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Think out of the box, embracing a new normal

2020 will go down in history as a year unlike any other. As the world came to a nearly complete shutdown due to the outbreak of Covid-19, businesses had to think out of the box, embracing a new normal. Lifting Africa spoke to Trevor Herbert, Head of Distribution at Scaw South Africa, about the year that was and the one to come. If asked to describe 2020 no-one would be surprised if the answer was difficult. Herbert does not disagree. “Our business was not spared and like most other companies in the country were hard hit,” says Herbert. “There was no avoiding the challenges and businesses faced some serious headwinds this year. It was a tough year.” What was pleasing, however, was the rapid recovery the company saw following the lifting of level 5 lockdown. “We came out of the stringent lockdown in April and immediately started to see a ramp-up in business and while there was a month or so that it levelled out, it has been incredibly positive overall and we have seen a constant increase in demand. It is a trend that we hope to see continue in 2021.” As a producer of a diverse range of high-quality steel products, with a global reach through its various operations around the world, finding its feet as quickly as possible after the initial lockdown was important. Herbert says much effort has gone into creating a stable operating environment for employees and continuing to ensure customer demands are met. “As a lifting company, several of the industries that we service were heavily affected. There has been a steady recovery in most of these industries and demand for our products steadily increased over the past few months across the board in the different sectors we serve. Mining, for example, was hard hit by the lockdown and the outbreak of the coronavirus, but even this sector is steadily coming back online.” He says one of the biggest boons during the past few months has been the company’s manufacturing ability. This reduced a large part of our dependency on the exchange rate. The crisis undoubtedly highlighted the benefits of local production, says Herbert. “Our local manufacturing ability did help us to weather the storm better than what we would have been able to do if we were only importing products.” Tackling challenges One of the biggest challenges in recent months for most producers has been the availability of steel. Local producers such as JSE-listed steel producer ArcelorMittal South Africa publicly battled critical shortages of steel products which in turn negatively impacted the building and construction and manufacturing sectors. 18

Lifting Africa - Nov/Dec 2020

“This did impact somewhat on us,” says Herbert. “The bulk of our product, however, is drawn from our parent company. There was some demand that we needed to source locally and it has been challenging as there have been massive shortages.” For local manufacturing to thrive a solid supply chain is critical. Herbert believes boosting and encouraging more local production is necessary especially in the steel production industry. The challenges with sourcing steel abroad are plenty, he says advocating for local supply assurance. “It can’t be picked up as quickly and the nature of the product being heavy it comes with several logistical challenges as well.” Just as important, he says, is that local manufacturers deliver a quality product that is competitive with imports. “Our company will continue to invest in our local manufacturing capability. It is part of the bigger company ethos of encouraging local manufacturing as much as possible.” With this in mind, money is continuously being ploughed back into the factories of which the key facilities are all located in Johannesburg and surrounds providing proximity to key African mining locations and industrial centres. Growing footprint Owned by the Barnes Group for the past two and a half years major efforts have gone into stabilizing the business. With a firm strategy in place to grow its footprint both locally as well as internationally a tremendous amount of time and resources has been ploughed into the factories delivering world-class facilities. Training has taken centre stage within the company as it has set out to ensure it has the right people in place to grow the business. “We are cautiously optimistic for 2021,” says Herbert. “Our approach is one of not lying down in challenging times, but rather to get out there and find the business. Of course, this is easier said than done, but thanks to the backing of our shareholder we have the necessary support to push forward.” Plans for 2021 include increasing export volumes both regionally and internationally to Europe, the US as well as the East. “Sales and training will remain vitally important in our business. We place a lot of emphasis on our team being well trained in our products.”

Scaw South Africa, + 27 (0) 11 620 0000, therbert@haggie.co.za, www.scaw.co.za

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