PEOPLE CULTURE TRAVEL PROPERTY BUSINESS WINE SPORT ENTERTAINMENT
ISSUE 13 R40.00
Charl Schwartzel SOUTH AFRICA’S NEWEST SPORTING HERO
West African Business Review West Africa: Good investment option for SA
African Food & Agriculture How the global demand for food is helping the continent grow
Plumblink
Seaweed McFarlane discusses SA’s solar potential
Century City
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INVEST IN AFRICA South African President Jacob Zuma has urged businesses to explore BRICS opportunities. He asked the business community attending the BRICS Business Forum to aggressively take advantage of the opportunities that BRICS offers. In an address for delivery he said Africa needs $480 billion for infrastructure development over the next 10 years, which “should interest the Brazil, Russia, India, China and South Africa (BRICS) business communities”. This is exciting news indeed. Officials and experts say that South Africa will become a gateway to the African continent for other BRICS countries and its membership of the group will enhance south-south cooperation. China is already South Africa’s largest trade partner with bilateral trade valued at $25.65 billion last year, up 60 percent from 2009, according to Chinese statistics. This makes this special issue of South Africa Magazine all that more poignant. This month, not only do we have everything you have come to expect from this market-leading magazine, we also have two very special supplements. The first is West African business. Our West Africa Business Review supplement explores some of the bountiful opportunities in Ghana and elsewhere, looking at the challenges and benefits of operating a business in this booming region. Second, we focus on Africa’s food and agri business in our African Food and Agriculture supplement that looks at one of the continent’s most important industries, which is seemingly a magnet for foreign investment. We also have a focus piece on South Africa’s newest hero, golf sensation Charl Schwartzel.
EDITORIAL
Editor – Ian Armitage Acting editor – Susan Miller Editorial assistant - Inger Smith Sub editors – Jahn Vannisselroy Janine kelso Tom Sturrock Alison Grinter Writers – Colin Chinery Jane Bordenave John o’Hanlon
BUSINESS
Advertising Sales Manager – Andy Ellis Research manager – Andrew Williams Researchers – Jon Jaffrey Elle Watson Chris Bolderstone Dave Hodgson Nicholas Davies Sales executive – rahim Ali Sales administrators – Abby Nightingale katherine Ellis
ACCOUNTS
Financial controller - Nick Crampton
PRODUCTION & DESIGN
Magazine design – optic Juice Production manager - Jon Cooke Images: Getty News: NZpA, AAp, SApA
DIGITAL & IT
Head of digital marketing & development – Syed Ahmad
TNT PUBLISHING
CEO - kevin Ellis Chairman - ken Hurst Publisher - TNT publishing Ltd South Africa Magazine, The royal, Bank plain, Norwich, Norfolk, Uk. Nr2 4SF TNT publishing Limited, 10 Greycoat place, London, SW1p 1SB tntmagazine.com
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NEWS
All the latest news from South Africa
SPORT Charl Schwartzel
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Those of us brave enough to stay up into the small hours on April 11, 2011 would have witnessed another South African making sporting history
SPORT What next for Proteas?
After another disappointing World Cup campaign, the Proteas face an uncertain future
FEATURES
REGULARS
Contents
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PLUMBLINK EVEREADY SENET CENTURY CITY DIJALO PROPERTY GROUP TENOVA PYROMET FERMEL MINING (PTY) LTD FASA FOCUS
G4S NIGERIA
62 66 72
JOHN HOLT PLC
76 80
SPICER AXLE
86
INTERNATIONAL SOS
SUPPLEMENTS
107 110 116 121
18 26 32 40 48 52
HERB 125 CAPE AND SPICE 130 DU ROI LABORATORY 136 COMPASS BAKERY 140 GATTI ICE CREAM 144 FOX & SWAN SWEETS 148 MIDMAR LIQUORS
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EUROPA MULTI CONSTRUCTION CHEMICALS
eTHEKWINI FIRE AND EMERGENCY SERVICES UNIT
FLINT CONSTRUCTION AFRICA RAIL EXPO KARSTEN
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All the latest news from South Africa Business Sport
TOP BUSINESSMAN Kirsten
TAKES OVER for Proteas job approached
MCDONALD’S SOUTH AFRICA
One of South Africa’s most prominent and politically connected businessmen is taking over all of the McDonald’s restaurants in the country, McDonald’s said. The announcement did not say how much Cyril Ramaphosa is paying for a 20-year master franchise agreement to run all 145 McDonald’s restaurants in South Africa. But it did say that unlike a conventional franchisee, Ramaphosa would own all the assets, including owning or leasing the real estate. Customers won’t notice any change, McDonald’s said. Ramaphosa is a former union leader who was African National Congress general secretary during the constitutional negotiations that ended apartheid in 1994. He went on to found an investment empire with interests that include a power plant, a Coca-Cola bottler and mines. He remains a leading figure in the governing ANC. Chris Gilmour, an analyst at South Africa’s Absa Asset Management who follows the fast food business, said McDonald’s has struggled since opening its first South African restaurant in Johannesburg in 1995. R.J. Hottovy, a Chicago-based analyst for Morningstar, added that McDonald’s lags in South Africa behind KFC, a U.S. company that has been here longer, and the local Nando’s chain. “My suspicion is that the company hadn’t gained the kind of traction that it wanted,” Hottovy said. 6
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Gary Kirsten, who led India to World Cup glory, has told BBC Sport that he has been approached over the vacant South Africa job. Cape-Town born Kirsten played 185 one-day internationals for South Africa and told BBC Radio 5 Live, “They have approached me but I’ve said I’m not going to make any decisions just yet.” Cricket South Africa (CSA) has drawn up a six-man shortlist for the job that is reported to include former England coach Duncan Fletcher and ex-New Zealand captain Stephen Fleming. Kirsten, 43, has asked for time to take stock and consider the offer. “I need to take some time off and clear my mind for a while after this magnificent journey,” he said. CSA are expected to name a replacement for interim coach Corrie van Zyl in June.
Lifestyle
Africa’s largest undersea Internet cable to land this month Africa is set for an Internet explosion, according to mobile service provider MTN, which has said that a new undersea telecommunications cable, designed to boost Africa’s Internet access, will land this month. MTN called it the continent’s largest data pipeline yet. The 14,000km West Africa Cable System (WACS) fibre optic line is scheduled to reach South Africa’s Western Cape province on April 18, linking the continent’s Internet providers directly to the servers of Europe and boosting the bandwidth of the world’s least-connected region. The cable starts in London and will connect 15 points along Africa’s western coast, said MTN, which has a $90-million stake in the $650-million system and is the project’s single largest investor. The new link is the latest in a series of submarine cables that hold the promise of better Internet access for Africa, where only 9.6 percent of people are web users, compared to
65 percent of Europeans. The capacity of Africa’s fibre optic cable connections has expanded almost 300-fold since 2009, when the continent relied mainly on excruciatingly slow satellite connections, and will expand another 23 percent with the launch of the 5,120-gigabit WACS. “WACS will ... go a long way towards catapulting Africa into the digital age,” said Karel Pienaar, managing director for MTN South Africa.
Travel
Air France to fly Paris-Cape Town Direct Air France will begin flying direct from Paris to Cape Town three times a week starting in November, an official has said. The flights from RoissyCharles de Gaulle will begin on November 3, with a Boeing 777-200 carrying up to 309 passengers on
Wednesdays, Fridays and Sundays. Air France currently serves only Johannesburg with daily flights from Paris on the Airbus
A380 superjumbo. “We still see the demand for South Africa growing very rapidly,” Ralf Karsenbarg, Air France-KLM’s Johannesburg commercial director, told AFP. “The research shows a very positive outlook,” he said. “The French community is very strong in the Western Cape.” www.southafricamag.com
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BP says pipeline tariff
Business
could cost SA
“R1b a year” The almost 60 percent fuel pipeline tariff increase could cost the economy R1 billion a year and lead to 40,000 job losses, BP has said. “The cost to the economy could be up to R1 billion annually and conservative estimates are that 40,000 jobs will be lost with the National Energy Regulator of SA’s (Nersa) pipeline tariff increase of 59.9 percent,” BP said in a statement. Business Day reported in March that Nersa had granted Transnet the increase to its petroleum pipeline tariffs to help pay for a new pipeline. The new pipeline will replace the current ageing link between refineries in Durban and Gauteng, and will significantly increase the amount of fuel pumped up to Gauteng from the coast. BP said the increase would result in South Africa’s tariffs being among the highest in the world. “Our analysis shows that these tariffs exceed the global average by over 400 percent,” said Sipho Maseko, BP South Africa CEO. “At these high input cost 8
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levels, business viability is at stake and will inevitably lead to major job losses in Gauteng.” He said Nersa said the increase in the petrol price resulting from the higher tariffs would only make up a small fraction of the gross domestic product of inland provinces. This “suggests that they view the magnitude of the increase to be insignificant”. “However their own figures show 40,000 job losses, which is very significant,” he said. BP wanted the local pipeline tariffs to be benchmarked against those in other parts of the world. “Nersa’s disregard for this request violates many of the Act’s objectives, which include promoting the efficient, effective, sustainable and economic distribution of petroleum and the promotion of access to affordable petroleum products.” BP called on Nersa to review the implications of the tariffs “given its comparison with global benchmarks and the consequent implications for the competitiveness of the regional and South African economies”.
NEWSINBRIEF Trade
Food
Crime: South African police have arrested a former Currie Cup rugby player over three axe murders allegedly to avenge the gang-rape and HIV infection of his daughter, Afrikaans daily Die Beeld has reported. One victim was allegedly decapitated and others hacked in the neck.
scam
Business: Gold Fields Limited has announced that attributable Group production for Q1 2011 is expected to be approximately 830,000oz - five percent higher than for the corresponding quarter a year ago (793,000oz). Production was lower than that achieved in the previous quarter (900,000 ounces), however, because of the customary Christmas break in South Africa, which saw all mines close for two weeks. Property: A new programme to address urban decay and rejuvenate Joburg’s CBD – called the Inner-City Property Scheme (ICPS) – has been launched by the city’s mayor, Amos Masondo. “... The state and appearance of a CBD is an important barometer to determine the ability of a city to attract and retain investment,” Masondo told reporters. “It is also a reflection of the extent of the advancement of commerce and overall economic development.”
ANC strengthens Coca-Cola SA hit by
ties with phishing
Chinese
The ANC's Progressive Business Forum met the China Council for the Promotion of International Trade (CCPIT) to strengthen trade ties between the two countries, the PBF said early April. "The CCPIT, with more than 300,000 companies as members across the length and breadth of China, agreed to co-operate with the PBF, in specific areas of trade promotion, including the co-ordination of South African participation in a number of trade exhibitions and fairs in China, as well as the facilitation and enhancement of trade delegation visits between the two countries," read a statement from the PBF. "Both sides undertook to spare no effort to ensure their work was co-ordinated and unified to the benefit of both countries and its people." This would be done by private sector trade delegations from each country visiting the other and acting as "conduits" to establish contacts between SA and Chinese enterprises wanting to trade in the two countries.
Peninsula Beverage Company (PenBev), local bottler of The Coca-Cola Company’s products, is warning that Coca-Cola South Africa has recently had the Coca-Cola name fraudulently incorporated in a number of phishing scams and is urging all customers and consumers not to get caught. The public is being warned to be vigilant when it comes to receiving a short message service (SMS) or e-mail messages from individuals claiming they are from CocaCola and that they have won money in lotteries. Common signs that a message may be a part of an email, SMS or phishing scam include basic spelling and grammatical errors in the email, the use of free, non-corporate email accounts like Yahoo! Gmail or Hotmail, and requests for personal information such as bank accounts. www.southafricamag.com
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CHArL SCHWArTZEL:
SAFA WINS THE
MAStErS Those of us brave enough to stay up into the small hours on April 11, 2011 would have witnessed another South African making sporting history. His name? Charl Schartzel. It is worth remembering. Words: Ian Armitage
AUGUSTA, GA - APRIL 10: Charl Schwartzel of South Africa celebrates a birdie putt on the 17th green during the final round of the 2011 Masters Tournament in Augusta, Georgia. (Photo by Harry How/Getty Images)
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The Masters 2011 SporT
N
ever has the world of golf seen a finish quite like the one we saw at the Masters. It had it all. The final round began with 21-yearold Irishman Rory McIlroy in the lead. He fell apart. That part was normal. We’ve seen it so many times before. What was amazing was the charge from behind by the so-called “less-famous” players. It was crazy. An amazing day. And South African’s will remember it for a long time to come. We’ll remember it because it was the day Charl Schwartzel, a 26-year-old from Johannesburg, wrote his own bit of sporting history. He birdied the final four holes to win the Masters
by two - 14 under par - over two Australians, Jason Day and Adam Scott. Never before has a Masters champion done that, birdying the final four holes to win. It was a fantastic win for Schwartzel and marked the 50th anniversary of Gary Player’s breakthrough first international win at the Masters - another famous South African triumph. Unfortunately, most of us back home missed it (not me though, I was up flying the flag). When Schwartzel sunk his birdie putt on the 18th at Augusta National, it was almost 1am in Joburg. Schwartzel is now South Africa’s third Masters champion after three-time winner Player and Trevor Immelman, who won in 2008.
Going to be nice to have some South African food at the Champions Dinner again next year TREVOR IMMELMAN
Charl Schwartzel of South Africa reacts on the 18th hole green after sinking the winning putt in the final round of the 2011 Masters Tournament at Augusta National Golf Club in Augusta, Georgia. AFP PHOTO / ROBYN BECK (Photo credit ROBYN BECK/ AFP/Getty Images)
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Last year’s champion Phil Mickelson (L) puts the Green Jacket on Charl Schwartzel from South Africa after Schwartzel wins the Masters golf tournament at Augusta National Golf Club in Augusta, Georgia. (Photo credit ROBYN BECK/AFP/Getty Images)
Player was quick to recognise the achievement, which was Schwartzel’s biggest career win so far, commenting on Twitter: “I am absolutely delighted for Charl and South Africa. Congratulations and very well done to him. That is how you finish like a champion!” “Really happy for Charl!!!” 2008 champion Immelman added on his Twitter page. “Going to be nice to have some South African food at the Champions Dinner again next year,” he said, in reference to the tradition of the defending champion choosing the menu for the subsequent Masters champions’ dinner. South African newspapers hailed the Schwartzel “masterclass”. “Charl’s Masterclass,” said The Star, alongside a full-page photo of a victorious Schwartzel waving to the galleries on the 18th green. 12
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The Afrikaans-language Beeld called his performance “Masterful” while online, The Citizen said “Schwartzel wins Masters with birdie blitz,” adding “No Masters champion had finished with such a run” following Schwartzel’s clutch of late birdies. South African President Jacob Zuma was full of praise too. He said Schwartzel’s win was “a feat that put South Africa back on the international golfing map following Trevor Immelman’s success in the same tournament in 2008, and Gary Player 50 years ago. This victory proves that South Africa continues to produce some of the best golfers in the world.” The president added that he hoped Schwartzel “will be an inspiration to many young people who will be joining the golf sporting code, and this victory and future
The Masters 2011 sport
victories will unite and inspire our people.” Sport and Recreation Minister Fikile Mbalula jumped on the bandwagon, adding: “We are grateful to the achievement of the young golfer from Gauteng for flying the South African flag higher at the US Masters.” With five South Africans in the top 50 official world golf rankings, we could be set for many more happy days to come. Time will tell whether Schwartzel will be regarded as highly as Player, Bobby Locke, Ernie Els, Retief Goosen, and, more recently, Louis Oosthuizen. END
FACTFILE name: Charl Schwartzel AGE: 26 AT A GLANCE: Comes from a strong golf family.
