples from our client companies that show a deeper penetration of Lean thinking and

University of Kentucky - Lean Systems Program

scribing the current status of the T J Samson Community Hospital

Ownie McBride, Lean Systems Program instructor answers an attendee’s question at the 2013 Conference

the use of broader applications that create great success stories,” Uminger reveals. “On top of this of course we would love to see attendance levels continuing to rise and we think a 25 percent increase on this year would be a good target for us to aim for.”

Turning back to the present day and all that Uminger has witnessed in the past several weeks, what he has seen has clearly given him even greater optimism about the future adoption of Lean processes throughout different sectors and industries.

“Like Lean itself,” he concludes, “the very adoption of the process is about constant improvement. In order to help facilitate this we continue to work with both our established and newer client companies

tangibly, joining them out onsite or inviting them to our facility, and what we have seen gives us great encouragement. Long before we think about who will be presenting at this year’s conference we will be helping these companies to develop their implementation and practical application of the process.

That will ultimately mean that this year we can not only look forward to hearing more mature examples from our previous clients, but also about the next generation of Lean success stories.”

For more information about University of Kentucky - Lean Systems Program visit: www.lean.uky.edu

BE Manufacturing | 103

Coresa

It’s in the bag

Managing director Jose Ignacio Arrate talks about Coresa’s range of plastic packaging solutions, and the company’s opportunities for expansion in South America

written by: Martin Ashcroft research by: Abi Abagun

104 | BE Manufacturing

Coresa storage silos allow for the temporary storage of cereals, pulses, fertilizers, pastures, feed, among others

Coresa

P

ackaging specialist Coresa was the world, but to be clear on what we mean established in Chile in 1966. here, it is also known in Latin America as a “We started making flexible ‘maxi saco’, and in English speaking countries containers from polypropylene in as a ‘bulk bag’. I’m sure you know what I the 1980s and also some fabrics mean. It’s the bag that your local building for specific applications,” says managing merchant uses to deliver a ton of sand, or the director Jose Ignacio Arrate, “so we’ve been agricultural merchant a ton of animal feed. making these products now for thirty years, It’s an essential product for bulk deliveries, and the company has been in existence for and Coresa has a consolidated capacity of nearly fifty years altogether.” more than 150,000 a month from its three The products he refers to are predominantly manufacturing facilities, one in Chile, one in bags and sacks for the packaging and Argentina, and one in Peru. transportation of commodities in a variety The Chilean factory is the heart of the of industries including fisheries and food, organisation, with 550 employees. The Coresa plant in Peru employs animal feed, mining and construction, although there 180 and Argentina 150. is also strong demand from The number of employees agriculture, in particular, in each facility reflects the for woven polypropylene or production capacity of each polyethylene fabric sheeting plant. “In Chile we have the The year that Coresa was used in containers, perimeter capacity for 100,000 tons of established fences, curtains, tents and extrusion per month, enough blankets, among other things. for seven million bags a It’s too easy to describe them as “bags and month,” says Arrate. “In Peru we have an sacks,” however, as this fails to convey the extrusion capacity of 400 tons a month, but multitude of different product lines Coresa we don’t produce fabrics in Argentina, we produces for individual customers and ship them in from Chile and produce bigbags applications. “Our product range uses over and sacks from the imported material.” a hundred different fabric specifications in Raw materials purchasing is centralised in terms of their properties, thickness and weight Chile, as also are the finance function and per square metre,” explains Arrate. “We have the ingredient ‘recipes’ for each product. different bags with different designs for the With three manufacturing facilities in three top and the bottom, for different sizes and different countries, however, and a reputation weights, which are all customised for each for quality to protect, consistent processes are client and each application.” essential across the board, so the plants are One of Coresa’s most successful products is integrated using the same ERP system. “We the ‘bigbag’, as Arrate refers to it. It probably have SAP R/3 in all our plants so we have has a different name in different parts of standardised processes for manufacturing,

1966

BE Manufacturing | 107

management, accounting, buying, selling, accounts receivable, etc, in all three facilities,” says Arrate. “Everything is managed using SAP—the same platform in all three plants.”

A major benefit from the close integration is that it allows Coresa to operate with a very lean management hierarchy at each plant.

“We have the same machines in each plant,

we have a lean operation to avoid duplication and waste, and we have a really ultra-light back office in all of our plants,” says Arrate.

“Our goal in manufacturing is to increase our productivity based on three pillars; efficiency, quality and safety. We set productivity goals for each machine and we monitor these shift by shift and day by day.”

“Our goal in manufacturing is to increase our productivity based on three pillars; efficiency, quality and safety” 110 | BE Manufacturing

Coresa

Coresa bags are manufactured to withstand industrial transportation

The machines themselves are top of the range, from one of the world’s most respected equipment manufacturers. “Almost all our machinery is Starlinger,” says Arrate, “the Austrian specialist manufacturer of sack making machinery.” Starlinger is famous for developing the patented Adstar bag for carrying cement, which is now one of Coresa’s core products. “We have two machines in Chile producing Adstar sacks for cement,” says Arrate. “They are paper sacks, but without any sewing. We have the capacity to manufacture two million of these bags every month in Chile, but we are also planning to start producing them in Argentina soon. We were the first company

in Latin America to make this bag when we introduced it in 1998.”

In the thirty years that Coresa has been manufacturing bags and sacks, customer requirements have continued to evolve, so research and development has been an ongoing process. Innovation has been a constant preoccupation, and the company has successfully converted many new ideas into solutions for its customers. One of these is a type of tent used by cherry farmers to cover the trees when the fruit is maturing.

Another solution has been developed to cover blueberry plants. “We also have new developments in sewing techniques for some of our customers.”

BE Manufacturing | 111

“Environmental awareness is an issue all over the world, but with plastic, it’s more about final disposal than manufacturing”

Coresa container bags are designed to hold loads from 300-2500 kg

112 | BE Manufacturing

Coresa The company sells all over North and South America, and continues to look for opportunities to expand. “We are interested in Colombia, Mexico and Brazil,” says Arrate. “We are one the biggest in our industry in South America, we have a lot of experience, a recognised quality in the market and a flexible capacity to answer anything that is asked of us in terms of productivity and quality. We also have a capacity in Chile that could be redirected to produce a final product somewhere else. It’s easy for us nowadays to start a factory anywhere, using our SAP platform. We have a lot of strengths which we can use to start a new business from scratch.”

Environmental awareness is an issue all over the world, but with plastic, it’s more about final disposal than manufacturing.

“The manufacturing process from the extruder to the assembly of the product is actually a very clean process,” says Arrate.

“We only need electricity to do it, and there’s a minimal amount of scrap that can’t be used again in another product.

“There is a lack of public perception in South America about plastics recycling, however,” he continues. “It’s not as far advanced as it is in North America or Europe. We are just beginning to think about it here. You could not imagine

modern life without plastic products, so I think we will soon see better technology for recycling plastics, and also more education to teach people how to handle plastic packaging after it has been used.

That is a big opportunity in Latin America.”

On the social side of corporate social responsibility, Coresa is active in the areas in which it operates. “In San Antonio we have experience running soccer tournaments and other sporting activities, says Arrate, “and in Argentina the Christmas party for the whole town was held in our factory.”

For more information about Coresa visit: www.coresa.cl

BE Manufacturing | 113

Chicken and egg Country Bird Holdings (CBH) is a fully integrated poultry company with breeder facilities, hatcheries, broiler sites and processing plants and feed mills: a leading brand in South Africa, its sights are set on growing markets across the continent

written by: John Oâ&#x20AC;&#x2122;Hanlon research by: Jeff Abbott

114 | BE Manufacturing

CBH

BE Manufacturing | 115

Nutri Feeds delivery truck

CBH

K

evin James acquired CBH in 2003 when it was a small and struggling operation processing just 250,000 chickens a week at its Bloemfontein location.

However, having just shaken the dust of Zimbabwe, where he had built up a thriving poultry business, he hit an auspicious moment for the South African market, with feed prices declining and chicken prices firm. A year later he and his partners were able to buy and restart an operation in Mafikeng turning out 400,000 birds a week. They increased the capacity of both operations and by 2007 had a joint weekly capacity of 1.5 million birds. To this they added a number of feed mills, and in that year listed the group on the Johannesburg Stock Exchange.

Today the group employs 5,379 people and trades its poultry into the South Africa market under the Supreme Chicken brand and its animal feed under the name of Nutri Feeds, now the leader in animal feed manufacturing in South Africa with manufacturing plants in Viljoenskroon, Mafikeng and Bloemfontein.

“The feed market is very consistent,” says James. “We produce 500,000 tonnes of feed a year, around half of it for our internal use and the rest sold into regional and even global markets. We have three abattoirs, each of them working double shifts to produce half a million birds a week and additionally we have our own breeding programme.”

After just five years, then, CBH is now the third largest poultry producer, and at times has been the largest poultry exporter in South Africa.

BE Manufacturing | 117

Albrecht Machinery since1

Pty (Ltd)

949

Solutions for food producers & manufactures Freezing, Chilling, Frying, Cooking, Roasting, Baking, Proofing, Searing, Steaming, Blanching, Thawing, Drying, Slicing, Dicing, Cutting, Peeling, Breading, Battering, Coating, Filling, Multihead Weighing, Product Forming and Extruding Machines, Thermoforming Packaging Machines, Carton Erectors, Fillers and Closers, Dough processing, Pie and Bread lines, Bread roll lines, Baking Equipment

Through our World Leading Food Machinery Suppliers

Frigoscandia Spiral Freezers

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Albrecht Machinery Carton Freezers VacForm series

Frigoscandia | Stein | DSI | Double D

foodprocessing

T: 0861 000 516 | E: gcc@albrechtmachinery.co.za We also offer the following in-house services: • Project management • AutoCAD drawing services • Trained technical support

• 2nd hand machinery dealers • Equipment moving and refurbishing • Equipment servicing

CBH

5,379 People employed by CBH group

Feed may be a consistent market – chicken meat is more volatile. At the time of listing, the South African poultry industry was quite buoyant. Since then rising maize prices have chipped at margins and rapid expansion of the poultry industry has led to over-supply.

But an even more serious challenge has come from cheap meat flooding into the country from overseas, particularly the EU and Brazil. The South African Poultry Association has asked the International Trade Administration Commission of South Africa to raise duties to as much as 82 percent from

CBH founder, Kevin James

Albrec

ALBRECHT MACHINERY

since1

949

Solutions for food

Established in 1949 to service the growing needs of the food industry in South Africa, Albrecht Machinery has developed a reputation as a leading supplier of equipment and turnkey solutions. The quest for reliable new equipment and innovations is on-going in a bid to ensure that local industries are exposed to the best that the world has to offer.

The company is currently agents for a number of global players in food processing equipment. These companies have been selected for their individual areas of

expertise and their compatibility with others in the stable to provide solutions to various Through our World Lea processing and packaging needs.

We have an extensive service and spare parts network with technicians based in Johannesburg, Cape Town and Durban.

Our technicians are highly skilled in multi disciplines.

We strive to build partnerships with our customers and believe that we have a vested interest in their success.

Freezing, Chilling, Frying, Cooking, Blanching, Thawing, Drying, Slicin Coating, Filling, Multihead Weighi Thermoforming Packaging Machin processing, Pie and Bread l

Frigoscandia Spiral Freezers

P

Extrusion

FO EX

Cabinplant Multihead Weighers

VacForm se

E. gcc@albrechtmachinery.co.za

Frigoscandia | Stei T: 0861 000 516 | E:

We also offer the f • Project management • AutoCAD drawing services • Trained technical support

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WHY IS ARBOR ACRES THE INTEGRATOR’S CHOICE?

LOW COST PER CHICK

PARENT STOCK PRODUCES EXCELLENT CHICKEN NUMBERS

SELECTED TO OPTIMIZE FEED EFFICIENCY

BEST GROWTH RATE AND LEADING FCR

LOW COST PER KILO

EFFICIENCY AND YIELD ADD PROFIT

ARBOR ACRES FITS ALL STAGES OF THE INTEGRATOR’S PRODUCTION CHAIN AND HAS WELL-ESTABLISHED PERFORMANCE CREDENTIALS TO IMPROVE YOUR PROFITABILITY AND SUCCESS. We are pleased to have partnership with Supreme Poultry to continue serving customers in the region. aviagen.com

GENETICS PLUS SERVICE PLUS PERFORMANCE.

The Ross® 308 is driven by industry-leading investment in R&D and new technology that continues to yield the greatest rate of genetic improvement for customers like you. This long-term commitment to research and genetic progress together with world-class support of a knowledgeable, regional technical team gives you not one, but two, key advantages. We are proud to be associated with Ross Breeders Zambia and look forward to a future of providing unequalled value to your business.

CBH Arbor Acres

Arbor Acres has remained a leading product and generated trust and respect in the global poultry industry with: • An easy to manage breeder with excellent chick production • A broiler with the best growth rate and outstanding feed conversion • Dedicated service team experienced in Africa • Support from the industry’s leading R&D breeding programme. www.aviagen.com

ROSS

The Ross 308 has a unique R&D breeding and selection programme utilising first class pedigree facilities together with more challenging, industry-like conditions to identify the most efficient and robust birds for future breeding stock. The use of multiple selection environments together with life time feed conversion testing enables the Ross programme to improve faster than competitors. www.aviagen.com/ross

CBH produce 500,000 tonnes of feed a year

the current 5-27 percent range, saying that as many as 20,000 jobs are being put at risk across the industry.

CBH has not escaped the effects of this unfair competition. “Producers are selling the breast meat and thighs on their own markets and dumping the leg quarters cheaply on South Africa,” he points out.

