Enterprise Africa June 2017

AFRICA

THE BUSINESS MAGAZINE FOR AFRICA’S INDUSTRY LEADERS

June 2017

www.enterprise-africa.net

LETSENG DIAMONDS:

The Diamond of Lesotho

ALSO IN THIS ISSUE:

Atlantis Foundries / Shuter & Shooter / Chet Chemicals / Winelands Pork

EDITOR’S LETTER Joe Forshaw EDITOR joe@enterprise-africa.co.za Hal Hutchison SALES MANAGER hal@enterprise-africa.co.za Emma Neethling SALES ADMINISTRATOR sales@enterprise-africa.co.za Sam Hendricks SENIOR PROJECT MANAGER sam@enterprise-africa.co.za Shaun Cousins PROJECT MANAGER shaun@enterprise-africa.co.za Shannon James PROJECT MANAGER shannon@enterprise-africa.co.za Aaron Chapman PROJECT MANAGER aaron@enterprise-africa.co.za Adam Dowson PROJECT MANAGER adam@enterprise-africa.co.za Emma Smith FINANCE MANAGER finance@enterprise-africa.co.za Harvey Tarlton SENIOR DESIGNER harvey@enterprise-africa.co.za

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Published by CMB Multimedia Chris Bolderstone – General Manager Logo Two E. chris@cmb-multimedia.com Sackville Place, 44-48 Magdalen Street, Norwich, NR3 1JU T. +44 (0) 20 8123 7859 E. info@cmb-multimedia.com www.cmb-multimedia.com CMB Multimedia does not accept responsibility for omissions or errors. The points of view expressed in articles by attributing writers and/or in advertisements included in this magazine do not necessarily represent those of the publisher. Any resemblance to real persons, living or dead is purely coincidental. Whilst every effort is made to ensure the accuracy of the information contained within this magazine, no legal responsibility will be accepted by the publishers for loss arising from use of information published. All rights reserved. No part of this publication may be reproduced or stored in a retrievable system or transmitted in any form or by any means without the prior written consent of the publisher. © CMB Multimedia Ltd 2017

Welcome to our latest edition…

//

June’s Enterprise Africa is stuffed full of stories from companies that are experiencing exciting positivity.

While mainstream media remains focused on negativity of economic slump and political turmoil, we are talking to organisations that are driving business forwards and stimulating economic development.

Lead features for June come from educational publishers, Shuter & Shooter; engine block casting company, Atlantis Foundries; and Lesotho mining operation, Letšeng Diamonds.

Shuter & Shooter explain that, where others found 2016 challenging, they had a fantastic year and have continued in 2017 in the same form. Atlantis Foundries came through a very challenging 2016 but are now looking at opening up new markets to create major opportunities for expansion. Letšeng Diamonds has made four significant discoveries recently and is also celebrating an exceptional safety record. While people talk about slowdowns and crisis, these businesses are looking inwards and maximising efficiencies, building on positive relationships and, vitally, always continuing to invest where necessary.

We also hear from Winelands Pork, who have won accreditation for quality and first-class processes, and Chet Chemicals, who are investing in new machinery to cope with increasing demand. Then there’s Cemblocks, the Rustenburg-based brick manufacturer who recently completed upgrades to plant to improve efficiency; and Calvin and Family Group, run by awardwinning entrepreneur Calvin Mathibeli, who plans to create 5000 jobs by 2022.

It’s exciting and refreshing to hear about business that is not focused on the negative; business strategies that are not defensive, and business ideas that go beyond just benefiting shareholders. If your company is embracing the changing landscape and coming up with fresh new ideas, get in touch. We’re online @EnterpriseAfri1

Joe Forshaw EDITOR

GET IN TOUCH +44 (0) 20 8123 7859 joe@enterprise-africa.co.za www.enterprise-africa.net

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06/NEWS: The Month that was...

A round up of some of the latest news stories from around the country

102/EXHIBITION CALENDAR: Key Upcoming Events Across the Country Our regular update to help you keep track of important events and exhibitions taking place across the spectrum of industry sectors

8/LETSENG DIAMONDS: The Diamond of Lesotho Leading Lesotho diamond miner, LetĹĄeng Diamonds, has been celebrating some impressive discoveries in recent months, and working on important projects to ensure growth and expansion can continue.

Acting CEO, Jeff Leaver explains more‌

8/ 4 / www.enterprise-africa.net

CONTENTS

44/

40/

92/

INDUSTRY FOCUS: MINING

INDUSTRY FOCUS: AGRICULTURE

20/DEBSWANA: Strong Performance in Changing Market

64/WINELANDS PORK: Winelands Pork Has the Recipe for Success

INDUSTRY FOCUS: AUTOMOTIVE 26/ATLANTIS FOUNDRIES: Atlantis Foundries Forging new Oppertunities 34/S4 AUTOMATION AND INTEGRATION: S4 Drives SA Automotive Automation Industry

INDUSTRY FOCUS: ENGINEERING 40/KELVION THERMAL: A Rebrand for the Heat Exchanger Specialists 44/HOWDEN AFRICA: Engineering Expertise in Air and Gas Handling

INDUSTRY FOCUS: CHEMICAL 48/CHET CHEMICALS: Household Giants eye African Expansion

INDUSTRY FOCUS: EDUCATION 54/SHUTER & SHOOTER: Committed to Serving the Educational Needs of Southern Africa

INDUSTRY FOCUS: PROPERTY 70/BROLL FM: Utilising Tech Advances to Maximise Potential of Property Africa

INDUSTRY FOCUS: CONSTRUCTION 76/TIBER: Tiber Close to Completion With Discovery Project and Remaining Positive Amidst Tough Market Conditions 82/CALVIN & FAMILY GROUP: Calvin Mathibeli: Building an Expanding South African Organisation From Nothing 86/CEMBLOCKS: Rustenburg Bricks Building SA

INDUSTRY FOCUS: PRINT 92/KONICA MINOLTA: Celebrating Fifty Years of Print Dominance

INDUSTRY FOCUS: INSURANCE 98/THATCH RISK ACCEPTANCES: Taking Insurance Personally www.enterprise-africa.net / 5

NEWS IN BRIEF GMSA CONFIRMS EXIT, AND ROB DAVIES ISN’T HAPPY Trade and Industry Minister Rob Davies has responded to GMSA decision to exit South Africa with regret and concern for the jobs and livelihoods that will be affected.

“The Minister has learnt of the announcement by General Motors South Africa to cease some of their operations in South Africa with regret and concern for the numerous employees whose jobs and livelihood will be directly and indirectly affected as a result,”said the DTI. General Motors has had a presence in South Africa since 1926, under various brands such as Buick, Chevrolet, GMC, ISUZU, Oakland, Oldsmobile and Vauxhall.

Given the intense competition in the South African market, especially after 1994, GM has had some difficulties including: The GMSA plant not meeting the initial annual minimum production volume of 50,000 units set under the Automotive Production and Development Programme (APDP) since 2013; sales have been on a downward trend for the past five years; and exports remained low at about 2000 vehicles per annum with a maximum of 3500 units.

“Although we do not welcome this decision, we believe that the future of the industry positive, as automotive industry stakeholders are finalising a Master Plan for South Africa with a view to growing domestic vehicle production volume and local value addition and an announcement on the final program can be expected early 2018 latest and will cover the period post 2020,”said Minister Davies.

The Minister added that the dti will continue to work with all stakeholders to mitigate the impact of this exit.

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27.7% UNEMPLOYED IN FIRST QUARTER OF 2017 According to Stats SA, the country’s unemployment rate rose to 27.7 % in the first quarter of 2017.

“What we see is the highest [unemployment] since September 2003,” Statistician General Pali Lehohla said at the release of the Quarterly Labour Force Survey (QLFS).

The QLFS showed that the growth in employment by 144,000 was offset by the growth in the number of job seekers by 433,000, driving the unemployment rate to 27.7%.

According to the survey, on a quarter to quarter basis, the official unemployment rate increased by 1.2%, showing that 6.2 million people were unemployed in the first quarter.

Of the 433,000 that were unemployed, 58% were young people aged 15 to 34. This increased the youth unemployment rate by

1.6% to 38.6%.

“Once this group is unemployed for a period of time, [it] gets harder and harder for them to get jobs,”said Lehohla.

When looking at market rates by education level, the unemployment rate for those with less than matric was at 33.1%, up from 31.2% in the fourth quarter of 2016. The unemployment rate for graduates went up from 7% in the fourth quarter of 2016 to 7.3% in the first quarter of 2017.

Lehohla said the labour participation rate of graduates is higher because the likelihood of them getting jobs is higher and they continue searching for work.

Meanwhile, the increase in unemployment rate was recorded in seven of South Africa’s nine provinces. The highest increase was recorded in the Eastern Cape at 3.8%.

SA’S NSIGHT1 BLASTS INTO SPACE Weighing just 2.5kg, South Africa’s first privately owned nanosatellite, nSight1, has been successfully launched into orbit from the International Space Station (ISS).

Deployed on 24 May, nSight1 will orbit Earth and capture images with a remote sensing camera.

Locally designed and built by SCS Space, a member of the SCS Aerospace Group, nSight1 was constructed over a period of six months using all the available space infrastructure in South Africa.

It is the first time a private company in Africa has invested in building and launching a satellite.

“The satellite is an important milestone, demonstrating the outcome of the capability established through the Department of Science and Technology’s ongoing investment in the South African space programme.

“More than 70% of the satellite is made up of satellite components supplied by enterprises in the South African space industry,”said Mmboneni Muofhe, the department’s Deputy Director General of Technology Innovation.

The department, which welcomed the

deployment of nSight1, said South Africa has been involved in space research and technology for 50 years. nSight1’s deployment follows the successful launch of South African satellites since the late 90s, including SUNSAT (1999), SumbandilaSat (2009) and the Cape Peninsula University of Technology’s ZACUBE-1 satellite (2013). nSight1 was part of a batch of 28 nanosatellites from 23 different countries, launched on 18 April 2017 from Cape Canaveral in Florida, USA. The main objective of nSight1’s mission is to demonstrate a patented coding technique developed at Nelson Mandela Metropolitan University and to showcase the space capabilities of private companies in South Africa. nSight1 is part of the European Commission’s QB50 project, which is aimed at designing and deploying a network of satellites to study the largely unexplored lower thermosphere.

Hendrik Burger, CEO for SCS Space, said the company was delighted to be part of an international project that has put South Africa on the international satellite map.

NEWS ROUNDUP IMF EXPECTS SA’S GDP TO GROW TO 1% The International Monetary Fund (IMF) has raised South Africa’s growth forecast to 1% this year.

Speaking at the end of an IMF staff team visit to South Africa, led by Paolo Mauro, the monetary fund said there are signs of a modest improvement in the South African economy.

“Following last year’s near-stagnation, there are signs that a modest improvement in the pace of economic growth is underway. The rate of real GDP growth is projected at 1% in 2017,” said team leader Paolo Mauro last month.

The main factors underlying the pickup in economic activity this year are a resumption of solid agricultural production as the drought abates, and an increase in mining output, prompted by a moderate rebound in the prices of South Africa’s commodity exports.

“The pace of recovery this year and the next is unlikely to prevent a further increase

in unemployment and a continued decline in per capita incomes,” he said.

The IMF had previously projected growth of 0.8%.

In the National Budget tabled in February this year, National Treasury said South Africans can expect growth of 1.3% in 2017, which is expected to improve moderately to over 2% in the medium term.

The IMF team, which was in South Africa from 3 – 16 May 2017, said they expect headline inflation to return to below 6% in the second half of 2017 and in 2018.

“Under the current stance of monetary policy, headline inflation is expected to return only somewhat below 6% in the second half of 2017 and in 2018. In line with the inflation targeting framework, it would thus be appropriate for policy rates to remain on hold, and for the central bank to stand ready to increase rates if inflation expectations were to rise,” said Mauro.

In March, the Reserve Bank said its forecast for inflation has improved, with headline inflation now expected to return to within the target range of between 3% and 6% in the second quarter of 2017.

The IMF team said with limited room for stimulus through macroeconomic policies, the priority to stimulate economic growth and job creation rests with structural reforms, notably in product and service markets and in the labour market.

At a media briefing last month, Finance Minister Malusi Gigaba said while the executive leadership of the finance portfolio has changed, government’s overall policy orientation remains the same.

“Government has been and will remain committed to a measured fiscal consolidation that stabilises the rise in public debt. The fiscal trajectory that our country is pursuing will continue. Our fiscal objectives remain unchanged,” he said at the time.

‘INTERNET FOR ALL’ BY 2020 The SA Government is forging ahead with its plans to connect 22 million South Africans to the internet by 2020.

Known as ‘Internet for All’, the initiative is a partnership between the Department of Telecommunications and Postal Services and its social partners, and the World Economic Forum (WEF).

The Internet for All South Africa Steering Committee will be launched this month, with the express aim of identifying areas with the highest need and channelling resources to provide skills in those areas.

Telecommunications and Postal Services Minister Siyabonga Cwele tabled this and other plans when he delivered his department’s Budget Vote in Cape Town recently. “[The plan] focuses on extending ICT infrastructure to underserved areas,

lowering the costs of being online and cheaper gadgets, digitising local content and providing ICT and digital skills.

“This partnership has youth ambassadors, who ensure that the interventions address challenges faced by the youth and to help with the awareness.

“Yesterday, we held an industry engagement wherein stakeholders pledged to train millions of young South Africans in various digital skills over the next few years,” the Minister said.

Minister Cwele said the Internet for All South Africa Steering Committee will coordinate all these training initiatives and monitor and track their implementation.

He said the goal of the initiative is to give people digital skills that will enable

them to redefine their future and that of generations to come.

Minister Cwele said this is also an opportunity for the private sector to invest in their future by preparing future users of their services.

With regards to the state of broadband, Minister Cwele said the recent Independent Communications Authority of South Africa’s report showed 3G coverage reaching about 99% and 4G rising to approximately 75% of the population.

“However, not all those who are covered have access to or are using internet, as only 53.4% of South African households have access to internet.

“The industry invested R28 billion in 2016 on general network improvements as well as fibre deployment in major urban areas,” said the Minister.

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C

LETŠENG DIAMONDS

The Diamond of Lesotho PRODUCTION: Karl Pietersen

Leading Lesotho diamond miner, Letšeng Diamonds, has been celebrating some impressive discoveries in recent months, and working on important projects to ensure growth and expansion can continue. Acting CEO, Jeff Leaver explains more…

INDUSTRY FOCUS: MINING

//

In April, leading global diamond producer of high value diamonds, Gem Diamonds, announced that it had discovered a 114-carat D-color, type-II rough diamond at its Letšeng mine in Lesotho. Just a few weeks later, in May, the mine announced another important discovery - a D-color, type-II 80-carat rough stone which, although smaller than previous discoveries, is almost unmatched for quality and was called ‘one of the highest-quality diamonds ever found at the Letšeng mine’ by Gem Diamonds. Then, later in the same month, Letšeng mine circulated news of the discovery of a 98.42-carat high quality D-color Type

II diamond, the third major find in a matter of weeks, alleviating concerns after a dip in recovery figures showing just 11 discoveries over 100 carats in 2015 and five in 2016.

Jeff Leaver, Acting CEO at Letšeng Diamonds tells Enterprise Africa about the importance of recent flagship discoveries.

“Every large stone is significant,” he says. “The 80-er is not in the class of our largest finds, however its exceptional quality makes it just that, exceptional!”

Located high up (3100m) in the Maluti Mountains in the Kingdom of Lesotho, the Letšeng diamond mine is famous for its large, top quality

//SOUND PLANNING AND LEADERSHIP ARE KEY TO PROVIDING STRATEGIC DIRECTION ON HEALTH, SAFETY AND ENVIRONMENT//

diamonds; it’s known as the highest dollar value per carat kimberlite diamond mine in the world. The mine is owned by London-based Gem Diamonds (70%) and the Government of the Kingdom of Lesotho (30%).

After a challenging period for the global diamond industry, following slack demand in major markets including the US, China and India, compounded by global economic and political uncertainty, Letšeng remains upbeat about the future.

Gem Diamonds’ CEO, Clifford Elphick commented: “Letšeng has recovered larger better-quality diamonds during the quarter and it is encouraging that during April and May, there was a notable improvement in the size and quality of diamonds recovered at Letšeng with the dollar per carat achieved trending positively.

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INDUSTRY FOCUS: MINING

“The market for Letšeng’s highquality diamonds has remained firm over the period and this is anticipated to continue into H2 of this year. In addition, the revised life of mine plan was implemented during February with the objective of reducing waste tonnes mined and improving near-term cash flows, and we expect to see the benefits emerge during 2017.”

Jeff Leaver reiterates: “We

12 / www.enterprise-africa.net

have experienced a difficult 12-15 months, but have weathered the storm and have come out stronger.

We are confident that we have turned the corner, as shown in the increase in the dollar per carat our diamonds have fetched in the market.”

SPARKLING ECONOMY? At the end of 2015, the global diamond industry, particularly

that of the SADC region, faced challenging conditions, thanks to slow demand from Japan, India and Europe and disinvestment from major organisations, but stable demand and pricing in the US helped keep the market steady.

In 2016, the local economy came under pressure thanks to the aftereffects of the global commodity price crash and slow investor confidence. However, at the end of

LETŠENG DIAMONDS

2015 and through 2016, the Lesotho economy maintained a positive trajectory with 3.1% growth, thanks to investment in mining and a booming tertiary sector, and growth is expected to continue throughout 2017 and 2018. But the global diamond industry continues to face challenges of marketing and retailing to a changing consumer base, an issue highlighted by De Beers CEO Bruce Cleaver at the 2016

Diamond Conference in Botswana in December, and this will continue in the future. Letšeng Diamonds has remained somewhat protected from global economic sloth thanks to the quality of its produce, but the health of the economy, where an estimated 56.2% are living in poverty, remains a concern for the company.

“Given that we produce an exceptionally high-quality product,

we have been shielded from the head-winds of the dip. The market for our product remains robust,” says Leaver.

“Absolutely, we are concerned about the state of the economy,” he adds. “We have very active community driven corporate social responsibility initiates but, I am afraid to say, these are not and cannot be expected to address and eliminate all economic suffering.

Our most important contribution to addressing the consequences of these problems is to mine responsibly and sustainably, and in so doing maintain and create employment and contribute significantly the fiscus of the Sovereign Kingdom of Lesotho.”

More than 50% of the population remains unemployed

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INDUSTRY FOCUS: MINING

//OUR LARGEST PROJECT RIGHT NOW IS THE RELOCATION OF THE MINING COMPLEX. THIS CERTAINLY ISN’T PARTICULARLY EXCITING, IT IS ABSOLUTELY NECESSARY// and many of the jobless live in rural areas. This has resulted in many international organisations calling for an aggressive approach to reduction of unemployment and inequality so that the economy can thrive and bolster entrepreneurship and industrialisation.

“Finding citizens with quality mining experience in Lesotho is very very difficult, the issue of skills has

14 / www.enterprise-africa.net

been and remains the top risk to the company,” admits Leaver.

“Attracting qualified and experienced technical skills always poses a particular problem, but regretfully, the other skilled functions required in a mining company of our size are also in short supply. This is exacerbated both by the lack of Lesotho citizens with these qualities and by the growth in the diamond

sector in the country.”