His father, George, was a toplevel amateur before he became a professional coach and his brother, and occasional caddie, Adrian, is an emerging player on the South African circuit.
Turned pro in 2002 and, at age 18, became the third youngest player to secure his European Tour card through the qualifying school. Clinched his third European Tour title at the 2008 Madrid Masters.
Won two European Tour events early in 2010, the Africa Open and Joburg Open, before joining the PGA Tour as a special temporary member. In 11 appearances on the U.S. circuit, he made nine cuts and recorded three top-10s, with a best finish of second at the WGC-CA Championship.
AUGUSTA, GA - APRIL 10: Charl Schwartzel of South Africa celebrates his two-stroke victory on the 18th green during the final round of the 2011 Masters Tournament at Augusta National Golf Club in Augusta, Georgia. (Photo by Jamie Squire/Getty Images)
Won two more European Tour events early in 2010, the Africa Open and Joburg Open, before joining the PGA Tour as a special temporary member. In 11 appearances on the U.S. circuit, he made nine cuts and recorded three top-10s, with a best finish of second at the WGC-CA Championship.
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SA CrICkET:
Proteas? WHAT NEXT For
After another disappointing World Cup campaign, the proteas face an uncertain future. Words: Pierre de Villiers
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What next for Proteas? SporT
W
here to now for South African cricket? Embarrassed in the World Cup and in desperate need of a decent coach, these are indeed uncertain times for the Proteas. SA cricket needs to reassess and refocus but not before the powers-that-be pick through the wreckage of another putrid World Cup campaign. When the Proteas capitulated against New Zealand, cries of “chokers” reverberated throughout the cricketing world. Was South Africa’s depressing loss really just another pressure-induced failure by talented but mentally fragile players or should the selectors carry some of the blame? Closer inspection suggests the latter. Given South Africa’s record in World Cups there would always be a situation in India where panic spread like a gastro bug through the batting line-up during a tight run chase. When that happened the Proteas would need players in the middle and lower order who could perform the Heimlich manoeuvre when the choke started. In the minds of the selectors the best candidates for the job was a player still establishing himself (JP Duminy), a rookie (Faf du Plessis) and, in Johan Botha and Robin Peterson, two blokes whose main job is to bowl teams out. Perhaps inevitably, they couldn’t get the job done when it counted against a disciplined New Zealand side. When the rot set in against New Zealand, how much would South Africans have liked to see a warrior like Mark Boucher striding out to the wicket - a man who, on countless occasions, has batted with the tail to get the Proteas over the line. Or what about someone like Albie Morkel, an IPL star who could launch a counter attack and put the pressure back on the Black Caps? If the coaching staff still believe SA could have done without a player in the Lance Klusener mould they clearly didn’t see India’s Yuvraj Singh change games with his power hitting. Selectors have to be honest and admit they got the balance
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of youth and experience wrong at the World Cup, something they have to address if the Proteas are to become the best side in the world. Fortunately, such is the depth of talent in South Africa you can’t help but be optimistic about the future of the national side. In Hashim Amla, Jacques Kallis and AB de Villiers, South Africa have three batsmen who should find themselves in the top 10 of the ICC ranking at all times, while Dale Steyn with his fast, late swing and Morne Morkel with that steepling bounce are the most feared opening bowlers in the world. Add the fact that the Proteas now have a genuine wickettaking spinner in Imran Tahir and they will be a handful on any surface around the world, if well captained and coached. Who, then, should step into the void left by the stop-gap measure that was Corrie
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van Zyl? India’s former coach Gary Kirsten seems the most natural choice. The way he managed the big egos in the Indian side was impressive and tactically the former South African opening batsmen got things spot on during the World Cup. The question is whether Kirsten can strike up a good working relationship with Graeme Smith who, as Test captain, still casts a big shadow over the Proteas. If rumours – and Herschelle Gibbs’s controversial book - are to be believed Smith and a handful of senior players run the show when it comes to the South African cricket team, something Kirsten would certainly not abide. Throw in the spectre of political interference that forever hovers over SA cricket and Kirsten might just think that a lucrative IPL coaching contract is the way to go.
What next for Proteas? SporT
Whether SA cricket authorities have learnt from their mistakes at the World Cup and have made the right decisions will only become clear when a thoroughly humbled Proteas side take to the field again. Hopefully by then South Africa’s most talented batsmen AB de Villiers will no longer be breaking his back behind the stumps, Gary Kirsten will be the man in charge and the South African cricket team will be hellbent on getting some seriously angry supporters back on their side. END
SOUTH AFRICA’S WORLD CUP FAILURES 2011: Quarter-final. New Zealand 221 for eight off 50 overs beat South Africa 172 off 43.2 overs by 49 runs. South Africa were 108-2 with Jacques Kallis and AB de Villiers in command but lost their next six wickets for 38 runs. 2007: Semi-final. South Africa 149 off 43.5 overs lost to Australia 153 for three off 31.3 overs by seven wickets. 2003: Did not reach knockout phase. 1999: Semi-final. Australia 213 off 49.2 overs tied with South Africa 213 off 49.4 overs. Australia progressed to the final because they finished higher than South Africa in the Super Six table. 1996: Quarter-final. West Indies 264 for eight off 50 overs beat South Africa 245 off 49.3 overs by 19 runs. 1992: Semi-final. England 252 for six off 45 overs beat South Africa 232 for six off 43 overs by 19 runs under the then rain rule.
IMAGES: Getty www.southafricamag.com 17
SS o o L A r ? FAr So SLoW
With soar-away electricity prices biting, solar power is a ‘natural’ for South Africa. But so far consumer response has been surprisingly lukewarm. All this could change says Seaweed McFarlane, CEo of market leader Plumblink.
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Plumblink FEATUrE
S
outh Africa has abundant sunshine, the perfect solar climate and serial electricity price hikes. A compelling prescription for solar power that can cut up to 40 percent off a typical domestic electric water heating system? Eskom certainly thought so, offering cash incentives to customers who install solar water heating panels, and most commentators and sector specialists agreed. But the reality of public response has been far below expectations. “The take-up has been very disappointing,” says Seaweed McFarlane, CEO of leading national plumbing retailer Plumblink, whose sales campaign was directed towards middle and upper income groups and based on a high-pressure solar heating system it was bringing to the market. “The rebates are very attractive, but despite extensive marketing not only by us but also a lot of opposition companies, the sales have been very disappointing, travel around the suburbs and you will see very few solar geysers installed in homes. I’ve installed one and am very happy with it.” But what has taken off is the low-pressure lower cost water solar water heater being installed in low-cost housing, many of which never had hot water systems in the first place. “In some middle and upper class areas there’s been a resistance to putting solar geysers and panels on the roofs of the homes. Some years ago we had rolling back-outs, and until something like this happens it seems the public is unlikely to be pro-active.” High pressure solar system installation costs range from R15,000 to R25,000– while
low pressure variants are being fitted for the cost of the rebate – R4,000 – R4,500. Heat pumps - which use less electricity and are cheaper to install - are proving an attractive alternative. Until recently electricity in South Africa has been relatively cheap and in constant supply. But over the past two years this has changed dramatically. Eskom admits it cannot keep up with growth and demand, and begun a load shedding and power plant construction programme funded by roll-on price increases. So could Eskom’s latest planned electricity hikes now be the solar power catalyst as customers begin searching for ways to reduce their electricity bills? “I’ve heard talk that Eskom is considering reducing the rebate - pure speculation at the moment – and there’s also a new levy to fund a R27 billion electricity upgrade with consumers facing the possibility of a 25 percent tariff price rise,” says McFarlane. “Developments like these should encourage more and more people to move to solar. Something needs to happen to wake South Africans to the fact that electricity is going to be in short supply.” Plumblink are specialists and market leaders in bathroom, kitchen ware and plumbing supplies, operating in this its centenary year from 27 stores strategically situated throughout South Africa. It is the oldest and most reliable name in plumbing in South Africa, and with a wide range of local and imported ceramics, brassware and plumbing supplies says ‘We really do have everything you need.’
With a growing base of 5,000 loyal clients we service government, commercial, industrial, housing and DIY projects, and offer a service you can count on
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Plumblink FEATURE
More than 12,500 quality products are sourced from over 150 local and international suppliers offering a broad range including state-of-the-art and exclusive ranges. A VIP loyalty programme gives preferential rates on plumbing purchases, with a two percent rebate on an annual spend of R32,000.00 plus. “With a growing base of 5,000 loyal clients we service government, commercial, industrial, housing and DIY projects, and offer a service you can count on.” says McFarlane, who plans to double the company’s footprint over the next three years.
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Plumblink has moved through several forms since it started in the Western Cape in 1911. Five years ago it was acquired by South Africa’s leading private equity manager Ethos, the point at which Seaweed McFarlane arrived as CEO. “Many members of the old staff left the company and opened up in opposition, something of a set back causing us to look again at our expansion plans then on the horizon. “While the last three years have been pretty stable, this period has coincided with the reduction in house building and construction and right now we are probably on one of
REGIONAL LEADER, GLOBAL PARTNER The Dawn Group is a powerhouse in the construction, building materials and infrastructure sector with a network of strategically positioned distribution centres nationally, into Africa and Mauritius.
Distribution and Warehousing Network Limited
Dawn prides itself on its manufacturing and wholesale distribution of leading, quality branded hardware, sanitaryware, plumbing, kitchen, engineering and civil products. Optomised and shared logistics and administrative services enhance the production and distribution efficiency of The Dawn Group and its subsidiary companies like WHD and Saffer. This enables them to offer a total package solution with maximised service efficiency, just-in-time breakbulk and supplychain capabilities affording their retail customers the benefit of optimal working capital management.
SANGIO PIPE
Cnr. Barlow Road & Caveleross Drive, Jupiter Ext, Germiston 1401. Tel.: (+2711) 323-0000. Fax.: (+2711) 323-0466 Listed DAW. www.dawnltd.co.za
Plumblink FEATUrE
the biggest ‘lows’ the industry has ever experienced. Even so Plumblink has a growth strategy to reinforce its position as Africa’s sector leader. We have already opened six new stores over the past year and have an expansion plan in place that includes doubling our size over the next three years, increasing turnover and our footprint in South Africa. “But it still depends on how well the market recovers. We will move cautiously, not out-running market capacity. We have competitors but outside franchise operation, in the main they do not have a national footprint like ourselves.” New buildings and total refurbishment programmes at airports, hotels, business parks, hospitals, offices and similar locations account for 40 percent of an annual turnover - with trade 45 percent and consumer/ home owner 15 percent. And while the main trading has been focused on selected large warehouses and showrooms in the major cities, Plumblink has begun opening smaller and more convenient express stores. “We will make it easy for the plumber, developer and home owner to walk into a specialist supplier closer to home or business. Traffic is now a major problem in all South Africa and it’s becoming more and more evident that one has to be placed in a convenient spot for customers. “We see ourselves as being better able to address the market requirements through our distribution centres that will feed smaller stores and get products to customer at his convenience. I believe this will lead the way for us to take a major share of the uptake when it comes.” In Britain bathrooms and kitchen are seen as the key ‘wow factor’ areas in attracting homebuyers, and McFarlane says this is becoming increasingly the case in South Africa. “The older homes were built 50 years ago with one bathroom and three bedrooms. These days the more affluent and middle class home has more than one bathroom, often en-suite for each bedroom. Open 22
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FRANKE KITCHEN SYSTEMS Franke Kitchen Systems South Africa would like to take this opportunity to congratulate the Plumblink Group on their 100 year anniversary. We consider them to be one of our key distribution partners of our Franke range of products, and wish them great success and growth for the next 100 years! The Franke Kitchen Systems Group is proud to announce that in 2011 we to celebrate our 100 year anniversary! Franke Kitchen and Washroom Systems is the world’s leading provider of intelligent systems for both domestic and commercial sectors. Franke boasts a comprehensive range of sinks and mixers. In our commercial sector, we have complete hygiene systems that outshine the rest in functionality, design and durability.
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Comap prides itself on service excellence, product solutions to fit any job and quality assurance backed by Comap International. Products supplied include: Q Fittings (use the Sudo fitting shot from the top right of the last adver) Q Piping systems Q Underfloor heating systems Q Brassware products and finishes Comap offers brands such as Sudo, Jevco, BioFloor, Flexseal and Pipe Doctor
Comap is a proud supplier to the Plumblink group We’re now located in Northriding, Jhb, why not give us a call?
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Call centre 0861 372 653 enquiry.fsa@franke.com www.franke.co.za
Plumblink FEATUrE
planning is becoming increasingly popular, so yes, the kitchen and bathroom are playing a major part in the valuation of a house.” Plumblink’s market lead is driven by large stock holding availability at all major centres and a strong national team that can advise on products and product usage. “Many competitors still have old-style stores, a trade counter and warehouse behind. We are moving away from that, bringing the product to the customer and making it available for him or her to feel and touch, while at the same time having informed and helpful staff on the floor who can assist and give advice.” A strong sense of corporate responsibility and environmental awareness also flavours Plumblink’s approach to business. “We believe in contributing to the well-being of society by promoting responsible environmental values and actions, by both ourselves and our clients. We actively assist our clients with the supply of products and services that are not harmful to natural eco-systems, and promote ‘green’ building principles and energy saving initiatives. “We have 100 years of trading history and you are assured of getting decent quality products – 95 percent of which are sourced locally and backed by reliable suppliers. Plumblink’s tried and tested reliability is an established brand in itself. Our customers really can and do ‘Count on Us.’” Meantime as electricity prices soar on a continuing projection, Plumblink is providing South Africans with an opportunity to take advantage of abundant solar energy while making an investment with sustained returns. So watch those Eskom prices and then count the savings. END
We will make it easy for the plumber, developer and homeowner to walk into a specialist supplier closer to home or business
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poWEr To
rely on Eveready South Africa faces the twin challenges of declining markets and rapid technological change but it has a strategy to keep it as South Africa’s number one brand for batteries.