But CBH has a strategy that is mitigating the damage. The company has been very successful in penetrating the demanding QSR (Quick Service Restaurant) market, selling value added products to expanding chains

“The company has been very successful in penetrating the demanding QSR (Quick Service Restaurant) market” BE Manufacturing | 121

CBH like KFC, Hungry Lion and Captain Dorego.

These products now make up 15 percent of CBH’s total production of around 3,000 tonnes a week and the plan is to increase this segment to around 35 percent, which he feels is eminently doable. The result will be a balanced business selling a third of the product into retail, a third wholesale and a third to the foodservice market.

These plans are keeping the marketing department very busy at the moment, backed up by investment in plant and machinery.

Specialised cutting equipment, crumbing lines and tumblers are examples of the sort of machinery that has to be sourced

BIDVEST LAUNDRY GROUP For over 35 years, Bidvest Laundry Group has been leading the field in total laundry solutions and we pride ourselves on being South Africa’s Industrial Laundry of choice.

And we do it all – from work-wear, mat rental, bulk laundry, hotel guest laundry, on-premise laundry and even eco -friendly industrial laundry equipment- you and your staff will never have to worry about clean laundry.

• Our service is comprehensive, from A to Z • We are ISO9001 compliant and operate to the highest standards • We only use top of the range SABS approved chemicals, including our specially formulated advanced detergents • Our laundries are state-of-the-art, with built-in redundancies to ensure no downtime (backup generators, compressors, boilers, water storage, fire protection)

Bidvest Laundry Group considers the protection of the environment as essential and is also committed to sustainable use of the environment. That’s why we have implemented a number of green policies and constantly monitor and improve our water, fuel, and chemical efficiencies. We are also exploring alternatives to phosphates in our detergents, reducing our electricity consumption through variable speed controls, and using boreholes to reduce our eco-footprint. All in all, Bidvest Laundry Group is a fast, reliable and fresh solution to all your laundry requirements. And, as a proud member of the Bidvest Laundry Group, we have the credentials and clout to consistently deliver on our promises. Truly, Bidvest Laundry Group is your A-Z solution to laundry excellence. www.bidvestlaundry.co.za

BE Manufacturing | 123

CBH from abroad. Additionally all the abattoir lines are Farmwise offers a comprehensive futures and physical being upgraded to meet the brokerage service to the Agricultural industry. Our standards required globally clients include producers and consumers in the Food by the customers. All three and Feed sectors. processing plants have Farmwise has developed an internet based trading system achieved YUM food safety that enables our clients to monitor the market in real time, as well as placing electronic orders. accreditation and can supply As one of the founding members of the AMD Division of KFC, CBHâ&#x20AC;&#x2122;s biggest QSR SAFEX, we have stood the test of time. customer, with product, but www.farmwise.co.za other outlets like Nandos, Hungry Lion and Captain Dorego each have their own specifications. With something like 12 percent of the South African foodservice market already captured, there is plenty of room for CBH to expand.

Exporting into Africa is hard to do if your production base is in South Africa.

Most of the neighbouring countries have taken measures to protect their indigenous producers, some imposing very high import duties, some entirely banning imports of frozen poultry. The only solution is to set up businesses in these markets, and that is something CBH is continuing to focus on. In fact, with operations already set up in Zambia, Namibia and Botswana it was Kevin Jamesâ&#x20AC;&#x2122;s original intention of leaving

Farmwise

$25 million Loan amount from the IFC to fund its African expansion

BE Manufacturing | 125

CBH Zimbabwe to focus on these countries had not an unmissable opportunity arisen in South Africa.

Now the emphasis is once again on Africa.

CBH has in fact already started its return to Zimbabwe where it has been given the KFC franchise. The first restaurant will open in Harare in November – something of a departure for a company that is primarily a breeder and producer but the longer term plan, when the time is right, is to set up an operation to supply poultry to the trade.

In April this year the IFC (International Finance Corporation, the private sector funding arm of the World Bank) provided

Operators in the Botswana factory

BIOMIN Mycotoxins a serious threat to broiler producers Broiler operations are under enormous pressure to produce chicken meat for the lowest possible cost. Feed conversion, growth rate, mortality and hatchability are all monitored carefully and strategies are constantly reviewed to maximize efficiencies. As production is fine-tuned, there is increased attention placed on the effect of mycotoxins on the bird. Consumption of even low levels of mycotoxins can lead to decreased feed consumption, poor growth rate and increased susceptibility to disease. Higher levels lead to clinical signs such as beak and intestinal lesions, kidney disorders and mortality.

Unfortunately, mycotoxins often occur in low concentrations that are difficult to detect, interactions between individual mycotoxins are not well characterized and unidentified mycotoxins may be causing the sub-optimal performance.

The dilemma for broiler producers is to counteract the risks associated with mycotoxins, against the

cost of ensuring they do not adversely affect bird performance. While mycotoxin analysis will provide some indication to the type of mycotoxins and levels present, the speed of chicken meat production usually means this information is only useful in ‘hindsight’. Mycofix® Select provides the solution to the dilemma faced by broiler producers. This product is added into the feed and will deactivate Deoxynivalenol and other Trichothecenes, as well as bind adsorbable mycotoxins (e.g. aflatoxins).

When clinical mycotoxicoses is seen in the birds or the feed contains highly contaminated/high risk raw materials, treatment levels of 1.5 – 2.5 kg Mycofix® Select per tonne of feed should be used.

The Mycofix® Select recommendation for subclinical mycotoxicoses, with 1.0 kg per tonne being more appropriate for those flocks which are under immunological, environmental or nutritional stress.

E. office.za@biomin.net www.mycofix.biomin.net

BE Manufacturing | 127

EASY PACKAGING SYSTEMS Due to the nature of the market we operate in and industry standards, we are constantly improving on our products and offering.

We offer a wide variety of plain and printed packaging and packaging products and accessories: • Polyethylene Bags (Plain and Printed) • Fresh Produce Bags • Sheeting • Tubing • Shrink Wrap (Plain and Printed) • Shrouds • Pallet Wrap • Food Wrap • Machine Wrap • Refuse Bags • Form File & Seal (Plain and Printed) • Book Covers • Industrial Packaging Products • Plain & Corrugated Board • Packaging Tape / Strapping We are pleased to list some of our achievements thus far: • We are proudly a BBEE Level 4 supplier and contributor • We are SABS approved • We are ISO9000 approved • We fully comply with HACCP requirements

Contact us: T +27 11 837 6789 | F +27 11 837-1031 | E sales@easypack.co.za

Providers of professional veterinary services to the pig and poultry industry throughout the SADEC region and beyond. www.avimune.co.za

Preferred supplier of day-old broiler chicks and hatching eggs.

Tel +27 (0)18 632 0336/9 Email optichicks@nwk.co.za www.optichicks.co.za

CBH

“Africa needs dynamic regional agribusiness companies that help encourage competitiveness” Easy Packaging Systems

Easy Packaging Systems has been operating for over 19 years. It was the determination to succeed, and to offer the very best in quality and service that has ensured the success of the company.

We have grown from strength to strength and become a major force within the packaging industry. We employ a large workforce of dedicated employees who are linked to a fully operational factory.. www.easypack.co.za

CBH with a loan of $25 million, convertible to shares within two and a half years from disbursement, to fund its African expansion plans. Apart from the money to increase production and set up new operations, this is a massive vote of confidence from an organisation committed to helping African economies and companies that catalyse growth. “Africa needs dynamic regional agribusiness companies that help encourage competitiveness and can expand successful models outside their home markets,” said

BE Manufacturing | 129

Morupule Coal Mine (MCM) is located

Tel: +267 492 0667 Fax: +267 492 0643 www.mcm.co.bw

14 kilometres west of Palapye in eastern Botswana. With a vision of being recognised as a leading coal energy business, MCM delivers energy for the benefit of its stakeholders in a sustainable and responsible manner.

CBH Saleem Karimjee, IFC Senior Country Manager for Southern Africa.

With increasing urbanisation and disposable incomes, per capita meat consumption is expected to double in Africa by 2030, particularly that of poultry, which is cheaper relative to other meats.

“We are spending $15.5 million in Zambia on upgrading our hatchery from 380,000 to a million birds a week” Also in Zambia, CBH has bought a ‘grandparents’ farm.

Hatchlings become the great-grandparent flock, which produce grandparent stock, which in turn produce parent stock – it is the offspring of the parent stock that are raised for meat production, so the operation in Zambia will supply Angola, Zimbabwe,

MORUPULE COAL MINE In 2000, Debswana acquired MCM as its 100 percent owned subsidiary and it has since grown both in stature and production to be a dominant influence in the coal mining sector in the country and region. Situated above the Kgaswe coalfield, which is endowed with good quality coal contained within four main seams, MCM is estimated to hold reserves of approximately 2.91 billion tonnes of coal within the number 01 and 02 seams, with a total inferred inventory coal resource of 12 billion tonnes across all the seams within the mining lease area.The main customer for MCM’s thermal coal is the adjacent Botswana Power Corporation (BPC), with supply historically going to the existing 150MW Morupule ”A” Power Station. In 2008, South Africa advised Botswana of its intention to

gradually terminate export of power to Botswana and other neighbouring states. This resulted in BPC constructing a new 600MW power station. MCM rose to this national challenge for power supply and executed its own MCM Phase I expansion project that resulted in a threefold increase in installed capacity to 3.4 metric tonnes per annum. Since the successful completion of its Phase 1 expansion, MCM continues to explore its vast reserves and is currently undertaking further exploratory and investigative work (Phase II expansion) with the objective of establishing an open pit mine in the northern boundary of its mining lease area to meet the additional regional and overseas markets’ demand for coal. www.mcm.co.bw

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A hEAD START FoR hEAlThy ChICkS With the new product hP AviStart in the poultry feed you benefit from: • Excellent digestibility • High in energy • Just 5% dosage in prestarter • Supports optimal performance up to slaughter • Attractive return on investment • Available in a non-GM version

Distributed in South Africa by: NUTRIBASE CC P.O. Box 74155, Lynnwood Ridge, 0040 Pretoria Tel: (+27) 12 004 0165, anta@nutribase.co.za

Feel free to discover www.hamletprotein.com

Contact: Pietman Blignaut Tel: + 27 12 348 9291 Cel: + 27 82 322 8297 Email: pietman@nutribase.co.za

RANAN TRADING LTD.

ELECTRICAL & HARDWARE Suppliers of: Hardware, Building Materials, Paints, Electrical & Plumbing Fitting Email: ranan@zamtel.zm • www.ranantrading.com P.O. Box 33546, Corner of Kalambo & Cha Cha Cha Road, Lusaka, Zambia.

Telefax: 231454, 233528

Northend, Cha Cha Cha Road, P.O. Box 33546, Lusaka, Zambia.

Telefax: 222875

CBH Nutribase

Nutribase focuses on supplying feed additive solutions that create economic benefits for our customers. We have proudly been a business associate of Country Bird Holdings since 2008, supporting them towards success.

Nutribase products include: • Hemicell enzyme: Assisting with the reduction of feed cost, while supporting health parameters.

• Avistart (Hamlet Protein): Improves pre-starter feed quality, bird health and production parameters at slaughter.

• Biostrong feed additive: The natural solution for profitable poultry production Nutribase, your partner to create value through feed additives. www.nutribase.co.za

Botswana, Mozambique, Malawi and Uganda with the parent stock for breeding.

These are all territories that Kevin James and his associates know well.

However the biggest prize of all in Africa is Nigeria, its most populous and diverse country. CBH is actively and currently moving into Nigeria with a turnkey project, he explains, in partnership with four partners who came from Zimbabwe

$15.5 million Investment amount for the Zambain hatchery

BE Manufacturing | 133

BTC

BTC Products & Services (Pty) Ltd +27828535201 +27823319720 brandon@btcproducts.co.za www.btcproducts.co.za

BTC Products is a company specialising in chlorine dioxide technology.

We offer a full technology package based around Chlorine Dioxide.

This package includes: • The design, supply, installation and maintenance of our Chlorine Dioxide Generators and associated dosing control and automation systems.

• The supply of the precursor chemicals for use in conjunction with our chlorine dioxide generation systems • Ready-To-Use Solutions.

• Monitoring of residuals and supply of the test kits.

• Technical Service and Back-up.

BTC Products is in a unique position of being able to offer specialty expertise in a variety of chlorine dioxide applications for disinfection

and oxidation within agricultural to food & beverage as well as industrial applications.

Chlorine Dioxide is a powerful oxidizing with broad-spectrum efficacy against bacteria, fungi, algae, viruses and protozoa.

The basic properties of chlorine dioxide that differentiate it from other disinfectants are: • Not sensitive to system pH. • Does not produce carcinogenic by-products.

• Provides a residual disinfectant level.

• Is significantly less corrosive than chlorine.

• Is 100 – 1000 times more effective at removing/preventing biofilm than chlorine.

Chlorine dioxide and disinfection solutions B S I

Boiler & Steam Installations c.c.

Our products are of high standards and we wish to maintain this standard for customer satisfaction.

We are proud to be able to inform you that we have supplied and continue to supply major industries.

We specialise in: • the manufacturing of the NEW THERM “O” STEAM BOILER • reconditioning of secondhand boilers • gas, oil, water & compressed air pipelines • steam and condensate systems • boilers and steam controls

• calorifiers & heat exchangers • chimney stacks, hotwell tanks etc.