But the Acting CEO does believe that there are opportunities at Letšeng Diamonds for people to gain employment, gain skills and gain promotions.

“This is our model for developing and retaining staff,” he says. “Of course, no matter what amount of time and money a company throws at such development initiatives, it still takes years and years to make a material difference.”

However, despite these challenges (which are not new for Letšeng), the company continues to lead the way in the sector in

INDUSTRY FOCUS: MINING

Lesotho and acts as a shining example of a well-run diamond mining operation to onlookers from around the world.

“We would like to think we are the industry leaders in Lesotho, but with sincere humility,’’ says Leaver.

“First and foremost, the quality of our diamonds separates us from other our producers. Secondly, the expertise within the technical, financial, and sales and marketing functions of Gem Diamonds all contribute materially to our strength,” he adds. ‘’It is our hope that the diamond sector will flourish in the Kingdom and that complimentary business and other sectors follow suit. A strong Lesotho economy is much desired.”

DIAMOND STANDARD SAFETY Of course, as in any mining operation, safety remains the top

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priority for management at Letšeng.

Employing around 1500 people the drivers of the business - Letšeng has a closely-held responsibility to ensure that its employees come to work with confidence regarding safety.

“Health, Safety and Environment issues are regarded a very critical value within the Gem Diamonds Group and at Letšeng Diamonds,” the company states.

“Programmes to ensure continual improvement on HSE performance are in place. These programmes promote occupational health, prevention of injuries, protection to of property damage and protecting the environment. Subscription to an internationally-acclaimed HSE management system is one clear indication of Letšeng Diamonds’ commitment and belief that Zero Harm is attainable. National

statutes provide minimal standards.

Therefore, genuine commitment to preventing accidents and incidents, especially in accident-prone mining and construction sectors, can only be achieved through continual improvement.

“Sound planning and leadership are key to providing strategic direction on health, safety and environment. Involvement of management and employees at all levels gives impetus to our programmes. Some of the key pillars of our health, safety and environment programme at Letšeng Diamonds are: provision of enabling training, competencies, effective communication, management of operational risk and change, prompt reporting of incidents, including near-misses, at-risk behaviour and conditions, prevention-oriented investigations,

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INDUSTRY FOCUS: MINING

sound management of corrective and preventive actions, promotion of safe behaviour, brother’s keeper principle at all levels and Visible Felt Leadership.”

Last month, Gem Diamonds released its trading update for the first quarter of 2017 (1 January to 31 March) stating that, as a result of on-going emphasis on health and safety around the workplace, “there were no Lost Time Injuries (LTI) during the period, resulting in a Group-wide Lost Time Injury Frequency Rate (LTIFR) of 0.00 for the period,” making it clear that the company’s initiatives are working.

FUTURE PROOFING In an effort to maximise future efficiencies and lengthen the life of the Letšeng mine, the company is currently moving its mining complex to expand the available space for pit mining. Bank funding for the construction of the Letšeng mining support services complex valued at M215.0 million (approx.

US$16.0 million) was secured by Letšeng during the first quarter of

The Lesotho Promise Gem Diamonds recovered the 603 carat Lesotho Promise at its Letšeng mine in August 2006. The Lesotho Promise is currently ranked as one of the world’s largest white diamond on record and the largest diamond to emerge from the Letšeng mine to date. The Lesotho Promise was sold for US$12.4 million to SAFDICO, the manufacturing arm of Graff Jewellers, at an auction in Antwerp in October 2006.

letsengdiamonds.co.ls

2017. The funding is required to relocate the mining workshops, offices and related services within the mining area to allow the mine to effectively maintain the new and larger fleet of mining equipment as a result of the new waste cutbacks required to extend the life of the open pit in line with the revised mine plan which was implemented in February.

“Our largest project right now is the relocation of the mining complex. This certainly isn’t particularly exciting, but it is absolutely necessary given

ACTING CEO JEFF LEAVER

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the expanding footprint of the open pits, which in turn is rapidly encroaching into the area of the current infrastructure,” explains Leaver.

Other important ongoing projects include upgrades to security equipment and researching advances in technology and implementing those into daily operations.

“The company has seen a positive result from these investments,” says Leaver. “Knowing that security of product is as assured as one can hope for, given the lure of our product to nefarious individuals, is exceptionally comforting. Naturally we continue to make incremental improvements in the field of security, but the material improvement brought about by the projects including upgrades to the Coarse Final Recovery Plant, Personnel Control Centre and X-ray security technology was much needed.

“Modern technology and analytical techniques play and important part in us getting better definition of the variables within our ore bodies.”

Who can predict the future of the diamond industry? It’s a milliondollar question that many have looked to address. Will demand be strong in the next 12 months, or will supply outweigh demand and cause prices to drop? It’s certainly a

LETŠENG DIAMONDS

challenging industry to be in; while the value of these natural minerals can be extremely high, the nature of the industry can often replicate their formation process at high pressure high temperature, deep in the earth’s mantle. There’s pressure on producers to find diamonds efficiently, there’s pressure on retailers to get the best prices, and there’s pressure on governments to ensure the economic benefits of successful diamond production are shared.

In Lesotho, diamond exports as percentage of total exports and GDP increased from virtually zero in 2002 to around 30% and 16% respectively in 2011. According to the country’s central bank: “despite the capital-intensive nature of the mining industry, it has contributed to employment in

the country hence has shaken the roots of poverty in some parts of the country as household incomes increased for those employed in the mining industry”. It’s clear that diamond mining in Lesotho is vitally important and remains globally relevant. The recent discoveries made at the Letšeng mine and the work underway to secure the future of the operation help to highlight the organisation as an example for others to follow.

Letšeng Diamonds, formed in 1995 as a vehicle to for the recommencement of mining the two Letšeng kimberlite pipes, is truly a diamond of Lesotho.

Not put off by the ups and downs of the economy and challenges faced by the industry, Leaver is unequivocal in his view that this is the industry

for him “There’s no doubt at all.

The difference between mining diamonds of the calibre we mine is virtually incomparable to other sectors. The heady mix of the exhilaration felt when we find a special stone and the financial reward is intoxicating,” he concludes.

LETŠENG DIAMONDS (+266) 2222 1000 communications@letseng.co.ls www.letsengdiamonds.co.ls

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DEBSWANA

Strong Performance in Changing Market PRODUCTION: Karl Pietersen

As Debswana’s Cut-8 expansion project at its prolific Jwaneng mine continues to gather pace, De Beers is looking to a new consumer group to market its products to, now and in the future.

//

It’s well-documented that the commercial success of Debswana and the privatepublic partnership model has been an outstanding accomplishment for an African mining operation and a shining example of what is possible from a relationship that is ambitious and mutually respectful.

While the last two years have presented challenges and required the taking of tough decisions, historically Debswana is viewed as a triumph.

To recap, back in 1969, the government of Botswana teamed up with global diamond specialist De Beers to initiate a rough diamond mining operation following the discovery of diamonds in Letlhakane and Orapa. After much growth and gaining of international recognition, the business has been one of the most prominent contributors to economic security in Botswana, employing tens of thousands of local people, earning 90% of the governments revenues from exports and creating one third of the country’s GDP. De Beers, owned by Anglo American, also included Botswana in its group ownership structure thanks to the contribution of the country to its success – today, Botswana has a 15% share in De

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Beers global business.

Away from commercial operations, Debswana has taken a firm stance on community investment, running an enterprise development programme, two private hospitals, and two private schools in Orapa and Jwaneng. Its mines are some of the world’s most famous and high value diamond mines: Damtshaa, Jwaneng, Letlhakane and Orapa and Jwaneng mine, west of the country’s capital Gaborone, is ranked number one in the world by value produced, and is estimated to independently produce 15% of the world’s diamonds by value. It is also celebrating its 35th anniversary this year demonstrating the longevity that is possible through effective management.

But even with the success and recognition that the organisation has achieved, it still faces hurdles and 2015 threw up a number of difficult situations.

Back in March 2016, Enterprise Africa discussed the impact of a global economic slowdown, crashing commodity pricing, slowing demand from key markets, and uncertainty caused by global political instability.

So, was 2016 and the first quarter of 2017 the same, or was the trend bucked?

Estimates suggest that production remains

© DE BEERS

INDUSTRY FOCUS: MINING

strong. Global mined diamond output in 2017 is expected to increase 11.5% year-on-year to 142.3 million carats, worth some $15.6 billion, which itself is a 9.9% increase in forecast total value produced.

In the 2016/17 financial year, the company’s performance was solid.

Managing Director, Balisi Bonyongo said at a stakeholder meeting last month: “Things have stabilised, profitability improved to 40% compared to 37% in 2015 and that is significant good business with applauds.

“This was driven by high revenues from stronger rough diamond demands, improvement in costs and operational efficiencies and favourable exchange rates; these three played a key role in the positive financial figures we experienced last financial year.”

Talking about the future, Bonyongo confirmed that changes will come but the company will continue to invest in necessary initiatives to ensure a strong and sustainable future.

“We have to continue to invest in projects that will in future continue to ensure growth and sustainability of the company.

“Debswana will also close its 42-yearold Letlhakane diamond mine this year and it will be replaced by a tailings plant, which is expected to be commissioned before June. The Letlhakane mine has come to the end of its life span. We have invested 2.1 billion pula into a tailings plant which is expected to mine about 800,000 carats over 20 years from the dumps.”

CUT-8 Even during the slow year in 2015, Debswana continued to invest in business development; it’s something we hear constantly and it’s so important for companies – if you can invest during tough times, you should so that when you emerge in a positive environment, you will be on top of the industry. Debswana’s investment came in the form of the fifth year (initiated in 2010 by President Ian Khama) of its Cut-8 project. An expansion of the Jwaneng mine, Cut-8 involves

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extending the life of the mine by exposing new diamond bearing ore.

“During 2018, Cut-8 will become the main source of ore for Jwaneng mine and extend the life of one of the world’s richest diamond mines to at least 2033, providing access to an estimated 91 million tonnes of ore, containing about 110 million carats of mainly high-quality diamonds,” says Bonyongo.

“But before a single diamond can be found, about 500 million tonnes of rock lying above the diamond-bearing ore must be removed. We started this in 2010 and, by the end of 2014, we had removed 50% of it.

“We call it Cut-8 because it is the eighth section of the mine that we have, as it were, scooped out. The deeper the cut, of course, the more expensive the project becomes. This cut will almost double the depth of the mine from about 380 metres to 624 metres, making the pit 2.7km long and 1.8km wide.

“Jwaneng mine, which opened in 1982, 11 years before I joined as a junior plant metallurgist, is the world’s richest diamond mine by value. We recovered 11.3 million carats in 2014. The performance and progress of Cut-8 mining are critical to the future of Debswana and, more importantly, the future of Botswana.

The Jwaneng mine will be catapulted to ‘super-pit’ status, becoming one of the largest open pit mines in the world. What gives me particular satisfaction about Cut-8 is that, since work began in 2010, our investment has added 1,400 jobs (86% of them held by Botswana citizens) to the total of 3,100 currently employed at Jwaneng – and it has brought about opportunities for many local contractors and businesses.”

By the end of March 2017, 88% of the 500 million tonnes of rock had been cleared and Bonyongo said that the project was on track to meet its objectives and ore from the mine expansion project is now being delivered to the main treatment plant.

CHANGING INDUSTRY For the last few years, to stay in line with

market demand while not overspending and further depressing the market, Debswana has been only producing enough rough diamonds to satisfy demand. The entire industry is hoping that demand will grow and return to pre-2008 levels and De Beers CEO, Bruce Cleaver said at the Diamond Conference in Gaborone at the end of last year that demand is not falling and 2016 saw a healthy environment in the industry.

“All demand for rough diamonds is linked to diamond jewellery consumption.

The big four markets are the US, China, India and Japan. 2016 has been a reasonable year for demand in those markets,” he said. “Demand is around flat compared to last year with the biggest market, the US, growing reasonably so diamond jewellery consumption is not in a bad place. There was an excess of stock in the system and that made 2015 more difficult but we’ve seen that work its way out through the course of 2016.”

Bonyongo said Debswana would produce about 20.5 million carats this year, or slightly more as the company continues with its strategy of producing to demand.

Cleaver adds: “We are continuing to see steady demand for rough diamonds, despite the industry entering a typically quieter season. Sentiment remains positive as we head towards the important Las Vegas trade show in early June.”

Of course, continued success for Debswana means positivity for Botswana.

Through its corporate social investments, the company is one of the biggest contributors to the welfare of the country.

In 2016, Debswana spent more than P4 billion locally, encouraging development of a thriving supply chain. Funding was also provided for a range of community projects, including upgrades to health and education facilities, accommodation programmes for key workers and cultural tourism development.

Bruce Cleaver says: “While our diamond partnership with the Government of Botswana has delivered a great deal of direct economic benefit over the last five decades, we are increasingly looking for ways in which we can also

INDUSTRY FOCUS: MINING

© DE BEERS

maximise our contribution outside of our core business.

“Putting the supply chain to work is helping to secure jobs and deliver substantial benefits to local businesses across a range of sectors. Meanwhile, our community investments are helping with the provision of important services for people who need them across the country.”

Going forward, the target for Debswana will be to re-evaluate its marketing and outreach strategy following the publication of a report in which the company evaluated attitudes, spending habits and lifestyle trends of millennials.

“Change brings opportunities if you are able to deal with it,” Cleaver told SABC at the Diamond Conference. “We launched a detailed study that we did on millennials - folks born between 1980 and 2000 - in Hong Kong recently and what we found is that millennials are very invested in the diamond dream and they regard diamond gifting as a very important part of their lives. They also reach financial maturity later than their parents, which isn’t a surprise. We think that in the big four markets they are 220 million potential customers so there is a huge opportunity there, but they are different.

They do things differently to their parents and they are much more into individual experiences. They shop online but they are looking for engagement so retailers

24 / www.enterprise-africa.net

must find out how they can make the experience more individual and engaging.

Millennials also have many more relationships than their parents did, thanks to social media, but they are crying out for meaningful relationships and diamonds can cement a meaningful relationship and that is what they have done over the generations that we’ve sold them. We as an industry are going to have to think very differently about how we market to them but there is a big opportunity.”

He also commented on reports that there was ongoing tension in the 50/50 partnership with the Botswana government thanks to decisions to close mines and pull back on spending over the past 24 months. “It’s like any marriage; we have times where we don’t always agree but we have always been able to sit down, hear our partners, them hear us, and work out a solution to any issue that we have faced,” he said.

It will be vital for Debswana to quickly create a strategy for marketing to this new customer group while also carefully managing its outstanding relationship with the government as the future will only bring new challenges, one of which will be the increase of production and potential attraction of investment to Canada where two of the newest diamond mines in the world are being touted as future industry stars.

New York-based diamond industry

analyst, Paul Zimnisky said in a report last month that ‘Canada is arguably the most active nation in the global diamond mining scene,’ and Gahcho Kué and Renard, the new mines, are estimated to bring to market 4.5 million carats of incremental supply this year, worth $500 million, with the two mines contributing about a third of the estimated 14.7 million carat increase is global diamond output in 2017 over 2016. He added that a number of other smaller companies in Canada are advancing mines that could soon be world class. Canada is the third largest diamond producer in the world behind Russia and Botswana respectively.

It’s an important period in the history of Debswana and, for a company that has been so successful, it is likely that the coming challenges will be met with an appetite for achievement.

Importantly, Jwaneng, which means ‘the place where a small stone is found’ in Setswana, will continue to remain highly significant to De Beers and the people of Botswana, and with talk of Cut-9 and Cut10 already being discussed it is likely that this operation will continue to add to the fantastic story that is Debswana.

DEBSWANA + 267 361 4200 www.debswana.bw

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the dolomite units beneath the upper shales.

services to Debswana and included the De Beers sinceindustry 1996.

Initial contract services theGroup highest standard gyroscopic borehole surveys at Jwaneng, Lethlakane, A high-resolution reflection seismic Mine. survey was also Orapa and Venetia. An in-mine borehole seismic survey was also completed at Finsch Initial contract services included the highest industry standard

completed over the site where Debswana was considering

gyroscopic borehole surveys Jwaneng, Lethlakane, Orapa constructing shaft for underground at theto map the The most extensive projectatcompleted to date was at Jwaneng Mine. aPrevious work had development, only been able and Venetia. An in-mine borehole seismic survey was also time that Cut 7 was also being considered. A hydrophone kimberlite pipes to depths of 200-300m below surface. The physical property contrasts between the pipes and the completed at Finsch Mine. was placed in a surface borehole at 600m beneath the host shale and dolomite lithologies are very small, cultural development around the open pit is extensive and the potential shaft site and data from all seismic shot points mine used an electrical powered shovel to load the waste and ore material.

The most extensive project completed to date was at Jwaneng was recorded. The results were interpreted in 2D, 2.5D Mine. Previous work had only been able to map the kimberlite and 3D and determined that the site was not suitable for Without causing any disruption to the mine production targets, AEGIS and its associates successfully mapped the pipes to depths of 200-300m below surface. The physical shaft development. This was supported, within days, by an individual pipes within the mine to depths well in excess of 1000m below surface.

AEGIS was also able, from the property contrasts between the pipes and the host shale and independently derived Debswana geotechnical evaluation. results of an extensive wireline surveydevelopment programme, which did not include the use of density or neutron tools, to dolomite lithologies are very small, cultural confidently define discrete signatures for the AEGIS five known phases of kimberlite intrusion. around the open pit is extensivegeophysical and the mine used an Instruments is always seeking to promote The results were used powered to interpret the volumes of the diamond-rich kimberlite phases hosted by the dolomites, electrical shovel to load the waste and ore material. applications for new or economically more viablefor mine planning purposes, as mine development reached the dolomite units beneath upper geophysical solutions.the Near termshales. future work includes Without causing any disruption to the mine production targets, completing 3D Full Waver IP/resistivity surveys to assist in A AEGIS high-resolution reflection seismic survey was also completed the site Debswana was extents considering and its associates successfully mapped the individual further over evaluating the where true volumes and lateral of constructing a shaft underground development, at the time that Cut 7 was also beingpipes considered.

A hydrophone pipes within the mine for to depths well in excess of 1000m below known diamondiferous kimberlite in the Jwaneng and surface.

AEGIS also able, from the an extensive Orapa shaft Mine districts well from as possibly identify shot new targets was placed in awas surface borehole atresults 600mofbeneath the potential site andasdata all seismic points was wireline survey programme, did not include the2.5D use and 3D that have been missed or overlooked in the The Full recorded.

The results werewhich interpreted in 2D, and determined that the site was notpast. suitable for shaft of density or neutron to confidentlywithin define discrete Wavers have the potential to record geotechnical valid information to development.

This tools, was supported, days, by an independently derived Debswana evaluation. geophysical signatures for the five known phases of kimberlite depths in excess of 300-500m below surface. One user intrusion.

The resultsis were used to interpretto thepromote volumes of reports targeting at 1000m in aviable favourable AEGIS Instruments always seeking applications forsuccessful new or economically more geophysical the diamond-rich kimberlite phases by thecompleting dolomites, 3Denvironment. solutions.