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Eveready South Africa FEATUrE
M
anufacturing and selling batteries in South Africa must be rather like trying to photograph a cheetah. Despite the fact that packs of batteries in their familiar sizes - hanging in petrol stations, newsagents, food stores and street markets look much the same as they have for decades, this is a fast moving market. The familiar products are running out of steam. There is no lack of new electronic products that call for batteries, but they get more sophisticated every year, demand precise things of their power supply, and crucially it is becoming increasingly common for them to come with a built in powerpack that recharges when you connect it to the mains, to your car or to a computer. Jacqui Brown has an enviable job in many ways. As marketing manager of Eveready South Africa she presides over the most recognisable brand, known and trusted for generations and associated with quality and reliability. On the other hand, she has to protect Eveready’s market share from marauders which include names that are very well known (outside of South Africa anyway) and the inevitable low price imports from the Far East. Under these circumstances Eveready’s 75 percent share of the market is impressive. It is helped by the fact that Eveready is probably the only manufacturer in the world of layer cell batteries. These rectangular power packs are a basic product for radios, radio cassette players and music centres. Devices powered by layer cells are common in South
people like our power plus layer cells for the good reasons that they are better value for money in radios than round cells
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Eveready South Africa FEATUrE
Africa, where they have a loyal following evidenced by the fact that in 2010 Eveready sold nearly 80 million units. “People like our Power Plus layer cells for the good reasons that they are better value for money in radios than round cells, they last and last and they are available in all the local general stores,” says Brown. But that market will inevitably decline. The younger generation is where the spending power is these days, and the devices they aspire to don’t work with the heavy layer cells. Nevertheless as we move into the middle and upper strata of customers by income 28
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rechargeables are brilliant for digital cameras and remote control toys, hobby aeroplanes and the like but if you use them in a calculator or a clock you are wasting your money
and lifestyle Eveready has other advantages. Frankly the bottom end of the market is flooded by cheap and exotic brands but who wants to put something into a new Sony radio or Hitachi remote control that might leak and ruin it? In any case, when they have to replace it constantly they end up with an Eveready anyway. But Eveready inherits one headache from the perception that made them buy cheap in the first place. When people go out to buy AA or AAA batteries two traps await them if they don’t match the battery to the device. Eveready Power Plus and Power Plus Gold zinc chloride batteries are cost effective for flashlights,
Delta EMD (Pty) Ltd was established in 1982 and is a market leading supplier of premium quality Electrolytic Manganese Dioxide (EMD) to the global battery industry. Delta’s EMD facility is located in South Africa, a modern operation with a production capacity greater than 30 000 tons per annum. Delta’s production facilities are ISO 9001 certified and is a committed supplier of choice to the world’s major battery producers through product performance, reliability and consistency. Technical service and product development collaboration with major battery producers are leading features of the business. Delta applies and maintains the highest standards of occupational health and safety and also adopts best practice standards to meet its commitments to comply with local environmental regulations. The business is OHSA
18001 certified and is a signatory to the requirements embedded in the Responsible Care® Management Code of Practice, which are driving the continuous improvement of its systems and processes. Three major product ranges are manufactured – High Grade EMD, finding application in various types and sizes of alkaline batteries, Low Grade EMD, consumed in cylindrical and flat Zinc Carbon cells, and Lithium Primary Grade EMD for application in cardiac rhythm management, military devices, etc. Other applications are found in the water purification, welding rod, glass, capacitor, animal feed and other agricultural industries. Further development focuses on EMD derivatives for application in the secondary Lithium-Ion battery industry, specifically the field of Electric Vehicle Batteries.
Tel: +27 (0)13 759 3500
www.deltaemd.co.za TV remotes, clocks and other ‘low drain’ applications but they are not designed for digital cameras, which need a lot more sustained power. That power is delivered by alkaline batteries and rechargeables. On the other hand it would be pointless to put a rechargeable battery into a remote control or a clock. Eveready Power Plus Gold will keep these running for a couple of years at a quarter the price, says Brown. “Rechargeables are brilliant for digital cameras and remote control toys, hobby aeroplanes and the like but if you use them in a calculator or a clock you are wasting your money.” If the consumer has to choose the right product for the job, Eveready has been in the business of providing the right product for the South African consumer since 1937 when it opened its original factory in Port Elizabeth. Over the years it changed hands with global corporate changes but the present-day company, wholly South African owned, dates from 2002, selling Eveready branded
Uniprint (previously trading as Universal Print Group) is a full-service provider in the design, manufacture and distribution of a wide range of commercial print products and services to corporate customers and institutions that have consumer mass markets or branch networks throughout Africa.
Visit our website for more information:
www.uniprint.co.za
As people buy more digital cameras, powered models, portable CD players and other high tech equipment alkaline batteries are taking up a larger share of the market
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batteries in South Africa and similar products branded as Ecocell in the other southern African and Middle Eastern markets that Eveready controls. The greater part of the company’s sales volumes still come from the Power Plus and Power Plus Gold ranges, which are standard inc chloride batteries from the miniature AAA size to D size used in large torches. Battery power is as essential in everyday life in large parts of Africa as candles used to be, explains Brown: “A lot of places either don’t have electricity or if they do the supply is erratic: they need flashlights to get home from work, and then listen to battery powered radios.” Power Plus batteries are brilliant for these applications, she adds, and while that market may be declining it is going to remain strong for the foreseeable future.
Eveready South Africa FEATUrE
But the market for alkaline batteries is not declining. Eveready Alkaline Plus and Lithium batteries have between three and five times as much capacity as Power Plus and are ideal for moderate to high drain devices. “As people buy more digital cameras, powered models, portable CD players and other high tech equipment alkaline batteries are taking up a larger share of the market, and volumes are growing really fast.” As long as people continue to think of batteries as a commodity their confusion about them will continue, she says. Actually the battery forms an integral part of the design of modern electronic devices, and they deserve to be taken seriously. Yet many misconceptions persist. For example people have been encouraged to think that batteries
K-Mark was established in 2002 to meet the demand for customised protective packaging in the automotive industry. Whilst protective packaging still constitutes 60% of our business, over the past 4 years we have diversified into other markets. Our facilities and capabilities in 2011 can therefore cater for customised sewing of a wide range of products.
Disposable garments House of York homeware range Disposable automotive protective products Dunnage / pallet protective covers
1st floor, Mutual Warehouse, 64B York Road, North End, Port Elizabeth, 6001 PO Box 13265, Humewood, 6013 Tel: 041 - 373 1419 Fax: 041 - 373 0764 Email: kmark@lantic.net
contain hazardous chemicals, yet the majority of them will break down harmlessly. The key ingredients of a consumer battery are zinc and manganese which when disposed in conventional waste methods converts itself to various salts of zinc and manganese which act as micro nutrients for the soil! Eveready has taken great steps to be as environmentally friendly as possible, Brown insets. “We have been certified to the ISO 14001 standard for the past eight years, won the SJM Flex Environmental award in both 2006 and 2007, and were recently awarded the Eastern Cape Clean Industry award for General Manufacturing from the Department of Economic Development & Environmental Affairs (DEDEA) in conjunction with the Institute of Waste Management for Southern Africa (IWMSA).” END
marvels MINING
Engineering and project-management company SENET, based in Johannesburg, is an internationally respected leader in the design, engineering and construction of mining projects in Africa.
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SENET FEATUrE
E
ngineering and projectmanagement company SENET is an internationally respected leader in the design, engineering and construction of mining projects. The Joburg-based firm is a “diverse and dynamic” design, engineering and project management company and it provides professional services to host of clients. Services including scoping studies, feasibility studies, bankable feasibility studies, consultancy services, EPCM projects, and EPC/turnkey projects help SENET stand out in a crowd. It also offers design and estimate audits, due diligence studies, project procurement and logistics, project financial services, and FEA and dynamic analysis. “SENET have established themselves as one of the most dynamic engineering companies in Africa today,” the firm’s website www.senet.co.za - says. “Continuing to expand through a forward looking policy and diversification of its already widespread range of activities, servicing a variety of clients,” it adds. SENET’s capabilities include the ability to design, manufacture, supply, transport, construct and commission gold CIL/ CIP/CIS process plants, heap leach projects, mineral beneficiation plants, bulk materials handling and storage facilities, coal washing plants and rapid loadout/loading terminals. It designs and supplies mobile heap leach stacking systems, mobile and radial stacking systems and agglomeration and acidification drums as standard proprietary equipment, as well as overland conveyors, belt feeders, cement handling systems, stackers, sicon conveyor systems, pipe conveyors and high angle conveyors. “SENET’s core capabilities include EPCM & EPC/Turnkey Projects, Consultancy Services,
SENET have established themselves as one of the most dynamic engineering companies in Africa today
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SENET FEATURE
© Goran Bogicevic
Scoping Studies, Prefeasibility & Feasibility Studies, Design & Estimate Audits, Project Financial Services, HAZOPS Studies, Test work Supervision, Process Development & Design, Detailed Engineering & Design, Value Engineering, Due Diligence Reports, Technical Audits, Specialist Engineering (Finite Element & Dynamic Analysis),” the SENET website confirms. “SENET’s in house capabilities include Process, Civil/Structural, Mechanical, Piping, Electrical and Instrumentation disciplines including SCADA, PLC Automation, Project Procurement, Spares Management, International Shipping expertise and Logistics Management services.” SENET was established in 1989 by a group of qualified engineers and project managers with many years of experience in design, 34
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project and construction management of turnkey materials handling and minerals process projects. It grew quickly when, in the early 1990s, it developed a range of proprietary heap leach stacking and agglomeration equipment, which has enjoyed global success. “We are today considered as a world leader in heap leach equipment technology,” a source at SENET told South Africa Magazine. Since 1991 it has actively completed export type projects all over West Africa, North Africa, Sub-Sahara Africa as well as in Asia, Central and South America. SENET has worked with some of the world’s major gold producers and some of the countries that it has completed projects in, operated in, or has clients and/
TANK
MANUFACTURERS (PTY) LIMITED
Years of serving many different sectors of industry has enabled Tank Manufacturers to becomes a leading force in the manufacture of technically advanced pressure vessels, heat exchangers and a great diversity of other capital equipment. Tank Manufacturers’ expertise has expanded dramatically over the years and now includes products for the beverage, bulk handling, chemical, dairy, food, mineral processing, mining, petrochemical, power generating, pulp and paper, plastic, textile and water treatment industries as well as general fabrication. Tank Manufacturers (PTY) Ltd, 7 Brunel Road, Tulisa Park, Republic of South Africa Tel: (011) 613-7043/7044 | Fax: (011) 613-7048 | paulo@tankmanufacturers.co.za
We serve industry, Construction and Mining with efficiency friendliness, reliability and integrity.
We are comitted to your success Heavy Duty Industrial (pty) ltd Tel: (011) 974 8725 Fax: (011) 974 2366
Roymec Technologies (Pty) Ltd
is a leading
supplier of filtration, screening and thickening process equipment, with reference installations in 25 countries on 5 continents Telephone Number: +27 (0)11 656-2523 Fax Number: +27 (0)11 656-2537 E-Mail Address: sales@roytecsa.com
www.roytecsa.com 100% South African
Global Technology Supplier
SENET FEATUrE
or representation in are Angola, Botswana, Borneo, Canada, Chile, Cote d’Ivoire, DRC, Ghana, Guinea, Honduras, Mali, Mauritius, Mozambique, Namibia, Nigeria, Peru, Senegal, Zambia and Zimbabwe. “SENET have supplied and built projects for many clients over the years, with a high degree of repeat business,” its website says. © Sergey Galushko
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Key clients include end-users such as African Copper, Aluminium Chemicals, Anglogold, Anglogold Ashanti, Ashanti, Anglovaal, Anglo Platinum, Avmin, Axmin, BHP Billiton, De Beers, ESKOM, First West Gold, Ghanaian Australian Goldfields, Glamis Gold, Glencor, Impala Platinum, Ingwe Coal, Iscor, JCI, Johannesburg City Council,
We are today considered as a world leader in heap leach equipment technology
SENET FEATUrE
Khutala Mining Services, Randgold Resources, SA Port Operations, Sasol, and Tarkwa Goldfields, as well as project houses and clients like Babcock, Bateman, Hatch, IMS, and Murray & Roberts. SENET has been heavily involved in the Sishen South Iron Ore Project. “The Contract for handling 9MTPA of iron ore was awarded by Kumba Iron Ore Limited at the end of March 2009,” SENET’s website says. “The Plant is situated in the Postmasburg area some 80 km south of the Sishen’s main plant in the Northern Cape Province.
“The project consists mainly of several in-plant belt conveyors complete with the associated equipment and controls and handles the ROM iron ore from the offloading pit area, to the export load out station. “The scope includes the design, supply, fabrication, erection and commissioning of nine new belt conveyors complete with transfer stations, tramp iron removal, sampling stations for material quality control, Moisture and Partical Analysers as well as three yard conveyors which interface with the stacker and reclaimer machines supplied by others.” END
SENET have supplied and built projects for many clients over the years
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Kimtrac Earthmoving Equipment and Cranes is a division of Kimble Investments (Pty) Ltd, which was started in 1963 by Dennis Kimble. The company specializes in the procurement and supply of Earthmoving Equipment, Trucks and Cranes for International Companies working in Africa.
Tel: +27 12 372 0009 Fax: +27 12 372 1712 E-Mail: kimtrac@mweb.co.za Dennis Kimble Cell: 082 457 7778
Importers and exporters of conveyor equipment
CONTACT:
www.wca@edx.co.za
With our vast technical and marketing experience, we can offer superior quality of conveyor equipment such as conveyor belting, conveyor idlers, conveyor pulleys and rubber lagging which meet all international standards. Our credentials were established through commitment in quality in both domestic markets and export markets.
160 Main Reef Road, Anderbolt, Boksburg Postnet Suite #286, Private Bag X1, East Rand 1462 Cell: 082 600 7574 Cell: 082 526 2207 Fax: 086 654 1260 Email: worldwideconveyor@live.co.za
CENTUrY CITY:
space, YoUr
place YoUr
South Africa Magazine goes inside Century City , Cape Town’s mixed use development.
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Century City FEATUrE
W
hen the development of the Century City complex began in 1997 the 250-hectare site consisted mainly of bush. It was a degraded wetland, which was a breeding ground for water birds. When you look at it today it is very different, although the birds, thankfully, remain, particularly within Intaka Island, a 16-hectare nature conservation area, which comprises rehabilitated wetlands rich in indigenous flora and birdlife. “When Century City was being planned it was decided to develop the site in such a manner that there would be a successful wedding between property development and conservation where the built and natural environments could co-exist harmoniously,” says Chris Blackshaw, CEO of Century City Property Owners’ Association (CCOPA), the section 21 company responsible for the daily running of Century City. Both goals have seemingly been achieved. “Century City is best described as a city within a city,” adds Blackshaw. “We are at the heart of the greater Cape Town metropole and the city combines office, residential, retail and leisure opportunities on a scale unlike anything else in South Africa or indeed the African continent. “This is an integrated environment that is perfectly tailored to the leisure, work and lifestyle demands of today’s society.” Century City is home to the hugely popular Ratanga Junction theme park and the Canal Walk shopping centre, which is one of the largest regional shopping centres in Africa. “Century City embraces the principles of new urbanism,” Blackshaw says. “The city is sought-
This is an integrated environment that is perfectly tailored to the leisure, work and lifestyle demands of today’s society
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after particularly in terms of corporate South Africa with offices catering for small, medium as well as large users. “Strategically located on the N1 in the heart of the greater Cape Town Metropolitan area, Century City is surrounded by a strong road network giving ease of access to the entire Western Cape region. “There are also a wide range of wonderful amenities in easy walking distance within Century City. “The safe and secure environment that we provide is also a major attraction to our growing community. ” In fact Century City is Cape Town’s largest new combined commercial, retail, residential and leisure precinct. “To stress the point, Century City’s success is down to its central location, its safe and secure environment and its continually evolving infrastructure. We have the new rail station; we have direct access to the N1 highway and are located just 10km from both the Cape Town CBD and the Cape Town
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International Airport. “The retail heart of Century City is Canal Walk Shopping Centre, which attracts in excess of 21 million visitors a year.” When Century City is fully developed, says Blackshaw, it will be almost as large as the Cape Town CBD. It is already home to numerous multinationals like IBM, Liberty Life, Aurecon, PriceWaterhouseCoopers, Mazars and Vodacom. “The CCPOA functions as a mini municipality,” Blackshaw adds. “We are responsible for the management of the Century City Precinct and are committed to the advancement of Century City as a quality development. “The city has grown significantly in recent years; it is really impressive how much it has changed, especially since 2004-05.” As the city has grown so too has the public transport offering available to commuters with no less than 16,000 passengers per day making use of one or other service, Blackshaw says. Public Transport is extremely important to
Century City FEATUrE
the efficient running of Century City, whose transport manager, Aron Pietersen, has the unenviable task of ensuring the smooth interface of the various public transport modes. Fortunately for commuters, he does a great job. Commuter buses and minibus taxis are not permitted on the Century City road network and their operations are restricted to two Public Transport Interchanges. An internal shuttle service is operated and used by around 4000 passengers a day, while formal minibus taxi services to Century City operate from Koeberg, Goodwood, Maitland, Bellville, Mitchell’s Plain, Manenberg, Khayelitsha, Nyanga, Guguletu, Du Noon and various other destinations on the Cape Flats with 6000 commuters using this service daily. Metered taxis are permitted on the Century City road network and commuters also have the choice of the Golden
Arrow Bus Services which operates direct bus services to Century City from Cape Town CBD, Khayelitsha, Nyanga, Killarney, Elsies River, Hanover Park, Atlantis/Mamre and Mitchell’s Plain. “Century City’s public transport offering was boosted considerably last year when the new Century City Railway Station came on stream,” says Blackshaw. “This has proved hugely popular with more than 4200 commuters using the newly constructed pedestrian walkway between Century City and the station on a daily basis. “We are also extremely excited that Century City has been included in Phase 1A rollout of Cape Town’s Bus Rapid Transit System,” he continues, explaining that the ease of private transport to and from Century City from the southern Suburbs will be hugely improved with the completion of the Koeberg Interchange later this year.