• underfeed stokers and spares • water treatment plants • new and secondhand spares • mobile boilers • boiler re-tubes • boiler services and inspections

11 - 1st Road, Bredell, P.O. Box 10425, Aston Manor, 1630 Tel: +27 (11) 396 2737 | Fax: +27 (11) 979 3097 | Email: bsi.aj@mweb.co.za | www.boilerandsteam.co.za After hours: Andries Jacobs - 083 268 4077 | Dirk Jacobs - 083 395 3788

CBH eight years ago at the BTC express invitation of the Chlorine dioxide is a powerful disinfectant, that goes a then president Olasegun long way in the effort of satisfying consumer demand for Oba sa njo.

Oba sa njo a better quality food product with lower chemical input. gave each of them 1,000 BTC Products is specialist company, whose focus is on hectares near the western how best to undertake dosing, process integration, control and monitoring. We put together full service packages, city of Ilorin. covering design, installation, servicing and maintenance.

Kevin James is very Our aim on offering our expertise in partnership with our excited by the project. customers to meet their food quality goals. It is along “With 4,000 hectares at these lines that we have implemented chlorine dioxide our disposal we will have a as the primary process water disinfection system for breeding operation, a feed Supreme Poultry Processing Plants. mill, and a broiler operation www.btcproducts.co.za there, doing 250,000 birds per week by the end of this year. We will be supplying KFC in Lagos and the local market there.” Many people think that Nigeria is a difficult market to crack, and are put off by reports of inter-community conflict. Well, that does not apply in Kwara State, he observes, where Muslims and Christians coexist harmoniously. And he has found Nigeria to be the most collaborative of the many African governments he has worked with when it comes to cutting the red tape associated with getting permits, arranging investment and the like.

The Nigerian operation is already in pilot production, processing 25,000 birds

“Many people think that Nigeria is a difficult market to crack, and are put off by reports of inter-community conflict” BE Manufacturing | 135

CBH

25,000 Number of birds processed per week by the Nigerian operation.

a week, and the feed mills and houses are under construction. It will be in full production by the end of 2014, with a target output of 100,000 birds a week – with no lack of demand from a population that is both affluent and famously fond of chicken. The area is already benefiting: “We are empowering a lot of the farmers there,” says James. “We buy 90 percent of our maize from the Ilorin area, and we give them soya bean seed for them to grow and supply back to us.”

Wherever there is a need for poultry in Africa, Country Bird will be present, he promises. “We have a training school in Zambia for people who know about farming and want to go into poultry. That gives us a real edge, having high calibre managers at our disposal.” Trainees come in from Angola and other territories, and South African staff are trained there for deployment in other countries including the staff needed to supervise the Nigerian business, who recently concluded their training.

For more information about CBH visit: www.cbh.co.za

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Zambeef

Feeding a nation

Zambeef has grown from very humble beginnings to become one of the largest integrated agri-businesses in Zambia

written by: Will Daynes research by: Jeff Abbott

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Zambeef

W

ith limited capital, the company known as Zambeef was incorporated in 1994.

Employing 60 staff, slaughtering 180 cattle per month in a rented abattoir, delivering meat via a single Land Rover and selling it through two rented butcheries, it was very much a small-scale operation to begin with. Nevertheless, through a combination of organic growth and acquisitions, the company went on to become one of Zambiaâ&#x20AC;&#x2122;s largest agri-businesses, achieving a compounded organic growth rate of over 20 percent in real terms between 2003 and 2008 alone.

Today boasting annual revenues of approximately US$255 million and providing employment for more than 5,500 people, the Zambeef group is principally involved in the production, processing, distribution and retailing of beef, chicken, pork, milk, dairy products, eggs, edible oils, stock feed, flour and bread. The group also has large cereal row cropping operations, principally maize, soya beans and wheat, with approximately 8,350 hectares of row crops under irrigation and 8,650 hectares of rain-fed/dry-land crops available for planting each year. Furthermore, the company is today is the process of rolling out operations into Nigeria and Ghana.

The scale of Zambeefâ&#x20AC;&#x2122;s current operations is truly staggering. In addition to slaughtering some 60,000 cattle per year it is also responsible for producing approximately eight million litres of milk, 20 million eggs and 120 million tonnes of feed per annum, while also processing 3.5 million chickens and 90,000 hides.

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....keeping Zambia moving Established in 1992, Autoworld has positioned itself as one of the leading companies in the motor trade industry in Zambia with eleven branches throughout the country.

Autoworld is a retail store and fitment centre catering to the needs of any vehicle or boat with an extensive range of quality guaranteed products and services offering a one stop shopping experience.

We primarily operate in the replacement automotive parts industry with a focus on product ranges from accessories through to lifestyle equipment. Autoworld are dealers in both automotive and marine products from a wide range of global manufacturers.

Our product & service range offered includes: • Motor Vehicle Parts • Accessories • Tyre Specialists • Garage Equipment

• Fitment Centre • Boats • Marine Engines • Marine Accessories

Tel: +26 0211 237716/19 | Fax: +26 0211 223323 Email: info@autoworldzambia.com | www.autoworldzambia.com

Zambeef While the size of the autoworld business has changed Established in 1992, Autoworld has positioned itself as dramatically since the midone of the leading companies in the motor trade industry 1990s, its vision and strategy in Zambia with eleven branches throughout the country. remains virtually the same, Autoworld is a retail store and fitment centre catering to that being for Zambeef to be the needs of any vehicle or boat with an extensive range seen as the most accessible of quality guaranteed products and services offering a one stop shopping experience. Our vision at Autoworld is to and affordable quality protein keep Zambia moving by supplying a staggering range of provider in the region, and vehicle, marine and lifestyle products. to increase the efficiency www.autoworldzambia.com and capacity of its primary production facilities.

To achieve this, the Zambeef group continues to pursue a vertically integrated business model, from primary production to processing and distribution to retailing the finished products in a value-added form directly to the end consumer through its own extensive retail network. The vast majority of Zambeef’s food products are retailed directly to the end consumer through Zambeef’s extensive retail network. Indeed the company has one of the most impressive distribution and retail footprints in Zambia, consisting of 91 retail outlets, three wholesale centres, six fast food outlets and 20 Shoprite butcheries.

The company’s three wholesale centres were opened in 2011 in order to attract

“Zambeef group continues to pursue a vertically integrated business model” BE Manufacturing | 143

Versapak Zimbabwe began operating in Harare in 1995.

The company is the leading manufacturer and distributor of expanded polystyrene and printed rigid plastics in the country.

Product Range Foam Trays & Boxes for •Butcheries •Fruit & vegetables •Fast Food available in both plain and printed varieties Rigid Products •Dairy Product yoghurt cups •Yeast containers•Disposable cups Bottle and Jars •Petroleum Jelly jars and closures •Beverage containers Other products •Clingfilm for both industrial and domestic use • Vacuum bags •Fomopads -which are used to absorb excess moisture in packaging

We always strive to bring the best products to the consumer by using the latest advances in technology such as in our “Ultra-zorb” range of products that eliminate the use of the traditional fomo pad.

We recognise the need to care for the environment and are actively involved with Environmental Agents, Non – Governmental Organisations and Local Authorities.

We have a wide network of distributors who offer their customers professional service and advice as well as competitive prices. We also sell directly to the public.

For a list of distributors please visit our website www.versapak.co.zw

Zambeef business from the large commercial sector in Zambia.

Versapak Zimbabwe was established in 1995 and is the Elsewhere, Zambeef is leading manufacturer and distributor of Plastic Packaging in continually investing in the country. Our company has a proud history of involvement upgrading and refurbishing in the food packaging industry and offers high quality existing stores as well as products that meet both local and export market demands for opening new retail outlets food grade packaging of the highest standards.

Versapak supplies the Zimbabwean market and exports each year. It also operates one products to Zambia, Malawi and DRC. of the largest transport and www.versapak.co.zw trucking fleets in Zambia, which are serviced and maintained at its own workshop.

One particular quality that the business possesses that assists it in standing out amongst similar enterprises in the region is its commitment to the continuous improvement of its environmental and social management. To this day the company continues to subscribe to the United Nations Millennium Development Goals, while also actively assisting and supporting worthy causes, activities, organisations and charities.

Among the important aims that Zambeef supports is the eradication of extreme poverty and hunger, achieving universal primary education, the improvement of basic health care, and the fight against HIV/AIDS, malaria, TB and other diseases.

Zambeef has also signed up to an

Versapak Zimbabwe Pvt Ltd.

$255 million The companyâ&#x20AC;&#x2122;s approximate annual revenue

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UNITY Quality and Service

Unity group of companies based in Zambia are experts in packaging and distribution with a strong subsidiary specializing in work-wear and clothing. â&#x20AC;&#x153;Unityâ&#x20AC;? group of companies is the preferred supplier to the Zamanita Group of Companies, Zambian Breweries, Tradekings Group and other leading biscuits and beverages manufacturers in Zambia VISIT US ONLINE

www.unity.co.zm UNITY | Ulengo Road, Ndola, ZAMBIA. Phone: +260-212-650222 | Fax: +260-212-650131 | Email: info@unity.co.zm

Show the world what your company has to offer with our tailored packages

Seen www.bus-ex.com

Zambeef

Environmental and Social Action Plan, which for Zambian citizens and local pension funds requires the company to achieve a number of to buy shares in the company. With most local international standards on the environment, pension funds as shareholders in Zambeef, health and safety, and social responsibility. almost every full-time Zambian employee The most recent independent consultant benefits from the success of Zambeef, which reports stated that Zambeef continues to make ensures the company helps with wealth good progress in delivering the approved creation within Zambia.

Environmental and Social Action Plan.

Further to this, Zambeef has a number of Perhaps not surprising, given its size, operations in largely rural areas, and in many Zambeef is one of the largest employers in the of these rural areas the company is one of country. It also boasts a strong the largest business partners development record, being and employers, through one of the largest investors the procurement of locally in the agricultural sector in produced raw materials, Zambia over the last ten years. resulting in povert y The companyâ&#x20AC;&#x2122;s listing on alleviation and sustainable Employees working the Lusaka Stock Exchange in development of these for Zambeef today rural economies.

2003 provided an opportunity

5,500+

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Zambeef Examining what the immediate future holds for Zambeef it is clear that the companyâ&#x20AC;&#x2122;s aforementioned integrated business model provides it with strong foundations for growth, foundations including the underpinning of margin capture and value-add, the security of its supply chain, and the reducing of risk and earnings volatility.

Several recent large capital investments have certainly helped showcase the companyâ&#x20AC;&#x2122;s determination to grow further still. These have included successfully integrating crop production to its Mpongwe farm ahead of budget, and the upgrading and expansion of its activities at uts subsidiary Zamanita, where it has doubled its crushing capacity.

Targeted re-investment on the other hand is helping to drive Zambeefâ&#x20AC;&#x2122;s organic growth, specifically through the increasing of its production and efficiencies in its stock feed, dairy and milk processing divisions, and by adding additional retail and wholesale outlets where they are required. All of this combined is expected to see the company return to positive net cash generation over the coming year. This will enable Zambeef to start paying meaningful dividends from 2014.

With the company well placed to achieve its long-term ambition of becoming one of the largest food producers in the region, it is understandable why the board of Zambeef looks forward to the future with confidence.

For more information about Zambeef visit: www.zambeefplc.com

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Making a difference

For more than 50 years Seven-Up Bottling Company has been a significant contributor towards the development of Nigeria, making it one of the countryâ&#x20AC;&#x2122;s most admired businesses

written by: Will Daynes research by: Candice Nice

150 | BE Manufacturing

Seven-Up Bottling Company

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Seven-Up Bottling Company

W

ith its expanding financial, ser vice, communications and entertainment sectors, Nigeria without question possesses all the vital components necessary to be recognised as one of Africaâ&#x20AC;&#x2122;s most important emerging markets. In fact, as of 2012, the country was ranked 30th in the world in terms of gross domestic product and the second largest in Africa. This places it on track to become one the 20 largest economies in the world by 2020 according to a number of experts and analysts.

As various economic sectors have improved across the country, so too has the quality of life enjoyed by a large number of Nigerians.

This improved quality of life stems from all manner of sources, but for around 3,500 men and women it comes from their employment with Seven-Up Bottling Company, one of the countryâ&#x20AC;&#x2122;s largest manufacturing companies and distributor of some of the best known, and widely consumed, brands of soft drinks.

From its nine state-of-the-art manufacturing plants, located strategically across Nigeria, Seven-Up Bottling Company produces and markets internationally recognised products including Pepsi, 7Up and Mountain Dew. These are some of the products that the company also markets through its network of more than 200 distribution centres that are spread over the length and breadth of the country.

The company was originally founded by one Mohammed El-Khalil, a Lebanese national who first arrived in Nigeria back in 1926.

Originally operating under the name El-Khalil Transport, it began life as a very successful

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SUGAR REFINERY

SUGAR

CEMENT

FLOUR MILLS

OIL MILLS

SHIPPING

REAL ESTATE

PORTS & TERMINALS

BUA Sugar Refinery is committed to the production, storage and distribution of safe, high quality refined sugar that exceeds customersâ&#x20AC;&#x2122; expectation through the use of well motivated employees and appropriate technology. Our business processes are conducted in a sustainable manner, including the adoption of an effective HACCP programme thus minimizing risk to products, staff, customers and environment.