Near term future workhosted includes Full Waver IP/resistivity surveys to assist in further

evaluating the true volumes and lateral extents of known diamondiferous kimberlite pipes in the Jwaneng and Orapa Mine districts as well as possibly identify new targets that have been missed or overlooked in the past. The Full www.enterprise-africa.net 25 Wavers have the potential to record valid information to depths in excess of 300-500m below surface. One /user reports successful targeting at 1000m in a favourable environment.

ATLANTIS FOUNDRIES

Atlantis Foundries Forging

New Opportunities PRODUCTION: David Napier

After a challenging year in 2016 as a result of the decline of the Class 8 Market in the US, Western Cape-based Atlantis Foundries, global leader in supply of heavyduty engine blocks, is looking forward to a prosperous future with a number of investments and opportunities bubbling in the pipeline.

C

INDUSTRY FOCUS: AUTOMOTIVE

//

The ability to search out, capture and make the most of new opportunities is vital for business development, and when the market is tough, the economy is slow and the future is uncertain, this hunt for new prospects is more important than ever.

This is the situation for Atlantis Foundries; sold two years ago by Daimler to German foundry group, Neue-Halberg-Guss (NHG), the company is reviewing all of its business and hoping to forge new opportunities in new markets with new products, while continuing to offer first-class service to its existing clients all over the world.

Atlantis Foundries is based in the town of Atlantis in the Western Cape. It’s around 50 km from Cape Town Port and 55 km from Cape Town Airport so strongly located logistically. It’s core business is the production of cylinder blocks for heavy-duty cars and trucks, with the ability to produce other

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cast automotive components.

Formed 38 years ago, in 1979 by the SA government, the company has endured through social, societal, political, economic and technological change. 99% of its produce is currently exported but, according to Chief Commercial Office Sally Redshaw, this could be about to change as Atlantis searches for opportunities closer to home to complement its existing export portfolio.

“Working with SA OEMs is absolutely something we’re looking at,” she says. “We’re focussing heavily on marketing, both locally and at group level. Because we were owned by Daimler for many years – their focus being Daimler products – they cancelled contracts with other customers with whom we had longstanding relationships so we’re actively trying to win those back and win new business.

“We recently participated in our first NAACAM (National Association of Automotive Component and

Allied Manufacturers of South Africa) exhibition in Durban and it really exceeded our expectations.

The timing was perfect because it was part of a localisation indaba where Minister of Trade and Industry, Dr Rob Davies, announced that in order to qualify for the 2020 replacement of the current APDP (Automotive Production and Development Programme) incentive scheme, which is crucial for our competitiveness, they are looking for 60% local content for OEMs. That means that we have a much bigger opportunity to enter the local market than ever before and one of the easiest ways to localise is for the OEM’s to look at the engine build. Atlantis Foundries also offers the OEM’s the same (if not better) quality and standards that can be expected in other parts of the world and a competitive price.

The only drawback is that we are predominantly heavy-duty and we, at this stage, cannot yet produce aluminium engine blocks for

ATLANTIS FOUNDRIES

passenger cars on a large scale.”

Opening up this new market would require investment into new facilities but would offer Atlantis access to a potentially major market with a first-mover competitive advantage.

“We are looking towards producing in lighter material because we see an opportunity in the local market, and an entry to expand into passenger car components – especially with the drive for localisation within SA,” says Redshaw. “Locally, there are no companies that supply engine block castings within SA and so we are looking at investment opportunities surrounding the feasibility of installing an aluminium line.”

With a number of major global passenger and commercial players active in the manufacture of vehicles, including automotive super-powers such as BMW, VW, Ford and Toyota, South Africa produced around 600,000 vehicles in 2016; clearly an attractive market for a business like Atlantis Foundries.

PRODUCTION LINE INVESTMENT Since Daimler took control of the Atlantis business in 1999, the company went through an exponential growth period, increasing casting production from 30,000 to 69,000 net tonnes per year. Today, its reputation for quality is international. But to ensure the company remains at the peak of the industry, a strategy of continuous and ongoing improvement has been adopted.

But this is not easy for a foundry business; it’s not as simple as a software upgrade or a new machine, as Redshaw explains.

“Foundry technology is old and established, and involves very complicated processes.

There simply aren’t the same technological advancements as

there are in other industries,” she says. “For improvement, we have to look internally to focus on standardisation, optimisation of layout, continuous maintenance and preventative maintenance. In terms of capacity, it’s difficult to increase in small increments in the foundry business, it’s generally a very large jump. You get to the point where you have to make a huge investment and go for a whole new mould line, new furnaces etc

to get to the next level, and for that type of investment we need firm Customer Orders and commitment.

“What we try to do is make processes more efficient so that we can get more output with the same or less input. In terms of automation, we’ve not focused robotics to reduce labour costs as the payback has been 3-5 years.

Historically, we only invested in robotics for safety, quality, or if it is impossible for a human to perform

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INDUSTRY FOCUS: AUTOMOTIVE

the task. However, that is changing; we are in a high inflationary country, labour rates are increasing 8-10% each year and the cost of automation is constantly reducing.

“We’re looking at it stage-bystage. We have one large robot for core dipping, we have a core drilling robot which we installed earlier this year, and we have plans for other, medium-sized robots. We’re not looking at going fully automated, that’s not easy in foundry, but we do have a lot of plans that are being discussed. The rate of installation will be dictated by our natural labour attrition.”

Any investment that can help improve efficiencies and processes will be welcomed by the company’s widespread customer base, and its 851 permanent employees. Locally, the Atlantis Foundries directorship formulates strategy and consults with NHG for large-scale expansion tactics.

“Our decision making is done locally,” explains Redshaw. “We are a separate entity although part of

30 / www.enterprise-africa.net

the group. We know that you can’t just apply the same things that work in Germany over here and that’s something we’ve learnt being part of Daimler. Only significant investment that needs approval go through the parent company.

We devise the strategies, goals and targets here in Atlantis. Of course, we do keep in mind the overall objectives and strategy of the group.”

FEELING THE HEAT? While the opportunities for Atlantis Foundries’ expansion may be great, there are some hurdles which first need to be cleared; or at least fullyunderstood – you cannot expand your production line or market to new segments if the ROI is not worthy.

The major challenge faced by the company is the weak economic performance of the country. After entering recession in 2008 and rebounding in 2012, the country is once again only growing at marginal rates (approx. 0.6%) and

this is worrying for those trying to expand. Of course, this situation is exacerbated by uncertainty in the global economic climate.

“Last year was difficult for us,” admits Redshaw. “There was a significant decrease in the market in the US, which dipped by almost 40%, and so we had problems at the end of the year and were forced to restructure slightly. We didn’t expect any turnaround in the volumes short-term, and that has been the case.”

She says that there is no indication that political influence has had any impact on demand from the US but politics could play a role, that the company will have to monitor, in the future.

“We are now getting indications that the market in the US is picking up again but there’s concerns for us about trade agreements, specifically with the US. 60% of our product does go to the US and under AGOA they are able to claim GSP on import tax making it interesting for them to buy from SA. We’re

ATLANTIS FOUNDRIES

not sure about the future of that arrangement and that concerns us.

“Locally, the fluctuating currency price causes us problems as it disturbs pricing strategies with OEMs and there are pieces of industrial equipment and resources that we simply cannot source in SA and with a weak Rand they cost us more. The downgrading of credit status also concerns us.

“We have heard predictions that an upturn is coming and we will soon get back to around 3% but right now we don’t know.”

If the company’s potential expansion into the passenger car industry materialises soon, this could provide a needed boost.

“In the heavy-duty industry there’s a cycle, and that’s the same for passenger cars. For heavyduty, we are currently in a down

period and we could be producing a lot more but the demand simply isn’t there. With passenger cars, it follows a similar but shorter cycle and we don’t see a major problem right now; Toyota, Ford, Nissan, VW, Mercedes-Benz and now BAIC are all heavily investing and there’s a lot of interest from the OEMs,” explains Redshaw.

Away from economic concerns, Atlantis Foundries is also having to carefully consider its approach to input costs. One of the key elements in its supply mix is steel and that industry in its own right is under increasing pressure in SA. “We need a good quality, reliable supply of steel scrap at a competitive price; it’s one of our biggest inputs into the product and it’s challenging. Many customers don’t appreciate that steel prices

in SA are not aligned with general indices. In Europe for example, you can buy steel scrap at indices prices but it doesn’t work that way here,” says Redshaw.

“It’s a serious challenge. We’re competing against traders who are buying for the export market and that’s a challenge for a lot of people in the steel and foundry industries.

Also, where we are located in the Western Cape, there’s not a lot of industry so we can’t get material locally and that means we incur logistics costs.

“We’ve looked into importing steel and we’ve been approached by companies from China, India and Brazil trying to sell to us but the delivery time is long, quality is never guaranteed and the logistics costs are high so at the moment it doesn’t make sense,” she adds.

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INDUSTRY FOCUS: AUTOMOTIVE

ISO 14001 CERTIFIED Another significant challenge facing Atlantis is the business worlds everincreasing focus on environmentally friendly practise. Companies are continuously put under pressure to reduce their impact on the environment and improve their carbon footprint. But this is not something that Atlantis views as a challenge and the company embraces the move towards energy and environmental efficiency as an opportunity.

“Being a responsible corporate citizen, it is a welcome concern for us. Right now, we’re facing serious water shortages in the Western Cape and in the past we’ve had load-shedding so we’re aware that effective management of resources is vital. We have recently received

our ISO 14001 certification so we do have an environmental management system within the company that pushes us to be much more conscious and aware while looking for more energy efficient methods and processes.

“We’re working on a sand reclamation programme as sand is a major input into our process. We’re looking at sand separation so we can use old sand from used moulds again and not dump it. We’ve replaced the lighting across our facilities with LEDs, we’re looking at putting solar panels across our site and we’re looking at boreholes and water re-usage programmes to ensure we remain focussed on resource and environmental efficiency, and this obviously has a positive impact on costs” says Redshaw.

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CASTING THE RIGHT PEOPLE The next big obstacle for the Atlantis to conquer is that of skills.

Recruitment and development is an extremely challenging area for the company, with the often-mentioned ‘skills gap’ coming into play but in the foundry industry, this is intensified by the fact that skills development cannot be fast-tracked.

“It’s very difficult to find artisans with relevant industry experience,” details Redshaw. “The foundry industry is not a huge industry, especially in SA. There’s only a few major key players from across the globe and foundry is not something you can learn from a book; it takes a lot of years to learn the different permutations.

“We have to take on artisans with a basic skill level and knowledge and invest a lot of time, effort and money training them over a long period of time. We do have a very low attrition rate; we have a number of people who have been with us for more than 25 years and we have to plan for the future.”

To combat this problem, Atlantis Foundries looks to education for a solution.

“We have a heavy focus on CSR. Our local community is vital for us; approximately 90% of our workforce comes from Atlantis so we have a great sense of commitment and we feel responsible for our community.

We invest into schools, we pay for additional learning, we offer bursaries for students and we like to help families of our staff and others in the community.

“We have a good contact with the local colleges and universities and also, to a lesser-extent, with institutions in Johannesburg and this is usually where we source our students, artisans and learners,” says Redshaw.

INDUSTRY POLE POSITION It’s clear that although Atlantis

ATLANTIS FOUNDRIES

Foundries has experienced difficulties in the past 12 months, this specialist SA company has remained focussed on its core business and continued to delight customers with reliable, highquality supply – something which isn’t easy in the foundry business.

“There’s no other foundries in SA that can produce the size and weight of engine casting that we can,” enthuses Redshaw. “The main product that we make for Daimler is one of the most complex castings in the market and we produce it to the very highest quality, and we have a great record on quality. We don’t have a direct competitor from SA for the markets we’re in. We have a great reputation

locally, we have a lot of history and we’re crucial to the Western Cape, the South African Foundry Industry and the community of Atlantis,” she adds.

The next step in taking this business to the next level is for Atlantis to secure new business, both locally and in export markets. This will in turn allow the company to justify investment into expansion and build on its already sterling reputation while creating jobs and further benefitting the economy.

“We are always looking for innovation, efficiency and different ways of doing things to keep our competitive advantage. We’ve been in the game for many years, we have

a lot of experience and that helps to carry us through,” details Redshaw.

“From our perspective, the future is bright. We think we have a sustainable future. There are many opportunities for growth and new business,” she concludes.

ATLANTIS FOUNDRIES +27 (0)21 573 7200 www.atlantisfoundries.com

//

“I started working for Mercedes-Benz AMG High Performance Powertrains in Northampton in the UK in 2007. I’m a chartered accountant by trade and I was the company accountant for Mercedes-Benz High Performance Powertrains, who are making the Formula 1 engines for Mercedes GP, Force India and Williams. They are owned by Daimler who owns Mercedes-Benz.

“I was given the opportunity to transfer to Daimler headquarters in Germany to work for Daimler Trucks. I took the chance and worked in Stuttgart in the area of Truck Accounting for more than three years, during which time I was responsible for Atlantis Foundries from a consolidation and Accounting standards perspective. I came out to SA on many business trips to support the Foundry and got to know the people.

“There was a need to transfer additional accounting skills to the Atlantis finance team, and I was transferred on an expat contract as the Chief Accounting Officer for two years. When it was confirmed that Atlantis Foundries would be sold, by Daimler to NHG, my contract was extended for six months and I managed the M&A process.

“I was lucky that NHG offered me a position and I became one of the three local Directors. I’ve been here for five years, I’m a permanent resident now, and it’s exciting, interesting, I love it and it feels like home.

“There’s a special culture here in Atlantis Foundries; most of the employees come from the surrounding area and it feels like one big family.”

CHIEF COMMERCIAL OFFICER

SALLY REDSHAW

www.enterprise-africa.net / 33

S4 AUTOMATION & INTEGRATION

S4 Drives SA Automotive

Automation Industry

PRODUCTION: Manelesi Dumasi

Ambitious and innovative Port Elizabeth-based S4 Automation & Integration has outgrown its current facility and will be moving into new premises in early-2018. The move will help the business achieve its growth targets and diversify into new markets.

Founder and CEO, Vaughn Fulton tells us more‌

www.enterprise-africa.net / 35

INDUSTRY FOCUS: AUTOMOTIVE

//

Last month, at the National Association of Automobile Component and Allied Manufacturers show in Durban, Minister for Trade and Industry Minister Rob Davies reminded of the importance of the country’s automotive sector. “The auto industry is key to the future of manufacturing in this country,” he said. He stressed the importance of local input in the auto industry and cited Australia’s industry as an example that had all but disappeared thanks to a lack of support.

The automotive sector contributes around 7.5% of GDP and employs approximately 113,000 people directly, making it vital to ensuring economic growth. Critical in the auto value chain is the automotive component segment, the most labour intensive sector, accounting for around 72% of the total.

South Africa has some of the world’s most advanced and experienced component manufacturers and there is demand from not only the local market but internationally too.

Port Elizabeth-based S4 Automation & Integration has been supplying the country’s big auto manufacturers for over 20 years.

The company is a service oriented organisation that offers superior turnkey automation and machine building solutions. While the current economic climate is not encouraging significant growth from many businesses, S4 is expanding and founder and CEO, Vaughn Fulton puts the current success down to a strong automotive industry.

“There hasn’t been any real growth in the past year and South Africa has been stagnant. However, the automotive industry within the

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country is holding its own,” he says.

“A Chinese company announced a major investment in Port Elizabeth, new model programmes have been announced by existing players, and my feeling is that even with our political challenges, South Africa still offers good value to the global auto industry. We have attractive labour rates, you will find decent expertise in the country, and there are good leaders located here.”

Thanks to a unique product and service offering, S4’s expertise has been in demand for some time and with new opportunities opening up and important relationships with European partners growing all the time, S4 is moving into a new office building to bring all departments under one roof and leave room for further development.

Originally scheduled for completion in January 2018, construction of the new office is underway in Fairview off Willow Road in Port Elizabeth.

“We are currently quite segmented. We’ve outgrown our current premises and had to move our software department into additional premises which is around 8km away and that’s not helpful from a management perspective. Our new facility will put all office staff and manufacturing in one place. It’s a 3000 m2 facility on 6500 m2 grounds.

“We are slightly delayed and we’re probably looking at April; everything is underway and we will open in April 2018,” says Fulton.

TRULY SOUTH AFRICAN For more than two decades, S4 has been building a reputation for delivering quality, and customers in the automotive and automated production industries know that calling on S4 will result in a seamless, end-to-end service incorporating cutting-edge hardware and software expertise. But the company hasn’t always been an industry leader; in its early days back in 1994, Fulton and his

S4 AUTOMATION & INTEGRATION

GROWTH & DEVELOPMENT Over the years, S4 became a reliable and consistent supplier to the industry and used its expertise to solve problems as they arose.

“Being onsite in the motor industry, mainly with VWSA in the beginning, allowed us to see other opportunities. We had expertise and they would ask us to look at various other aspects such as vehicle tracking systems etc. We continued to grow and started training people with new skills, adding more people into the plants and gaining maintenance contracts for high-level electronic support equipment in various plants,” says Fulton.

A further catalyst for growth came in 2008 when S4’s German partners decided to solidify the relationship between the two companies by taking a shareholding.

“My original partner retired eight years ago and when his shares were on the market, DSA bought in with a 30% shareholding. The business case for this is the Rand and the labour rate in SA offers much better value than in Europe so they would use our guys to go around the world and sub-contract for them. This model worked for us so we partnered with roll and brake and wheel alignment company BEP in Belgium on the same basis.”

In 2012, the company began investigating different opportunities, specifically in industrial turnkey automation.

“We continued to look for expansion opportunities and we had software, process and automotive expertise so the next natural step was to build PLC (programmable logic controller) panels for automation.

To offer a full-suite of services, we

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business partner, the late Hilary Fisher, ran the operation from a small house in North End Port Elizabeth.

“Our primary focus at that point was electrical check out system testing for motor vehicles. That involved intercepting a battery current while telling the driver which units to switch on and then ensuring the consumer - whether its lights, wipers or any electrical consumer - was drawing the expected rated current and therefore fully operational. We could quickly detect blown park lights or similar using this system. That was primarily with VWSA,” he explains.

In the early days, growth was relatively slow and after three years the company employee count was around six people. In 1996, as the country changed, the company received a real boost after agreeing to a partnership with a German international electronics company for Africa, DSA. “When I went to Germany I explained my situation and said I wanted to act as partner with potential for work for VWSA. I said, ‘VW will place the order with me, you send me the equipment, and when they pay me, I’ll pay you’ and they just laughed at me. I didn’t know the financial system at all. Fortunately, trust prevailed and they gave it a shot and it worked well with the relationship growing.”

Having a close relationship with the country’s automotive manufacturers, and now with the backing of a significant European partner, S4 began to realise further opportunities for expansion.

“Electronic engine management control units started to emerge in the market and they better control the efficiency of the engine but they needed to be programmed so that was a natural migration for us. We continued to work with DSA, they would send the equipment and we would do all the local programming for VWSA. We grew and started working with GMSA and a few other companies too,” explains Fulton.

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INDUSTRY FOCUS: AUTOMOTIVE

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S4 AUTOMATION & INTEGRATION

partnered with Mosmech Engineering for all the mechanical bits and pieces but the market didn’t take to it because we were two separate entities and people wanted a one-stop-shop. We then found ourselves in the fortunate position of having the opportunity to purchase Mosmech outright and from there the business soared. We grew from 45 to 170 people.”