There are also a wide range of wonderful amenities in easy walking distance within Century City
EXCITING TIMES AHEAD
Century City, as much as it has grown, is still a work in progress. Already some R16 billion has been invested in the burgeoning City, with new development totalling R11billion in the pipeline. The Rabie Property Group, which holds the rights to all the remaining undeveloped land, has big plans. “Since Rabie came on board in 2004 the development has grown from strength to strength with over 50,000 people now living or working within the precinct,” says Blackshaw. John Chapman, a director of the Rabie Property Group, says Century City has development rights totalling more than 1,25 million square metres of which just over www.southafricamag.com 43
Century City FEATUrE
760,000 square metres has already been built and a further 93,000 square metres is currently under construction or in various stages of planning. “As we stand now the built form comprises around 300,000 square metres of offices, more than 3000 residential front doors and 150,000 square metres of retail as well as numerous leisure facilities including Ratanga Junction and hotels so what you see now is just over half of what this city within a city will constitute when it is fully developed. “There is no doubt Century City has reached critical mass in terms of a mixed use development and is well geared and well structured to take advantage of the economic upturn we see just around the corner. In fact we expect the pace of development to continue gaining momentum as we go forward thanks to the centrality of the location and all the amenities on offer within the integrated precinct.” Chapman says while there was generally a shortage of zoned land in Cape Town, Rabie is in an enviable position of being able to immediately push the button on new development as and when the market dictates. “There are very few if any other areas that can accommodate large corporate requirements for between 5000 and 50,000 square metres of offices, which we can,” he says. “Many of these now demand state-ofthe-art green buildings as is the case with Aurecon whose new regional headquarters are under construction at Century City and which is aiming to become the first four-star rated green building in Cape Town.” While details were not yet available, Chapman says there were also moves afoot to install one of the first open access networks, which will provide the best and fastest voice and broadband services to the people living and working in Century City. “Going forward this will ensure Century City remains at the cutting edge and we are optimistically looking to the future and further growth of our precinct,” concludes Blackshaw. END 44
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GORRIE & FINDLAY AS A RESULT OF THE RECENT RECESSION, THERE HAS BEEN A COMPLETE LACK OF OFFICE SPACE BEING DEVELOPED WITHIN CENTURY CITY, CAPE TOWN’S PRIME OFFICE DEVELOPMENT. IT HAS BEEN CONFIDENTLY PREDICTED THAT, AS A RESULT OF THIS LACK OF CURRENT DEVELOPMENT, THERE WILL BE A CRITICAL SHORTAGE OF OFFICE SQUARE METERS OVER THE NEXT 12 – 24 MONTHS, DURING WHICH TIME GORRIE & FINDLAY’S PARK LANE DEVELOPMENT WILL BECOME AVAILABLE FOR OCCUPATION.
ORBIS Security solutions is the current service provider to the Century City Property Owners Association and is well placed to provide residential, corporate and retail developments an integrated security solution that will complement the existing crime prevention strategy in place at Century City. Our management expertise and existing infrastructure and support mechanisms at Century City has proven results and in many instances give ORBIS a competitive edge over similar service providers.
PROUD SUPPLIERS TO CENTURY CITY DEVELOPMENTS
orbissecurity.co.za | info@orbissecurity.co.za Tel – 021-7623813 | Fax – 021-7629027
TEL: 021 425 4192 WWW.ITALCOTTO.CO.ZA
BUILDING A propErTY
DIJALo’S DrEAMS To BE ACHIEVED
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Dijalo Property Group FEATUrE
Ian Armitage learns that through the merger of two of South Africa’s prominent commercial property companies the dreams of Saul Gumede and Djialo Property Group are set to be achieved.
S
aul Gumede is a very charismatic man. From humble roots, he has helped build an empire: A property empire. The empire’s name? Dijalo Property Group. Now he is preparing to take his business into the next stage through a merger that will create the largest black-controlled JSElisted property fund in South Africa. Gumede is the co-founder of Dipula Property Fund, which is set to merge with another black-controlled property company, Mergence Africa Property Fund. The move will create an entity with property assets valued at about R1.4 billion, Gumede says. It will give Dijalo a huge boost. The property operations of Dipula, including acquisitions, sales, redevelopment, refurbishment, day-to-day management and administration are managed by Dijalo, Gumede says. “The merged entity will be listed on the JSE, allowing it to grow exponentially into the future,” he tells South Africa Magazine. “It will result in increased portfolio diversification and reduce risk. The larger combined fund will generate more sustainable and growing income and the intention is to grow the fund through a highly acquisitive strategy and to take best advantage of our market position.” The merged entity will have exposure across nine provinces with 50 percent retail properties, 25 percent offices and 25 percent industrial properties. Gumede says the merger has a number of advantages. “Dijalo brings many years of
The merged business will be listed on the JSE, allowing it to grow exponentially into the future
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Dijalo Property Group FEATURE
property management experience, while the Mergence team has strong financial and investment banking. Both companies have acquired strong property asset management expertise. The new venture will become a second-tier player among funds with total assets valued at around R10 billion. The likes of Hyprop and Resilient sit in this space. I believe that the new property entity could grow very quickly. The merged business will be listed on the JSE, allowing it to grow exponentially into the future. We are currently negotiating acquisition of two property portfolio totalling R800 million, which will increase our listing value to R2.2 billion on date of listing.” Gumede has come a long way. His property experience took shape in the 1980s when he served as an employee of Old Mutual property division. He left Old Mutual in the 1990s, eventually helping establish Dijalo Property Services. “A partner and I established Dijalo in 1998,” he says. That partner was Hosia Malekane. “What made Dijalo different is that we focused on property management,” Gumede
Dijalo Property Group fast fact The planned merger of Dipula Property Fund and Mergence Africa Property Fund will create a R1.4 billion property portfolio spanning some 320 000 m2 of gross lettable area and serving more than 500 tenants throughout South Africa.
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Saul Gumede – Group CEO
Peter Gray CEO Dijalo Property Management
Mongodi Pitso CEO Dijalo Valuation
Experienced Property Service Provider
in business since 1998
DIJALO PROPERTY GROUP
Property Asset Management Property Management Property Consulting Property Valuation Facilities Management
Sunnyside Office Park 2 Carse O’ Gowrie Road Block D, 6th Floor Parktown 2193 PO Box 2691, Johannesburg, 2001 Tel: (+27 11) 544 2800 Fax: (+27 11) 484 6459 Web: www.dijalo.co.za E-mail: info@dijalo.co.za
Dijalo Property Group FEATUrE
our portfolio consists of property asset management, property management, facilities management, letting and broking, valuation services and property consulting
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says. “My dream was to start the first full service black owned property services company in South Africa. We are a professional total solution’s company, managed by professional property practitioners, each with many years of experience.” Since the establishment of Dijalo in 1998, the company has re-structured and a number of subsidiary companies were formed. The Group of companies is now known as the Dijalo Property Group and consists Dijalo Property Services (Pty) Ltd, Dijalo Facilities Management (Pty) Ltd, Dijalo Property Management (Pty) Ltd, Dijalo Valuation Services (Pty) Ltd, Dijalo Asset Management (Pty) Ltd, Dijalo Investments (Pty) Ltd and, of course, Dipula Property Fund. “Our portfolio consists of property asset management, property management, facilities management, letting and broking,
At Sithole SS we are proud of our partnership of many years with the Dijalo Group and Congratulate them on achieving excellent growth over this period At Sithole SS we grow with our clients
We are SMALL enough to care and BIG enough to cope Our services include : Internal Auditing | Performance Auditing Risk Management and Assessment Corporate Governance Review | Forensic Investigations External Audit & Regulatory Audit | Process Re-Engineering Accounting & Secretarial Services | Business Advisory
Head Office: Johannesburg 150 Commissioner Street 21st Floor, Carlton Building, Johannesburg Phone: +27 11 331 0150 Fax: +27 11 331 0149 Cell : 082-333-3357 Stefaan Sithole Other Offices: Nelspruit +27 13 741 1675 | Welkom +27 57 357 1489
valuation services and property consulting,” says Gumede. “Most property investors do not have the time to manage the physical needs of a property and tenants, including things like collecting rent or maintenance. We have built a solid reputation and grown to be one of the most recognised firms in this area of property services.” According to Gumede, Dijalo came to prominence when it teamed up with JSE-listed Redefine Property Fund, to establish the Dipula Property Fund in 2006. With Gumede holding a majority stake, Dipula saw opportunity in commercial property and grew to a company that had
a portfolio worth around R800million. Few Black partnerships have been concluded in the property sector, and the Dipula transaction is testimony to the fact that Black companies can work together and create considerable opportunities and make a substantial contribution to the South African property sector. “We are now hopeful that the plantation will now grow bigger and faster from the good rains we will be receiving from the JSE,” Gumede concludes. Dijalo comes from a Sotho word, which roughly translates to “plantation”. Dipulatranslates to “good rains”. END
My dream was to start the first full service black owned property services company in South Africa
www.southafricamag.com 51
TECHNO-SAVVY
Dragon OUTPACING
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THE
Tenova Pyromet FEATURE
F China is both a market of opportunity and a powerhouse of increasingly impossible odds. Chris Oertel, Sales and Marketing Director of advanced technology leader Tenova Pyromet tells Colin Chinery that while China is fast catching up on Western expertise, the innovating Johannesburgbased sector leader is focused on staying ahead of the game.
or China this is the Year of the Rabbit, 2012 the turn of the Dragon. But forget cuddly Bunny; it’s the fire and the talons of the perennial Dragon that challenge South African and Western industrialists. Advanced technology for the metal and mining industries is the forte of Johannesburg-based Tenova Pyromet, with R&D and innovation increasingly important in meeting emerging competition in China, says Director of Sales and Marketing Chris Oertel. “We work in China and are constantly having to compete against local companies. And although their technology is way behind ours - from 10 to 30 years - they are gaining experience and knowledge at a rapid rate. In five to 10 years they will be where we are today. “Our main concern is that where we sell equipment into China you could maybe do two or three projects and after that you can expect they will have learnt from our technology and will partially succeed in simulating the technology. In effect you have a small window to sell your existing technology, they then replicate, and you need to have something new or different. It’s impossible to compete with them on a cost basis, you have to keep coming up with new technology.” Tenova Pyromet is a leader in the design and supply of high-capacity electric submergedarc smelting furnaces and complete smelting plants for the production of ferroalloys, base metals, slag cleaning and alloy refining; part of the Tenova Group with 33 companies located throughout the world. Like Pyromet each specialises in a niche area from mining through to final steel production. Tenova in turn is the technology division of the $20 billion turnover Techint Group whose interests span steel production, construction, oil, gas and health care. “At Pyromet we make a lot of use of the other Tenova companies worldwide, making use of their local knowledge. As well as designing we supply equipment and are www.southafricamag.com 53
Tenova Pyromet FEATUrE
involved in project implementation. But at heart we are really a technology company focussed on having the best technology available in the arc furnace sector.” Pyromet started here 25 years ago as Pyromet Technologies and until five years ago when it was bought by Tenova, most business was conducted within South Africa. But backed by Tenova’s financial strength, world-wide net of companies and marketing agents, and manufacturing facilities in China, global work took off dramatically. It was a fortuitous change of direction. About three years ago South Africa was hit by the power crisis and with it limited electricity supply. “Currently there are no major projects happening here and they will only start again in a year or two time when the new power stations are due to come on stream. At present 60-70 percent of our work is international.”
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K&S ELECTRICAL AUTOMATION K&S Electrical Automation was established in September 2000 and is involved with the design, manufacture and supply of Electrical Switchgear and Control Panels The Company’s range of products include Motor Control Centres, Distribution Boards, P.L.C Panels, Containerised MCC’s, Junction Boxes, etc. The company’s main client base includes Tenova-Pyromet, Anglo Platinum, Impala Platinum, Afrisam, PPC, Samancor, Lonmin, Columbus Stainless and D.R.A K&S Electrical Automation complies to SANS 60439-1, which includes: Certification of SANS 1973-1 and 1973-3 Specifications Should you have any interest in our products please do not hesitate to contact us. We look forward in assisting you.