...unlocking opportunities Group Office: 35 Saka Tinubu Street Victoria Island, Lagos. Tel: 234-1-448971-3, 4610669-72, 01-2623537. Fax: 234-1-2623535, Apapa Office: 22B, Creek Road, Apapa, Lagos. Tel : 01-587087, 5451584, 5876260. Fax: 5803808 Website: www.buagroup.com, Email: info@buagroup.com

Seven-Up Bottling Company transport business, growing BUA Sugar Refinery into the largest company of its Congratulations to a Bottling Giant, 7Up. It just goes to kind in the whole of Western prove that hardwork and commitment always makes a Africa. The metamorphosis difference. BUA Sugar is proud to be associated with you on of the business came on 1 the occasion of your well deserved recognition by Business October 1960, when the very Excellence Africa and Food & Drink online magazine and first bottle of 7Up rolled off wish you a much greater accomplishment ahead. www.buagroup.com the production line and out of the company’s factory in Ijora.

In the years that followed the growth of the soft drinks industry partnered the growth of the company itself, with it establishing two additional plants, in Ibadan and Ikeja, in the late 1980s. It was then in the early 1990s that Pepsi International took control of 7Up International, a move which opened the door for Seven-Up Bottling Company to introduce another world leading brand to the people of Nigeria.

Today the company retains the same core vision that it has held since day one and that is to become the most admired and innovative company in Nigeria. In order to achieve this it conducts each and every task or operation with a set of core values at its heart. The first of these revolves around the concepts of commitment and ownership. These ideas can be seen throughout the business with

“Seven-Up Bottling Company produces, Pepsi, 7Up and Mountain Dew” BE Manufacturing | 155

A leading supplier of PET preforms in West Africa We pride ourselves not only on product quality, but also on the technical support we provide for our customers. This includes : • Bottle design • Lightweighting of preforms • Introduction of different neck finishes • Development of new preforms for specialised applications BevPak also supplies multilayer preforms, for shelf life extension of carbonated soft drinks, beer, fruit juice, sauces, etc. In fact, any product which is sensitive to gas loss or gas entry into the bottle benefits substantially from this technology.

enquiries@bevpaknigeria.com

|

www.bevpaknigeria.com

Show the world what your company has to offer with our tailored packages

Seen www.bus-ex.com

Seven-Up Bottling Company employees often referring to BevPak (Nigeria) Limited Seven-Up Bottling Company BevPak (Nigeria) Limited was established in 2008, and as “our company”. This is said has rapidly become recognised as a leading supplier of PET to reflect the entrepreneurial preforms in West Africa and beyond. spirit and sense of ownership BevPak specialises in advanced technology and superior that exists within the technical support. Its multilayer technology facilitates PET’s business, traits that have use in non-traditional PET applications such as beer.

Bevpak offers a range of technical support services for helped build the organisation customers with difficult applications. into what it is today. www.bevpaknigeria.com Along a similar vein to the aforementioned characteristics is the sense of teamwork that runs throughout Seven-Up Bottling Company.

Its people also carry with them a reputation for unflinching integrity and having high ethical standards. Such qualities have allowed the management of the company to have total confidence that all employees act in the best interests of Seven-Up Bottling Company, a significant level of trust that is also extended in the opposite direction.

As a business that is so closely linked to the development of Nigeria it is not surprising to see Seven-Up Bottling Company doing its bit towards contributing to a better future for the country. One of the ways it is doing so is through the 7Up Harvard Business School Scholarship. Launched in January 2011, the program sees one deserving Nigerian youth selected to have their higher education

“Today the company retains the same core vision that it has held since day one and that is to become the most admired and innovative company in Nigeria” BE Manufacturing | 157

“The unveiling of the scholarship program was part of the 50th anniversary celebrations of Seven-Up Bottling Company in Nigeria back at the end of 2010” sponsored at the prestigious Harvard Business School. The scholarship itself covers the costs of tuition, housing and tickets to and from the United States at the start and end of the individuals’ course.

The unveiling of the scholarship program was part of the 50th anniversary celebrations of Seven-Up Bottling Company in Nigeria back at the end of 2010, and came as a result of those in charge of the company deciding

158 | BE Manufacturing

that they wanted to create a unique legacy that a further 50 years from now people would remember them for.

The theme of this legacy was to be education, a choice that is particularly significant when it comes to Nigeria due to the complaints that have been raised in the past about the quality of the products and services that came from many of the country’s institutions. It was Seven-Up Bottling Company’s desire to take

Seven-Up Bottling Company

measures to help reverse this trend, however it did not want to simply replicate what other organisations have done, and continue to do, which is provide funding towards professional training in one of the countryâ&#x20AC;&#x2122;s universities. In wanting to be unique the company devised the Harvard Business School Scholarship.

As previous winners, Misan Rewane in 2011 and Olujimi Williams in 2012, can attest, there is no bond attached to the recipient of the scholarship and they are not tied into working for Seven-Up Bottling Company upon their graduation. All that is asked of the recipients is that they eventually return to Nigeria, this could be some years after graduating Harvard Business School during which time they can acquire greater business experience in the US, at which time their skills can contribute

further to Nigeriaâ&#x20AC;&#x2122;s national development.

Many prominent Nigerians have walked a similar career path in their lifetime, including current Minister of Finance Dr Ngozi OkwonjoIweala and the Minister for Commerce and Investment, Dr Segun Agagan who at one point held the position of Managing Director at Sach & Sach Corporation in the US. There are of course countless other individuals in both the public and private sectors silently doing their part in making national development a reality and Seven-Up Bottling Company is proud to be contributing in its own way.

For more information about Seven-Up Bottling Company visit: www.sevenup.org

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PET Project BevPak has successfully taken modern PET bottle technology into the challenging Nigerian market: now it is looking further afield

written by: John Oâ&#x20AC;&#x2122;Hanlon research by: James Boyle

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BevPak

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BevPak

I

n the short space of five years since BevPak was established in Ibadan, Nigeria’s third largest city, the company has put down strong roots in Nigeria. In 2008, a group of entrepreneurs bought a small operation in the city and equipped it with modern machinery to produce the preforms from which PET bottles are blown.

The Managing Director of this operation is Syd Carter, who has 18 years’ experience in the PET conversion industry in Africa.

The rationale for setting up BevPak was simple. Nigeria is a country with a huge population of nearly 170 million people – and it is a growing economy, underpinned by its substantial oil reserves. While it is well developed socially, educationally and politically by the standards of sub-Saharan Africa it also has a massive potential for growth in most consumer sectors, not least food and drink.

Nigeria’s very size and complexity have proved a disincentive for many investors who prefer a tidier market, but Carter and his associates saw the opportunity and were prepared to take the risks. The venture was based on an understanding of the industry’s fundamentals. “Traditionally there are three different options for packaging beverages: glass bottles, metal cans and PET bottles.

Nigeria has always been a predominantly glass bottle market,” he explains.

These days there is a movement into PET for its clear advantages, principally driven by convenience: it is lightweight, it is resealable after opening, and it is safe to the user – no cuts or damage can be done with a PET bottle. From the customer’s point

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1.5 million BevPak’s daily preform output of view, PET bottles carry no deposit, and they are easy to recycle. There is a good recycling infrastructure in Nigeria, where people perceive value in waste, so there is a good rate of conversion of PET into fibre for stuffing mattresses and pillows, and other uses. PET fibre is one of the most widely produced synthetic fibres. It is put to use in products as different as tyre cords and clothing.

Recycled Pet for use in PET bottles is not yet produced in Nigeria at this stage – bottle-to-bottle recycling is expensive and requires much greater volumes to make it viable. Carter is confident that this will become a reality once the PET market in Nigeria reaches sufficient volume to justify the investment.

The Ibadan factory of BevPak now employs 64 people. Ibadan is only 120 km from Lagos, and offers certain advantages: “Many of our staff can walk to work: in Lagos they would probably face a two hour commute – each way!” says Carter. Since the factory is a 24/7 operation this degree of proximity is a significant help.

Infrastructure is also a challenge, as it is throughout Africa. Electric power is unreliable to the extent that a factory like BevPak’s has no option but to generate

164 | BE Manufacturing

BevPak

its own, and there is no municipal water supply. The state of the roads throughout most of the country is not good; nevertheless Carter has been impressed by the ability of the transport contractors who truck the preforms across this large country to deliver. The ingenuity of Nigerians

to get a job done in the face of problems does them credit, he feels, and is one of their many strengths.

When BevPak arrived in Nigeria it entered a market that was becoming increasingly sophisticated. Customers were looking for the same advantages as their counterparts

â&#x20AC;&#x153;Finding good staff is a key aspect to a successful operationâ&#x20AC;?

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in Europe or America. They wanted lighter preform system from US-based Kortec, Inc. weight products, longer shelf life and One of the characteristics of polyethylene better performance from the packaging terephthalate (PET) bottles is that they permit they were buying, as well as the ability the slow passage of gases through the bottle to add value through design and colour. wall. This means that a carbonated (‘fizzy’) drink will eventually go These customers welcomed the advent of a manufacturer flat over a period of time. who could give them these Multilayer technology options, plus a high level of inserts a layer of much less local technical support. “We permeable material that slows down the migration of put a big emphasis on aftergas and can extend the shelf sales support,” he says.

People employed at Ibadan life of carbonated beverages In 2009 BevPak invested in a state-of-the-art multilayer by a factor of two.

64

166 | BE Manufacturing

BevPak

“Up to now we have been concentrating on good growth in the local market but now realise there is potential for export” Another advantage of using a multilayer bottle is that it can be made lighter, since it does not rely on the thickness of the bottle wall to hold the internal pressure. This is good news from an environmental point of view.

Since gases can also migrate inward

through single layer PET, beverages, like beer and fruit drinks, are sensitive to oxygen seeping from the atmosphere into the drink. However, a practical shelf life of six months or more can be achieved using multilayer PET bottles, comparable to the performance of glass bottles.

BevPak is an integral part of the business of its customers in many ways, beyond simply supplying them with a value-added product. The factory can produce 1.5 million preforms a day, and can supply the bottling plants at short notice so the customers do not need to store large quantities of stock.

As we have noted they can work with BevPak to create bottle shapes that will help market their products, and bottles whose performance will keep those products in ideal condition. Now it is installing a new line in the factory to make closures. Every bottle needs a cap: from early 2014 BevPak will be a one-stop shop for its customers.

That will mean expanding the workforce as well as the equipment. As the latter becomes more sophisticated, so do the skills needed to operate and maintain it. BevPak places great importance on retaining the skills it needs: “We invest time and money in training our staff,” says Syd Carter. “We do a lot of this work in-house, and augment that

BE Manufacturing | 167

BevPak with specialist training from the equipment suppliers, either in-house or by sending staff to their premises. Finding good staff is a key aspect to a successful operation,” he adds. “We have been fortunate in being able to recruit some very able people. Low staff turnover and good training have been important factors in our success.”

Already one of the largest manufacturers of PET preforms in West Africa supplying the world’s leading brands of soft drinks and mineral water, and major bottlers throughout Nigeria, BevPak is also looking outward. It would like to become a regional player, and in preparation for that it has secured certification to the ECOWAS Trade Liberalisation Scheme (ETLS).

Once the customs unions of the 13 ECOWAS countries have completed their paperwork, BevPak customers based in those countries will be able to import their preforms and closures duty free.

“Up to now we have been concentrating on good growth in the local market but now realise there is potential for export,” Carter explains. However in the coming year thirsty Nigerians will provide plenty of opportunity to grow the business locally, and BevPak will be working closely with its customers on lightweighting, high performance, and how best to complete the transfer to the most versatile form of packaging available today.

For more information about BevPak visit: www.bevpaknigeria.com

BE Manufacturing | 169

The secret to s

As well as being the largest sugar manufa Sugar Company is today making a name

written by: Will Daynes |

170 | BE Manufacturing

Mumias Sugar Company

sweet success

acturing operation in East Africa, Mumias for itself in the field of power generation

| research by: Abi Abagun

BE Manufacturing | 171

Mumias Sugar Company

L

ocated in the Western Province on importation and aim for self-sufficiency of Kenya, Mumias is home to one when it comes to sugar production. of the country’s largest and most The company’s original factory possessed established businesses, Mumias a capacity of 45,000 tonnes of sugar per year Sugar Company. The history of when it was fully operational in 1973. In the company dates back to 1967, when the the decades since the operation has grown government of Kenya first commissioned dramatically giving Mumias Sugar Company Booker Agriculture and Technical Services a facility with a capacity of 173,000 tonnes to carry out a feasibility study on the viability of sugar and 1.8 million tonnes of cane of growing sugarcane in Mumias, before then crushed per year. initiating a pilot project.

Mumias Sugar Company’s production It is fair to say that at the time the Mumias process comprise of cane production, sugar area was one of Kenya’s more underdeveloped production, cogeneration and the production locations, typified by the fact of molasses. Cane farming that what land was used accounts for approximately was only done so by farmers 80 percent of the production growing crops for subsistence of farm produce in the sugar and grazing animals. zone, and this provides While poor land utilisation, up to 90 percent of the total coupled with the remoteness cane that the company uses of the area and virtually nonas raw material. The cane Of sugar produced existent communications itself is then used to produce annually from the the primary products of infrastructure, had until company’s Mumias that point deterred economic Mumias Sugar. factory activity in Mumias, the fact Mumias Sugar Company is that land adjudication had today responsible for between been carried out and farmers had freehold 60 and 65 percent of the total amount of title to their land attracted the interest of the sugar produced annually in Kenya. This also government due to its favourable conditions makes it the largest sugar manufacturing operation in all of East Africa. Producing for sugarcane development.

On 1 July, 1971, Mumias Sugar Company both industrial sugars for local firms and was formally incorporated as the body that table sugar for individual use, the company’s would be responsible for implementing the primary markets for its products also include project. The main objectives of establishing Tanzania, Uganda and other surrounding the company were to provide a source of nations. Meanwhile, Mumias Sugar is income for farmers, create job opportunities recognised as one of East Africa’s top 100 in the local area, help curb rural-urban brands. The company also exports some of its migration, reduce Kenya’s overdependence sugar to international markets mainly in the

173,000 tonnes

BE Manufacturing | 173

Moving together

FEIL manufactures and supplies a vast variety of agricultural equipment and farming machinery from tractors and bailers to sugar handling and land development equipment.