S4 moved from a small to a medium sized company overnight and positioned itself for diversification and further growth. Part of the challenge was combining the cultures of the two different companies into one unified automation company. “Initially, there was a lot of finger pointing between the electrical and mechanical departments, but some serious teambuilding soon sorted that out.

“Now, of our 170 people, around 30 are working solely for DSA here in SA and eight of them are travel engineers, working around the world doing service and installations for DSA. Around five software engineers are working solely for BEP. “Building these relationships takes time, especially with European companies. We need all the source code and all intellectual property before we can help as that is essential for writing and modifying programmes. That is a big ask and there is obviously a trust barrier to break that was a real challenge but I think we done that very well and are on extremely good terms with all our partners with high levels of trust,” says Fulton.

None of this expansion would have been possible without the success that the company created within South Africa’s automotive sector, and the skillsets that S4 employees have displayed constantly over the years. The current levels of expertise within the organisation, and the relationships that have been developed have created a robust platform from which S4 can continue to grow.

INDUSTRY LEADERS “We are definitely one of the

automotive automation frontrunners in the Eastern Cape, there’s no doubt about that, but there is strong competition in certain areas” admits Fulton. “Some of the competitors have been around much longer and some play in offshore markets and with less focus on the local market.

We are definitely the strongest in Industrial software as we have learned a lot from our German partners. There are well-skilled smaller companies that we do compete with but we are fortunate to be able to tackle sizable project now.”

Along with the opening of the new facility in Port Elizabeth, S4 will also look to bolster presence at its support bases in Pretoria and Durban.

With the industry growing across SA’s borders, S4 is also keen to investigate opportunities on the continent.

“We’ve just appointed a dynamic manager in Pretoria from our Port Elizabeth office and we will focus heavily on the Gauteng region in the second half of this year.

“East Africa is showing a lot of promise and growth; a lot of South Africa’s local motor manufacturers are opening up small operations in East Africa and that will open doors for us.

“We also meet regularly with our German partners as they are constantly changing their products. DSA in particular has no mechanical wing to their business and we see synergy between our operations so we’re not ruling out further collaboration to offer them automation solutions,” says Fulton.

Of course, expansion of this kind will not be a distraction for the company’s talented people but Fulton does state that effective HR management will be a key strategy for the business as it grows into the future.

When asked what has been the key ingredient to the success of S4, “I have to say surrounding ourselves with the right people. We have an extremely good culture within

the business, largely thanks to our general manager and visionary Andrew White, who has been a wonderful asset to the company,” says Fulton. “I could be hit by a bus, but if Andrew is hit, we would be in trouble.

The biggest challenge that we face going forward is retention of our skilled people and the attraction of skilled people, especially in the area of design and PLC programming.

“10 years ago, there was a good pool of people to choose from but today that pool has waned completely and it’s a very challenging process to find good staff. We do have a good relationship with the University of Port Elizabeth and we do earmark talented students and help them with bursaries.

“We make investments in training but we do have the problem of poaching by companies who can offer higher salaries, including the offshore markets” he adds.

Despite this challenge, S4 remains a company that has the ability to grow - creating employment, driving innovation and creativity and bolstering the reputation of SA expertise in international markets. Thanks to its high-quality systems and solutions, its ability to build and maintain lasting relationships and a history of excellence, the future is looking bright.

“The company is in very strong position and we are excited about the future but we will continue to closely monitor the economic situation and the health of the automotive industry,” Fulton concludes.

S4 AUTOMATION & INTEGRATION + 27 41 451 1250 sales@s4.co.za www.s4.co.za

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KELVION THERMAL SOLUTIONS

A Rebrand for the

Heat Exchanger Specialists PRODUCTION: Karl Pietersen

Catering for companies across Southern Africa and far beyond, Kelvion Thermal Solutions manufactures air cooled heat exchangers, shell and tube heat exchangers, pressure vessels and cooling towers for the petrochemical, power and mining industries.

//

Kelvion Thermal Solutions was better known for many years as GEA Aircooled Systems, whose South African operations began in 1975. The parent company was founded by Otto Happel senior in Bochum, Germany in the 1920s, and was initially a company specialising in the manufacture of dust removal systems. Its name - Gesellschaft fur Entstaubungs-Anlagen - translates to ‘company for dust-removal-plants’ and lent it the more commonly seen abbreviation GEA. Over its distinguished lifetime the company’s activities diversified into various related fields, encompassing thermal and energy technologies, food and process engineering, air-treatment,

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refrigeration and environmental technology.

GEA began its South African operations in 1971. At the outset, this arm of the business served primarily as an engineering and sales office for the group’s products and services, which at the time were essentially imported from the German parent company. GEA Aircooled Systems was then founded in 1975, winning some notable contracts catering for the power industry in the early 1970s, which were then followed by further contracts for the petrochemical industry. These rapid successes combined to result in an aggressive expansion of the South African operation.

The acquisition and subsequent

extension of local manufacturing facilities followed out of necessity, in order to keep pace with the growing demand for its relatively new services.

GEA Aircooled Systems became largely independent after a total technology transfer from the parent company, giving it full control over the day-to-day running of the company.

When GEA sold GEA Heat Exchangers Group to an investor, Triton, in 2014, the group was subsequently split into three distinct divisions: Kelvion, which specialises in industrial heat exchangers; Enexio, whose forte is cooling systems for the power industry; and DencoHappel, which offers heating, ventilation and air conditioning.

Enexio is a pioneer in the field of

C

INDUSTRY FOCUS: ENGINEERING

power cooling and water treatment, and has established itself over past four decades. It boasts experience in and a pioneering approach to engineering, manufacturing and service, delivering state of the art solutions for power plants, water and wastewater applications. DencoHappel, meanwhile, is among the leading technology innovators in the field of air treatment, air conditioning and filter technology, as well as cooling process air. It has employed the cutting-edge innovative concepts it has built up over more than 100 years of operations, to set new technological standards in fulfilling its customers’ requirements.

Since GEA Heat Exchangers became Kelvion, GEA Aircooled Systems has become an integral part of the group, thanks to its noteworthy thermodynamic and mechanical design expertise, as well as engineering, manufacturing and contract management capabilities. GEA Aircooled Systems became Kelvion Thermal Solutions (Pty) Ltd in 2016.

GEA was a name associated with a

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policy of constant innovation, a tag that Kelvion works to uphold. It is arguably most well-known for the development and pioneering of the direct air-cooled steam condensation system, becoming the world leader in this field, as well as in the design and manufacture of finned tube heat transfer equipment.

In keeping with this, at this year’s Power-Gen Europe & Renewable Energy World Europe Kelvion will present its heat exchangers for energy supply in solar thermal power plants. It will exhibit performance-enhancing solutions for steam power plants, such as feed-water preheaters and condensing systems, surface condensers and air-cooled condensers designed to remove noncondensable gases present in the steam cycle. All the solutions on show will seek to achieve optimal energy yield and maximum efficiency.

Kelvion Thermal Solutions has, it goes without saying, substantial thermodynamic and mechanical design expertise, as well as engineering, manufacturing and contract management capabilities. It

operates from a large-scale, 21,500 m2 manufacturing facility in Roodekop, Germiston, while its product offering includes air-cooled heat exchangers, shell and tube heat exchangers, pressure vessels and columns, plate heat exchangers, cooling towers and air-cooled condensers.

In addition to the products that the company manufactures in South Africa itself, it also markets the full range of Kelvion products which covers transformer cooling systems, transformer oil pumps, machine cooling systems and plate heat exchangers, alongside others smaller, yet no less critical.

The company is currently completing work on an air-cooled condenser at Eskom’s Medupi power station, which is scheduled for completion in 2017. This air-cooled condenser will be one of the largest in the world, with a plot area of about 72,000 m2. The Medupi plant is located at Lephalale in Limpopo Province, in the northern part of South Africa. Once complete, this

KELVION THERMAL SOLUTIONS

baseload facility is expected to provide around 12% of the nation’s total power generation capacity.

One of Eskom’s flagship power plants, Medupi is something of a technological showcase. With drought currently plaguing much of South Africa it is one of few countries in the world facing extreme water stress, a principal reason why the country’s state-owned electricity provider Eskom is well on the way to building the world’s largest air-cooled coal plant to solve its ongoing electricity shortage, and electing not to build a water-cooled plant.

The 4790 MW plant will be the biggest dry-cooled power station in the world. It is composed of six Alstom STF100 steam turbines, each capable of producing 794 MW. Kelvion comes into the equation in providing the air-cooled condensers (ACCs), while Hitachi is suppling its supercritical boilers whose capacity for steam is 2288 t/h per boiler.

A vital cog in an enormously complex process, firstly a series of low-NOx burners with staged combustion are used to burn the coal.

After using all the useful energy from the steam, it is sent horizontally to the air-cooled condensers, where a massive steel and concrete structure supports the ACC modules which use GEA’s A-tube arrangement in order to maximize the volume of galvanized tubing subjected to cooling. Huge fans continually blow air across these tubes to cool the steam down to the desired temperature to bring about condensation.

Capturing and reusing waste heat in biomass plants is central to efficient, effective operations, and heat exchangers play a vital role at every processing facility in which heat is essential, whether it is an oil refinery or a biomass power plant.

As energy efficiency importance grows, the role of heat exchangers will become even greater, and their technologies more advanced. Heat is

generated for and in various industrial processes, and were it not for heat exchangers, massive amounts of thermal energy would be wasted.

Kevin McGinnis, Sales Director for heavy industries and mining at Kelvion, points to several common sources of waste heat in industry: turbines, dryers, kilns, incinerators, boilers and flue gas from heaters or burners, to name but a few. “In general, waste heat can be captured with various types of heat exchangers and used for various applications,” he says, “including combustion air preheating; heating a facility, plant, building or home; boiler feedwater preheating; heating a process fluid for another application.”

What sets Kelvion apart from the many other heat exchanger companies is its ability to offer its customers one of the world’s largest product portfolios

in the field, according to McGinnis.

“It includes individual solutions for practically all conceivable applications and complex environmental conditions, including plate, shell-andtube, finned-tube and refrigeration heat exchangers, and modular cooling tower systems.” Such diversity of product and innovative ethos will allow Kelvion Thermal Solutions to continue to thrive as the country embraces increasingly ambitious solutions to power generation.

KELVION THERMAL SOLUTIONS +27 11 861 1500 africa@kelvion.com za.kelvion.com

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HOWDEN AFRICA

Engineering Expertise in Air and Gas Handling PRODUCTION: Timothy Reeder

Howden Africa designs, manufactures, supplies and provides aftermarket support for a vast range of products intended for use in diverse applications across mining and industry in Africa.

This includes fans, regenerative heat exchangers, compressors, blowers, furnaces and industrial combustion.

//

Howden offers its customers engineering expertise built up over its long and decorated history of innovation in the air and gas handling field, and it uses its many past achievements to inform the workings of the company today.

The foundations of the company date back to 1854, when, aged just 22, James Howden set up his own consulting engineering business in Scotland, in the face of competition from professional engineers of much greater age and experience.

In the space of a few years he had

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commenced the design and supply of boilers and steam engines for the marine industry, and patented a method of preheating combustion air.

Now based in Johannesburg, Howden Africa continues this spirit of innovation in its design, manufacture, and marketing of specialised air and gas handling solutions the world over. A global engineering business, its primary focus is on providing its clients with industrial products that help multiple sectors improve their everyday processes. These range from

mine ventilation and waste water treatment to heating and cooling.

Howden Africa’s overriding aim is fairly unequivocal; it strives to be the world’s leading application engineer, and to provide lifetime solutions in air and gas handling.

In addition to its comprehensive product list for applications in mining and industry in Africa, it offers several wet, semi-dry and dry gas cleaning technologies, and can apply performance enhancements such as electrostatic precipitators to existing plants. Turnkey project management

and comprehensive aftermarket support are available for all the solutions Howden supplies.

The company operates through various fundamental segments: Fans and Heat Exchangers, Environmental Control, and Fabrication Technology.

The first of these focuses on air and gas-cooling technologies within the coal/gold mining and power generation markets, and is also involved in dust extraction on coal mines, mine cooling and heating and ventilation on demand. The Environmental Control segment

offers dust extraction and gastreatment technologies, including gas cleaning plants, combustion engineering and waste water treatment, while the Fabrication Technology division distributes equipment and filler metals for welding and cutting applications.

It serves power generation, petrochemical, mining, construction, refrigeration, water treatment, machinery, fabrication, ship building, and general industries.

Howden Africa has identified certain key industries among the

myriad it services as most central to assuring its successful future. It recognises the growing demand for water treatment plants, to process large volumes of waste water from municipal sewerage systems and industrial processes such as food, drink, pulp and paper. As a result it has developed its patented turbo compressor technology for the specific needs of water treatment plants - a highly efficient design, fitted with variable inlet guide vanes and a variable vane diffuser system, which offers a unique high

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INDUSTRY FOCUS: ENGINEERING

performance across the entire range.

Cement production meanwhile is one of the world’s most energy intensive industries. Current cement making processes place heavy demands on process fans, including high abrasion, excessive dust build-up, and high temperatures.

Howden supplies the many and varied fan types required by the cement industry, ranging from large custom-built fans for process critical applications to pre-engineered units for lower specification and more general applications.

For Howden’s products, some of the most arduous applications they face at the present time are encountered in the iron and steel industry. The need to move large volumes of air or gas, in many cases at high pressures and high dust burdens, is extremely demanding, while in ore beneficiation processes

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HOWDEN AFRICA

such as sintering and pelletising, as well as in basic oxygen and direct reduction steelmaking, Howden fans are required to operate in high temperature and erosive environments.

More than ever and increasingly the case, the world is dependent on a reliable supply of electric power.

Howden’s products play a central role in supporting the power producers who need efficient, reliable fans, rotary regenerative heat exchangers, compressors and other equipment it can supply to keep the generating process running smoothly and continuously.

Arguably Howden’s signature industry, it engineers and constructs turnkey ventilation, refrigeration and gas cleaning systems for mine ventilation throughout the world.

Howden has over 160 years of experience in meeting its customers’ mining ventilation needs in some of the most remote and challenging underground mining environments in the world.

The last of Howden’s prime targets, the Petrochemical industry is one of the world’s most complex.

Howden has met these unique needs by engineering products for use at sites that produce liquid fuels, plastics and materials for manufacturing industries. Bespoke boiler fans are supplied in large numbers to petrochemical customers, while its compressor technologies are well suitable as utility gas compressors for nitrogen and air, or in large critical process applications.

Not only in the Petrochemical sphere, but across the board, Howden’s experience enables it to support its customers in achieving their efficiency objectives through the optimisation of equipment and systems. It is focussed on maintaining high level of customer service the industries it serves, while investing in its people - in part through maintaining and developing the flexibility of its technical skills throughout the business.

Howden’s recently released financial results for 2016 made for extremely pleasing reading for the company. Its headline figures showed an 8.2% increase in revenue, and aftermarket orders receive grew by 14.6%. The Fans and Heat Exchangers

division revenue experienced a remarkably strong year, up 19.8% on the previous 12 months.

This all took place in a climate where both Africa, and world mining markets as a whole, remain subdued, which in turn means a subduing of customers’ desire across all industries to invest in major original equipment.

Despite a potentially gloomy outlook, however, Howden Africa enjoyed a solid and encouraging 2016, outperforming much of the competition and growing its reach ever further. This, together with the company remaining debt-free and with significant cash reserves, means that it is well placed to take advantage of the many opportunities set to present themselves in the coming months, and to build on the rich heritage of this South African name.

HOWDEN AFRICA +44 141 885 7500 webenquiries@howden.com www.howden.com

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CHET CHEMICALS

Household Giants

Eye African Expansion PRODUCTION: Timothy Reeder

Established in 1965 with the aim of manufacturing day-to-day household products, Chet Chemicals manufacturing facility in Kempton Park, Johannesburg, now produces between 200 and 300 metric tons of liquids and powder detergents per day. Chet has contract manufacturing relationships with, among others, Unilever and Tiger Brands, and now looks to take its model even further afield.

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INDUSTRY FOCUS: CHEMICALS

//

Chet Chemicals constitutes the household and toiletries arm of Libstar Operations, and manufactures a vast array of products including bleach, dishwashing liquids, fabric softeners and laundry detergents. It manufactures for a number of major SA retailers in the household field, while Sealed Air/ Diverse and GNLD make up the final two of its four major contract manufactures.

Headquartered in Johannesburg, Libstar itself began life in 2005, as an investment holding company investing in companies operating in the Fast Moving Consumer Goods (FMCG) industry. The company focuses mainly on the food, beverage, household and personal care segments of the market. With the Group consisting of 22 business units that operate nationally across 31 sites located in Gauteng,

Mpumalanga, Kwa-Zulu Natal, Western Cape and Eastern Cape provinces, Libstar has annual net revenues in excess of R7bn.

Libstar believes wholeheartedly in what it terms simply the ‘power of partnership’. It is aware that its work does not take place in a vacuum, but in a vibrant mesh of relationships with customers, employees, suppliers, partners and communities. Libstar seeks to ensure that it always follows through on what it says, believing that its positive actions lead to stronger partnerships while promoting productive teamwork, thus keeping its various business concerns in positive territory.

Following this lead, it has been Chet’s ability to partner with the most well-known Retailers and their brands that has been a key factor in its success, and the growth in scope

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of its capabilities. Sales Director Ross Rossouw takes us through the importance of these relationships to Chet’s burgeoning status in the market.

“Our relationship with Unilever and Tiger Brands, as well as the Retailers in South Africa, is very well suited to our assets.

“In the early days, we had to look at those guys in order to optimise our volumes and as such make it a viable option for us - to keep our costs down, and to enter the major South African retailers. As a result, we’ve always had a good relationship with them.

“Unilever is currently busy commissioning an upgraded plant, which may see our contract work for them reduced. We therefore have to have plans in place to make up this potential shortfall in business, but they know that as far as accreditation and quality of product are concerned that they can fully trust in us to help them out from time to time.

“In the field of contract manufacturing in South Africa Chet Chemicals has been an ever-present for over 40 years,” Rossouw goes on, “and so we’ve obviously earned our stripes.

This endurance has been down to our focus on the quality and the service level we have offered over this time.

We have been and remain successful because we manufacture a quality product which adheres to specifications - that is what gives us the edge.”

This responds perfectly to one of the central pillars of Libstar’s overall mission; to enable its companies to create consumer, shopper and customer demand for world-class quality products and services executed perfectly, on time, in Africa and beyond.

As Libstar again recognises, Chet’s field of industry is not a vacuum; instead it finds itself surrounded by similar partnerships being constructed all the time and other firms looking to impose themselves upon the market.

This must, therefore, lead to it being an extremely competitive business.

“Unbelievably so,” confirms Rossouw.

CHET CHEMICALS

“At all times you have to be extremely careful because you don’t want to step on anyone’s toes, but competitors are gaining market share at such a rate that business can lose value and it can be a real struggle.

“It is good for us in some ways however, and certainly keeps us on our toes in terms of keeping ourselves ahead of the rest. Obviously, it is good for the consumer too, as this competitiveness translates to more attractive pricing of goods.”

When it comes to investment in new machinery for Chet, this is targeted in particular at the bleach side of the business, one of the key weapons in Chet’s armoury as Rossouw explains. “If you break up our business, household is defined as laundry and Household liquids, which bleach is then also part of. We also make a thick bleach, however, which is an all-purpose cleaner.