K & S ELECTRICAL AUTOMATION (PTY) LTD REG NO. 2000/005765/07 VAT REG NO. 4250190040
Electrical Switchgear • Control Panels • Control Desks • PLC Panels • Distribution Boards • Field Isolator Stations • Manufacturers • Installation Contractors Safety of Assemblies Compliant to SANS 1973-3 Type Tested Assemblies to SANS 1973-1 WADEVILLE P.O BOX 9243 ELSBURG Tel: (+2711) 914-4285 Fax: (+2711) 914-3934
BOKSBURG Tel: (+2711) 824-0667/2364 Fax: (+2711) 824-2215 1407 M.T van Tonder A.J Atkinson - quotations@kselectrical.co.za 208A Guthrie Road, Wadeville, 1428 Unit 10 Van Dyk Secure Business Park, Cnr Van Dyk & Brakpan Rd, Boksburg East
Pyromet’s last major South African project began three years ago and commissioned twenty one months later; the ASA Metals project 125 km south of Polokwane - the design, fabrication and installation of the two 66-MW ferrochrome furnaces, part of ASA’s expansion project at the Dikolong chrome mine. “Normally in South Africa we would do the complete plant - turnkey projects which have a far bigger value to us. Outside South Africa we rarely undertake turnkey, and instead supply the main furnace technology and equipment.” Two furnace upgrade projects in Brazil have just been completed, and current projects include Australia, South Korea, India – a total of 16 furnaces – USA and Russia. “At present there’s an opportunity for us in China. In the past they’ve had mostly small furnaces - smaller than 16MVA - but now they are looking at big furnaces four or five times that size. This is new to them so they are turning to Western technology. But even here they are limiting our scope as much as
possible. And once we’ve supplied a couple of those projects the local competitors will be undertaking the work themselves. “In five to 10 years our competitors within China will probably become our competitors outside of China as well. So as I say, we’ve got to keep coming up with new technologies all the time. And with the focus on reducing energy consumption there are a lot of opportunities, and we need to develop into them and be ahead of the game.” South Africa’s skills shortage is not a serious issue. “On the plus side, the mining and smelting industries are quite big in South Africa so there’s a sizeable pool of experienced people we can draw from. On the downside demand has meant that salaries have gone up quite a lot and are now easily on a par with salaries in Europe and the US. You can get people but you need to pay a competitive salary. Previously South Africa has been competitive in terms of the labour market, a big factor when you are competing against www.southafricamag.com 55
Tenova Pyromet FEATUrE
We are constantly looking at new technology we can develop
countries in the East where engineers are generally paid a lot less.” Oertel, 46, accepts that Pyromet cannot compete on a cost basis against China, Korea, and India.” It’s just impossible because they come out with ridiculous prices. So our main challenge is reducing costs to be competitive against our peers in the West. And we are succeeding in this, landing a lot of projects, supplying good technology and being more competitive than other Western companies.” And here the Chinese Dragon throws up a paradox. Since a large part of project costs are related to the supply of equipment, Pyromet is benefiting from the large manufacturing facility established in China by Tenova some 10 years ago. “We export all over the world manufacturing out of China and yes this gives us an edge. “But the point about China is that if you don’t manage the quality you don’t get it. And the 56
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quality produced by competitors in China is quite unacceptable to the West. Their manufacturing is cheaper than our Chinese manufacturing, but we manage the quality and so we can export to Europe, Australia, the US and South Africa.” A secondary challenge is technologyrelated. “We are constantly looking at new technology we can develop and then take through to industrial scale. There’s a lot of scope for development. Ideally you need to get a willing client who’s interested in the new technology and wants to work with you to develop it, or is prepared to put up the first plant. And that’s a big step.” Meantime Chris Oertel sees significant potential growth in the base metals sector. “It’s an area in which we’ve been active but where we don’t have a big market. In ferro alloys we have a big market share, we are well known and have a big reference list. But on the base metals side – copper, the
platinum group metals, nickel – there’s a lot of potential growth and we want to increase market share. It’s an area we are focusing on. In the platinum group metals we are well established due to our successful past and current projects in the SA PGM industry” Tenova Pyromet’s prime market identity he says, owes much to a reputation for flexibility. “Many of our clients want to have an input into the project: they have plants, experience and want to have their say in the design, plant layout etc. “So when we approach a new project it’s never just a design that we take out the bottom draw, but each project unique because of client input. We are prepared to incorporate our client’s learnings with ours and come up with a solution they buy into as well, as opposed to saying, ’this is what we sell off the shelf and there’s not much you can do to change it.’ Our whole ethos is based on customer focus, meeting customer needs, outstanding quality and continuous improvement.” END
‘BUILDING YOUR WORLD’
Rainbow Construction is a dynamic, highly skilled black-empowered construction company. Established in 1995 the company has grown steadily over the years with the aim of developing a strong skills, plant and financial resource base to equip it for a broad range of construction contracts. 53A Andries Street, Wynberg, 2090 PO Box 578, Bergviel, Gauteng, RSA, 2012 Tel: 011 887 6609 | Fax: 011 887 7939 www.rainbowcon.co.za
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machines t o y o u r South Africa Magazine casts its eye over Fermel Mining (Pty) Ltd a leading provider of mining machinery and equipment.
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Fermel Mining (Pty) Ltd FEATUrE
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stablished in 1962, Fermel (Pty) Ltd, a manufacturer of underground trackless and rail bound equipment, has established itself as a leading player in the mechanising machinery industry. The company has twice won the Cullinan Design of the Year Award for its products, has achieved ISO 9000 accreditation with Lloyd’s of London, and has an extensive list of designs and products to its name. Founded by Giorgio Iovino, and originally called Impala Engineering Works, the business started life as a general engineering machine shop. 1977 marked a change in focus; it transformed from a service-based business into a manufacturer, which offered a full suite of equipment, ranging from coal, personnel transportation, multi-purpose vehicles and production equipment. Angelo Iovino, Operations Director at Fermel explains: “We have an intimate understanding of mining conditions and are able to come up with solutions which meet the requirements of the users.” The product range is diverse and impressive, aimed at continually producing quality products, measured by their operational capability and quality of build. Behind each Fermel product is a strong team of engineers and draughtsman, which endorse the company’s cornerstone of R&D, Angelo says. The key to Fermel’s design philosophy is its use of the modular format, Angelo adds. The company understands that operations differ in terms of their requirements and is therefore
our aim is to continue to produce quality products measured by their operational capability and quality of build
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Fermel Mining (Pty) Ltd FEATURE
able to package solutions competitively, yet retaining the flexibility of customisation. Fermel’s manufacturing operations are divided across three specific facilities, consisting of product assembly lines, machine tooling shop, electric and hydraulic workshops, production stores and aftermarket inventory warehouses. Focusing on the industrialisation of the building process Fermel ensures the maximisation of productivity and product quality throughout manufacturing. In this same vein of continuous improvement, skills development and continuous learning are hallmarks of its HR philosophy. “We believe our human resources are our DNA and hence our most valued asset,” the company says. “We’re in a niche market and as such we require diverse and unique skills
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throughout our operations. Attracting new and developing in-house skills is ongoing and runs in synchronisation with our growth strategies. As an employer we look to create employment opportunities within the local communities in the geographical areas of the respective operations.” With permanent representation in Zambia and Botswana, Fermel is able to focus on the sales, distribution and support of its products in the region. The creation of a registered subsidiary in these countries follows the company’s commitment to organic and sustainable growth in new markets, Fermel says. “Client confidence with our ability to provide levels of service commensurate with their requirements will be the key objective for our fledgling operation,” Angelo adds.
meisterfab.co.za
Fermel has undertaken extensive work in conjunction with the inspectorate of the Department of Minerals and Resources to include new innovative features in braking systems of trackless equipment, resulting in the safe stop of vehicles. Although the company complies with the ruling SANS 1589, it has subsequently trademarked the SLD™ and SBI ™ acronyms for the Speed Limiting Device and Speed Brake Interlock, respectively. Fermel is the only Original Equipment Manufacturer to have successfully designed and tested, including third-party verification, these functions on its machines; equipping all current machine builds with this technology. South Africa Magazine is sure the company will definitely keep its finger on the pulse in the future. END
Tel: 011 865-3785 Fax: 086 648 4000 Email: meisterfab@polka.co.za Unit A11, Metropolitan Park Bevan Road, Roodekop Industrial (Wadeville Ext 14)
Welding Services Plate Rolling Machining Cutting Cones Stands Stairs Shelving Prototypes Platforms Pipe Fabrication Gaurds Fans Ducting Brackets Buckets Scissor lifts Crane Booms Baskets Personnel Carriers
STANDER UNDERGROUND ROADS Axiom Hydraulics is proud to be a Supplier of selected High Quality Hydraulic Products to FERMEL
Sole distributer for:
One of Axiom’s primary strengths lies in our ability to produce complete solutions for any hydraulics requirement for any industry, as well as our ability to offer a variety of mechanical solutions.
We have a Horse and trailer, transportation of heavy machinery/ vehicles anywhere in the country. One man business. Owner drives his own truck.
17 Heidelberg Road, Village Main, Johannesburg axiomjhb@mweb.co.za | +27-011-334-3068/86 www.axiom.org.za
Contact: Fanus Stander Cell: 082 454 2696 | e-mail: joy.stander@gmail.com P.O.Box 25037, Eastrand Mall, 1462
resilient Franchising big draw for ASPIRATIONAL SoUTH AFrICA A franchise is essentially a replica of an existing business and the right franchise can provide a measure of security often missing from new ventures. But it’s not roses all the way, and with its large and increasing appeal to enterprising South Africans, Vera Valasis, and Executive Director of sector association association FASA talks to Colin Chinery.
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he news that Cyril Ramaphosa, one of the country’s most prominent and politically connected businessmen, is taking over SA’s McDonald’s restaurants, throws a spotlight on the franchise sector that employs half a million people in South Africa. The former union leader and ANC general secretary during the constitutional negotiations that ended apartheid in 1994 has gone on to found an investment empire with interests including a power plant, a Coca-Cola bottler and mines. 62
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FOCUS Fasa
Crowd at MCDLR
Chairman of leading black-owned and managed investment company the Shanduka Group, Ramaphosa is paying for a 20-year master franchise agreement to run all 145 McDonald’s restaurants in South Africa. Unlike a conventional franchisee, development licensee Ramaphosa will own all the assets, including owning or leasing the real estate. “There’s no one in South Africa more qualified to get the DL than Cyril. His experience, track record, values, and community involvement speak volumes,” says Dave Murphy, divisional president of McDonald’s Asia-Pacific, Middle East and Africa. His enthusiasm is shared by Vera Valasis, Executive Director of the Franchise Association of South Africa (FASA) “We are very excited about the acquisition. Cyril is a fantastic businessman with a very good track record.” A recent research report sows that franchising is contributing 11.8 percent (R287.5 billion) annually to South Africa’s GDP. It is a proven business model – 29,204 outlets under 551 systems at the close of February 2010 - presenting many opportunities for entrepreneurs to grow with minimum investment, security of investment, and returns. The biggest franchising sector is petroleum
- forecourt retail offering makes it a popular attraction - followed by retail fast food and restaurants. Currently there is good growth in the home-based education sector – additional to formal schooling provision - with home care (for the terminally ill for example) among the latest entrants. “This is something we haven’t seen before. Whether it will take off I’m not sure because it’s still very new,” says Valasis. Based at Bedfordview, Johannesburg, FASA’s primary role is to define franchising while ensuring all parties adhere to internationallyaccepted business principles. Another is to promote the advantages of franchising business to entrepreneurs, prospective franchisees and to the public at large. Traditionally, FASA members make a voluntary commitment to abide by the ethical standards laid down by FASA and the international franchise world, but new legislation sees a decisive toughening up. Up to now the industry has been unregulated, and the worst a member who had transgressed FASA’s code of ethics could face was expulsion. But with the Consumer Protection Act that came into force this month (April) all franchise companies must comply with its terms or face fines. “We’ve been working with the www.southafricamag.com 63
Government for the past four years, and very much welcome this protection.” Ethical violation has been an issue outside the FASA fold, says Valasis. “And these people have given the entire industry a bad name. Some would sell a franchise and then vanish overnight with the potential franchisee’s funds to Australia or some other destination. And these kinds of incidents have happened quite frequently in recent years.” Valasis is the first woman Executive Director in FASA’s history. Her experience in franchising spans over 20 years from her early days managing restaurants and in retailing, to holding the position of Managing Director for leading brands Milky Lane and Juicy Lucy under the Pleasure Foods banner, and more recently as MD of Debonairs for Famous Brands. Set against the recessionary backdrop, she says South African franchising “somehow manages to hold its own. If you look at the sector’s contribution over the last couple of years it has waned a little but we haven’t seen a major fall-out.” If commitment and adequate funding are among the givens for running a successful franchise, Valasis adds another; a strong emphasis on attention to detail. “A question often asked within many successful businesses is why one franchisee is so much more successful than another. There will be similar personal traits, equally fantastic locations and good staff, but the one doesn’t deliver the same sales turnover as the other. And the answer every single time is that the successful person is pedantic about every detail. And this is absolutely crucial in our business. An employee might not have that same level of attention to detail but as a business owner this is an imperative. It makes the difference between success and failure.” Entrepreneurs beware however. “Such people are temperamentally averse to the cookie cutter approach and find it hard to apply themselves to a business model. And it is this that is required to make a success of a business 64
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originally conceived by the owner. It’s crucial that franchisees implement the business model in its entirety, but not everyone is cut out for that restricted environment.” Switching hats, a potential franchisor should first analyse whether a business is franchisable. “And if so what are the barriers to entry? There are many businesses that are franchisable but have very low barriers to entry. In this case growth potential will be difficult because potential and existing franchisees look at the model and copy it. “The other issue to consider is the high cost of supporting a franchise system. You have to employ top notch staff, pay them well, and willing and able to support your franchisees. Many potential franchisors do not understand that this is probably going to be the biggest single investment they have to make in the business.” Companies have different views about franchises. Grocery chain Spar and restaurant company, Famous Brands do not have any corporate-owned stores and work only with franchisees, while Pick n Pay and Shoprite have more corporate stores than franchises. The high take-up of franchises in South Africa
FOCUS Fasa
Seminar session
is said to be due in part to poor education levels, with companies struggling to find high-quality managers. “It’s certainly an issue. Many franchisees battle with this especially when it comes to senior managers.” Entry stakes are rising too. “After 2008 we’ve seen many of the franchisors are now placing their financing requirements at a higher level. Up till then - and depending on your profile - personal funding injection might have been 40 percent. Now it’s up to 50 percent. This has made things more difficult of course, but one can understand why these new requirements have been put in place.” Funding access - or lack of it - is a major issue. “I’m passionate about the funding issue. The Government says we need to create jobs and upskill people but what the funding agencies and media are saying - and what is happening on the ground - are two different stories. “We are getting enquiries from prospective franchisees on a very regular basis saying they have approached various Government funding agencies, and they are not getting a response, are being rejected, having to wait six months for
an answer, or told the budget has run out. It’s all hugely frustrating for young Black people coming up and who are excited about the opportunities. It’s a very big dampener of the growth and future of the industry.” Despite these frustrations, franchising remains a catalyst for growth in South Africa. “Very much so. Many of the corporates who over the years took the franchise route have been blown away by the performance of those franchised stores. By putting franchisees in those businesses they saw a 20 percent – 30 percent growth. When they were companyowned outlets they could not have achieved those figures. “Franchising is a very sound and reliable business model with a very successful track record here as all over the world. It has shown that despite the recession the industry can and does hold itself well during hard times and you can’t say that about many sectors. “The proof of the pudding is there. If your business is placed well in terms of funding and location it will continue to grow. I strongly believe there’s a great future for franchising in South Africa.”END www.southafricamag.com 65
all
Food Solutions for
Europa is the chameleon of food franchises, serving good food all day to the ravenous and the peckish alike. Now the company’s new brand, Europa Express, has the lunchtime desk-diner in its sights.