FEIL also provides construction equipment and heavy-duty machinery customised to suit the ever growing needs of East Africaâ&#x20AC;&#x2122;s booming construction industry.

www.feil.biz

Kisumu Showroon Nairobi Showroom

T. +254 (0) 733 638 708 | E. feil@feil.biz T. +254 (0) 733 638 709 | E. feiln@feil.biz

Mombasa Showroom Kampala Showroon

T. +254 (0) 727 203 660 | E. feilmsa@feil.biz T. +256 (0) 752 222 506 | E. admin@feilug.com

Mumias Sugar Company Europe, with at least 20,000 metric tonnes of sugar being exported annually.

In the eyes of many the reputation that Mumias Sugar Company has carved out for itself has been built on a foundation of having a quality product at the right price, the right weight and the highest level of consumer satisfaction. In staying true to these basic principles the company has helped itself to become a market leader and it is here that it aims to stay.

Retaining this position naturally requires

a company to give its customers what they want, the way they want it. Mumias Sugar Company has shown its ability to do this time and again over the years, not least so in its introduction of both white and brown sugar products that cater for the regional preferences that exist in Kenya, where the majority of consumers in the Nairobi region prefer the former, while those in the Mount Kenya and Eastern regions of the country sway more towards the latter.

FEIL At our state of the art fabrication division, FEILâ&#x20AC;&#x2122;s world-class designers use the latest technology to turn your ideas into real life products.

We provide earth moving equipment for the agriculture, forestry, mining and construction industries, and custom manufacture a range of implements including trailers, bowsers, grader attachments and front end loaders from our state of the art manufacturing facility, currently based in Kisumu. Using Auto CAD to come up with designs which are suitable to the exact customer requirements, the implements we create are made exclusively in our facility, up till painting. The utmost care is taken during this process with the implements double reinforced to ensure quality performance. Once the implements are constructed they are treated with an anti- rust spray before they are then

painted.Our after-sales service and training are second to none and most certainly our strong points. At FEIL we place a huge emphasis on sending our technicians and sales people on overseas training and towards offering training to our customers, operators and mechanics.

We currently operate seven branches in Kenya and Uganda, and one in Tanzania. Meanwhile we have our eye firmly set on expanding into South Sudan, Rwanda and DRC Congo, from where we currently operate through subdealers. In addition to this we are opening a new state-of-the-art HQ, which will be on Mombasa Road, Nairobi, that will boast technology greater than that of all our competitors.

E. feil@feil.biz www.feil.biz

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General auto hardware General Auto Hardware Ltd started as a promising wholesale and retail business set up in 1987. From then on the vision has evolved year on year and today has over 26 years experience in industrial and general hardware. The company has grown many folds and is certainly an established company and has been for this period of time had strong, vast experience in supplying products that meet required specifications as per our clients needs.

Like any company, General Auto Hardware Ltd with a sound futuristic vision to grow further, have visualized in marking our presence in the global markets. Our under mentioned products should help our clients improve efficiency

of their processes and increase competitiveness in the global scenario.

Our association with Mumias Sugar Co. Ltd is remarkable in core areas, such as the supply of: • Sealing Products - Gland Packing & Steam Gasket • Tube Cleaning Equipment (Boiler) • Roller Bearing & Cooper Split Roller BRGS • Mini Roller Grooving Tools • Boiler Tubes, Lifting Tools & Equipment • Electric Geared Motors • Insulation & Lagging Materials • Industrial Gate Valves LP & HP • Conveyor Belts gah@swiftkisumu.com

Mumias Sugar Company

Another development of interest has seen the company develop and introduce fortified sugar to the marketplace. This particular brand is fortified specifically with Vitamin A, something which resonates strongly with the needs of Kenyan children to have access to products containing important micronutrients that are essentially to a healthy upbringing.

In order to ensure a sustainable income

throughout both good and challenging economic times, Mumias Sugar Company has made a very unique effort to diversify part of its business into the power production sector. This initiative came into being back in 2005 when the companyâ&#x20AC;&#x2122;s board approved the exploration of a co-generation electric power production project, which included the construction of an ethanol plant.

â&#x20AC;&#x153;Mumias Sugar Company is today responsible for between 60 and 65 percent of the total amount of sugar produced annually in Kenyaâ&#x20AC;?

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“Another positive facet of the company’s move into power production is that its technology allows for the creation of clean energy” The fact of the matter is that in Kenya the demand for electricity far outstrips supply. The company’s co-generation plant is designed to help alleviate this issue somewhat. At present the company has the capacity to produce 34MW of electricity, with 26MW supplied directly to the National Grid, thus supplementing Kenya’s ever increasing domestic demands. On-site power

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production from the project through bagasse co-generation is currently on the rise, with the company extremely confident that its potential has yet to be fully exploited.

Another positive facet of the company’s move into power production is that its technology allows for the creation of clean energy. This is because its source is primarily the by-product of the sugar production process, a fact that

Mumias Sugar Company

highlights the increasing important of sugar cane as feedstock for ethanol.

Kenyaâ&#x20AC;&#x2122;s sugar industry, and specifically Mumias Sugar Company, has worked hard to take advantage of the concept of bio-refinery technologies or integrated sugar production processes which utilise the entire crop for a variety of environmentally favourable outcomes. Effective use of by-products in an integrated sugar plant diversifies the income stream by adding new intermediate-value and high-value products.

A number of regional factors including limited supplies of crude oil and refining capacity, and rising environmental concerns, have presented Mumias Sugar Company with the perfect opportunity to expand its product

range and it is with this in mind that it set about the construction of a distillery plant with the capacity to produce 22 million litres of ethanol annually.

To this day the company continues to champion a number of important social causes, from providing economic opportunities to more than 14,000 cane farmers to investing in the training, health care and education of its employees. It does all this while retaining its leading positions in both the consumer goods and power production markets.

For more information about Mumias Sugar Company visit: www.mumias-sugar.com

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Henkel South Africa

Sticking to whatâ&#x20AC;&#x2122;s best During the course of Henkel South Africaâ&#x20AC;&#x2122;s history it has consistently displayed a commitment to sustainability and its ever-growing importance to the Sub-Saharan market

written by: Will Daynes research by: Paul Bradley

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Henkel South Africa

F

ounded in 1876 and today headquartered in Düsseldorf, Germany, Henkel is a recognised holder of globally leading market positions in the consumer and industrial businesses. Boasting a host of reputable brands including Persil, Schwarzkopf and Loctite, Henkel has some 47,000 employees operating throughout the world across the group’s three business sectors; laundry and home care, beauty care and adhesive technologies.

In the last of these categories Henkel is undoubtedly at the top end of the market when it comes to delivering adhesives, sealants and surface treatments to consumers and craftsmen, and for a wealth of industrial applications.

Part of the group’s Europe, Middle East and Africa region, Henkel South Africa is seen as one of, if not the major player when it comes to adhesives in Southern Africa. The company’s operations cover a wide customer base including companies operating in the industrial, automotive and metal industries, all of whom it serves from its manufacturing facility in Johannesburg.

Much like the wider Henkel group, Henkel South Africa has built its reputation on delivering good consistent results and its ability to compete across various applications and technologies is something that industry watchers have come to know and respect.

Having its own manufacturing facility is another important positive for the company. What it has found with many of its competitors is that they rely on importing products into the marketplace. This can

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Bidvest Panalpina Logistics Bidvest Panalpina Logistics and Henkel recently entered an agreement with BPL implementing a dedicated warehouse management solution.

Strategically located in 25 facilities across South Africa, BPL has a combination of dedicated and multi-user warehousing including both free and bonded storage.

Our experience and understanding of complex supply and demand chains allows us to synchronise cargo flows through our infrastructure, inclusive of airfreight and ocean freight, forwarding and clearing, customised warehousing, transport and distribution solutions, the objective being to increase overall

efficiency of clientsâ&#x20AC;&#x2122; particular logistics requirements. BPL offers an integrated logistics service in all aspects of the global and local supply chain.

E. info@bpl.za.com www.bpl.za.com

Henkel South Africa

have a negative impact, particularly in confidence is that fact that it believes that difficult economic times, when you consider its superior products, brands and technology, factors like the highly volatile interest and together with its competitive internal cost currency rates that we have experienced in structure, can carry it through the more recent years. What this means for Henkel challenging times.

South Africa is that by manufacturing Donâ&#x20AC;&#x2122;t take this to mean however that this locally it actually benefits from significant is a company prepared to rest of its laurels.

Indeed there is a great deal happening cost advantages in the long run.

While the company did experience strong throughout Henkel South Africa to not only business growth in the respond to todayâ&#x20AC;&#x2122;s market years immediately following conditions, but also to better 2008, it is correct in saying equip it for the future. Over that the current global the last two and half years economic climate has called the company has been for a more conservative involved in an important Henkel employees outlook. Nevertheless, what logistics redesign project across the world gives Henkel South Africa with the aim of reviewing

47,000

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Memcon (Pty) Ltd Memcon (Pty) Ltd in conjunction with Henkel South Africa engineered and manufactured a customised membrane filtration plant. This world class automated MF Plant processes waste water streams from all the production lines within the manufacturing facility ensuring acceptable municipal discharge limits 24 hours a day.

Upgrades to the existing plant can be made to further improve the water quality to fresh water standards for reuse in the manufacturing facility.

Technology is based on cross flow filtration principles utilizing ceramic membranes; unlike dead-end filtration the cross flow velocity through the plant

causes the feed liquid in circulation to scour the surface of the membranes creating a constant cleaning effect with minimized chemical cleaning.

Modular design allows for any flow rate with capacities which can be increased at a later stage by adding more modules.

E. info@memcon.co.za www.memcon.co.za

MEMCON Total Process Solution® (MTPS®) provides customised membrane technology solutions for liquidliquid and liquid-solid separation.

MEMCON membrane systems can mechanically separate any kind of liquid into valuable and unwanted substances as part of the client’s production or effluent processes.

MEMCON’s comprehensive laboratory and pilot plant equipment are used to assist in feasibility studies and project costing forecasts.

Customer Benefits: Legal environmental compliance with reduced operational expenditure by designing a technical solution that guarantees compliance with environmental legislation (Local and International).

Reduced Total Cost of the client’s operational process (lowering operational expenses, recovering valuable substances back into client’s process, i.e. fresh water). www.memcon.co.za | +27 11 534 3938 | info@memcon.co.za M I C R O F I LT R AT I O N | U LT R A F I LT R AT I O N | N A N O F I LT R AT I O N | R E V E R S E O S M O S I S | M B R

Henkel South Africa

the whole of the companyâ&#x20AC;&#x2122;s investments throughout the business where possible, logistics chain.

At its most complex, the perhaps the best recent example being the capital it companyâ&#x20AC;&#x2122;s logistics chain previously involved working has spent to install a series Year Henkel was founded with some 17 different service of new effluent filtration and logistics suppliers. What plants. Taking up a space of it has done now is to redesign just 3x5 metres these plants the entire logistics model of the country will take used water and reduce its effluent and it is currently looking to find service content be up to 100 times, thus allowing providers who would be capable of covering the filtered water to be completely reused. the whole of that model. Successfully doing so This investment is another example would of course bring cost savings to Henkel of Henkelâ&#x20AC;&#x2122;s global strategy to improve South Africa, however the biggest and most its sustainability footprint being put important beneficiaries would be efficiency into action. Considering the geographic and customer service. markets that it operates in, the company Meanwhile, Henkel South Africa has found its sustainability credentials has continued to look to make positive have become a significant point of sale.

1876

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â&#x20AC;&#x153;the African market needs to be approached with due care, research and understanding, and that is precisely the way the business operatesâ&#x20AC;?

With South Africa being something of a dry country developments like its use of these eff luent filtration plants are all the more important, not only for its reputation as a responsible company but for the communities in which it operates.

Across the wider Henkel group there is a major global rebranding initiative currently

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going on,with the aim of reducing the complexities that arise from possessing a huge portfolio of trade and brand names.

As recently as early July the first Henkel business unit kicked off its rebranding activities. The process Henkel is involved in involves reducing its total brand portfolio to five major brands that all other products

Henkel South Africa

will then be grouped into. This is obviously a major logistical expertise and one that it is very focused on throughout the organisation at present.

Southern Africa, south of the Sahara, is of considerable strategic importance for Henkel and as such it has been working extensive over the last two-to-three years to evaluate the opportunities the market has to offer.

The company has always understood that in order to grow accordingly it needs to first identify applications or markets that best suit its operations before targeting them. What it also knows to be true is that the African market needs to be approached with due care, research and understanding, and that

is precisely the way the business operates.

This methodical approach has enabled the company to successful expand upon its export side of the business to other important African markets and it such growth that Henkel South Africa is clearly focused on. Going forward it will continue to use all of the strengths at its disposal in terms of brands, technologies and innovation in order to identify those areas in which it can grow, while also retaining its competitive advantage.

For more information about Henkel South Africa visit: www.henkel.com

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Ghana Rubber Estates Ltd

The substance

of tyres

With primary exports to the European market, and the main buyer being tyre manufacturer Michelin, Ghana Rubber Estates Ltd (GRELâ&#x20AC;&#x2122;s) international footprint and customer base is rapidly expanding

written by: John Oâ&#x20AC;&#x2122;Hanlon research by: Paul Bradley

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Collecting rubber sap from tree

Ghana Rubber Estates Ltd

G

hana Rubber Estates Ltd. smallholders taking part in this scheme.