“This is the machine that we are replacing, and the upgrade has been made necessary purely due to the demand we are experiencing for this product. We have been growing in double digits for the last two or three years so we have simply outgrown the capacity of the current machine.”

This vital new machinery will, according to Rossouw, be commissioned in October of this year, allowing Chet to be up and running with the increased capacity before the end of the year. “We project that it will allow us to serve the current demand, with a continuation of the growth we are currently seeing, for around the next five to seven years,” he says.

This division is one of Chet’s focal expansion priorities; as Rossouw goes on to explain the impact of an uncertain climate on the company’s grander ambitions. “The trading environment in South Africa is very tough at the moment,” he says, echoing the sentiments of the vast majority of major players in the country. “For this reason, you have to spread your investment over a longer period.

“We would love to replace our thin bleach machinery, which is also growing at a phenomenal rate of around 30% year-on-year, and this growth has been sustained for the last three or four years. As soon as it is viable we will be making the same improvements to this section of the business. As we are part of the Libstar Group these requests go through them for authorisation. The most recent indications suggest that we will receive it in 2018 and be able to proceed with this next project.”

In addition, Chet is always on the lookout for acquisition opportunities to give another dimension to its expansion plans, taking on board the smaller players and growing the scope of its business. “Libstar is a company that constantly looks for acquisitions to expand their current operations,” says Rossouw, “and we as a company are also

doing so, especially where household is concerned.

“We are actually in discussion with one of the smaller South African companies in our field at this very moment. Negotiations and discussions are almost complete with regards to a JV; we just need to dot the i’s and cross the t’s.”

Chet Chemicals is reaching that stage encountered by many a burgeoning, successful South African company, in that it is now seeking avenues by which to expand its footprint beyond the country’s frontiers and into the rest of Africa. Its parent company wants to be the trusted partner and preferred ‘one stop solution’ in providing fast-moving consumer goods to every sector, but crucially it wishes to deliver on expectations beyond its targeted markets in Africa.

Such a bid provokes significant

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INDUSTRY FOCUS: CHEMICALS

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CHET CHEMICALS

opportunities and challenges, as Rossouw goes on to outline.

“At the moment, we are purely a contract manufacturer, which means that we don’t have our own recognisable brand with equity which we can just decide to take into the rest of Africa. As far as the categories in which we operate go, however, there is a big demand in Africa for the majority of them. While the size or profile of these products may change slightly, we have the capability to make whatever it may be and the get it into market.

“As far as our footprint is concerned, we are already active in Botswana, in Namibia and in most of the neighbouring states, but at this time that is due to the activity of the formal retailers in those countries. A big part of our export business is the distribution channel via retail - for example Shoprite in South Africa has interest in many countries in Africa.

We deliver to them, and they then take on the distribution for us.

“It is a very expensive business if you want to set up in a new country.

There will be agents there handling the product who naturally will want to take commission, which simply does not make it a viable option for us at this stage. Because we supply a private label, or a house brand, the margins are not as rich as for some other companies who are developing and marketing their own brands.

“We have an alternative game plan, whereby we will identify in these countries perhaps a local producer, and then begin to contract manufacture or contract pack his brands instead as a way around the pitfalls we face. This worked for us in Namibia where we are packing the household range produced by one of the local guys there. Phase one has consisted of household powders, which we have been doing now over a 12-month period, and we’ll be launching phase two at the end of June, where we will also introduce the liquid products within the household range.”

This seems to be the key to Chet Chemicals’ future progression, with South Africa all but conquered in its provision of household wares. “With regards our South African growth potential I think we are pretty much there or thereabouts - I wouldn’t go as far to say that the market is saturated but it is not far off. There is not a lot of potential for incremental growth; the growth we see at this stage is the opening of new stores within the retail environment, and it is 100 times more saturated than in the rest of Africa.

“For us to be successful for the next 40 years we will have to start making plans to dominate the African market as a whole, and we are busy with that,” Rossouw begins to sum up.

“In five or six years we hope to have good, reliable customers in strategic

countries, where we employ our South African model in these new domains, contract manufacturing for somebody with the footprint, the capability and the infrastructure to distribute the product there.”

Rossouw concludes his thoughts on the company’s future in typical Chet Chemical fashion. “Building a partnership with companies, or individuals in these countries, to enable us to achieve this - that is where our growth will come from.”

CHET CHEMICALS +27 11 971 5300 www.libstar.co.za

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SHUTER & SHOOTER PUBLISHERS

Committed to Serving the Educational

Needs of Southern Africa PRODUCTION: Karl Pietersen

Shuter & Shooter Publishers is one of the longest running educational publishers in Southern Africa and has always remained committed to its core values of serving the educational needs of a rapidly changing region.

Marketing Director, Warren Kliphuis tells Enterprise Africa more about how the company is approaching challenges of e-learning, political instability, economic uncertainty, succession planning and, most importantly, remaining relevant to consumers.

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INDUSTRY FOCUS: EDUCATION

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The South African government - responsible for education through two departments, the department of Basic Education (DBE) and the department of Higher Education and Training (DHET) – is committed to tackling challenges in the education sector head on. In April, Higher Education and Training Minister Blade Nzimande announced major new investment in university infrastructure, which will see government spending R7 billion on a range of projects countrywide. In March, Deputy President Cyril Ramaphosa explained that government has embarked on a number of initiatives to improve the country’s skills base, promising R3.3 billion for bursaries in the next three years, focussing on basic education which is still “feeling the after effects of the apartheid legacy”. Just last month, Mpumalanga Education MEC

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Reginah Mhaule announced that R1.166 billion has been set aside to achieve infrastructure development in 2017/18 financial year.

Investing in education is key to the development of the country and the continent; ‘education systems must be oriented towards producing skills and young people who have both strong foundational skills as well as specific skills for jobs’ was the message from Jeff Radebe at a World Economic Forum workshop in January. These investments will be welcomed by all involved in education, not least the students. Businesses that supply into the educational space will also be happy to hear that the sector will receive extra funding.

KZN-based Shuter & Shooter Publishers has been supplying text books and reading materials to the educational industry since

the 20s and today, after all of the change and transformation that has happened in the country and the industry, the company remains positive about the future.

“Our country is still grappling with issues such a discrimination and inequality but we work handin-glove with our Department of Basic Education to ensure that our learning materials are educationally sound and promote the ideals of our constitution.

“The company has evolved significantly since the 1920s and there has been a lot of change but we’re committed to making a real difference in the lives of South Africans through education. Quality education is an evergreen topic so we feel very committed to doing our part in ensuring the children of South Africa have the best educational materials. Our values

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INDUSTRY FOCUS: EDUCATION

have always remained the same but we’ve gone through massive change and adapted to changing circumstances,” says Marketing Director, Warren Kliphuis.

The company’s history is long and complex; Shuter & Shooter started life as a printing, stationery and music business in Pietermaritzburg in 1850, known as Vause, Slatter and Co. In 1921, stationer Mr L.G. Shuter bought the company and in 1925, he was joined by publisher, Mr R.A. Shooter with the pair changing the name.

In the 1930s, Shuter & Shooter began its publishing activities producing mainly iZulu novels, poetry and textbooks. Through the Second World War, the company partnered with international publishers to bring leading titles to SA in sufficient quantity. The ensuing years saw a number of

ownership and leadership changes while growth across the country remained strong. By 2000, Shuter & Shooter was one of the larger publishers in Southern Africa and split from its book-selling retail division to focus on its core competence, and since then the company has gone from strength to strength, emerging as an educational publishing industry leaders.

“There’s a long pedigree in our organisation,” says Kliphuis.

“The biggest changes have come in the last 20 years since we became a fully-fledged democracy. The introduction of a universal schooling system and the development of education has allowed us to rise as a prominent player in the industry and that all stems from making sure we offer our customers what they want to

the best of our ability.

“We are an industry leader.

We’re not the largest company in our sector when it comes to revenue, but one of the reasons for that is our textbooks are significantly cheaper than most of our competitors. We sell more textbooks in KZN than any other company and we are the dominant player in the isiZulu market. We believe we produce leading content and we think we are the largest wholly South African owned schools publishing company.

“We are extremely proud of our ability to maintain our black economic empowerment score.

The new Codes were introduced recently and that meant we had to work a lot harder to maintain our Level 3 BEE score; companies that just continued to do what they’ve always done found that they

DIGITAL TEAM MEMBERS MO & KYLE DEVELOPING E LEARNING PRODUCTS

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SHUTER & SHOOTER PUBLISHERS

dropped on the new scoring system, but we managed to maintain our score despite the increased requirements from government and that is a real credit to the team involved.

‘A GOOD YEAR’ In recent editions, Enterprise Africa has heard from educational publishers who have hinted at challenges beyond the obvious plight of education in the country and shifting dynamics in learning environments. Big name international businesses have expressed concern with their ability to remain relevant as revenues come under pressure in a quickly changing sector, not just in South Africa but globally.

However, Shuter & Shooter are in a strong position thanks to a flourishing year for 2016/17.

“We’ve had a very successful year both from a revenue and profit perspective thanks to substantial textbook sales in the larger provinces. We were fortunate that some of our bigger provinces had a need to replenish or purchase new text books and that helped create a good year for us,” explains Kliphuis.

“We’re one of the few companies that has been able to weather the economic turmoil of the last couple of years,” he says.

“Every year is scary. We start the beginning of our financial year and we set targets that are in line with our shareholder’s expectations and often, when we reach the halfway point, we wonder whether we will make it because of the uncertainty and the challenges. But in the last five or six years, we’ve always achieved the numbers we’ve needed to. It’s down to a committed workforce that knows what the goal is.

“We’ve been able to remain relatively lean; we’re an unleveraged company and the

health of our finances is strong considering the economic climate and the challenges that exist, and that is something to be proud of.”

MIGRATION TO E-LEARNING? The use of e-learning materials to assist in educational spaces remains unproven; while there is of course mass potential, the impact of e-learning tools is still something which has not been documented, especially in an African context where connectivity is still developing.

In April, at the British Education and Training Technology (BETT ) Middle East 2017 event, held in Abu Dhabi, a report from Microsoft and market research firm YouGov looking at the possibilities for tech in the classroom was tabled. Results showed that 52% of educators

surveyed lack proper training to understand and implement the integration of technology and 36% believed students would find it hard to adapt to the future workplace with their low digital literacy.

As a leading content creator, Shuter & Shooter has ventured into the e-learning sphere and is looking at possibilities to increase its involvement in this developing market while remaining committed to its ideals that any e-learning material must ultimately benefit students.

“The uptake of e-learning is there with some ditching the textbook and chalkboard and going for the e-book and interactive board. But the SA school system still has so many challenges and e-learning isn’t enjoying universal uptake. Just converting a printed

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INDUSTRY FOCUS: EDUCATION

textbook to an e-book isn’t what the market is after; it’s not what teachers or leaners want. Some schools have gone digital and are running ahead of the curve but many schools are going to take a lot of time before they’re ready for it. Teacher training is a big factor as many are not yet comfortable to include digital resources. There are still schools that don’t have running water so there are bigger problems to address before the migration to digital becomes a reality,” says Kliphuis.

However, the Marketing

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Director does recognise that e-learning has gained momentum and says that the company is investing as much as possible to ensure it remains pertinent when the market does head down the digital route. Right now, the challenge is to continue creating fantastic content and ensuring that, internally, staff are ready to market to digital buyers.

Kliphuis is also conscious of the companies that are using any steps towards using improved technology in the classroom as an opportunity to upsell.

“There’s also the factor that

bandwidth and hardware providers have seen an opportunity to sell infrastructure to equip schools with connectivity and tablets, laptops and smartboards to take education to another level but without content that’s not possible.

As a content provider, we’re hoping that interest in e-learning will grow and stakeholders will understand content is key and simply giving a tablet can’t solve problems.

“We will always be innovative; we understand that kids learning today will learn very differently from how we learned in the past and we

SHUTER & SHOOTER PUBLISHERS

have to adapt and remain relevant.

There is investment; we’re doing as much as we can so that we can remain relevant in the changing market but there has to be a focus on content in order to make sure learners are the beneficiaries of this change,” he says.

NEW PRODUCTS & MARKETS Shuter & Shooter currently relies on government spending for most of its revenue. While this is usually constant, stable and reliable, any changes to curriculum or allocation of budget could expose the company to risk and this is

something Kliphuis is keen to mitigate against.

A recently launched venture into educational products for the consumer market, that will assist with professional and vocational training and development, is going well and something that the company is keen to explore further.

“We’re in the early stages of exploring new markets and we’ve only recently launched our first major series which is aimed at the consumer market but the feedback has been extremely positive. It will take us 12-18 months to see revenue that we’ve projected but

people like the products and they meet the needs that they are aimed at.

“We’re interested in new markets such as vocational education as we’re not a player in that market and we see the demand for skills in SA growing. Either through acquisition or building business units from scratch, we’re interested in expanding into new sectors in line with our core competence,” he says.

“It’s to do with risk management.

Textbooks are predominantly bought by provincial departments of education for their learners. If anything changed with this system, we could be at risk so

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INDUSTRY FOCUS: EDUCATION

we like to explore opportunities beyond school publishing that are in line with our core competences.”

Targets have been set for the next five years and it is expected that the company’s offerings in these new markets will grow.

“Educational publishing is facing big and real difficulties and disruptions.

There’s technology, there’s politics, there’s economic factors but if you ask anyone in any industry, they’ll tell you the same. No matter what business you’re in, there’s challenges. The good thing about this business is that we know what we do is in some small way helping to improve education. By creating a good quality textbook that helps people towards a positive future means I’m doing my bit and while it’s a challenging industry it’s very rewarding.

We can genuinely raise our hands and say that we’re making a difference and that is a nice thing.”

TURNING A PAGE IN AFRICA While looking for opportunities to

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spread risk with new products for new markets, Kliphuis explains that Shuter & Shooter has also started exploring the potential of geographical expansion, beyond South Africa’s borders. Upon reaching a certain size, this is the preferred option for many of SA’s expanding businesses but it comes with major complications and cost.

Often, in educational publishing, governments require books to be produced and ready for market with no guarantee that they will be approved and added to academic listings. This means investment can be wasted.

“We would love to expand into other African countries and we have started testing the market on a small scale. We’ve submitted a couple of opportunities and gained feedback and we’ve created materials that can go onto a government list. We’ve not been able to expand purposefully yet because the barriers to entry and upfront investment needed are substantial. We are interested in opportunities but we are cautious.

“We would always explore exciting opportunities no matter where they are in Africa. For countries much further north, we would likely investigate some sort of partnership,” details Kliphuis.

PUBLISHING PEOPLE One of the key challenges for Shuter & Shooter in the future will be recruitment, retention and succession planning for its staff base. Home to a collection of fantastic employees who are ambitious, passionate and talented, the company lists its people as its most important asset but Kliphuis, who has been in the industry for 11 years, says that attracting young people to take on the mantle when experienced professionals retire is vitally important.

“Our industry desperately needs young and talented people to get involved,” he says. We’re seeing fewer young people enter the industry and that will be an issue for us in the next decade. We need to make the industry attractive.

“We invest heavily in on-the-job

SHUTER & SHOOTER PUBLISHERS

training and that is a good thing. We’re also looking at succession planning so that we can bring talented new people onboard for the future. When we established the e-learning division, we saw an influx of people enter the company with exciting new skills and that was very pleasing.

“We’ve consciously looked for interns that we can bring onboard, train up and retain or help gain employment in the industry. Young people need nurturing and upskilling and often they will not add value straight away so employers do need to change their attitude and realise that investing in people is important.

I’m proud that we have been quite deliberate in getting interns onboard, upskilling them, retaining them where possible and creating opportunities elsewhere in the industry.”

Another issue that makes recruitment challenging is the nature of educational publishing; it’s a unique industry and requires a specialised skillset and attitude and this isn’t always easily transferable from other sectors.

“Our business is specialised and different from other sectors. People have entered this industry and tried to implement what they know from previous industry experience and it doesn’t work. Because of the specialised nature of our business, if people are not willing to let go of what they have learned in the past, they rarely succeed.

Despite the challenges that the company faces with recruitment and development, thanks to the positive previous year, deliberate investments into expansion strategies, and a commitment to serving the educational needs of a changing Southern Africa, Shuter & Shooter remains in a strong position and has a robust base from which to look at growth and advancement through 2017 and beyond.

“We will always pursue further growth. We want to be bigger. We want

to expand. We want more revenue, more profit and more jobs. We want to remain financially stable, and we want to support local communities. We are happy with what we have achieved but we recognise there is room for growth and e-learning and digital is an area in which we can do better,” says Kliphuis.

Of course, the state of the educational system will be an ongoing issue which Shuter & Shooter will have to monitor. With continued largescale and widespread investment from the government, surely outcomes in the industry can only improve, with Shuter & Shooter playing a part in this. Any migration towards digital e-learning will also be a slow process and the company already has a base in this market, giving it an advantage for the future.

“Our challenge is to remain relevant. This is the challenge for

publishing across the globe,” admits Kliphuis. “In South Africa, the added challenge is political uncertainty. But you have to remain positive; if you can’t see through the challenges you are not going to have a good ride. You have to believe in the people you work with and remain lean, nimble and willing to take chances while doing the right thing.

“Education has the power to improve people’s lives and we are proud to be a part of that,” he concludes.

SHUTER & SHOOTER PUBLISHERS +27 33 846 8700 www.shuters.co.za

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WINELANDS PORK

Winelands Pork

Has the Recipe for Success PRODUCTION: David Napier

In an effort to promote quality, sustainable South African pork, the South African Pork Producers Association has introduced the pork 360 accreditation programme. The first pork business to gain this admired certification is one of the country’s industry leaders, Winelands Pork.

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INDUSTRY FOCUS: AGRICULTURE

//

Pork is one of the healthiest meats available on the market today. Eating pork offers people significant levels of protein, essential vitamins, minerals and amino acids which are good for overall health. It has a high mineral content of Phosphorus, Selenium, Sodium, Zinc, Potassium and Copper. Importantly, pork is also rich in two vital minerals, Iron and Magnesium. It is excellent for increasing intake of Vitamin B6, Vitamin B12, Thiamin, Niacin, Riboflavin and Pantothenic Acid, and is also home to a number of antioxidants. It’s great for you, it tastes fantastic, and it is sustainable.

But, with a number of suppliers servicing the market, how do

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you know which pork products should be top of the shopping list?

Thanks to SAPPO (South African Pork Producers Association) and Winelands Pork, and the new Pork 360 quality assurance programme, consumers can now buy first-class pork products with confidence.

Pork 360 is a rigorous audit and certification process that pork farmers voluntarily opt into.

It involves a complete review of processes to ensure that that producers meet the increasing demand for food safety by retailers and consumers.

“Pork 360 certification is the guarantee to both the consumer and retailing sector that the producer has a consistent production process that complies

with minimum standards and ensures high-quality pork,” explains SAPPO. Winelands Pork; the country’s second largest pork abattoir, based close to Cape Town; has embraced the Pork 360 movement and is looking to bolster support for the initiative with retailers and consumers.