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Europa FASA
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uropa, part of the Antimo Foods group, is one of the premier food retail organisations in South Africa. The original Europa Delicatessen was opened in Orange Grove, Johannesburg, in 1986. It soon became a franchise operation, known as Europa Food Emporium, opening delicatessen-cafés around the country and later moved into the restaurant business. Most recently, the company has started a new venture, Europa Express, which provides quality take-away food to people on the go. In the 10 years after the founding of the first delicatessen it became apparent that in order for the business to succeed it needed to change. “In most of the locations where we were trading we found that, in order to become viable, we needed to be able to trade at night,” says Marketing Director Gerry Thomas. It was this that led the business to establish the first Europa restaurant in 1997. “We had been perceived as a daytime coffee shop operation – not somewhere you would go of an evening. So we altered the menu and the aesthetics of the premises to accommodate night trade.” Accommodate being the key word – Europa didn’t abandon its daytime crowd, it supplemented it with the evening trade. The restaurants serve a range of Europeaninfluenced breakfasts and remain open throughout the day for customers looking for a light lunch or full dinner. The concept has been such a success that there are 25 Europa outlets throughout Southern Africa and counting. In 2006, having experienced such success with its restaurant business, the company decided to launch a new brand – Europa Express. These outlets are, as Thomas describes it ‘convenience in corporate environments’ – that is to say they target captive markets in business districts. “Europa
The Europa name means fresh food made to high standards
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Europa FASA
OMNI CATERING Over the last 10 years Omni Catering Equipment Manufacturer’s and Europa Food Emporium have developed a strong relationship and worked closely to build the food preparation, cooking area and front of house to Europa’s exacting standards. This time has enabled Omni to understand and appreciate the core business needs of Europa. This relationship has developed to such a level that the two companies have teamed together on Europa’s latest coffee venture to specification build a coffee shop within the tightest space limitations without foregoing the quality of the Europa offering. Designed and built completely within Omni’s factory we have been able to identify the key elements required within Europa’s new franchise and deliver a solution that will enable each shop to fulfill it’s full profit potential. We look forward to another 100 years of growth.
Express stores provide quick, on the go food to people who don’t have time for a sit-down meal,” he explains. All items are sold in take-away packaging, speeding up the sales process for cashier and customer but, despite this emphasis on rapidity, quality is still the number one priority. “The Europa name means fresh food made to high standards, which applies as much to Europa Express as it does to the rest of Europa.” This venture, which has seen a new store open every year since its introduction, has given the organisation a greater versatility in a competitive market. Europa Express is a different approach for the enterprise and it’s a different type of customer who comes in. While Europa bistros aim to attract passing trade and act as a destination, Europa Express shops are deliberately situated to attract workers who are short on time but still want good food. The whole of the Europa business works on a franchise basis, with strict criteria surrounding the franchisee selection process. The owners of the shop or restaurant need to understand the Europa brand and philosophy 68
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and to do that, they need experience. “We look for people who know the food and hospitality business and who are going to be hands-on operators,” says Thomas. “It is also essential that they have the necessary funding or financial backing to open the franchise.” In order to ensure that customers experience a uniformly high standard of service at all of its outlets, Europa ensures that all its staff are well trained. “All our training is done on the job, with an emphasis on practical skills,” Thomas explains. “Training obviously varies by position – the training a manager receives will not be the same as someone who is in a customer facing role. Similarly those working in the kitchen get their own training.” Another factor in ensuring that the Europa experience is the same everywhere is strong supply chain management. The company divides the items that franchisees will need to purchase into three categories – Europa branded, generic brand and unbranded. “The first category is probably the most stringent: These are branded items that the franchise is obliged to carry and are only available from
Europa FASA
suppliers that we have nominated,” Thomas says. “The second are other well known brands that you would expect to find in any food outlet. The shop or restaurant is obliged to sell these products, but is able to source them from whichever supplier they believe to be the best. ‘Unbranded’ means items that we can specify are used by the franchise but have no ‘label’ to them – this would mainly cover fresh produce.” By managing its supply chain in this way, the organisation is able to maximise its own brand recognition across all outlets. It also ensures that no matter where a consumer or orders his or her food, it will always be made with the same ingredients to the same recipe. As all Europa and Europa Express outlets serve European-themed food, it will come as little surprise to find out that much of the produce used in the recipes comes from Italy. While this doesn’t present a particular opportunity for ethical development, there is
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one area that does – coffee. “We are in the process of developing our coffee blend and moving into a position where all the coffee we sell will be fair trade. That is our biggest initiative at the moment. However we also work on a site specific basis with landlords – if they have a specific requirement regarding recycling or sourcing, we can work with them to accommodate that.” In terms of the future, Thomas believes that the world is Europa’s oyster, particularly when it comes to Europa Express. “Growth is, naturally, the main objective. We have the strength of the Europa brand behind us, even though it’s a different entity entirely, but that helps us get into different environments where Europa would not normally compete. We want to capitalise on that and turn Europa Express into a sought after brand too for prospective franchisees and landlords. Once we have established that, the growth should be organic from there.” END
DESIGN FEATURES The Grand is a modern top-of-the-range light twin helicopter developed to meet a wide range of market requirements and provides levels of cabin space and payload that until now could only be met by larger, more expensive helicopters. it is unique in its category. AgustaWestland is committed to providing the marketplace with a modern, comprehensive commercial product line, ranging from single-engine to heavy multi-engine helicopters. This modern cost-effective light twin fits as a natural addition to the product line, at the upper end of the light twin FAr/JAr 27 segment. AgustaWestland is now offering the market the GrandNew, an evolution of the Grand model featuring the very latest developments in avionics while retaining the outstanding Grand’s characteristics, its superior performance, levels of cabin space and payload provided by larger and more expensive helicopters, low operating costs and high safety and environment friendliness standards.
One of the Grand’s most acclaimed features is its superior performance with a maximum cruise speed of 155 kts (287 km/h), a maximum range of 432 nautical miles (800 km) and an endurance of over 4h. This adds to its ample and unobstructed passenger cabin, advanced avionics and high safety level, low operating costs and excellent customer support. Its two Pratt & Whitney PW207C turboshaft engines provided with electronic control (FADEC) ensure a full Cat. A/Class 1 capability. The Grand is also fitted with main and tail rotors composite material blades generating reduced noise level proving well under ICAO limit. Its state-of-the-art avionics includes cockpit LCD displays, a three-axis duplex autopilot and enables to single/ dual pilot IFR operations. All reduces pilot workload. The cocoon-type airframe is fitted with crash resistant fuel system and crash resistant pilot and passenger seats to further enhance overall safety. An attractive Warranty Policy and, alternatively, availability of competitive “Pay-by-the-hour” spare parts support programmes ensure optimum operating cost control.
CUSTOMERS
For more information please contact: Tel: +39 0331 229935 Fax: +39 0331 229287
www.agustawestland.com
Orders for more than 290 Grand and GrandNew helicopters have been placed by almost 170 customers in over 30 countries worldwide, in order to perform several tasks including VIP/corporate transport, EMS, SAR and HPS. The Grand has achieved a remarkable success particularly in Europe and in the Central and South America and its presence is rapidly expanding in North America, Asia and Australasia as well as Africa and the Middle East. www.southafricamag.com 71
tECHNoLoGY
D r i V EN M A r k E T
L E A D E r
Multi Construction Chemicals (Pty) Ltd is a technology driven company focusing on the construction and mining industries.
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Multi Construction Chemicals FEATUrE
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ulti Construction Chemicals (Pty) Ltd is a technology driven company focusing on the construction and mining industries. The company obtains its raw materials from local and international sources, giving it the capability to develop cost effective, tailor made solutions for local conditions. A source at the Alrode-based company told South Africa Magazine that Multi Construction Chemicals provides “chemicals that enhance the performance of concrete, working heavily in the mining industry to strengthen shafts and on construction across SA.” He added: “We have worked heavily on World Cup projects and road construction with SANRAL.” FIFA’s infrastructure requirements for hosting the 2010 World Cup in South Africa resulted in unprecedented growth in the construction industry. Most of these projects are now long finished or nearing completion, including the massive Gauteng Freeway Improvement Project and the O R Tambo-Sandton route of the Gautrain. The construction upswing saw a marked increase in road infrastructure tenders from SANRAL, while tenders from the other roads authorities were scarce. Price wars ensued to secure contracts and speculations abounded about a post-2010 decrease in infrastructure spend. This impacted negatively on profitability and particularly the smaller consultants and contractors battled to survive. Of course, those worried about a decrease in infrastructure spend following the World Cup were right. Today big construction work seems to have dried up. But, despite the slow pace of economic recovery to date, many leading global engineering and construction (E&C) companies have a somewhat bullish
We have worked heavily on World Cup projects and road construction with SANrAL
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Multi Construction Chemicals FEATUrE
outlook for 2011, according to findings from the KPMG. Having repositioned their businesses during the downturn with sustainable models better suited to manage risk and expand into new markets and services, these firms are leaner, stronger, and more strategic, KPMG International says. South Africans may not agree. Many of the large infrastructure projects are yet to gain momentum and, with long lead times, it is unlikely that 2011 will show an improvement. That’s the case so far at least. Indeed there has been slow pickup with new projects after the Soccer World Cup and there has most certainly been a “World Cup hangover”. 74
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All products have been tested and applied through research and development in order to establish Multi Construction Chemicals (pty) Ltd as one of the forerunners in its field
Multi Construction Chemicals (Pty) Ltd is a diverse company, though. It manufactures a large range of products including mining products for underground and surface applications, waterproofing membranes (cementitious acrylic and bitumen emulsion coatings), aerated foams for void filling and ventilation walls, low density aerated motars, epoxy screeds, coatings, adhesives and grouts, non shrink cementitious grouts, metallic and natural aggregate floor hardeners, admixtures for concrete, concrete maintenance and repair products, concrete curing and shutter
Premier Packaging (Pty)Ltd suPPLy a range of Packaging Products. Packaging products include: • Plastic Bottles • PET & PVC Bottles & Jars • Jars & Drums • Bettix & Agri Bottles • Cups & Tubs • PVC Containers • Plastic Buckets • Tablet Vitamin Containers • Detergent Bottles • Steel Drums and Paint Tins It was our opinion that the client, big or small, should be able to purchase his goods, no matter what quantity and receive equal fast service. With this objective in mind we established a service whereby the customer can order whatever quantity he wants from our wide range of stock items and receive them within 48 hours.
Tel: +27 11 397- 3532 / 3 / 4 | Fax: +27 11 397-5021 49 Rudo Nell Street, Hughes Ext. 5, Boksburg, South Africa. P O Box 13214, Witfield, 1467. Email: terri@prempack.co.za | peter@prempack.co.za
release agents, tiling adhesives, grouts and bonding/priming liquids and PVC waterstop for water retaining structures, as well as many other speciality lines. “Multi Construction Chemicals (Pty) Ltd has its own manufacturing plant and all products comply with the stringent quality assurance programmes required by the South African Bureau of Standards,” the company says. “All products have been tested and applied through research and development in order to establish Multi Construction Chemicals (Pty) Ltd as one of the forerunners in its field.” Multi Construction Chemicals (Pty) Ltd is a technology-driven company. It focuses on the construction and mining industries and has been manufacturing and supplying South Africa’s major growth industries for nearly two decades with products, technical experience and service. It has its own local research and development centre, physical concrete testing laboratory, comprehensive manufacturing
facilities and quality assurance programmes, all backed by highly motivated employees. Its mission is to find new and innovative solutions for the local and international construction and mining industries. “We were found in May 1986,” says sales director Clive Hamman. The firm has four branches - Alrode, KZN Pinetown, Cape Town, Polokwane, he adds. Training is very important to Multi Construction Chemicals (Pty) Ltd and it offers ABET training programmes, in-house training (training facilities on site) and Aids awareness training through a company registered sister. According to www.topco.co.za all production and testing programmes comply with the local and international testing standards and its products are guaranteed when used in accordance with correct product application and instruction procedures. Multi Construction Chemicals (Pty) Ltd was rated as one of the Top 300 Companies in 2004 and 2005. END www.southafricamag.com 75
Driven, determined, capable
Dana is a world leader in the supply of axles, driveshafts, and structural, sealing, and thermal-management products, as well as genuine service parts. It has one facility in South Africa. It’s name? Spicer Axle.
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ocused on the design, manufacture and assembly of driveline products, Dana Holding Corporation’s Spicer Axle South Africa plays an important role in South Africa’s automotive industry. The component manufacturer, renowned for producing high quality driving axles and prop shafts for light commercial vehicles, is known internationally for its technological sophistication, expertise and flexibility. “We are suppliers of OE as well as P&A and aftermarket/replacement components,” a source at the company tells South Africa Magazine. Formed in 1967, Spicer Axle South Africa builds on a long tradition of being able to manufacture products quickly and economically, meeting high global quality and supply reliability standards. Originally, the firm focused on the passenger car market. But, with time, markets have changed, and it has diversified; amending the product range to suit the needs of the OEMs it serves. After some digging, South Africa Magazine discovered that the operations in South Africa were formed when axle design and manufacturing skills were transferred to South Africa from operations in Australia. It was a mixed and complicated early history and the firm was part of several different organisations, including BTR Automotive. In 2000, the South African facility was
Dana’s customer base includes virtually every major vehicle and engine manufacturer in the global automotive, commercial vehicle, and off-highway markets
IMAGES: Copyright© 2010 Dana Limited
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transferred to the Spicer Light Axle Division and it is now part of the worldwide Dana Corporation, which is headquartered in Maumee, Ohio, USA. “We have become a global company in becoming part of Dana,” our source continues. “That has been vital. So, we are global and diverse – and it is a good mixture.” Spicer Axle South Africa is as focused on the design, manufacture and assembly of automotive axle
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Dana is a world leader in the supply of axles, driveshafts, and structural, sealing, and thermalmanagement products, as well as genuine service parts
products. It utilises inventor software to ensure new designs are created accurately and quickly. Models can be used for rapid prototyping and for the generation of tooling. Spicer Axle South Africa is a leader in the supply of axles. It is also capable of supplying driveshafts, as well as genuine service parts. It is an extremely competitive offering. “Dana is a world leader in the supply of axles, driveshafts, and structural, sealing, and thermalmanagement products, as well as genuine service parts,” our source adds.
Spicer Axle South Africa FEATURE
Dana’s customer base includes virtually every major vehicle and engine manufacturer in the global automotive, commercial vehicle, and off-highway markets. The Ohio-based company’s continuing operations employs approximately 24,000 people in 26 countries and reported 2009 sales of $5.2 billion. Of course, the auto industry is a highly concentrated one, with roughly 10 global automakers accounting for over 77 percent of total production worldwide. The economic downturn provided the impetus for a massive structural change in the auto industry, laying the foundations for future growth. To remain competitive in the future, automakers will need to design vehicles that meet the requirements of consumers in both mature and emerging markets.
Spicer® Off-Highway PSR08 Transmission, Spicer® OffHighway Driveshafts and Dana Spicer Torsionally Tuned-40 Tandem Drive Axle. IMAGES: Copyright© 2010 Dana Limited
Automakers will focus on more userfriendly and low-cost vehicles that are technologically advanced. They have shifted their production facilities from high-cost regions such as North America and the European Union to lower-cost regions such as China or India. There are two underlying factors behind this shift. The first is cost. The cost of labour in emerging auto markets continues to be a fraction of that in the developed world. The second is demand. Many low-cost regions have high potential for growth. Since 1999, more than 20 of the largest global auto parts suppliers have filed for bankruptcy. Yes, the market is improving, but the financial condition of the majority of auto market suppliers continues to remain weak. For more information visit www.dana.com. END
FirE IN THE LINE oF
Durban has the highest fire risk profile of any South African city, and a metropolitan area that reaches from industrial concentration to the remote and sparse. Fire Chief Mark te Water tells Colin Chinery the challenges can be complex.