(GREL) started life in 1957, The model is that each outgrower plantation the year Ghana declared its covers four hectares and is run by a single independence from Britain family, planting one hectare per year. The and became the first African reason for this planting strategy is to allow country to free itself from colonial rule. outgrowers to grow both a cash crop and a The company’s assets at the time of its food crop in parallel. It is a good deal for establishment consisted of a comparatively these families, who have the security of a small private plantation, known as Dixcove commitment from GREL to purchase their and owned by R T Briscoe. In those days it rubber output for up to 35 years – the entire covered an area of 923 hectares at Abura in producing life of a rubber tree.

The phase four expansion is now complete the Western Region of the country, however it was nationalised only three years after and, like its predecessors, was supported independence, becoming a state farm. Since by Agence Française de Développement. then private interest has been It involved planting in the reintroduced with various region of 10,000 hectares of rubber. Phase five is now offtaking tyre companies, the end users of the product, well under way and will run taking a shareholding. The for three years during which time GREL will be working government of Ghana still Outgrowers supported has a 25 per cent holding. with over 4,000 outgrowers

by GREL GR E L has g row n to plant a further 13,500 hectares. Managing Director progressively over the intervening years and today, with its Lionel Barre estimates that within three to headquarters at the western city of Takoradi, four years the scheme will cover around it farms the largest industrial rubber estate 40,000 hectares and that these farms will in Ghana, owning more than 18,000 hectares produce up to 70,000 tonnes of rubber per of rubber plantation, of which approximately year, once the trees have matured between half is made up of mature trees. GREL’s 2020 and 2023. Going forward GREL wants annual revenue is in excess of $80 million, to add 2,300 hectares to the outgrower generated from an output of more than estate each year.

At the same time as expanding the 20,000 tonnes of granulated, or crumb rubber per year. In addition to the rubber it amount of land managed by outgrowers, processes from its own operations, GREL had as we reported last year GREL is also developed an outgrower programme since expanding and replanting its own estates.

1995. This programme has been expanded “We have a programme of investment of in three phases, with a fourth currently around €25 million for our entire estate in taking place. There are more than 5,600 terms of extension and planting over the

5,600

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• Internet Service Provider • Electronic Security Solutions • Communications Networks • IT Support Services • IT Procurement • Communications Convergence

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WE UNDERSTAND - your technology needs ICT Services CTSL recognizes the increasingly rapid pace at which technology advances, resulting in a rapid decrease in the lifespan of technological inventions.Our expertise helps your business communicate using advanced communication technologies with the flexibility to offer a wide range of services which are scalable, cost effective and can be deployed rapidly.

SPECIALITIES: • Internet Service Provider • Electronic Security Solutions (CCTV, Access Contol, Perimeter) • Data Voice and Video Communication Networks • IT Support Services

www.ctslafrica.com | info@ghanats.com | Tel: (+233) 3120 26124

Ghana Rubber Estates Ltd

Worker on the plantation

“Out ICT platform has been upgraded, with all our remote sites hooked unto the head office network” coming five-year period,” said Barre. This expansion in the company’s assets is a reflection of increasing demand globally.

“Today, worldwide consumption and production are almost the same, between 10.5 million and 11 million tonnes per year, but the demand is growing very fast: China is consuming basically 30 to 35 per cent of global production already and is growing very fast, as are India, Brazil, Turkey and Nigeria. But these countries, especially

India and China, are not really suited to producing their own rubber crops, so that is a big opportunity for us in Ghana.”

So for the future, GREL’s focus is firmly on expansion. “By 2020 we will be tripling the size of our factory, which means that we will have the capacity to produce 50,000 to 60,000 tonnes per year, compared to 20,000 today, “ Barre said last year. As he predicted in 2012, an additional 4,000 hectares have since been added to the company’s own

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holding, and in addition, “The Rubber Outgrower Plantations Project, of which we are the Technical Operators, will assist 4,000 farmers to plant 12,000 hectares. In 2013 alone, the target is to assist 2,000 farmers to plant 4,000 hectares.”

To cope with the anticipated increase in volume of the raw materials that will have to be processed, the expansion of the factory has been prioritised. Its capacity will grow

to 60,000 tonnes by 2018. Other investments such as housing, expansion of the factory buildings, new power generation plant, and the construction of warehousing are being carried out. The total cost of this will amount to about €6.5 million, he says. Nor have the ancillary services been neglected: “A new state-of-the-art laboratory to check the quality of our produce has been completed. Also we have trained four managers as industrial

“The Rubber Outgrower Plantations Project will assist 4,000 farmers to plant 12,000 hectares”

Out on the plantation

196 | BE Manufacturing

Ghana Rubber Estates Ltd

A tapper at work

engineers so they will be qualified to conduct periodic studies to enable us improve on our current procedures and processes. Also we have introduced the NR standard in our factory and training is taking place on the shop floor to improve productivity.”

Another important initiative has been to update the back office systems. “Out ICT platform has been upgraded, with all our remote sites hooked unto the head office network. A software program has been developed to enable us track our processes with great accuracy For example the remuneration system for rubber bought from farmers has been automated in such a way

that the speed of payment has improved: the target is to pay farmers within two hours from the time they drop the rubber at our factory.

A sales module has also been developed to enable us to better monitor and track the information supplied to our outgrowers.”

Working with partners like CTSL Africa, a Takoradi based company that is well versed in the implementation of large scale ICT and Integrated Security Solutions (ISS) projects to government, parastatal, corporate and NGO organisations throughout Africa, GSEL and its growers are today working on first-world level technology platforms.

Improvement initiatives like these, and the

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CHEMICO LIMITED Q U A L I T Y P R O D U C T, Q U A L I T Y S E R V I C E

CHEMICO Ltd is a 100% Ghanaian-owned business. We are a leading importer of agrochemicals and fertilizers and also distributors of feeds and veterinary products in the poultry and livestock industry.

• FERTILIZER BLENDING The first Company with a fertilizer blending plant in Ghana for providing specific fertilizer grades for specific crops.

• AGROCHEMICAL FORMULATION CHEMICO is the only agrochemical formulator in Ghana, and formulates the following classes of products, Insecticides and Foliar fertilizers.

• REPACKING Chemico also has facilities to repack agrochemical powders and liquids.

T: 233-303-202991, 202992, 202345, 206548 F: 233-303-202000 E: chemico@chemicogh.com

Ghana Rubber Estates Ltd

Head office

efforts the company has been always been important to making to refine the logistics GREL, and is very much and transition of materials encouraged by the culture between the plantations and of its parent group, SIFCA, the factory have already based in Abidjan, Cote Tonnes per year target started to show positive d’Ivoire and one of Africa’s factory capacity by 2018 results, adds Lionel Barre: biggest agro-industrial firms. The company runs an “We have cut down on the transport of labour and raw materials from apprenticeship scheme, aiming to recruit the plantations to the factory. We have been new graduates, many of them having able to predict our needs more accurately in already completed internships with GREL. terms of trucks, number of people, and other There are opportunities to gain experience infrastructural requirements especially where in other countries where the group operates, the newly acquired acreage is concerned. such as Nigeria, Liberia, Cote d’Ivoire and Training and the transfer of skills has Ghana itself. A training unit within the HR

60,000

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Collection of cup lumps

department circulates all departments at the beginning of each year to ascertain the skill enhancement appropriate to each individual, and based on this a mentoring and tutoring programme is drawn up and implemented.

The automotive industry that is the main end user for the rubber supplied by GREL may not be the most environmentally friendly, but rubber production as practised in Ghana is a green industry. Plantations of rubber trees

sequestrate CO2. The plantations therefore act as a carbon sink. “Rubber trees have an economic life of 35 to 40 years,” Barre reminds us. “GREL has entered into an agreement with a company called Takoradi Renewable Resources Limited (TRELL) that is felling our old trees and processing them into chipboard. The field is then replanted.”

By-products can be used as biofuel to produce green energy. Furthermore, as part of GREL’s

“As part of our environmental charter... we avoid ecologically sensitive zones where planting would disturb the ecology” 200 | BE Manufacturing

W

Ghana Rubber Estates Ltd

Weed control at GREL plantations

contribution towards food security, it has a unit that provides technical assistance to farmers who want to adopt good agricultural practices, enabling them to increase their food output per unit area. GREL has signed an agreement with a social agricultural enterprise to use its premises as a learning centre for its rubber farmers in both animal and crop farming. This initiative will cost in the region of €80.000, he says.

And as well as providing high levels of direct employment, and helping a huge number of farmers to achieve long term financial security, it directly supports a number of social initiatives. The communities affected

by GREL’s activities have grouped together to form an association called ‘ACLANGO” (Association of Chiefs Land on which GREL

Collection of latex

Operates) through which all community developmental projects are channelled.

Projects such as schools, clinics and water boreholes are undertaken for them and under a scholarship scheme GREL sponsors 14 children every year. “We have a charter on social, HIV/AIDS, Environment, Health and Safety which all employees strictly adhere to,” Barre concludes. “For example, as part of our environmental charter we have stopped planting in wet lands, and we also avoid ecologically sensitive zones where planting would disturb the ecology.”

For more information about Ghana Rubber Estates Limited visit: www.grelgh.com

BE Manufacturing | 201

The perfect partner Waco Industries is Southern Africaâ&#x20AC;&#x2122;s largest manufacturer and distributor of industrial electrical products and as such continues to play a hugely vital role in the development of numerous countries and industries

written by: Will Daynes research by: Paul Bradley

202 | BE Manufacturing

Waco Industries

Waco Industries

W

e don’t see our customers them with a plethora of solutions and items. as just customers,” states In many ways this has created a scenario Julian Lipson, General where the wholesalers see us as something of Manager of Waco a warehouse ourselves and as such we work Industries, “we see them tirelessly to ensure that we act as a reliable, as partners that we forge close relationships constantly stocked warehouse.”

Waco has five main divisions that make with from day one as we work to meet their requirements and solve their problems.” It is up its business. Its general products division this approach to business that has seen Waco consists of products lugs and ferules, tools, grow from an importer of industrial plugs and step ladders, air conditioners and many more sockets into one of the biggest manufacturers electrical, contractor and hardware orientated and distributors of industrial electrical products, while its power products segment products in Southern Africa. consists of various technical industrial From its humble beginnings in 1949 Waco products such as rotary switches, timers, Industries grew steadily over the subsequent sensors, enclosures and LG switchgear. decades, becoming part of Waco’s lighting division the Voltex group in 1991, meanwhile consists of two which itself merged into parts, the first being light the industrial division of sources and lamps, which comprise Phillips at the top Bidvest, BidIndustrial, in Line items that the end of the market and Waco 2002. Since then Waco has company stocks branded, economically priced expanded its product range and supplies and infrastructure in South lamps, while the second Africa to the point where is light fittings. Here the today is distributes a range of well-known company supplies both locally manufactured local and international brands, such as ABB products from Prism and a range of imported Enclosures, Phillips Lighting, 3M Products, light fittings mainly for domestic use.

CCG Glands and CRC Maintenance Chemicals, The aviation warning beacons that the to the electrical wholesale trade and original company produces are particularly interesting as they link back to Waco’s invention of said equipment manufacturers.

From its 9,000 square metre distribution beacons which are today used by many large warehouse the company receives and telecommunication companies and airports. distributes its comprehensive range of more These beacons serve as warning devices that than 6,000 line items. “We have always seen can be placed on high buildings, masts, towers ourselves as something of a wholesalers and cranes. These products are very robust wholesaler,” Lipson explains, “and as such and designed to withstand Africa’s unique we have always endeavoured to act as a environmental conditions, and have become one-stop-shop for our customers, providing a highly profitable part of Waco’s business.

6,000+

BE Manufacturing | 205

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www.energizer.co.za | Facebook/ENERGIZERSOUTHAFRICA Twitter/ENERGIZER

Waco Industries Last but not least is Waco’s Energizer latest venture, its fixings and Energizer, a global consumer goods leader in the dynamic fasteners division. business of providing portable power geared toward The core of Waco’s the new digital age, offers a full portfolio of products business in its early years including the Energizer MAX premium alkaline brand; centred around industry Energizer Ultimate Lithium; Energizer Advanced; Hearing plugs and sockets, and these Aid batteries; Specialty batteries and Nickel Metal Hydride (NiMH) – Recharge batteries and Chargers. simple yet hugely important Energizer also offers a full range of torches for all needs. products remain crucial to its These torches are Guaranteed for Life. customers, particularly those Energizer’s story began in the 1890s with its invention of in the mining sector where the first dry cell battery. Since then its pioneering spirit has virtually every mine across driven the business forward, leaving behind it a rich history the world uses a vast number than spans across numerous consumer brands. of them. These plugs and Energizer continually helps to bring consumer insight and innovation to these important household devices. sockets remain the biggest www.energizer.co.za single product that the company sells to customers in the mining sector.

“In the last several years the market around us has changed rather dramatically from being one in which the majority of products that we supply would be sourced from local manufacturers to one where anyone can source cheap goods from China,” Lipson continues.

“This has meant that we have had to rethink our own approach and this has led to our business becoming much more nimble and research focused then we were say 15 or 20 years ago.”

Another of Waco’s key objectives is to keep on expanding its product range in order to

9,000M2 The size of Waco’s distribution warehouse

BE Manufacturing | 207

“We have always endeavoured to act as a one-stop-shop for our customers, providing them with a plethora of solutions and items” keep up with technology and the changing needs of its customers. Waco’s innovative approach ensures that its products stay up-to-date with customer needs and has to-date enabled it to develop entire systems.