PORK 360 QUALITY “In February 2016, we were accredited as the first pork 360 abattoir,” explains Operations Manager, Henry Shaw. “Pork 360 is a quality assurance programme and SAPPO started the programme at farm level and we have a couple of farms accredited. Then they look at abattoirs and cutting plants

WINELANDS PORK

and we have been accredited with that status as the first producers of pork 360 meat in the market. We have a sole agreement with Food Lovers Market in the Western Cape and they only stock our product and other retailers are coming on board demonstrating the superior quality of our product. Gaining the pork 360 accreditation has been our focus over the past 12 months and we’ve started with some campaigns to roll it out with the retailers and public. That will be our focus for the next 6-12 months.

SAPPO created the website www.pork360.co.za to explain how everything works, from farm to fork, and we’ve been on the radio and there’s definitely a positive interest in the product which is understandable as this meat is the cream of the crop,” he adds.

The South African pork industry produces approximately 200,000 tons of pork each year and, although relatively small compared to operations in other countries, its 230 producers manage more than 110,000 sows. South Africa’s abattoirs slaughter more than 2.5 million pigs each year and just over half is sold into the fresh meat market with the balance heading to the processing sector.

Growth trends see larger farms absorb smaller set ups to create commercial-scale operations.

As the largest abattoir in the Western Cape, and a vital cog in the province’s meat producing market, Winelands Pork has become an industry leader through its 16-year life. Starting as an idea between a small group of farmers, the company is today widely respected

and has become a key supplier into South Africa’s food markets.

FARM HISTORY “Previously, the municipality ran most of the abattoirs but eventually there was a change and privatisation came into play and a lot of the municipal abattoirs were closed down,” details Shaw.

“Our current facility was a big plant in South Africa for the time.

It faced significant challenges and a group of local farmers came together thanks to the need for a local abattoir and they bought the facility, investing to bring it back to life.

“It was a group of 18 farmers and they run the cooperation like a company. The farmers are the shareholders of the business but also the producers of the business.

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INDUSTRY FOCUS: AGRICULTURE

//TODAY, WE ARE THE SECOND BIGGEST PORK ABATTOIR IN THE COUNTRY AND WE SUPPLY MAINLY INTO THE RETAIL INDUSTRY AND PRODUCTION HOUSES WITH THE BALANCE BEING EXPORTED//

We only slaughter our own pigs and a few long-term contracted farms. We don’t buy pigs in from the market. In the beginning we could only do 200 pigs a day and we grew the business to where we are now with a capacity for 1600 pigs a day, gaining export status in 2005.

“Today, we are the second biggest pork abattoir in the country and we supply mainly into the retail industry and production houses with the balance being exported,” he adds.

Export markets are set to become an increasingly important focus area for the business in the coming months and years. Demand for healthy, quality pork products from importers is high and markets with big potential are keen on South African products.

“Currently, we export mainly into African countries, Hong Kong and Mauritius. We have business in Botswana, Angola, Sierra Leone and wherever South African expats move to,” says Shaw.

“Europe is a bit more difficult as importing meat is highly restricted from countries that have any history of diseases. The only way we can export is from our compartmentalised piggeries so most of our pigs are now coming from compartmentalised diseasefree zones.

“Our first objective would be expansion in the Asian countries as they consume a large amount of pork meat and they have a good appetite for our products. The beef

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market opened up earlier this year so we are definitely looking East for opportunities. Africa is also on the radar as certain countries do consume a lot of pork.”

One market in particular that may be of is interest is Hong Kong, a market which imports a high percentage of its total food sources, especially meats.

“We are different from the other big abattoirs as we produce, we slaughter and we sell into the market. We do have a deboning facility which debones around 600 pigs each day. We also have a new farm coming online in August and we will start receiving pigs soon. We are looking at moving into processing but the biggest challenge will be to find export markets for processed products,” says Shaw.

To enter the processed pork meat industry, Winelands Pork will have to invest further in machinery, equipment and experience.

“It’s natural progression for the business, every time you increase volume you add another process to the line or you diversify. In our case, if the market needs carcases, we can supply; if the market needs primal cuts, we can supply; and if the market eventually demands processed products, we will be able to supply. Preparing to deliver processed products takes a little longer as we need equipment and experience and so we will probably look at it over the next 12 months.

“In SA, it’s very difficult to

finance this type of expansion and you often have to do it from your own funds and that can take a bit longer.”

OVERCOMING CHALLENGES It’s well known that farming is not an easy business to be in, anywhere in the world, but in South Africa, farmer’s challenges are escalated thanks to a unique set of problems which includes political uncertainty, economic instability, unemployment, climate change, land reform laws, lack of subsidies, disease, and more recently, drought.

However, even with a host of challenges to tackle, Winelands Pork remains confident. Shaw says that recent drought in the Western Cape, which caused Premier Helen Zille to officially declare the province a ‘disaster area’, has been effectively managed by the business and, although worrying, it shouldn’t impact on the company’s expansion.

“The drought is very concerning, without water people cannot carry on with their daily routines so emergency plans are being put into place and people are drilling boreholes for water. Apparently, there’s also a desalination plant being set up on the west coast. For us, it doesn’t affect the piggeries so much because the farms have their own water supplies from boreholes and feed isn’t effected as the drought is in the Western Cape which isn’t a feed producing province. Our feed mainly comes from North West and other areas which have had good rainfall recently.

“Cattle and sheep are effected heavily by drought as they graze on natural land which dries very quickly whereas poultry and pigs feed through intensive feeding programmes. When the drought starts, the numbers of cattle and sheep reduces quickly and people look to pork to subsidise volumes.”

WINELANDS PORK

As for the economic challenges, which have resulted in currency price fluctuations and slow investor confidence, Shaw says that the Winelands Pork business remains strong and sits on a robust platform for future growth.

“If you’re customer doesn’t have money then they buy less and that’s why we’re focussing heavily on export markets. Anything we can’t sell in the country, we export.

It’s essential for us to build good relationships and trade agreements with other countries so that we can trade there.

“People must eat and life goes on so we take the attitude that opportunities will always come.

The problems are exacerbated in the media; everyone talks of things falling apart but for us, things are falling into place.”

With the South African Rand currently enjoying favourable prices for exporters, Winelands Pork’s export focus could come at a perfect time for the business.

WINELANDS PEOPLE As Winelands Pork develops, and as the export and processing activities increase, the company will add to its current employee base of 300 people. But this is no easy task and finding the correct people to help drive the business forward will be a key focus for management.

“With processing, if we achieve our vision, we will probably add another 50-100 people to the plant and that will take us around level with the biggest employers in our industry.

“For us, recruitment is the biggest challenge. We are the biggest abattoir in the Western Cape and the rest are in the Gauteng region so when we need someone, we need to train them or ship them across the country and relocate them. We’ve started a number of inhouse training

programmes where we’ll take young people and upskill them. A number of our managers have been with the company since day one so they are highly skilled and we are trying to transfer those skills to the youngsters.

“We require a whole host of different skills and we are helping a great number of people achieve their targets with career development,” says Shaw.

With a sterling reputation for people development, a low level of staff turnover and a secure and stable business that offers real opportunities, it is likely that any vacancies that occur at Winelands Pork will be filled very quickly and the company will continue on its journey to the top of the industry.

This is a company that holds the vision of ‘positioning itself amongst

• • • • • •

the most admired global marketers and distributors of pork meat and to meet the various needs of the consumer every day by marketing and selling pork of a consistent high quality’ and with the capturing of pork 360 accreditation and with a growing emphasis on healthy living trends, Winelands Pork now has the perfect recipe for success.

WINELANDS PORK +27 21 945 2428 sales@wlpork.co.za www.wlpork.co.za

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The leading service provider in the establishment of safe and healthy living, working and recreational environments.

Website: www.aspirata.co.za Tel: 012 685 0800 Email: aspirata@aspirata.co.za

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BROLL FACILITIES MANAGEMENT

Utilising Tech Advances to Maximise

Potential of Property Africa PRODUCTION: Karl Pietersen

The role of the facilities manager is changing as technology dominates more and more parts of our working day and our working environment. As a leader in commercial property services across Africa, Broll is helping customers to make the most of the changing landscape and maximise the potential of their property.

//

Award-winning facilities manager and property group, Broll, is one of the leaders in the African facilities management and real estate market. Its services span the entire continent and, through its association with the CBRE network, it also plays in global markets.

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Founded in South Africa in 1975, Broll’s reach now extends as far as Angola, Cameroon, Ghana, Indian Ocean Islands, Ivory Coast, Kenya, Malawi, Mozambique, Namibia, Nigeria, Swaziland, Uganda and Zambia. At its core, Broll’s business involves commercial property services that enable companies

to maximise the potential of property. Services include: auctions and sales, corporate real estate services, facilities management, industrial, investment and office broking, property management, retail leasing and projects, research, shopping centre management, valuation, advisory services and

C

many more. “A four-decade track record, offices in all major South African centres and a growing continental footprint are factors that ideally position Broll to advise investors, owner-occupiers and tenants on their property investments throughout Africa.

In addition to our own research

capabilities, our affiliation to global property giant CBRE opens doors for our clients to a multitude of experts around the world. Our primary objective is to maximise your property’s potential,” says Broll CEO Malcolm Horne.

And now is the time to partner with an expert that can derive full

benefit from your property as the economic climate in South Africa, and around the world, is dull and not offering many possibilities for companies to grow.

Despite recent comments from the IMF (International Monetary Fund), suggesting that the economy is set to grow by 1% in 2017

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INDUSTRY FOCUS: PROPERTY

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compared to just 0.9% in 2016, growth remains flat, unemployment remains high, widespread poverty remains a reality and the currency price is less than half of the peaks of 2006.

“Against the background of declining business and consumer confidence and rising impatience with longstanding inequalities, the authorities face the dual challenge of reigniting growth and rendering it more inclusive,” said IMF team leader, Paolo Mauro.

We’ve heard so many times over the past 12 months that those companies who continue to invest when the economy is weak, those that do not let downturns effect their marketing, those that maintain activity during slowdowns, are often the companies that come through depressed times, emerging as industry leaders. Now is certainly a difficult time but Broll continues to invest and create new opportunities for its clients and its approximately 2000 employees across Africa.

BROLL FACILITIES MANAGEMENT

Property is the number one investment that any organisation will ever make. It’s the same as a family home; you spend more on property than on anything else, and this is why it is essential to maximise value.

At Broll Facilities Management, the enablement of positive work experiences is a key focus and by adopting facilities strategies that enhance performance and bring about positive experiences, the company continues to maximise property potential.

“Smart organisations understand that their primary goal is to enhance the performance of their people,” says Richard Flame, Director for Facilities Management at Broll Property Group.

“Not surprisingly, well thought through workplace designs can be powerful tools to supporting performance.”

But ‘well thought through workplace designs’ is a changing idea.

What fits one does not fit all and what works for a company today may not work for the same company tomorrow.

The facilities management business is liquid and is constantly changing.

Currently, a big focus is on smart technology, connectivity and Internet of Things (IoT).

Major South African cities are embracing the smart, connected future. Today, the big metropolitans use technology to keep up to date with every movement. This allows a council to gather real-time data from millions of objects, such as water meters, electricity meters, waste bins, traffic lights and street lights which allows for smarter management of the city.

And it’s the same for buildings. Broll can use smart tech such as computerassisted facilities management systems; advanced energy assessment, monitoring and management systems; adherence to occupational health, safety and security standards; and environmental sustainability.

Facilities management is changing; first came the buildings, then the

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caretakers, then the dedicated facilities managers, and soon the smart, connected programmes that will again change the role of the facilities manager.

But Richard Flame, a man still in the early stages of his Broll FM career after joining the business

in September last year, is keen to stress that people are still a major part of the facilities management equation and a good team inevitably results in good service.

“The most significant asset is, however, Broll’s human capital base that is characterised by a very diverse

Faradays Electrical objectives are to offer our clients a professional and technically sound installation with a complete after sales service.

Faradays Electrical objectives are to offer our

clients a professional and technically sound Our 24 hour, 7 day a week operation provides a quick installation with a complete after sales service. response to system failure and breakdowns.

Our 24 hour, 7 day a week operation provides a quick response to system failure and breakdowns.

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Faradays Electrical is registered with the Electrical Contractors Association of South Africa U.P .S INSTALLATIONS SUPPLY (ECA) and the Department of Manpower as GENERATOR well as the Electrical Contracting Board. & SERVICING & SERVICE We have a quality assurance policy and do regular inspections to ensure that all our installations comply with all the required regulations including the SANS 10142 code of practice for the wiring of premises (as amended) and the Occupational Health and Safety Act No 85 of 1993.

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INDUSTRY FOCUS: PROPERTY

skill base and I believe in the power of investing in people and I hope to contribute to a workforce that prides itself in excellence,” he says.

“I believe in the notion of a shared vision and having to depend on a team that are aligned to this singular vision.

It is important that the products and service we create for our clients must

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STRUCTION TRUCTION 74 / www.enterprise-africa.net

be benchmarked against best practice and ascribe to excellence,” he adds.

Ultimately, people are the drivers of technology and technology development and, as more and more companies look to include technology that allows workers to connect and collaborate more effectively in person and virtually, tools such as teleconference, video conference, web conference, instant messaging, social media and other communicators will continue to be emphasised by facilities managers.

Another key focus area for the modern facility manager is the growing emphasis being placed on creating positive experiences for those who are working, but are not in the office.

Along with the rise in technology comes a rise in the number of people working remotely.

“Life stage is a more important

Themolo is a 100 % black owned Black Empowerment Organization situated in Pretoria. We promote the principles of employment equity, equal opportunity and empowerment, regardless of gender, race, colour or creed and fair treatment for our workers in order to achieve a diverse workforce broadly representative of our people.

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Our team of engineering construction professionals offers a single-source solution for all of your construction-related needs. Whether its restoration, site preparation, a new facility or facility renovation and fitouts, we have the experience and personnel to provide the highest quality construction on schedule and within budget. We support our clients from project inception, to the commissioning of the fully operational facility.

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BROLL FACILITIES MANAGEMENT

//DELIVERING CUSTOMER SERVICE THAT EXCEEDS EXPECTATIONS STARTS WITH UNDERSTANDING WHAT GOOD SERVICE IS FROM THE CUSTOMER’S POINT OF VIEW// driver of demand for factors such as flexibility workspace designs and leading employers are recognising the need to take a holistic approach to when, where and how their employees work,” says Flame.

“In future, the role of facilities managers will include among others having facilities managers who are both strategic thinkers and innovators if they are to successfully incorporate facilities strategies that enhance performance, health, and wellness as well as enabling positive experiences within an organisation,” he adds.

Thanks to its immediate access to best-practice techniques through the CBRE network, Broll is able to deliver service of the highest levels, even when the requests and demands from customers go beyond the role of a traditional facilities manager.

“Delivering customer service that exceeds expectations starts with understanding what good service is from the customer’s point of view,” says Flame.

It is this innovation, forwardthinking and focus on quality that sets Broll apart from its large number of competitors. Put simply, Broll adds value to the operations of its customer base across Africa. it takes away the concern of maximising property potential and allows you to focus on your core business. If ever there was a time to think about outsourcing facilities management, it’s now.

The World Bank announced earlier in the year that despite a weak global investment climate, the economic situation in subSaharan Africa should improve throughout the year. “Sub-Saharan African growth is expected to pick

up modestly to 2.9% in 2017 as the region continues to adjust to lower commodity prices,” the bank said.

“Growth in South Africa and oil exporters is expected to be weaker, while growth in economies that are not natural-resource intensive should remain robust. Growth in South Africa is expected to edge up to a 1.1% pace this year. Nigeria is forecast to rebound from recession and grow at a 1% pace. Angola is projected to expand at a 1.2% pace.”

In these key Broll markets, those that have partnered with the

industry leader and stayed true to growth-based strategies through the challenging times should begin to see positive outcomes as we move towards the halfway point in 2017.

Broll, which recently moved into a new head office in Sandton, will continue to do what it does best and satisfy clients, while gaining further recognition along the way.

BROLL FACILITIES MANAGEMENT +27 11 441 4000 info@broll.com www.broll.com

• • • • • •

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www.centrelec.co.za www.enterprise-africa.net / 75

TIBER CONSTRUCTION

Tiber Close to Completion With Discovery Project and Remaining

Positive Amidst Tough Market Conditions PRODUCTION: David Napier

Tiber Construction is currently building the new R2.2 billion Discovery headquarters in Sandton. Alongside this mega-project, it boasts an extremely strong history and a list of completed projects that rival any out there. MD, Jose Correia tells us more about the challenges facing the company and his belief that a positive attitude will always bring success.

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Just two years ago, in mid2015, the South African construction industry was described as being ‘on its knees’ and ‘in a parlous state’ by the Financial Mail.

The stock prices for the listed firms had plummeted, revenues had decreased and demand was dry. The effects of the global economic slowdown were

very real and the harsh conditions were compounded for the big players by fines that had been handed out in 2013 for collusion and price fixing offences.

The outlook was not pretty.

2016 brought renewed optimism, with a slight upturn in the global economic climate (albeit overcast by the wave of global political impossibilities

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INDUSTRY FOCUS: CONSTRUCTION

becoming reality) and a number of new projects being announced, but the overall picture remained bleak.

The start of 2017 saw President Zuma once again commit to increased spending on infrastructure and development in his SONA but for those active in the construction industry, the number of projects in the pipeline remains slim and the environment is extremely challenging.

But challenging doesn’t always mean bad, and there are companies who have remained positive and who are enthusiastically searching for new opportunities; companies which are not as cumbersome as the ‘Big 5’. Sandtonbased Tiber Construction has a number of exciting mega-projects underway

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and is confident about securing future contracts, and Managing Director Jose Correia says that although times are certainly tough, those businesses that are able to remain positive and find opportunities are the businesses that will ultimately thrive.

“People are looking for opportunities and I always believe that there are opportunities in the midst of adversity. Many people are risk averse and the challenge is finding those who see the opportunities,” he says.

“There’s a lot of uncertainty, and developers are finding it more difficult to attract international tenants. We are currently tendering on various projects and in negotiations for several others, as we need to replace the contracts that

are nearing completion. We’re hoping to secure three projects that would commence by mid-June/July 2017.

As tough as the market is, there are developers that have approached us with potential opportunities, so we’re confident. There is work out there but getting things started is taking longer than normal.

“We have our ears to the ground and we are aware that listed businesses and big corporates are really struggling in the current environment.

“As an emerging, commodity based market, we feel the ripple effects from what happens in Europe and the West. Most of the buildings we work on are for big corporates and they have international exposure and

TIBER CONSTRUCTION

that filters through to our market.

Industry pressures are driven by South Africa’s unique and constant political uncertainty, but that is changing due to global political uncertainty which I believe will unlock future investment in the country.”

BUILT IN HISTORY The success that Tiber Construction has realised in the past decade is a result of the reputation that has been developed over the past 66 years. The company has experienced ups and downs, and has endured through economic, political and societal change. Established as a small family-run construction business back in 1951 by Paolo Rivera, Tiber Construction has Italian and Portuguese roots with a history of partnership between the Rivera and Cardoso families that spanned six decades and two generations. Gaspar Cardoso joined Paolo Rivera at Tiber in 1955 and Francesco Rivera joined the business in the late-60s. Gaspar’s son, Fernando Cardoso, joined the business in 1981 and is the current CEO of the Tiber Group. Jose Correia became part of the team in 1994.