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eThekwini Fire And Emergency Services Unit FEATUrE
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revention says Mark te Water, is always better than containment. No one knows this more than Te Water, Chief of the busiest Fire Department in South Africa – eThkwini (Durban). “In this country we probably over-emphasise the reactive and response function of the fire services to the detriment of the preventative. And I’m a firm believer in our role of preventing fires.” Durban’s fire risk profile is the highest of any city in South Africa for reasons clear to the eye. Its port is the busiest on the Continent, the container facility the largest, and Durban’s harbour serves the industrial hub of Gauteng. Across the water are the massive Island View oil and petroleum complex and the Maydon Wharf sugar terminal, one of the biggest of its kind in the world. And within the 2,300 sq k, 3.5 million population metropolitan area served by the Department are two airports, a substantial industrial sector and a large rural area with grass fire potential. “Most metropolitan areas are densely populated, but a large proportion of our area is rural which makes it rather unique,” says Te Water. “We range from the Class A Fire Risk densely populated areas of the city to Class D rural where you’d probably find one person to a sq k.” Deployed against incident and risk are 1,000 staff including 450 frontline fire fighters, 19 stations, 32 rescue pumping appliances - the standard fire engine carrying a crew of an officer and four fire fighters - a fleet of pump-equipped water-carrying appliances, five aerial ladder hydraulic platforms, two breathing apparatus tenders, two hazardous material and chemical incident units and one heavy rescue vehicle.
I’m a firm believer in our role of preventing fires
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eThekwini Fire And Emergency Services Unit FEATURE
“We have analysed our fire risk profile and are looking at building additional stations to reduce the percentage of people who are deprived of services. When I say deprived I am not saying there is no service but that it takes longer than 23 minutes to reach them - to all intents and purposes they are outside our response area. And given the cost of operating a fire station - typically R6-7m – the risk in itself does not make this a sustainable investment. We need to look at alternative means to provide a level of service to people living there.” Where rural meets urban, informal settlements or squatter camps pose major operational challenges and hazards. “People flock to the cities looking for work and live in abject poverty under plastic and corrugated iron or wattle and mud structures. These areas are without any form of infrastructure and it makes our lives very difficult. If there is one area where we experience the greatest loss of individual life in fires I would say it is here in the informal settlements. “It’s very difficult to get an appliance to where it’s needed. There is scant road infrastructure and in most cases no water provision, with 1.8 metre pit latrines all over the place and construction materials that are significantly combustible. Then there are people who ‘borrow’ electricity from the council without the intention of paying for it who have set up cables attached to overhead lines and run them along the ground. As a result many children are electrocuted. Sometimes firemen have to disconnect these cables and in so doing put their own lives at risk of physical attack.” Several years ago members of the Health, Safety and Social Services Committee ordered the Fire Department to report back after hearing there were times when only two fire fighters were manning a station. “At the time we were faced with a number of issues, not the least a change in labour legislation forcing us to move from a 56 hour three-shift working system to a 42 hour four-shift system. This implies an additional 25 percent staff allocation 82
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Heavy Duty Telescopic Bronto Skyflift HDT is a true aerial platform for the world’s fire departments. Fire Departments and other users in over 100 countries have selected one of the reliable and versatile aerials in the HDT range. HDT units range from 32 - 55 meters. Bronto aerial ladder platform’s compact structure allows it to reach its destination easily - with a 0-tail swing and up-and-over capability the unit is a real workhorse to fire brigades.
A full equipped rescue cage, a high-capacity stainless-steel water way, safe ladders - everything essential is always onboard. Typical accessories that are available in the cage include powerful floodlights, a cutting extinguisher, a rescue chute, double monitors for efficient fire fighting, power outlets for electricity, compressed air and hydraulic pressure for tools and a breathing air outlet for safer rescue and fire fighting. Fire Raiders and Bronto Skylift is proud to be associated with eThekwini Metro.
FIRE RAIDERS (PTY) LTD
2 Top Road, Anderbolt, Boksburg Tel: 011 894 3205 E-mail: info@fireraiders.co.za Web: www.fireraiders.co.za
eThekwini Fire And Emergency Services Unit FEATUrE
and a commensurate budget to go with that. “We had to shake out our 56 hour week work across four platoons without a material increase in staff. We then had a decision to make: did we close fire stations and continue to man the open fire stations with 100 percent crew levels or levels that conformed to norms and standards? Or did we reduce crewing levels at stations without a relatively high risk profile, and at least keep them open? “We took this second route. All our stations were kept open, with levels at the high risk stations kept up. At some we went down to two fire fighters on a water carrying appliance on the understanding that they were medically trained. And in a motor vehicle accident for example they would be quickly on the scene and make headway while awaiting backup from the nearest station. “Over a three year period we
were allocated funds to increase our resources and this helped significantly, and most of the stations have been brought back to what we call rescue pump stations - those where a rescue tender or pumping appliance is based.” Te Winter’s actual strength is far below the authorised; latest figures showing as well as 450 fire fighters, 80 ‘response’ officers in the operational sector, along with those in the training and fire safety branches and the administrative and technical support services. More than 30 Durban fire fighters are women. Impressive, yet compliance with affirmative gender legislation can have operational repercussions. “It’s one thing to have sufficient numbers of females, and quite another to recruit females able to carry people weighing 100 kilogram’s such as myself down a ladder. So it’s a very difficult
Most metropolitan areas are densely populated, but a large proportion of our area is rural which makes it rather unique
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thing to balance the national imperative for gender equity with the internal departmental requirement for people who at the end of the day are able to do the job. Camaraderie or esprit de corps is critical where dependence on other members of the crew is high.” 50 people die in fire incidents in the Durban area in an average year. Sometimes it can be as high as 90. But in South Africa the death-shock threshold is high says Mark Te Winter.” We have a relatively high incidence of life loss on our roads, a higher than average crime rate, one of the highest incidents of HIV infection in the world, and all this tends to taint one’s risk appetite. “So when people hear that sixty people die in fires each year they are likely to comment that thousands are dying on our roads each year, so is fire really a significant priority? Risk appetite is high, people tend to live with risk and absorb it.” END
UnQondo Projects is a specialist Fire Fighting Equipment Company based Johannesburg, Gauteng with regional office in KZN, Eastern and Western Cape. The company is full BEE compliant iro ownership and management. High Quality products are supplied from their International Network of associates in Europe, USA, UK and several other parts of the globe. UnQondo is constantly searching the market for new trends, products and services. After sales service and support is guaranteed as a prerequisite from the Brands they represent. Full workshop facilities are available for all repairs, servicing and maintenance of the equipment supplied. A laboratory is also available for foam tests and evaluation. Custom made products for the local market essentially for rural / wetland fire fighting is entertained. These includes Fire fighting trailers, Skid units, etc PO Box 10077, Vorna Valley, 1686, Gauteng, S. Africa Unit 08 Cranberry Industrial Park, Cranberry Street, Laser Park, Honeydew, Gauteng, S. Africa Tel: + 27 11 795 1699 / 1899 | Fax: + 27 11 795 1799 email: r.hemraj@unqondo.co.za
www.unqondo.co.za
take care of staff, TAkE CArE oF
International SOS is the world’s leading international healthcare, medical assistance, and security services company. It helps companies manage the health and security risks facing their international travellers and expatriates.
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frica is an increasingly attractive investment opportunity - mining, oil and gas, telecommunications and infrastructure, take your pick. They are all burgeoning. But thanks to wars, corrupt or weak governments, lack of education and healthcare, and crippling debt, most of the world’s poorest 30 countries are African. It means sending foreign workers to the continent can be dangerous. “There is always a risk for companies sending workers abroad,” says Dr. Ian Cornish, International SOS regional managing director in Southern Africa. “But it is relative risk; relative to your approach and preparation. “Employees are a company’s biggest asset; taking care of them if they are working abroad or while they are travelling for business is very important, especially if the locations include dangerous or remote places.” With over 8,000 employees in more than 70 countries serving thousands of corporate clients around the world, International SOS is a leading player in the global healthcare environment, he says. “Business travellers undertake millions of international trips annually, many of which are to high or extreme risk destinations.” With increased mobility comes inevitable risks, Cornish adds - exposure to illnesses like malaria, outbreaks of civil unrest like the recent events in Ivory Coast and natural disasters like the quakes and Tsunami in Japan. “We are here to assist. We are a healthcare, medical assistance and security services company and through our worldwide network of alarm centres, clinics and health and logistics providers, we offer local expertise, preventative advice and emergency assistance during critical illness, accidents, or civil unrest.”
We have a comprehensive suite of services to assist companies
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DUTY OF CARE Transnational companies have a responsibility to offer Duty of Care to their employees. This Duty of Care applies not only for emergency and medical evacuation situations but also for routine security and medical conditions for employees travelling and working abroad. Identifying risk for employees travelling abroad, mitigating risk for the corporation once in-country and managing risk once exposed is where International SOS comes in. “The concept of Duty of Care in the corporate sector has grown in recent years,” says Cornish. “More and more corporations are realising they must demonstrate it for employees travelling for work abroad. “Duty of Care is a company’s responsibility to ensure the health, safety and wellbeing of their employees, wherever they find themselves in the world,” he adds. “It 88
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includes assessing the risks of travel, demonstrating they have taken steps to educate their employees about these risks and prepare and assist them to mitigate risks should they arise. Employers must then monitor the environment for potential hazards and update international assignees on any developments that could become critical incidents. Finally, employers must adequately support and assist their employees in the event of a crisis or an emergency. “We have a comprehensive suite of services to assist companies in this sphere.” International SOS was founded in Singapore by Dr Pascal Rey-Herme and Arnaud Vaissié in 1985. “We have grown rapidly by constantly developing and responding to customer needs,” says Cornish. Working as a doctor for the French Embassy in Jakarta, Indonesia in the early 1980s Rey-
International SOS FEATUrE
Herme soon recognised the great demand for international standards of healthcare from the wider expatriate community and international organisations in the region. Already a successful businessman, Vaissié, joined Rey-Herme to set up Asian Emergency Assistance International (AEA) in 1985. The first alarm centre was opened in Singapore, followed by an office and clinic in Indonesia. In 1989 expansion followed into Greater China, establishing an alarm centre in Hong Kong and opening an office in Beijing. By 1995 new alarm centres and offices were established throughout Asia, Greater China and Vietnam, Australia and the U.S.
Subsequently through internal growth and acquisitions in the U.S., AEA International became the worldwide leader for medical assistance services. In 1998, it was renamed International SOS. “We help companies to avoid the risk of sending employees abroad on business,” says Cornish. “We help them take practical steps to safeguard the business traveller against threats.”
We do run a very successful business. We have cross-border ability all over the world
EFFECTIVE RISK MANAGEMENT Employers are responsible for making sure employees have the education, knowledge and tools to
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International SOS FEATUrE
As corporations grow and continue to deploy workers around the world, International SoS will grow too
protect themselves in when travelling abroad, Cornish says. “Employers should seek help to design a strategic risk management strategy,” he explains. The key to an effective risk management strategy he believes is to “identify and assess all foreseeable risks” and develop a “comprehensive risk management strategy”. “That is absolutely vital,” Cornish says. Of course, opportunities for work in the developing world are growing and are abundant at present with few signs of diminishing. It means an increase in activity for International SOS. “As corporations grow and continue to 90
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deploy workers around the world, International SOS will grow too,” says Cornish. “The developing world offers great opportunity. If incidents are managed badly, particularly around health, the news is transmitted quickly around the expat community that ‘my company didn’t look after my wife very well when she had malaria’. “We are offering extensive risk management services. We help corporations put in plans and strategies to reduce risks, because you can never eradicate them completely. “We take a proactive approach, believing that prevention is better than cure and have witnessed an increasing number of foreign companies coming to southern Africa – U.S., Australia, European and Asian corporations
Specialising in: ✔ Full (Executive) medical examination packages ✔ Occupational medical examinations ✔ Travel Medicine consultancy and travel clinic ✔ Pre travel, Placement, Periodical and Post Assignment examinations for expatriates ✔ Visa / Immigration medical examinations Our Medical Advisory service consults on wellbeing and corporate wellness for individuals and companies, including health risk assessments, audit of facilities and company wellness programmes. We have establshed partnerships to also provide Healthcare Provision solutions and Health Impact Assessments. We facilitate access to a wide range of specialists and ancillary health services, including Laboratory, X-Rays, Audiology, Nutritionists and Psychologists. Our practice is conveniently situated at the Sandton Medi-Clinic. Address: Suite 20 Sandton Medi-Clinic, Corner of Peter Place and Main Road, Bryanston 2021, Sandton, Republic of South Africa Tel: +27 (0)11 706 1231 Fax: +27 (0)11 706 1235 email: info@execuhealth.co.za website: www.execuhealth.co.za
Wellbeing Begins Here in particular. This is naturally an opportunity for us. “Mining, oil and gas, financial services and telecoms industries are full of potential. “Our main aim is to increase our staff in the various countries we operate, specifically in those where our clients are growing. We have seen significant growth in Mozambique, DRC, Tanzania and Uganda. So, what we are doing is moving more staff into those countries, backed up by specialist staff in South Africa who are easily deployable.” Medical infrastructure in these developing countries can be poor. Emergency response and evacuation plans while travelling and working in these areas are vital. “We do run a very successful business,” says Cornish. “We have cross-border ability all over the world. We have the ability to replicate our position in any country. “I think our biggest growth is going to be in Africa and South America,” he concludes. END
success THE roUTE To
railway and civil engineering contractor Flint Construction has enjoyed dynamic growth and has a significant presence throughout sub-Saharan Africa.
