MAKING THE BEST KIND OF DOG’S DINNER
Endeavour Magazine • June 2012 • 53
Promeal Fifty odd years ago Promeal started out as a company selling animal feed to the agricultural industry. As time went on they expanded into new markets, which most companies with any longevity will do eventually, but Promeal went a step further, leaving behind their old line of products altogether. “Around twenty years ago we moved to producing cans for pet food on a very small scale,” explains managing director Fazielah Allie. “Eventually we closed down the animal feed side of the business and focused exclusively on pet food. “ Leaving behind the line of products that your company made its name with is a bold decision, and not one many companies would make, but Allie believes it was the right one. “At the time the price of animal feeds was quite low and our equipment was coming to the end of its life cycle,” she says. “We were faced with a choice. We could either spend money upgrading our animal feed production equipment, or we could redirect that money into building the pet food side of our business. That option looked like it would be more profitable for us, so we focused on that.” Since then the company has built an identity around its pet food brands, and it is doing well out of it. “Price wise we’re able to be very competitive,” Allie admits. “We’ve got very low overheads because our structure is fairly compact, so on price terms we’re able to compete even against bigger companies because they have to pay those higher overheads.” Another reason Promeal has done well is its excellent relationships with retailers. “Because we’re a smaller company we come across as much more approachable and flexible to retailers. Even
though we actually control an impressive share of the market we still manage to maintain that flexibility compared to competition from big companies. We’re easier to reach and we’re able to make decisions much more quickly.” Last but not least, Allie believes Promeal’s success is down to the high quality of its products which keep retailers and customers coming back for more.
“Price wise we’re able to be very competitive,” Allie admits. “We’ve got very low overheads because our structure is fairly compact, so on price terms we’re able to compete even against bigger companies because they have to pay those higher overheads.” A Shifting Market Of course it’s not all plain sailing, and as Promeal has grown it’s faced numerous challenges. In the current economic climate it seems pet food has been one of the first things people are cutting corners on. “Everyone has gone through a bit of a recession, so a lot of people have gone to dry food because it’s a cheaper product. Many are even just feeding their pets with scraps from the dinner table,” Allie tells us. “We’re still seeing growth through our absolute top end products.” As well as growing their business through high end pet food such as their Petley’s Supreme Gourmet Cat Food, the company is also growing its business through private labels for other companies. With growth comes another challenge however- finding the right people for the business. The shortage of skilled workers in South Africa isn’t news. It’s an issue plenty of companies in a variety of industries have struggled with. It’s a particularly painful issue for Promeal, who are currently striving to get ISO 9001 accreditation over the next two to three years. However one of the criteria for that accreditation directly relates to the skill level of the workers. But Promeal isn’t going to let this obstacle stop them, and already they are working on new ways to achieve their goals. “Our plan for the next five years is to upgrade both our factory facilities and staff skills. We’ll be starting from May next year and we’re hoping that by the end of 2014 we’ll be in a position to get ISO 9001 accreditation. Right now the challenge we’re addressing is getting our people to think that way.” The main issue is IT literacy. To achieve their desired accreditation Promeal must be able to demonstrate the right level of computer skills throughout their staff. “We need people at entry level who can work on a PC,” Allie says. “We currently have staff from supervisor level down that don’t have those skills, so we’re getting people onto a PC skills course and where they can learn how to work computers and acquire the skills we need from them. “We’ve got our HR people to identify the staff who are
interested. Then we’re providing funding for people who want to study in a particular field or areas that are relevant to our business. We’re encouraging people to study further.” It’s a strategy that’s paying off, and several members of the Promeal team have benefited already. “We’ve got three guys who have applied for diplomas this year,” Allie says proudly. “Both our Maintenance Manager and our Quality Manager are studying a Project Management Course as well as, an engineer studying for an MBA.” “It’s important to offer staff a chance to advance themselves like this. If you’re stuck in a job with no prospects you’re not going to be engaged with the work,” she points out. Sourcing the Right Materials Another challenge that Promeal has faced has been the rising price of the ingredients they use. The trouble is that in the last few years people have started to use offal as a cheap source of meat for their own cooking, so what was previously a waste product has now suddenly acquired value. Allie says “We used to get a lot of our offal from local suppliers, but the price of it has gone up. People used to throw the offal away, but now they’ve found another market, so the price has risen. Quite a bit of the offal we use now, we import because we can get it cheaper from abroad than locally.” Thinking Big for the Future As for the future, Promeal has big plans. Although the Petfood market is currently stagnant in South Africa, they’re starting to export their products into other markets. “It’s easy to import and export now, it’s one global island,
everyone can mix with everyone,” Allie acknowledges. “The future for our business is taking the products that are being imported right now and making them available as local produce. In my opinion we’re about 10 years behind Europe and the USA when it comes to the products available but in terms of resources there’s nothing they have that we couldn’t get hold of through imports.” With Promeal on course to achieve new levels of accreditation, and the company’s plans to build a dry food plant to meet the demand for cheaper pet food in the current financial situation it seems like there are some exciting times on the horizon for this former animal feed company.
Promeal www.promeal.co.za +27 21 577 1520 By Chris Farnell