The business flourished from the

mid-70s and whilst construction has always been the engine of the business, land opportunities were identified and Tiber’s property portfolio was steadily built up over the following 40 years. Tiber Bonvec, as it was known then, undertook all of Tiber Property Group’s developments, whilst always maintaining a strong position in the tender market and building up a list of clients with which it under took negotiated repeat business as it still does today.

With both the development portfolio and construction business growing, in 2010, Fernando Cardoso led a management buyout of the construction business from the Rivera family and this was the catalyst for a period of superb growth and involvement in prestigious buildings.

Sadly, both Francesco Rivera and Gaspar Cardoso and passed away in the 2011 and 2012 respectively and as part of the restructuring of the Tiber Group, the property portfolio and management business was sold to Growthpoint in a R6.6bn deal in 2013.

“In 2015, we decided that we would rebrand as Tiber Construction and we made subtle changes to all branding

to enhance what we are about. We now generate a lot of work from the tender market but also negotiate many projects with existing clients with whom we have built strong relationships, due to the level of quality, commitment and excellence we deliver,” details Correia.

“Today, we continue to look for development opportunities and to get involved in deals that will contribute and sustain work flow for our construction business which remains the engine of the Tiber Group. We’ve taken up opportunities that have presented themselves and we’ve developed two recent projects by partnering with like-minded organisations. It’s a good source of income and sustainability but most of our work remains on the construction side,” says Correia.

“It sets us aside from most similar companies in our country; we have extensive development knowledge which is beneficial to our clients. We engage closely with Clients and advise on how to improve on buildability, increasing feasibility and ultimately advise on how best to maximise development opportunities on a piece of land.”

VIVA Formwork & Scaffolding has over 22 years in the industry. We specialise in the supply, errect and dismantle of formwork and scaffolding in and around GAUTENG. Our onsite management, engineering and safety teams have completed many successful jobs with the toughest structures and tightest of programs.

140 West Street is testament to VIVA Formwork and scaffolding’s capabilities. Teaming up with Tiber & WBHO lead to the successful completion of the super structure ahead of the program.

140 West Street • • • •

70 000 square meters of slabs 8 basements 15 Upper floors (Northern Tower) 16 months

“FORMING YOUR FUTURE”

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INDUSTRY FOCUS: CONSTRUCTION

Tiber Construction can also offer a complete development package, which is something that smaller or lesserestablished companies can’t do. “When a developer has a scheme in mind but he wants a one-stop-shop to deliver it, we offer a turnkey solution, taking away the client’s responsibility to employ agents, consultants and contractors.

We can then take on the full scope; employing consultants, completing construction work, and delivering the project from start to finish which very few companies can do,” says Correia.

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“Our success of the past, our quality, and the level of delivery attracts repeat business and that is what you need now as the market is tight, margins are tight and the tender market is cut-throat,” he adds.

DISCOVERY BUILDING With a long list of impressive achievements that read like a ‘who’s who’ of corporate headquarters in the Sandton area, Tiber will add further success to its portfolio with the impending completion of its biggest project to date; the R2.2 billion

Discovery Life headquarters, which it is undertaking as a JV with WBHO. “We’re not the size of the listed entities; we can’t tackle many mega projects at the same time. We like to have a model where we have one large anchor project and other smaller projects that feed off the anchor project.

Discovery is our anchor project; it’s a massive building. It’s 110,000 m2 of lettable space, the largest single tenanted building in the southern hemisphere,” explains Correia.

Construction of the Discovery building, in the centre of the so-called

TIBER CONSTRUCTION

Discovery is set for October 2017 and the second phase handover is set for February 2018. Management will start phasing out by July/August so we are back in the market pursuing new opportunities,” says Correia.

The new Discovery building has significant green credentials and will become another Sandton development to make the most of modern technology designed to make buildings as efficient as possible. Tiber is recognised as a builder with substantial green building expertise and Correia says that in today’s market, this is something you cannot do without.

“Initially there was resistance but as technology and systems improve, we’ve embraced it. If you’re a serious developer and you’re trying to put AAA grade space together that doesn’t have a minimum four green star rating, you’re not going to find tenants for your building.

“As green building principals has become more user friendly, the costs have decreased. For the level of building we do, it is now become the norm rather than the exception.”

‘richest square mile in Africa, started in October 2014 and upon final completion will become a new home to more than 6000 Discovery employees.

“We have another substantial project, a 23,000 m2 high rise building in Sandton, called 140 West Street.

“The Discovery project is a Development JV between Growthpoint and Zenprop and 140 West Street is a development owned by Zenprop. We have forged great relationships with both developers which has resulted in us building many of their AAA grade buildings in the past.

“We are also busy with a number of retail refurbs, extensions and alterations to Centurion Mall and Benmore Gardens, both Redefine Properties.

“The first phase of handover at

SOLID FUTURE With some predictions stating that meaningful economic growth is expected to return to the SA economy by 2020, the ability of companies to secure project deals for the next two years is important. Tiber has a number of interesting projects underway and set for the future, but the company is still searching for its next big contract. While Correia expects to have deals secured in the coming months, he admits that one of the challenges for the business is the improvement of its BBBEE status.

Currently a level-6 registered company, Tiber is working hard to improve this rating in the near future.

“One of our challenges is our BBBEE status. We’re actively looking for empowerment opportunities and believe that when we find the right solution, it will unlock big opportunities for the company and our view on growth in the

current market will be different.

“We have a homegrown brand of people and we have a great culture in the company. We’ve built a great foundation of people we can trust. We believe that our employees are our biggest assets.

We also have a phenomenal bursary programme ensuring that we have a consistent flow of great young students that then phase into our organisation seamlessly ensuring continuity of our principals and culture going forward.

The MD also suggests that, even within the tight market conditions, he believes that there is enough work in South Africa and Tiber will not, at this stage, look beyond the borders for new opportunities.

“Some companies prefer to look into Africa due to a lack of local opportunities. There are huge risks as every single country has different rules of engagement. We believe there’s enough for us in the local market to keep us going for a long time so I don’t think we will take those risks at this time.”

Tiber’s strapline reads: ‘The buildings we build, reflect who we are’; it’s buildings are magnificent, highly technologically advanced, a delight for clients, and a perfect demonstration of the skill level that the company holds.

Despite the challenges of the economy, Tiber is a company you can rely on and a partner that can meet all your construction needs now, and in the future.

“We are in a challenging environment but you have to be positive. We are a private business, we run a totally different set up to the listed firms, and we believe there are opportunities. I am cautiously optimistic,” Correia concludes.

TIBER CONSTRUCTION +27 11 430 7700 tiber@tiber.co.za www.tiber.co.za

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CALVIN AND FAMILY GROUP

Calvin Mathibeli:

Building an Expanding South African Organisation From Nothing PRODUCTION: Manelesi Dumasi

Award-winning entrepreneur, Calvin Mathibeli tells Enterprise Africa how he plans to create 5000 jobs in the next five years, and take his Durban-based organisation across Africa and build family-style business relationships similar to those that have helped him achieve significant success at home in South Africa.

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Creating a multi-disciplinary, multi-national company that offers clients reliable, quality service is not an easy feat. It takes time, money, creativity, passion but not luck, according to Calvin Mathibeli Chairperson of Calvin and Family Group. The company offers a wide service portfolio to public and private customers and has grown significantly over the past decade. Based in Durban, Calvin and Family Group specialises in property development but has diversified over the years into security services, infrastructure development, plant hire, concrete, marketing, communications, media, hospitability

and more.

“I believe that success is a choice you make and is not because of luck,” says Mathibeli. “When founding the business, I had to choose between giving up and dropping out of school because of lack of funds or establishing a model to generate funds for studying.”

A driven and determined individual, Mathibeli explains that he started his business as a student out of necessity to pay for his tuition fees.

“I started the company in 2005; I was a student. I used to walk 10 km to university every day. As I walked, I saw guys selling cell phone accessories and I realised there was an opportunity. A lot of

shops were closed during the day and then closed early in the evening so I acquired a small shop and started the company selling cell phone accessories. The main objective was to finance my studies and my accommodation.

“It was very difficult,” he adds. “We never had any financial backing and I started the business using transport money that I was supposed to use to travel to university.”

After forming the business, growing, and building a client base, Mathibeli began setting his sights on a long-held ambition of getting involved in property development, specifically in urban township regions.

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INDUSTRY FOCUS: CONSTRUCTION

“I was repairing a cell phone for a client in the shop and he was in the property development industry. I had always been interested in that industry and had a lot of ideas but he mentored me and helped me decide where to go first.

“I saved every little bit of profit we ever made until I could enter the township property development industry. I started buying and selling land in townships and eventually I started buying land, developing on that land, and selling the land. We grew from there and never looked back.

“We targeted Umlazi in Durban and we continue to grow and diversify. Today we have 10 subsidiaries,” he says.

EXPAND & DIVERSIFY Now with more than 10 years’ experience in the development and construction industry; specialising initially in residential developments and later branching out into commercial, retail, industrial development and civil, and more recently into low cost housing and schools; Calvin and Family Group has also pushed development of its other subsidiaries: Security services, project

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management, branding, printing and marketing, tv production, photography and videography, SA precast and concrete, safety wear manufacturing, plant hire, hospitality, electrical engineering and construction. each of these separate divisions are growing for the group and Mathibeli expects this to continue growing substantially in the future thanks to the expertise of the people involved.

“Each subsidiary has its own head who has skill and experience in that industry. I studied accounting so when I started the property development division I bought in a team of engineers and construction specialists. In security, I bought in a team from the army and people with state security experience.

“We currently employ around 900 people; that’s 200 permanent staff and the rest are contractors who have worked with us for a minimum of five years.”

And Mathibeli’s ambition when it comes to people development does not end with sourcing skilled people to fill positions as the group expands.

His motivation is to continuously create

employment for people in order to benefit the local and national economy. He’s a passionate people person and views all employees and partners as his most vital assets.

“We just bought a small electrical company and we are empowering those involved to grow as it can be difficult for small businesses to acquire finance and achieve their vision. We will continue to buy small companies and develop them to help achieve my target of creating a minimum of 5000 jobs in the next five years.

“We want to create 5000 jobs in the next five years so we are hoping to partner with emerging SMMEs because there is a township economy which is left aside by corporate companies. Yes, there are challenges in international markets but there are untapped opportunities for growth in township economies.

“My company is Calvin and Family Group. My family members are my employees. I don’t treat people as employees, everyone is treated as family.

I’ve introduced many plans for employees to ensure their family is cared for such as education, medical, housing, cars etc. Our employees are hardworking, dedicated and innovative and they make this company what it is. I believe the relationship between employer and employee is truly what makes our clients happy and what makes a successful business.”

ENDURING GROWTH As the anchor division of the organisation, property development will continue to build the Calvin and Family Group upwards but the advancement of other subsidiaries is also exciting.

“Property development and construction remains our biggest subsidiary and security is second. We are now manufacturing bullet proof materials and safety wares. 70% of our revenue comes from the private market, with property developers or banks, where we complete residential and commercial projects. The remaining 30% of our revenue comes from work with government.

“We’re working on a water and sanitation project for the municipal

CALVIN AND FAMILY GROUP

government. We’re working on residential housing projects, and we’re also busy with infrastructure projects,” Mathibeli explains.

He also has eyes on geographical expansion, hoping to deliver his services to African markets as the group grows.

“We recently opened a branch in Swaziland and we hope to grow across Africa. We’re working on a residential property development in Swaziland.

“I have developed great relationships with partners in Swaziland. People say ‘success can’t be ignored’ and they saw our achievement and approached me with an opportunity. It’s not like South Africa, there’s a lot of opportunities for infrastructure development.

“We’re currently looking at property development opportunities in Lesotho and we’re also exploring potential in Botswana for the next 12 months. We will then look to Nigeria and other countries.

“Our focus in Africa surrounds industrialisation, manufacturing and property development. When we have entered the market, we will then look to offer security and other services as well.”

top entrepreneurs in Africa by Forbes Top 30 under 35.

“I was named NSBC SA National Entrepreneur Champion in 2016, Top Young Executive Entrepreneur at the 14th National Business Awards in South Africa, among many other prestigious awards, because we are coming up with new and different ideas.

“We don’t want to leave any stone unturned. I believe now is the time for us to lead and champion our economy.

“Every business has competitors but it’s very important to research the market properly. You must fully understand the market, including your products, services, expertise and capacity. Our philosophy of market knowledge has helped is greatly.”

Importantly, with economic conditions likely to remain unstable for the foreseeable short-term future, Mathibeli hopes to continue building relationships with clients to ensure when the country

emerges from its economic lull, Calvin and Family Group will be in a strong position.

“I value relationships more than anything. The relationships we have with our clients are very consistent and they’re not about money. Often, we will complete projects at cost so we can tap into the market and introduce ourselves,” he says.

In fact, Mathibeli looks forward with great optimism.

“I’m grateful of my financially disadvantaged background because it’s made me who I am and taught me not to look backwards,” he concludes.

CALVIN AND FAMILY GROUP 031 566 5253 info@calvinandfamily.co.za www.calvinandfamily.co.za

NAVIGATING ECONOMIC LULL As a growing and expanding organisation, Calvin and Family Group has had to navigate a challenging set of economic conditions throughout its life. After establishment in 2005, the group grew straight into the global financial crisis of 2008 after which the country was officially in recession for nine months. The ensuing years brought much uncertainty and unpredictability and in early-2017 the country’s international credit rating was downgraded by the big-name agencies.

For businesses, this news is worrying as finance and confidence are often effected.

But for Calvin Mathibeli, the future looks bright; he is upbeat and positive about his group’s ability to successfully overcome these macro challenges, just as it has in the past.

“We do see the slow economy but with our innovative ideas on growth, we are not affected and hence you see us growing from one country to another, and hence you see us named as some of the

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CEMBLOCKS

Rustenburg Bricks Building SA PRODUCTION: David Napier

Following investment into new equipment and facilities, leading concrete brick and paving supplier, Cemblocks, is helping to build a better South Africa for the future, while always innovating and providing opportunities for its large employee base.

//

Cemblocks has been manufacturing and distributing concrete bricks and paving for more than three decades. Its product range includes Maxi Blocks, Stock Bricks, Bevel Paving and Interlocking Paving. Rustenburg-headquartered Cemblocks has delighted its customers over the years and continues to carefully grow its footprint through investment into new equipment and facilities that will see the company cement its name as one of the industry leaders.

Now celebrating 35 years of successful operation Cemblocks Director and Founder, Nic Alberts tells Enterprise Africa more about the challenges of establishing and growing a business in a tough market.

“The company was formed by myself and my wife in 1981, and commissioning of the first brick plant was completed in June 1982 which we regard as the ‘start’ of our operations,” he says. “The reason

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for the establishment of Cemblocks was because of an idea to supply a big market with products at a very low price, and not trying to make a fortune by selling one product for millions of Rand.

“In those years, stock bricks, especially cement bricks, were sold at R60 per thousand, compared to the R1100 per thousand today.

It was a fierce battle against regulations and municipalities that would not allow cement bricks to be sold in their areas. There was prejudice against the products in general and since we had to start with almost no financial backing, it was a time of grinding teeth.”

In the early days, the company had a small fleet but completed prominent jobs for a number of prestigious jobs for important clients including; Midtown Mall.

Kwa Maritane, PPC Dwaalboom.

Over the years, the size of job the company could complete grew.

Its level of skill and expertise expanded quickly and the company

INDUSTRY FOCUS: CONSTRUCTION

developed into an important player in the market.

“Despite all the negative things that crossed our path, we succeeded in keeping our quality at the best possible standard – and that is still our motto and one of the most important reasons why we are still in business after 35 years!

“Our son, Francois Alberts joined us in 2001 and has since taken over as CEO of the company, assisted by his wife, Liesl. We are very proud to say we have built a business that can be successfully passed on to the next generation!”

BUILDING SUCCESS Focusing on quality product, low pricing, and the development of long-lasting relationships has seen

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Cemblocks become recognised as an industry leader, but it has not been an easy journey. Since 1982, the industry and the country have changed dramatically and South Africa has experienced a number of challenging economic periods. Most recently, in 2016, PwC described the country’s construction industry as ‘in a slump since 2009, with margins under pressure, tight liquidity and decreasing order books’. However, with major opportunities yet to be realised, PwC has stated that there is reason for the industry to look forwards, saying: “While the seven years of weak performance have resulted in weaker construction companies, we nevertheless believe that the industry is well positioned to support the country’s

development goals.”

As a significant supplier into the construction industry, Cemblocks has witnessed the challenges bought about by economic instability but Alberts points out that the company has managed to remain strong thanks to an unwavering focus on its core competences and maintenance of positive relationships with key partners.

“We are not excluded from the political turmoil in our country and obviously also feel the restraints that go with it, but we have built experienced over the years and realised you must keep your focus on what your core business is – we do our business and we don’t focus on what we cannot control,” he says.

“Over the years, we have

CEMBLOCKS

//WE ARE NOT TIED DOWN BY LARGE CORPORATE DECISIONS AND WE THINK WE ARE MUCH MORE FLEXIBLE IN ANSWERING THE NEEDS OF OUR CUSTOMERS// succeeded in securing long term relations with our suppliers and therefore we’re able to keep prices at acceptable levels to our customers, and we seldom come across customers that find it impossible to accept our price range.

“Our partners in the success of our company are in our thoughts every day and also in the minds of our senior staff and we keep them up to date with all of our

developments and opportunities.”

MANUFACTURING EXCELLENCE Cemblocks can manufacturer and supply to projects of any size. The company is home to four specialised manufacturing plants and uses the latest technology to create products that are made using ash. Having recently completed upgrades to a brick plant, the company is wellpositioned to strengthen its position in the market.

“We have just upgraded one of our brick plants with a very sophisticated robot and pallet handling system,” details Alberts. “At the same time, we took delivery of our first Kerb plant, imported from the UK, which is currently being installed and commissioned. Our reasoning for these expansions was because of our belief in and commitment to the growth of our country despite all negative reports in the media.”

The use of ash in the manufacturing process stems from a number of reasons. The company usually uses a maximum of 30% ash in manufacture because it is readily available in Rustenburg, it bonds better to cement for stronger walls, it plasters better as it you do not get fine cracks in your plaster work,

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INDUSTRY FOCUS: CONSTRUCTION

it isolates better than a brick that is made of crushed material because of the thermal qualities of the brick, and it builds much quicker than other bricks as it is a more workable weight.

Alberts explains that there are also ‘green’ credentials that come with using ash.

“Every time we enter a debate on ‘green’ products, we come out on top. We handle roughly 2000 tons of material per day, working 24 hour shifts in three of our plants. The raw materials that we ‘convert’ into usable products with aesthetic value are almost without exception the waste material of the mines in our area thus we regard ourselves as one of the largest ‘green companies in North West and most probably in the country.”

Cemblocks ensures quality through membership with the

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Concrete Manufacturers Association, an organisation established in Gauteng in 1972 which promotes factory-made precast concrete products and lobbies for bestpractice technical standards.

Manufacturing quality products, reliably and responsibly has resulted in the development of a superior reputation which has allowed Cemblocks to continue planning for future growth, but both Nic and Francois Alberts are humble and will not grow too much too quickly.