The company’s research & development department develops systems from the ground up and refines customers’ needs to produce many successful end-products.

Energy is very much the source of Waco’s growth today and with the cost of energy,

208 | BE Manufacturing

particularly in South Africa, soaring in the last five years or so the company has become more involved than ever in energy saving initiatives, primarily in the areas of water heating and lighting. In the former category Waco has been getting more and more involved in the supply and installation of heat pumps. With research showing that these devices can produce electricity savings of up to 70 percent there has been a surge in demand for these solutions,

Waco Industries

particularly from mine operators looking to make significant cost savings.

“The development of LED lighting in the last three years has also been a source of real interest for us,” Lipson says. “Energy saving initiatives will play a big role in our business over the coming months and years and we believe that the single biggest growth area for us will be LED lighting, while we anticipate reaching its peak by no later than 2015. While it is reaching this peak we will be putting in a great deal of effort in the form of research and development to establish Waco as the leading player in this field of expertise.”

Since the start of July, Waco Industries has taken over responsibility for growing the retail market for electrical products on behalf of Bid Electrical. The company’s increased involvement in the retail side of

electrical distribution comes at a time when a consumer led boom continues to spread out across African countries.

“I believe,” Lipson concludes, “that consumer consumption is going to continue playing a big role when it comes to GDP growth in South Africa and we feel that this is steadily being replicated across the rest of Africa as well.

Coupled with the growth of the mining sector across the continent and the development of oil and gas fields in and around the Western coast we are very confident that future opportunities for our company are out there and waiting for us.”

For more information about Waco Industries visit: www.wacoelec.co.za

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Beier Envirotec

The technical textiles of choice Operations Director, Warren Sachs, discusses the growth of Beier Envirotec and the companyâ&#x20AC;&#x2122;s plans for future development, both in South Africa and further afield

written by: Will Daynes research by: Paul Bradley BE Manufacturing | 211

Beier Envirotec

I

t was in 1929 that O. T. H. Beier, a young everything we do here is related to engineered pioneer living in Germany, made a life- textiles and solutions in some form,” explains changing decision, going against the Operations Director, Warren Sachs. “What wishes of his family by leaving his home makes us unique is that our philosophy and travelling to Durban to establish involves targeting niche, speciality markets himself as a wool merchant. Little could Beier and those that require specific development. and his family have realised that with this Our entire business model revolves around decision he would be sowing the seeds for developing new products that are focused what would become a business legacy that on markets such as filtration, engineering continues in 2013. textiles, geo textiles, medical textiles and a Two years after his arrival in South Africa range of synthetic media.”

Beier received an offer from Storm and Beier Envirotec’s combination of expertise Company to manage their new scouring plant. and experience in the Southern African Beier took on this new challenge with relish subcontinent ensures that it is able to offer and within two years not its customers the latest only was the plant exporting technology and world class to Europe but Beier himself service, while constant reached agreement to take investment in equipment and over the plant from Storms. people enables it to guarantee In essence this represented product quality of the highest The year that Beier the true birth of Beier standard and industry Envirotec can trace its leading performance.

Industries, a business that history back to “Our core aim as a expanded rapidly as Beier business,” Sachs continues, capitalised on the vast potential for industrial development in South “is to be recognised by both our internal and Africa. What followed was the adoption of a external customers as the designer and supplier policy for diversification and expansion that of choice when it comes to engineered textile solutions and services. To put this into context, continues to this day.

It was this policy that helped give rise what we are doing is not only supplying the to Beier Envirotec. Operating from the filtration products to help power stations and headquarters of Beier Industries in Pinetown, other facilities to meet emissions requirements, Beier Envirotec is recognised as being one of but also providing a team of people who the foremost producers of technical textiles, visit the plant in question and maintain the specialised media and filtration products in filtration equipment. There they perform tasks such as changing out filter bags, or measuring Southern Africa.

“Under the leadership of our Managing plant performance and proposing changes, Director, Wolfgang Beier, who represents all of which allows us to provide a complete, the third generation of the Beier family, technically based turnkey solution.”

1929

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STANDERTON MILLS (PTY) LTD Standerton Mills (Pty) Ltd have been operating in South Africa for over 50 years, as spinners and weavers of industrial textile products.

During this time, the company has developed close links with the mining and filtration industries and is well positioned at the forefront of textile materials for these industries, as well as servicing other markets closely associated with the company’s core activities.

The company offers a broad range of products to suit virtually every textile need required by the mining and filtration industries, such products include • Scrims • Hose reinforcing • Release cloths

Proud suppliers of technical yarns and fabrics to Beier Envirotech.

Products include: • High temperature yarns.

• Cotton yarns.

• Spun polyester yarns.

Scrims.

Contact us for all your textile requirements…. www.standertonmills.co.za

Standerton Mills

• All types of industrial yarns and twines • Conveyor belt reinforcing • Household and apparel textiles Contact us for all your industrial textile requirements... www.standertonmills.co.za

Beier Envirotec

Beier strive to use the latest technical equipment

In addition to the imbedded strengths of the business there are also several external factors that are helping to drive the growth of the company today. One is the uptake throughout the developed world, particularly in core markets like Europe and China, of tighter environmental legislation regulating emissions from factories.

South Africa meanwhile continues to grow

at a steady pace with the constant demand for power resulting in the construction of a new generation of power stations. “In recent times we have also shifted our focus towards the medical side of the business,” Sachs highlights.

“This side of the company has grown in line with the increasing population of the country.”

Another facet of Beier Envirotec, and indeed Beier Industries as a whole, is its commitment

“Beier Envirotec is recognised as being one of the foremost producers of technical textiles, specialised media and filtration products in Southern Africa” BE Manufacturing | 215

PROPET SA Using the highest quality of recycled polymer and small quantities of virgin polymer, Propet SA, a leading South African polyester producer, is capable of producing from a 0.9 Dtex fibre (microfiber) up to 22 Dtex polyester fibre, both in solid and hollow combinations used in all industry sectors (from traditional home textiles to personal hygiene as well as many industrial and geotextiles applications).

Our ability to produce coloured, antimicrobial, low foam, hygiene, high tenacity, high elongation, hydrophilic and hydrophobic fibres enable us to be able to supply a diverse customer base. No matter the size of the client or the nature of the task ultimately we are always able

PROPET SA Propet SA, a leading South African polyester producer, places a strong emphasis on recycling and producing environmentally friendly polyester fibres. With the assistance of one of its group companies and own in-house recycled polymer facilities, Propet SA is responsible for recycling approximately 420 Million PET bottles per year and averting land fill space occupation of approximately 55,000 cubic meters per year.

Telephone: +27 21 5212200 E. jorge@propetfibre.com

to develop close customer relations and create products which meet specific and individual needs.

Propet concentrates primarily on supplying South Africaâ&#x20AC;&#x2122;s polyester requirements, yet at the same time we also maintain strong relationships and supplies throughout European markets, including the UK. For any queries, please contact our offices in Cape Town on 021 5212200 and speak with our sales and technical services teams about your needs.

E. jorge@propetfibre.com

Beier Envirotec

Employee group photo

“It is the shared view of the board of directors that one of things we should assist with in the community is the development of young people” to social responsibility. “One of the things we have done for some time now,” Sachs states, “is sponsor an underprivileged school in the local vicinity. From here we strive to take at least one learner from their final year into university. We then look to employ these graduates at the end of their studies.”

Beier Industries has also adopted a novel way of boosting skills development in the

local area by employing a chess tutor. “It is the shared view of the board of directors that one of things we should assist with in the community is the development of young people who have the ability to problem solve and chess is the perfect tool for that,” Sachs says. “In addition to chess we also run additional maths lessons for students on weekends. We do this in partnership with an

BE Manufacturing | 217

Indian firm who have developed a form of teaching that encourages the use of tablets and other technology devices.â&#x20AC;?

The last year and a half has seen the company undergo what can be best described as a complete manufacturing reorganisation.

This undertaking has seen Beier Envirotec

streamline its processes, install new equipment in a number of manufacturing areas and broaden its skills set by employing new people in both its testing and quality areas. At the same time the company has made a few changes to its management structure across various departments in order

â&#x20AC;&#x153;Our core aim as a business is to be recognised by both our internal and external customers as the designer and supplier of choiceâ&#x20AC;?

Beier products on site

218 | BE Manufacturing

Beier Envirotec

Textile manufacturing equipment

to improve efficiency across the business.

This is an exciting time for the company with it working on at least five new, highly novel products. This falls very much into line with Beier Envirotec’s core focus going forward and that is to achieve growth through new developments.

“We were one of the first textile plants to receive ISO:9001 and ISO:14001 accreditation, and are now pushing forward with gaining ISO:13485,” Sachs concludes. “Furthermore, we are looking at expanding our export operations. We are well aware that a large

portion of our future growth will come from exports and thus we want to significantly grow this part of our business over the next three to five years. At the same time however we continue to ensure that as a company we continue to ensure that our business is correctly structured in terms of current legislation to drive growth in South Africa.”

For more information about Beier Envirotec visit: www.beierenvirotec.co.za

BE Manufacturing | 219

Alpine Loung goes lean South Africaâ&#x20AC;&#x2122;s premium furniture manufacturer is meeting the challenges of a changing market by adopting best manufacturing practices more often associated with automobiles than luxury seating

written by: John Oâ&#x20AC;&#x2122;Hanlon research by: Vincent Kielty

220 | BE Manufacturing

Alpine Lounge

ge

BE Manufacturing | 221

Aerial view of the factory

Alpine Lounge

A

member of the Bravo Group, South Africaâ&#x20AC;&#x2122;s largest and most diverse furniture ma nu f ac t u rer, A lpi ne Lounge has left behind the world of high volume mass-produced furniture. It is a premium marque and its Ashanti brand can only be described as aspirational. Founded in 1969 it has built its reputation on state-of-the-art technology, quality products, on-time delivery and caring and efficient after-sales service.

Alpine Lounge only uses top quality raw materials and enjoys exclusive use of indigenous leather types sourced from South Africa and Namibia. In fact one of the companyâ&#x20AC;&#x2122;s unique selling points is appreciated by the discerning purchasing independent and therefore not suited to the mass market. Leather furniture has come into demand from a mass market in recent years; at the same time leather-look PU (polyurethane) and microfibre-faced fabrics have been perfected to the extent that itâ&#x20AC;&#x2122;s now virtually impossible to tell the real thing from the imitation. Car seating in particular, which consumes the pick of hides but routinely uses plastic on the non-contact sections of top of the range car seats, presents a challenge to the purist so perfectly matched are the colours and the textures.

Alpine Lounge furniture on the other hand makes a virtue of the marks that distinguish African leather whether from cattle grazed on the veldt or other indigenous species like gemsbok (sourced through strictly controlled culling programs in Namibia).

These hides show tick bites, thorn scratches and even the scars left by fighting. They tell

BE Manufacturing | 223

Hanni fine quality leathers since 1724 We at Hannitan are proud to be associated with Alpine Lounge.

Hannitan Leather, under the management of Rudolf Hanni, started from very humble beginnings. Hannitan has expanded into the largest supplier of furniture leather in South Africa, producing an average of 1,200 hides daily. The tannery produces a wide variety of upholstery leathers including, aniline leathers, semi-aniline, full grain, corrected grain, buffed leathers and oil pull-ups in a huge selection of colours. Hannitan manufactures a HANNI range of leather goods including travel bags, hand bags, leather cushions, leather folders and slippers to various outlets . It also offers a customized service manufacturing for various other well known labels and brands. Hannitan supplies its own range of leather care products including waxes, silicones and hydrophobic products.

Tel: +27 (0)11 817 2150 | Fax: +27 (0)11 817 5259 | Email: hannitan@iafrica.com

www.hannitanleather.com

Alpine Lounge Alpineand Lounge feature text tempor incididunt labore a story are appreciated Lawrence van derutMerwe, to here...Lorem ipsum et dolore magna Operations aliqua. Ut by go a select but significant Alpine Lounge’s enim ad minimDirector veniam,– quis and Technical and dolor sit amet, consectetur number of purchasers across Africa elit, and insed the UK, he has exercitation seen it all, ullamco having nostrud adipisicing do laboris nisithis utcompany aliquip for ex where Alpine Lounge has a been with eiusmod tempor incididunt devoted all but 40 years. consequat. ea commodo ut laborefollowing. et dolore magna All this makes Alpine Currently theredolor is an Duis aute irure in aliqua.

Ut enim ad minim Lounge a quis niche nostrud leather international in shortage of reprehenderit voluptate veniam, exercitation laboris leather,esse as cattle ranchers in furniture ullamco manufacturer. velit cillum dolore nisi ut aliquip ex ea commodo South America, world’s Other companies in the eu fugiat nullathe pariatur. consequat. main source, haveoccaecat moved group focusDuis on aute the irure mass Excepteur sint non proident, sunt marketinwhile Alpine Lounge dolor reprehenderit in This is a caption this is a caption cupidatat into shorter-term farming, in culpa qui of officia prides itselfvelit on its high level voluptate esse cillum and many the deserunt Chinese animare id estaggressively laborum. Lorem ipsum dolor of customisation customer focus.

“These mollit dolore eu fugiat and nulla pariatur.

Excepteur imports rather than amet, consectetur adipisicing do are huge brand assets, non but proident, they havesunt not sit economically priced. It’s a fact ofelit, life sed Alpine sint occaecat cupidatat in culpa qui our officia deserunt mollit id eiusmod tempor incididunt ut labore et dolore immunised company from the anim market Lounge has to live with, he says, and he is est laborum.