“We are blessed to be in a very lively market area. Rustenburg, still being the second fastest growing city in Africa, has a huge market in which we most probably have at least an 80% share and of which we are really humbled, but we have also opened markets around us in Gauteng – especially Johannesburg,

Pretoria, and to the West as far as Vryburg, Mafikeng, Zeerust and surrounding areas. Our ability to service these markets is thanks to our very sophisticated logistics department with a large fleet of vehicles transporting our products out and bringing raw materials into the factory. This is constantly reviewed and added to when necessary.

“We are believers that all your operations must be able to be viewed from the CEO’s office and your attendance at your factory is of utmost importance hence the decision not to expand to the rest of Africa, although such an opportunity will be considered should it arise.”

CEMBLOCKS PEOPLE While the Alberts family has been at the heart of the development of the

CEMBLOCKS

//WE HAVE JUST UPGRADED ONE OF OUR BRICK PLANTS WITH A VERY SOPHISTICATED ROBOT AND PALLET HANDLING SYSTEM// Cemblocks business over the past 35 years, the Directors are quick to highlight the major contribution of the company’s 300 people, without whom the company could not have succeeded.

“Success doesn’t come easy and I am sure that very hard work and the constant aim of renewal in your company, eventually brings success – but definitely not without excellent human resources around you,” says Alberts. “Our company depends largely on good, trained personnel but we also experience, like other entrepreneurs in the country, a lack of skilled staff which

stalls economic development and we are constantly working on trying to find solutions thereof and invest therein.

“One last-but-not-least factor in our success lies in good relations with our suppliers, both ways.”

South Africa has a number of national suppliers of cement products, but the continents big name players are all pegged back by ageing production facilities. With a trusted name, quality product, burgeoning market, reliable supply, and more than three decades of experience, who would be against Cemblocks capturing more market

share and increasing its reputation as the supplier of choice.

“In our distribution area, we regard ourselves as the leader in the industry but we are not unaware of much larger companies in the industry,” says Alberts.

“However, we are not tied down by large corporate decisions and we think we are much more flexible in answering the needs of our customers,” he concludes.

CEMBLOCKS +27145380311 delivery@cemblocks.co.za www.cemblocks.co.za

The latest dedicated brick handling crane from Atlas Germany

Contact us: E-mail: sales@bowmanafrica.co.za Contact number: +27 86 722 7096

Address: 178 Barbara Road, Elandsfontein, Germiston Website: www.bowmanafrica.co.za

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CHIEF SALES AND MARKETING OFFICER, ALTEN HULME

KONICA MINOLTA

Celebrating Fifty Years

of Print Dominance

PRODUCTION: Timothy Reeder

As Konica Minolta approaches the 50th anniversary of its founding in South Africa, Chief Sales and Marketing Officer, Alten Hulme talks us through some of the factors which keep the company ahead of the pack, and how it plans to extend its reach even further through its innovative product line.

//

The go-to name within the document imaging and management space, Konica Minolta offers a sophisticated and comprehensive range of products and services, operating on four continents.

With its headquarters in Johannesburg, Konica Minolta South Africa has a solid support infrastructure and distribution network in place: 23 branches and 47 dealerships countrywide give it the scope to cater for businesses of all sizes across Southern Africa.

Underpinned by its steadfast belief in in environmental, social and economic sustainability, as well as integrity, transparency, product excellence and exceptional service, Konica Minolta South Africa is the principal importer and distributor of the award winning bizhub range of digital multifunctional printers and production presses, in addition to laser printers and business

solutions. Its dominance within this sphere becomes more and more secure as its experience continues to expand, South Africa Chief Sales and Marketing Officer Alten Hulme tells us.

“The greatest success we have had over the past 12 months is the fact that we have remained the number one office machine supplier in Southern Africa, for the sixth consecutive year,” he states.

“In addition to this we dominated colour office machines for the 12th consecutive year, while we are also the number one production machine company in South Africa.

“We have won some very large tenders, which is always nice,” he continues. “For me personally though it is always great to retain customers - whether this is the smallest businesses or the very large corporates. We have some large

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INDUSTRY FOCUS: PRINTING

listed companies that have been our clients for close to 30 years, for example, and we have supplied the Government in South Africa on State Tender for 40 consecutive years.”

Understanding a client’s business and needs and building relationships has clearly been central to Konica Minolta’s enduring dominance of the market, seeing it deal with many of the top listed companies in Southern Africa.

“Besides the large corporates we also have large installations at several tertiary institutions where we manage the sites on behalf of those universities and colleges. Our sister company, Bidvest Business Technologies, manage print services, content services and rental assets on behalf of us at many large national and international companies and institutions.”

Hulme is unequivocal when

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asked on the key to both securing, and growing, the company’s top billing in the lucrative field of document imaging and management: “Our dominance in the South African market can be attributed to our focus on service excellence,” he states. “We also boast the biggest footprint in Southern Africa with 70 dedicated dealers and self-owned branches, and we have 1900 staff members looking after the needs of our customers around Southern Africa.

“We have award winning products and we’re ahead of the game.”

Konica Minolta traces its roots in South Africa right back to 1905, when it was originally established in Cape Town under the name Helios.

A key event was the company’s acquisition of the Minolta agency in 1967, when it went on to introduce

electro photo-static equipment to the South African market. Hulme takes us through some of the key moments in the company’s early days in South Africa, which have led it to its current incarnation.

INKED IN SA HISTORY “Konica Minolta South Africa started operating under the name Helios way back in 1905 in Cape Town, when they manufactured photographic films, plates and paper. The business grew and through the years three separate companies - with different products – operated under the same roof. In the early 1960s Helios got the license from Minolta Camera Company Japan to import and distribute Minolta Roll Paper Electrographic machines.

“In 1967 the three companies split and different companies were

KONICA MINOLTA

formed. Helios remained the office machine company, and a Dutch company Océ van der Grinten owned 40% of Helios, with Old Mutual owning the other 60%. Both these companies later sold to the Pepkor Group, which in 1997 sold to the Bidvest Group of Companies. Helios became Helios Minolta, which became Minolta South Africa, and when Minolta and Konica merged in Japan, we became Konica Minolta South Africa.”

The establishment of Konica Minolta in South Africa was a logical step according to Alten Hulme, building upon the successes of its history in the country to further grow its reach. “Minolta was world famous for cameras those days and a household brand in Southern Africa,” he explains, “and it therefore made sense to become the official importer and distributor of Konica Minolta office machines in Southern Africa. But it was more the fact that Minolta launched the first ever high quality micro toner copier in 1979, and then in 1980 the world’s first zoom copier, that combined to give us the edge in South Africa over our competitors.”

Even over a relatively short lifespan such as Konica Minolta’s in South Africa, rapidly changing times and technology means that the operational landscape today is somewhat different to its beginnings. “Initially,” says Hulme, “in 1967 we had three roll paper machines. In 1979, we had one photocopier in our line-up, and

the following year we doubled our copier line up to two; today we have 40 in our line up! Besides our machines that can copy, print, fax and scan we have 15 business applications offerings. We don’t just sell machines anymore.

“We also have a line-up of award winning high volume production machines, and recently entered the label printing market with a midvolume printer. We will also launch our packaging machine shortly.”

INNOVATION & EXPANSION The company’s present explorations of the packaging and labelling industries, some of the most lucrative in the business, was also an easy decision to take, according to Hulme. “Our research showed that there is a huge market for both these products,” he says. “The labelling

machine will cater for the small to mid-volume runs where there is currently a gap in the market place.

All my wine making friends down in the Cape are all very excited about this. We launched this machine last month and the interest was as such that we will conclude our first four sales within two months of this launch.

“The packaging machine is also a unique offering, and we have had many requests for a low-to-midvolume variable packaging machine, which is exactly what we are about to launch.”

Konica Minolta has never been one to be satisfied with its position at the forefront of its market, preferring instead a policy of constant development and innovation. Hulme details what shape this is taking in its current

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10007424_SASFIN_ENTERPRISE AFRICA PRINT AD_V2.indd 2

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INDUSTRY FOCUS: PRINTING

dealings. “A lot is happening in all aspects of our business,” he stresses. “In the service division, we are in the process of rolling out an automated service application on all our machines in the field. This is an advanced pre-order system whereby the machine – and not the user – orders consumables when they are low, makes service calls and even preventative maintenance calls.

“It also takes meter readings for us. In the past we had staff phoning our clients for monthly meter readings – now it is automated. The application takes the reading and emails it back to our offices.

“We are also in the final stages of our mobile service application, whereby the technical engineers receive a detailed notification of their next calls on their mobile phones and where the clients signoff the calls once completed on those phones.

//WE ARE THE NUMBER ONE PRODUCTION MACHINE COMPANY IN SOUTH AFRICA//

“The biggest development though, is the most exciting since the 1970’s when Minolta produced the first zoom copiers and also the first micro toner machines. The Workplace Hub will be launched in Europe in October and in Southern Africa next year, a world first for Konica Minolta and one which will change the office automation industry as well as the workplace.

In short, you will be running your business from one machine – the Workplace Hub. It will connect your staff, clients, suppliers, IT and even the internet through this device.”

On a smaller, but no-less notable scale, in May this year the company launched its new bizhub C458 and C558 models to the local market, the successors to the bizhub C454e and bizhub C554e which meet the efficiency and speed requirements specifically of companies with highly productive divisions, or vertical departments, including legal and finance. Greg Griffith, business solutions product manager at Konica Minolta South Africa, described the machines’ various merits: “These user-friendly multi-functional printers can help to increase productivity within the workplace by saving both time and effort,” he stated. “Ultimately, the bizhub C458 and C558 allow our clients to focus on their own core businesses, offering the perfect platform for collaboration, while also bringing fluidity and security to document workflow.”

Adding further weight to its commitment to developing new technologies and driving innovation,

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KONICA MINOLTA

Konica Minolta SA was festooned with a Good Design Award for its bizhub PRO 1100, an entry-level black and white digital press monochrome designed to pave the way for new business opportunities.

The programme recognises outstanding designs that enrich both industries and society across many spheres, with the Japan Institute of Design Promotion commenting that, “this product incorporates the universal design concept at a high level and is extremely user-friendly.

The appearance of the product was designed to ensure high operational efficiency and to blend naturally with its surrounding environment.”

It is not only in its product line that Konica Minolta seeks this level of growth and development, however, as Hulme underlines in its commitment to its people. “We put huge emphasis on training, and the sales staff is currently undergoing intensive training on a more scientific way of offering clients total

solutions. Hand-in-hand with that is online and classroom training on business applications offerings.

DEVELOPING PEOPLE “Part of our business plan is to offer the Konica Minolta clients an amazing experience dealing with all departments in our business, and surveys to help us achieve that are in the final stages.

“We upskill our staff – especially technical,” he goes on. “We also create opportunities, while training plays an important role. We also have several internships where we start with students at a younger age and develop them. Many of our interns are now full time employed by us.”

Hulme finishes by expressing his confidence of Konica Minolta SA’s continued dominance, amid an atmosphere of some unpredictability and uncertainty. “The volatility of the Rand hurt us a great deal,” he admits, “especially last year when political

decisions caused the Rand to plummet. We have major contracts and tenders where we have to keep our prices firm. It’s a nightmare when the Rand depreciates overnight as it did.

“We do however feel very optimistic for the near future,” he concludes. “We have an awardwinning product, world class service, the correct business plan going forward and exciting plans for the future. A combination of good, reliable equipment, after sales excellence, solutions to fit the company’s needs and the largest footprint in Southern Africa will all keep us ahead of the chasing pack.”

KONICA MINOLTA (+27 11) 661-9000 www.kmsa.com

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THATCH RISK ACCEPTANCES

Taking Insurance

Personally

PRODUCTION: Timothy Reeder

With more than 20 years’ experience in its specialist field, Thatch Risk Acceptances is the sole company to specialise exclusively in the diverse, demanding market of residential thatch insurance, a market leader in underwriting thatch risks offering the broker market an independent option with specialist expertise.

//

Thatch Risk Acceptances ( TRA) was founded in July of 1998 with the specific aim of catering to the varied needs of the thatch risk market, and has spent the ensuing years acquiring a strong understanding of its complex and diverse requirements.

While thatch is certainly TRA’s specialist domain, it also provides insurance for log cabins and timber frame homes. Across its many product offerings, cover is provided for structure, house contents and all risks, as well as motor vehicles and pleasure craft.

All of this is designed to give the client complete peace of mind when it comes to the all-important matter of their personal insurance.

Thatch Risk Acceptances is placed to offer a complete service to its broker base, backed up by a full mandate from Compass Insurance Company. Compass operates in the short-term insurance sector, offering a value-

added proposition to the market and focuses primarily on providing customised, innovative and costeffective insurance solutions. As a result, TRA can provide quotations, issue policies and manage the entire claim settlement process from beginning to end. Dealing with the broker network is also advantageous for TRA, as it is able to focus solely on the thatch industry and thereby constantly have the latest knowledge and capabilities at its disposal. “ The company started 15 years ago because there was a need to insure thatched properties in the local South African market,” explains Natasja Blok, Managing Director of Thatch Risk Acceptances, of the rationale behind TRA’s formation. “At that point in South Africa, there weren’t many players that were prepared to write thatched houses, businesses, lodges and hotels, for example.

Most thatch insurance business

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INDUSTRY FOCUS: INSURANCE

//OUR STAFF EAT, DRINK AND SLEEP THATCH// was placed at Lloyd’s of London on binders, so there was a gap in the South African market for a niche player and that’s how we got started.”

Since these early days, an important part of Thatch Risk Acceptances’s enduring appeal has been, and remains, its belief in managing a risk, rather than merely insuring it. It achieves this in large part through its work with the broker and strives to continually minimise the risk involved, while major exposures, improvements and requirements are identified through a comprehensive underwriting procedure. All of this of course combines to add value for the client, and ensure that hidden costs or charges are

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not part of its vocabulary: with TRA, the premium quoted is the premium payable in each and every case. It also prides itself on quick turn-around times on quotes, endorsements and claims, changing perceptions of what is often characterised as a lengthy, arduous process.

It is not just the reassurance of the full backing of Compass Insurance and Hannover Re, one of the largest reinsurance companies in the world, or even TRA’s proven track record over nearly 20 years, that have allowed it to establish itself so securely in the field.

Insurance, it goes without saying, really only becomes a pressing concern at times of stress, or even tragedy. This is where TRA’s

reputation for an individually tailored, personalised service provided by knowledgeable and friendly staff really comes into its own, with not a call centre in sight.

Blok highlights this personalisation of the business as a key aspect to is success. Although the company is composed of a relatively small staff complement, each member has vast experience in the thatch insurance industry.

“Our niche has never changed in over 15 years, and this is one of our key success factors. When you have a niche, you should stick to it and do what you know best.

“Our staff eat, drink and sleep thatch,” she goes on. “ They work with it every single day and they are extremely knowledgeable about it. They could answer any question that could come up about

THATCH RISK ACCEPTANCES

thatch and this sets us apart from other players.

“In addition, we don’t run call centres. We are very focused on personal service and in today’s fast pace of business, this is still appreciated by many brokers when they experience our personal touch.”

Dealing with a company committed to resolving matters as quickly and painlessly as possible has been vital to customers placing their confidence in TRA. The catastrophic St. Francis Bay fires of 2012 in particular gave Thatch Risk Assurances the opportunity to demonstrate this overriding aspect of its business, as Blok points out. “Insurance is such a grudge purchase,” she recognises, “and I think people hardly ever see the value, so I hope we were able to portray to the public that we are there to help when they need us most. It is an amazing opportunity that we in the insurance industry have, to enable our clients to recover financially.”

Thatch Risk Acceptances is thriving at a time when the subSaharan African insurance industry is becoming increasingly attractive to outside players. While it does present its own specific challenges, as is the case with any developing market, major Western insurance firms are beginning more than ever to pay it close attention. The majority of insurance markets in the developed world are highly mature, and the resulting intense

competition has made Africa’s dynamic, underserved markets an ever-growing focus of attention.

South Africa is in particularly rude health in this regard, according to global reinsurance firm, Swiss Reinsurance Company.

Swiss Re is a leading wholesale provider of reinsurance, insurance and other insurance-based forms of risk transfer, whose figures show South Africa to account for almost 75%, or $51.6 billion, of all insurance premiums on the continent in 2013.

There is also some healthy competition on the horizon set to challenge South Africa’s dominance too, however, with Nigeria top among a number of promising countries. CEO of Allianz Global Corporate & Specialty Africa, Delphine Maïdou, states that:

//WHEN WE STARTED THERE WAS A GAP IN THE SOUTH AFRICAN MARKET FOR A NICHE PLAYER PREPARED TO WRITE THATCHED HOUSES, BUSINESSES, LODGES AND HOTELS//

“Nigeria is Africa’s largest country by gross domestic product and has a mere 0.6% insurance penetration. It has all the ingredients for a thriving insurance industry because of its vast population of 170 million and active economy.” Maïdou also points to Kenya and Ethiopia, as significant up-and-coming insurance markets, “especially due to the size of their population and growing middle class.”

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EXHIBITION CALENDAR

KEY UPCOMING EVENTS ACROSS THE COUNTRY Our regular update to help you keep track of important events and exhibitions taking place across the spectrum of industry sectors.

MEDEXPO KENYA Kenyatta International Conference Centre, Kenya JUN 02 – 04 AFRICA OIL & POWER Cape Town International Convention Centre JUN 05 - 07 AFRICA HEALTH Gallagher Convention Centre JUN 07 – 09 AFRICARAIL Sandton Convention Centre JUN 13 - 14 CHINA TRADE WEEK - SOUTH AFRICA Durban ICC JUN 20 - 22 AFRICA’S BIG SEVEN Gallagher Convention Centre JUN 25 - 27

AFRICA’S BIG SEVEN JUNE 25 | JOHANNESBURG Africa’s Big 7 is the only f&b trade show in Africa to bring together hundreds of global farm to fork suppliers with motivated buyers from each segment of the buying community.

Now in its 16th year Africa’s Big Seven and partner event SAITEX (Africa’s largest product sourcing expo), attracts more than 14,000 trade visitors and 800 exhibitors.

Exhibiting at Africa’s Big 7 will provide you with an unrivalled opportunity to meet and engage with buyers and potential business partners from across the continent.

AFRICARAIL JUNE 13 | SANDTON Africa Rail, the largest and only event in Africa, creates a unique platform where the African operators, end users and government meet in one

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place. Africa Rail attracts 26 of the top African buyers in the rail space.

This is your chance to get face time with a decision maker who would typically take months to secure a meeting with.

This is the perfect opportunity to get exclusive insights into projects and influence policy.

FRANCHISE BUSINESS FESTIVAL JUNE 30 | JOHANNESBURG Always dreamt of owning your own franchise? Visit the Franchise Business Festival, 30 June to 2 July 2017. The Franchise Business Festival held in South Africa is the perfect opportunity to show thousands of visitors what franchise business you have on offer. Flaunt your recipe for success by booking your stand and have the opportunity to speak directly to interested entrepreneurs to generate sales and leads.

CBM TEC - MINING COPPERBELT Kitwe Showgrounds, Zambia JUN 29 - 30 FRANCHISE BUSINESS FESTIVAL Kyalami Exhibition & Conference Centre JUN 30 - JUL 02