Lorembyipsum dolor sit Ut enim minim quis revolution caused the influx of amet, good magna findingaliqua. weapons with ad which to veniam, fight back. consectetur adipisicing elit, sedChina,” do eiusmod exercitation ullamcocame laboris ut quality lounge furniture from says nostrud One key breakthrough lastnisi year

HANNITAN LEATHER CC The Hanni family have dedicated itself to an unbroken lineage in the leather trade since 1724.

The Hanni family coat of arms Rooster symbol is incorporated as the main element representing the forefathers and next generations of the Hanni family. The crown signifies the handing over of the Hanni family trade of leather tanning from the father rooster to the son rooster.

The father rooster holds two arrows namely craftsmanship and quality which is

passed onto the next generation. The son rooster holds one arrow, signifying innovation to adopt to new trends and current changes.

E. hannitan@iafrica.com www.hannitanleather.com

BE Manufacturing | 225

PROUD SUPPLIER TO ALPINE LOUNGE

South Africaâ&#x20AC;&#x2122;s largest producer of polyurethane foam.

Solutions in any shape, size and type.

Tel: +27 (0)21 5352280 | www.vitafoam.co.za

Quality Springs cc Distributors Of Industrial Staples, Coil Nails, Pneumatic Tools, Sagless Zed Springs, Hardware Products & Accessories to The Furniture & Allied Manufacturing Industries.

Telephone: +27 11 402 4250/7 | Fax No: +27 11 402 6661 | Email qualitysprings@tiscali.co.za KZN Branch: Telephone: +27 32 551 2262 | Email: qstanger@mweb.co.za | www.qualitysprings.co.za

Alpine Lounge when van der Merwe went Vitafoam to America, after Alpine Vitafoam South Africa is proud to be associated with Alpine secured the Africa-wide Lounge, a premier brand in the furniture industry in South licence to manufacture and Africa. As the leading producer of polyurethane foam in distribute La-Z-Boy products.

South Africa we offer our customers innovative solutions that This major US brand assist in product development and improvement. Vitafoam founded in 1927 had begun has been a major supplier to Alpine Lounge for many years and congratulate Alpine on their success and look forward to to struggle too, some seven making new contributions to their future success. or eight years previously, but www.vitafoam.co.za the common denominator was not just the competition from China. La-Z-Boy was founded in the 19th century and its designs reflected that but more importantly it was still manufacturing in a way consistent with mass production – the Ford model of motor manufacturing, if you like, which that industry had already abandoned in favour of the Toyota Production Method (TPM). “We started producing on line back in the mid 1970s, the time TV came to South Africa. And the factory was still laid out that way until last year. But the market has changed. We don’t have the volumes to enjoy the same economy of scale.

Stoppages are more frequent due to shorter runs and line imbalances result from that, Sewing department so it is no longer advantageous to produce smaller quantities on line.”

He put in some time in Quality Springs the States to learn how some We specialize in the BeA and Brett range of pneumatic tools and employ qualified technicians to service and maintain seven years ago La-Z-Boy these products both”in house” and on site at our customers had switched over to cell premises. Our mission is to offer the best quality products manufacturing, adopted lean and service on our ever increasing product range. We practices in its factory and are proud of the fact that we have established long-term revolutionised its designs, relationships with our clients and we continue to assist its methodology and quality them with their requirements. standards. At the same time www.qualitysprings.co.za it had revamped its design

BE Manufacturing | 227

14 Chestnut Grove, Bower Road, Wynberg, 7800 Tel: 021 761 0513 Fax: 021 761 0915 Email: gregd@procbroc.co.za Procurement Services is hugely grateful for being granted the opportunity to honour the relationship we have enjoyed with Alpine Lounge since 1979, to whom we value the status of being a preferred and worthwhile supplier.

The function of Procurement Services is to select suitable supplies for Alpine Lounge. This begins with the selection and sustainability of the raw material, starting from the forest, its species and density.

From there our reliable and sustainable sawmilling procedure is equipped to selectively cut, dry and define the quality that is required by Alpine Lounge.

Alpine Lounge has secured the highest quality of raw material, specifically selected and processed for their individual needs and has built secure and much valued supply sources. On behalf of all of our selected suppliers we would like to thank Alpine Lounge for its past support and we wish to reinforce our gratitude and commitment to its future and continued success.

Seen

Contact us today and put your company in the spotlight!

vincent@bus-ex.com 228 | BE Manufacturing

and marketing thrust to appeal to a younger audience, even getting Brooke Shields in as the ‘face’ of the La-Z-Boy brand. “I was struck by how successful they had been in turning the business around. It pulled them out of the red and into the black and the business is now fully recovered and doing very well internationally.”

Back in South Africa he persuaded his CEO that, facing the threat from low cost imports and a changing market dynamic, the business should adopt the same approach that had delivered such a great result for La-Z-Boy. As a result the entire group has started its lean journey, an initiative that will undoubtedly deliver results across the value chain from raw materials procurement to showroom, though

Alpine Lounge

Adam recliners and sofa

it starts with production. It’s early days in a process that started in September 2012 but will, he emphasises, never end. “There’s a huge task ahead of us. We are starting with a five-year transformation programme, that being continuous improvement, or Kaizen. I believe it will take us forward into the next decade and beyond, as lean manufacturing is the survival kit for modern manufacturing.”

Cell manufacturing differs from single element procedures, where each operator

repeats the same step on a production line.

Instead there may be six operators, multiskilled and between them taking complete responsibility for the product. “There are so many advantages when you work out the return rates compared to online,” says van der Merwe. “Quality is so much better, as is general control of production, particularly with smaller runs. You can identify product that is relatively easy to produce, what falls into the middle area of complexity and what

“I was struck by how successful La-Z-Boy had been in turning the business around” BE Manufacturing | 229

“Lean manufacturing is the survival kit for modern manufacturing” requires more work – and allocate these to particular cells, with people who have matching skills.”

The lean journey is a challenge to people used to the old ways, and some move on, but there is no turning back. Cell manufacturing delivers better productivity with fewer people, less waste, better quality and faster lead times. The factory is already looking a very different place, he says, with clutter

230 | BE Manufacturing

disappearing, and everything that is needed close to hand, visible and accessible.

This new manufacturing approach suits the increasing complexity and technical sophistication of furniture, a large proportion of which falls into the ‘motion’ category, with dynamic options built in. Alpine Lounge is the biggest manufacturer of motion furniture in South Africa and has been producing it in increasing quantities since 2002. To keep

Alpine Lounge

Panda in leather-look microfibre

pace with the growing sophistication of these systems as well as the volumes needed, Alpine Lounge recently shifted its sourcing to Leggett & Platt, the leading global supplier of mechanisms that can, for example, now recline a seat forward – or rather, ‘incline’ it like the latest aircraft seats into a 180 degree lay-flat position. This also means its back can be close to a wall, making it more suitable for the smaller room.

Finally, Alpine Lounge is now much in demand for cinema and auditorium seating, one sector of the market that seems to be recession proof. “Perhaps people go to the pictures to forget their problems!” Lawrence van der Merwe speculates. Whatever the

reason it is a growing market for Alpine Lounge, in happy partnership with the leading installer Destiny Seating. One UK cinema, Vue in Manchester, has just been completed, major cinema chains in South Africa are ordering, and the company is providing the seating for four cinemas in Doha, Qatar. Alpine is looking forward to the opportunity that offers to combine its luxury cinema offering with the innovative design and highly decorative finish beloved of customers in the Middle East.

For more information about Alpine Lounge visit: www.alpinelounge.co.za

BE Manufacturing | 231

Al

From mega Marine con

232 | BE Manufacturing

Hanseatic Marine

life of luxury

the game-changing SILVER to the largest all-aluminium ayacht ever made in Australia, the Smeralda, Hanseatic ntinues to revolutionise the world of luxury superyachts

written by: Will Daynes | research by: Jeff Abbott

BE Manufacturing | 233

Hanseatic Marine

L

ocated 23 kilometres south of effort spend has proven itself to be well worth Perth, on the coast of Western it with the company achieving successful Australia, is the Australian Marine sales to some of the planet’s richest individuals Complex (AMC), the Southern and receiving of the “International Super Hemisphere’s premier integrated Yacht Award” in 2007. marine industrial facility. A world-class centre In recent years the company has continued for excellence in manufacturing, fabrication, to work closely in the design and construction assembly, maintenance and technology of its vessels with internationally renowned development, it is home to more than 150 designer, Espen Oeino. A graduate in naval businesses. These businesses are separated architecture and offshore engineering at into four main precincts; fabrication, support Strathclyde University in Glasgow, Scotland, industry, technology and shipbuilding.

Oeino set up his own design studio in 1994.

One of the companies The company, Espen Oeino found operating at the heart International S-A-R-L, is of the AMC is Hanseatic today based in Monaco Marine, an Australian and is considered to be builder of some of the finest one of the leading studios custom luxury aluminium when it comes to large superyachts found anywhere custom motor yachts. in the world. From its home One of the most successful The average time the within the AMC, Hanseatic collaborations between company takes to build Marine is blessed with direct Hanseatic Marine and Oeino a custom vessel access to all the key ship was the creation of the building resources it could SILVER luxury yacht, a 73 ever need, while its own facilities include metre long aluminium semi-displacement two 85 metre boatbuilding halls, a purpose charter motor yacht that was completed in built interior fit-out shop, state-of the-art 2008. Built to accommodate up to twelve engineering hall and design offices. yacht charter guests, SILVER boasts a cruise Within these facilities the company utilises speed of 18 knots and a top speed of 25 knots. a straight-forward approach to building Espen Oeino designed SILVER to meet boats, one that is based on the traditional the specific performance requirements and values of craftsmanship, proven technologies environmentally conscious goals of the and only the finest equipment and fittings. vessel’s owner. At 73.3 metres, her semiSupplying its creations to markets across displacement hull creates a highly efficient the world, with particular attention paid to and stabile sailing platform, while SILVER’s Asia, the Middle East and America, Hanseatic slender lines and sleek profile depart from Marine typically spends between 18 and 24 a ‘higher and wider’ trend in modern yacht months building each vessel. The time and design. The overall effect is an elegantly

18-24 months

BE Manufacturing | 235

Muir Established in 1968, Muir’s complete range of anchor windlasses, anchoring systems and deck equipment is exported to more than 40 countries.

The majority of export orders consist of anchor windlasses as the dominant component with a mix of docking capstans, controls, anchors, and chain and restraint equipment supplied as part ofa complete package.

Muir pride themselves on working very closely with the boat yards and the relevant key personnel for any build to ensure that the customer get exactly what they require and in this regards Muir “customise” the equipment to suit.

Muir have been privileged to work with

Hanseatic Marine (Western Australia) on all three of their beautiful 77m super yachts built to date and are very proud to be associated with a quality business such as this.

E. matthew@muir.com.au www.muir.com.au

Hanseatic Marine

understated yet modern shape that has Powered by two 16V-4000 MTU engines, since been embraced by a large number of the vessel’s shallow draught provides for a highly responsive helm and allows the boat yacht owners.

SILVER possesses a “Contemporary Italian” to explore areas off limits to nearly all other interior style with extensive use of advanced vessels in her class. lightweight materials. This very minimal and In total it took Hanseatic Marine two years modern design creates gathering spaces that to build SILVER with some of the finishing are warm, comfortable, and casually stylish. touches being to include hand-made carpets, Built to Safety of Life at American walnut veneers, Sea (SOLAS) passenger ship stitched leather upholstery classification, Silver has been and contemporary Italianengineered to guarantee style minimalist furniture.

March 2012 was another safety and reliability. Her important month for the owners insist that a boat is to be sailed and all of its company. It was then that equipment has been selected it officially launched the Went into the making of the Smeralda megayacht. to meet the most stringent Smeralda, at the time operational demands. the largest all-aluminium

500,000

man hours

BE Manufacturing | 237

megayacht ever made in Australia. The 77 metre vessel was built for Guido Krass, the owner of the Pari Group. It was Krass who had previously commissioned both the aforementioned SILVER vessel and its successor the Silver Zwei.

As well as bearing a sleek profile similar to that of her sister vessels, the Smeralda’s

power is supplied by twin MTU 16V 4000 M90s that give it a top speed of 30 knots.

When maintained at a steady 18 knots the Lloyds-classed and MCA-compliant vessel is capable of a range of approximately 4,500 nautical miles.

Despite having an upper deck almost entirely given over to a single owner’s

“Hanseatic Marine continues to break ground in the superyacht sector, while exploring the opportunity to expand into exciting new international markets” 238 | BE Manufacturing

Hanseatic Marine

apartment, the Smeralda also boasts nine guest staterooms spread over the main and lower decks. Three VIP staterooms are forward on the main deck, while six twins, one also with a Pullman, can be found amidships below. The vessel also comes with several extravagant extras including an outdoor cinema and glass-fronted hot tub on the sundeck, plus large dining areas on both the aft main deck and sundeck.

Meanwhile, the ten metre, beam makes indoor areas like the saloon and beach club/gym equally welcoming.

Such was the level of work that went into taking the Smeralda from blueprints to a complete, sea-worthy vessel that Hanseatic

Marine estimated that it took its staff some 550,000 man hours in total.

With an entire catalogue of past projects and a wealth of satisfied customers under its belt Hanseatic Marine continues today to break new ground in the superyacht sector, while at the same time exploring the opportunity to expand into exciting new international markets as it looks to diversify. By successfully achieving these aims the company will no doubt remain one of the key global players within its field.

For more information about Hanseatic Marine visit: www.hanseaticmarine.com

BE Manufacturing | 239

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