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Flint Construction FEATUrE
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lint Construction (Pty) Limited’s ability to provide customised solutions and to work in challenging environments have been key factors in its success. The renowned railway and civil engineering contractor has expertise on industrial rail systems and counts a number of industry giants among its customers. While it’s Head Office is in KwaZulu-Natal, it operates nationally as well as across borders, with major contracts in Zambia, Botswana, Tanzania and Mozambique. The company was founded in 1990 by managing director Keith Flint. “The core of our business is in the construction and maintenance of railway track,” he tells South Africa Magazine. Flint Construction specialises in the construction and restoration of surface and underground rail systems, the sale and purchase of perway materials, such as rail and sleepers, and general civil engineering construction. Formed with an initial business focus on northern KwaZulu-Natal, the company’s professionalism and wide experience resulted in dynamic growth and it now has a significant presence throughout sub-Saharan Africa. The Rosetta-based firm operates in Botswana and Zambia through the subsidiary companies of Flint Construction (Pty) Limited Botswana and Railcon Zambia respectively. It has grown significantly since it started operations and currently employs over 800 staff members, according to its corporate website. Turnover is in excess of R70million per annum. Recent completed projects - and in progress - include track reinstatement Phase IV at AfriSam South Africa (Pty) Ltd’s Dudfield Factory and the construction of a Railtrack for
The core of our business is in the construction and maintenance of railway track
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a Deebar Railveyor System at XStrata Alloys Eland Platinum Mine in Brits. Flint Construction was also chosen as the contractor for India-based Vedanta Resources’ Konkola Copper Mines to equip the 875m-high midshaft loading haulage. The contract included 12 km of rail track, fully Thermit-welded to Class I (high-speed) specifications, drains, retaining walls, lighting and whitewashing, high-speed turnouts and all pipework and electrical reticulation. Flint Construction has been active on the Zambian Copperbelt since 2000 and has rehabilitated 17 km of underground haulage on Konkola and its sister mine Nchanga, in Chingola. According to Mr Flint, Flint Construction (Pty) Limited operates two separate divisions: one deals solely with underground and mining related projects and the other with surface
Site office KCM Konkola Zambia with 4# headgear in background 94
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rail systems. The company historically works in deep level mines where typically there is a vertical shaft system to and from each level, from which the tracks extend out three to four kilometres to allow for the transport and transfer of ore to the surface. The Konkola Deep project is designed to move 6,000,000 tons of ore annually with 300-ton trains at speeds of 20km/hr, all 3,000 feet underground, he says. “Flint Construction, as well as working with leading mining houses like Anglogold, Anglo American and Goldfields, also services petrochemical giants like Total SA and Shell, works closely parasatals like Passenger Rail Agency of SA (Prasa) and Transnet Freight Rail,” adds Mr Flint. Of note to all those involved in the rail industry is news that the government has given “the green-light” for a multi-year, multi-
Afrisam - Dudfield , train on newly rehabilitated Feederline to factory
Flint Construction FEATURE
billion rand recapitalisation of both freight and passenger rail systems in Southern Africa. It is designed to continue the resurgence in South Africa’s surface rail systems. Speaking to media at the a Railway and Harbours Conference in Nasrec, Johannesburg on April 6, 2011, Transport Deputy Minister Jeremy Cronin said: “The poor condition of Metrorail rolling stock contributes significantly to the delays and cancellations of the scheduled daily commuter rail service.” He said Prasa planned to acquire new metro service coaches over an 18 to 20-year period, starting in 2014. “A detailed needs and feasibility study is currently underway,” said Cronin. “The feasibility study covers engineering, economic, legal and financial analysis for the procurement, financing, operating and
maintenance of the new rolling stock for Prasa,” he added. Of the 4638 commuter coaches in the Metrorail fleet, 2200 were older than 36 years, and the average age of coaches was 40 years. Transnet was also preparing to purchase freight wagons and locomotives, he said. “This provides the opportunity of collaboration between Prasa and Transnet to leverage economies of scale, job creation and skills and technology transfers for the rail engineering industry in South Africa.” Cronin said a shift from rail to road transportation of freight had led to deterioration in road conditions, congestion, and collisions. “The disproportionate shift of freight onto road has seen road construction and maintenance costs soar,” he said. END
SURFACE PROJECTS Afrisam Lichtenburg - rehabilitation of rail network Eskom Majuba Power Station maintenance of existing rail link Camden Power Station - construction of new rail siding to power station UNDERGROUND PROJECTS GFI Mining: South Deep Gold Mine Rehabilitation of underground rail system
TRANSNET approved supplier of new hardwood rail crossings and ties (pressure treated with creosote or CCA)
Anglogold Ashanti: Mponeng Mine Rehabilitation of underground rail system Anglocoal: New Denmark Colliery Maintenance of underground rail systems Konkola Copper Mines Zambia - High speed haulage on 2900m Level Tel: +27 (0) 11 964-1413 Cell: +27 (0) 83 701-3500
Fax: +27 (0) 11 964-1432 Email: idward@netactive.co.za
WorLD
FroM
To THE
From June 27 until July 1 this year South Africa will be host to the Africa Rail and African Ports & Harbours Congress 2011, an essential meeting and exhibition for the entire African transport industry.
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country’s ports are its front doors, and while Rotterdam and Singapore, Piraeus and Shanghai define the great sea routes of the past, Africa’s ports, strung around ‘the world’s biggest island’ may be said to define the future. From the ancient harbours of the Mediterranean looking across to Europe; circling round to the West African ports rapidly adapting for oil; Cape Town and Durban in South Africa; and the Indian Ocean gateways of Maputo, Dar es Salaam and Mombasa so readily within reach of India and the Middle East, they are portals to the world’s fastest-growing economic region. With its huge human potential and its massive mineral resources Africa is quickly being recognised as a vital driver of world economic expansion in the 21st century and a place where well structured investment will benefit every part of the globe. Against this background, the events taking place in Johannesburg at the end of June take on much more than purely regional significance. Africa Rail 2011 will be the 14th annual conference and exhibition, bringing together rail operators, government agencies and investors, while Africa Ports & Harbours Congress focuses for the eighth successive year on investment issues, best practices and international collaboration. The synergies that exist between these events and Signalling & Train Control World, a more technical event which runs in parallel, are self evident. For the continent to develop (this is becoming a cliché!) there is a vital need for existing infrastructure to be upgraded to world class standards, and
The conference allows Africans to find out what other Africans are doing – and it allows outside investors to identify African projects they can support
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new systems built in the many places where these are non-existent. But Africa has an opportunity that other parts of the world lack: this is the chance to grow its infrastructure in a pan-national way, a way that will allow it to fulfil its destiny on a par with the ‘BRIC’ group of economies on which the future prosperity of the entire world depends. These are some of the reasons why Rail Africa and Africa Ports & Harbours attract speakers, delegates, exhibitors and observers not only from all parts of Africa but from all over the world. As Sam Pickard, Business Development Manager for Terrapinn South Africa, which organises the conventions says: “The focus of the event is to bring together African railway and port authorities to talk about how to manage their assets at a strategic level. How do they garner investment, and following that, how can they manage that investment?” Handling investment is a headache for both groups of administrators. This is a chance for them to test their ideas against the experience of people who have worked within different funding models in various contexts; public/ private partnerships (PPP) for example. No two projects are ever the same, and each country has different regulatory, legal and political drivers, but delegates to the conventions will be able to see how other ports or rail networks have worked with that kind of structure, says Pickard. “We will be talking about current projects: what has worked and what can be improved, sharing best practice and the different methodologies
We will be talking about current projects: what has worked and what can be improved, sharing best practice and the different methodologies and systems that are in use
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Africa Rail 2011 Exhibition FEATURE
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and systems that are in use to help drive the efficiency of the port or rail environment and move it forward.” While South Africa may be seen as ahead of the game, and European and America speakers present some state-of-the-art solutions, there is also a powerful presence from BRIC countries, with opportunities to benchmark on best practice in other emerging economies. After all, the sea ports and inland industrial hubs across the continent, linked by a network of rail and road routes, are economically interdependent. The people who lead and manage these facilities are, or should be, more aware of the power of networking than anyone. The organisers are determined to encourage key people to get together between sessions to exchange details. They may not have time within the tightly packed agenda to actually start negotiating with one another: that can come later says Pickard. “We have developed a concept called Speed Networking, where people get the chance to exchange cards with people whose interests coincide. It is like speed dating, but not so scary!” she suggests. This resonates with the organisers’ vision that networking extends beyond the conference itself, through blogs on the Terrapinn website as well as the Africa Rail LinkedIn group. The Africa Rail and Africa Ports and Harbours events are separately organised but the opportunity exists for cross-fertilisation, sharing best practice and discussing matters of common interest like how and when private finance can be effectively harnessed to deliver major projects. The actual content is controlled by Conference Manager Hmrithi Jairam who explains why Africa Rail and Africa Ports & Harbours have become so vital to the future of transportation in Africa. “This is the platform where all the big players in the industry will be discussing ‘how to’ within each industry. At the conferences they will be considering www.southafricamag.com 99
Africa Rail 2011 Exhibition FEATURE
IMAGE: Getty
steps that the industry needs to take in order to increase regional trade and urbanisation, to increase investment into infrastructure, to improve the operational efficiency of African railways and ports, and other issues crucial to the progress of this sector.” This strategic overview will be underpinned by the people who supply and implement systems. Train routing and detection, traffic management systems, driver information – all these feed into the safety and efficiency of the system and are given thorough consideration in Signalling and Train Control World. Africa Rail then goes boldly into the visionary and inspirational territory of ‘reimagining Africa’s railways’ before proceeding to high finance and the crucial role of the BRIC partners, whose interests coincide so 100 www.southafricamag.com
closely with those of Africa, says Hmrithi. “It is a global outlook – we need to see what America and Europe are doing, but the BRIC viewpoint is just as important because as we all know there is a gap between the emerging markets and the mature markets!” Both conferences will focus on the big issues like funding and finance, innovation and technology, she continues. PPP funding may have more relevance in the rail industry, privatisation for the ports; operators may have different concerns from developers: however discussion will always come back to individual projects, or as Hmrithi puts it: “The conference allows Africans to find out what other Africans are doing – and it allows outside investors to identify African projects they can support.” END
À The official distributor and authorised repair centre for LXE products (most of the pictures) À The developer of software solutions such as Granite the Warehouse System for ACCPAC ERP
A specialist provider of complete barcode/RFID solutions
À A provider of integration skills and technology skills in the fields of RFID, VOICE PICKING, Warehousing, Supply chain and Mobile applications
Contact us: Craig Collins 0824682120 sales@cradle.co.za www.cradle.co.za
CRADLE TECHNOLOGY SERVICES Cradle Technology Services is a wholly owned South African company with big plans and the ability to see them come to fruition. Formed in 2000 by Delia Collins as a small company focused on serving the niche market of supplying barcode labels to customers with barcode systems, Cradle has since invested in manufacturing equipment and now has a factory in Cape Town dedicated to manufacturing these labels. In 2004, Craig Collins joined the company and started developing and supplying simple barcode systems. The company purchased scanning equipment from various local vendors and distributors and resold the equipment. Today, Cradle is the distributor of various brands in Southern Africa. The jewel in the distribution part of the business is the LXE brand. One of the top four brands of scanner manufacturers, LXE has a reputation globally for rugged, ergonomic industrial hand held and vehicle-mounted terminals. Cradle is not only the sole distributor of this range throughout Africa, it also has the only certified Authorized Repair centres on the continent. Cradle is able to fully support the global LXE
warranty program. In 2006, the Cradle software division was formed. Starting off with customised solutions for Track and Trace, food and beverage industry, packaging industries and various other diverse customers, the Cradle Software team delivered custom solutions in the Barcoding field. Customers like Caterpillar Africa, Altech UEC, Cibapac, SBH Cotton Mills and Hud mining are just some of the customers that have benefited from Cradle’s expertise. In 2008 Cradle’s development team started work on an ambitious project to centralise all core application code into a central object framework and then the strategy was to develop standard, well designed software packages for global distribution. Today, Cradle has two software packages that are taking South Africa by storm. Facets – a fixed asset auditing system, and Granite – the Warehouse system tightly integrated to ACCPAC ERP from SAGE. In the next three years Cradle will move towards global distribution of these software packages. Along with a strong drive into Africa and a mindset that embraces partnerships, this is a company to watch.
Fruits
Labour
of
102 www.southafricamag.com
If you are currently eating a grape, odds are piet karsten supplied it. South Africa Magazine talks to one of the orange river’s biggest personalities.
Karsten Group FEATUrE
o
ver the last 35 years Piet Karsten of the Karsten Group has developed his small family table grape business into the largest table grape producer in South Africa. The Karsten group has 10 farm units, employing 1,200 permanent employees and 4,000 seasonal workers. In addition to grapes, the Karsten group grows melons, dates, apples and pears for export to the UK and other European destinations. The farms are spread out along the Orange River on the Namibian border. It is a very arid, sparsely populated area on the edge of the Kalahari Desert dotted with fruit farms. With low rainfall, the farms depend on irrigation provided by the Orange River. “Water from the mighty Orange River, sunny winter days and hot, dry summers, kilometre upon kilometre of vines that thrive in the rich desert soils to bring forth the sweetest grapes imaginable! And happy and prosperous people who share in the reward, this is the vision on which I founded Karsten Group,” says Karsten. The company is headquartered at Roepersfontein, near Kanoneiland, in South Africa’s Northern Cape region. It is here that he founded his grape growing and exporting business. “We have grown very fast,” Karsten says. “A strong partnership exists with the South African Industrial Development Corporation (IDC), which has helped growth. “The Group’s Orange River business is based on 10 farms, stretching over 300 kilometres from Klein Pella in the West to Kanoneiland in the east,” he adds.
Over time the Karsten group became one of South Africa’s leading grape growers and strategically invested in its own marketing and distribution infrastructure, establishing its own South African and European marketing companies, New Vision and Karsten UK, as well as a logistical services company, Horizon Fruits. “The Karsten Group now has a strong logistics and international marketing structure with companies and offices in London, Cairo and Cape Town,” Karsten says. “In partnership with other South Africans the Karsten Group has also established a marketing structure to promote and market its products in the Far and Middle East.” In recent years the Karsten Group expanded its production of dates and moved into citrus fruit, pomegranates and nuts in the Orange River. Further south, in South Africa’s Western Cape, it acquired a deciduous fruit farming operation, Hoogland. “Here the Karsten Group is expanding its production of apples, pears, plums and onions, and introduced the latest cherry and blueberry varieties to boost its produce basket,” says Karsten. “Diversification is very important,” he adds. “We spread risk and are trying to make the most of opportunities for [fruit and vegetable] production here in South Africa. We have also applied that same expertise and drive to overseas and developed partnerships that extend and compliment our products.” Karsten says outside South Africa the Karsten Group now has partnerships in grape
We are one of South Africa’s leading agribusinesses, respected both locally and internationally for the excellence of our products, cutting-edge innovation and integrity
www.southafricamag.com 103
Karsten Group FEATUrE
production in Namibia and Egypt and supply agreements with growers in Chile. All activities of the Karsten Group are based on the principles of applying Good Agricultural Practices and being “sensitive” to environmental issues. “Karsten Group confirms to all international food safety and environmental practices,” says Karsten. “We are also a very conscientious employer and invest in the development of world-class people.” The Group provides seasonal and permanent employment for a large community of people in South Africa’s poorest regions. All workers share in benefits such as training and development programmes, which are offered in association with institutions such as the International Finance Corporation. The Group, Karsten says, has undertaken two major empowerment projects.
“Two important initiatives in people empowerment, namely Keboes Fruit Farms and Mosplaas Citrus, both in the Orange River region, where workers will hold significant shareholding, are part of the Karsten business,” the company says. “The Karsten Group pioneered the export of Fairtrade Branded grapes from South Africa. Raap en Skraap, which is owned by Keboes Farms, has Fairtrade certification and workers benefit from premiums received from the marketing of the fruit. While Raap en Skraap has almost been developed to its full potential and in the most recent season for the first time packed a million cartons of grapes for export, Mosplaas Citrus is still very much in the development phase. The future development will see 350 hectares of citrus trees being planted on what was previously arid semidesert land.”
We are also a very conscientious employer and invest in the development of world-class people
104 www.southafricamag.com
THE CROP PROTECTION EXPERTS
Viking and Oranje Chem are proud to be associated with Karsten Boerdery (Pty) Ltd, a successful agricultural enterprise, and share their key values of trust, integrity, innovation and personal relationships. Our comprehensive knowledge of crop protection and our understanding of the supply chain requirements inspire confidence in our clients, suppliers of our products and international retailers. Tel: 054 332 4829 Cell: 082 881 4257 www.viking.co.za
Labels and Printing Systems We would like to extend you an hearty welcome to PSP Timber Industries (Pty) Ltd, one of the foremost Timber suppliers in the Southern Cape, South Africa. As you will see from our Product offerings, we supply various Timber products throughout Southern Africa and Internationally. • Creosote / CCA Pine • Fruit Bins • Pallets • Post & Rail Fencing Droppers / Laths • CCA Treated Cylindrical Poles • Boron Pine • Boron Cylindrical Poles • Boron Laths PSP Timbers Industries (Pty) Ltd Wagenaar Street, Spoornet P.O Box 84 Oudtshoorn 6620 Republic of South Africa Tel: +27 (0)44 272 6236 Email: p.s.p@mweb.co.za Website: www.psptimbers.com
Proud to be a Supplier to Karsten Boerdery www.redfern.co.za
Karsten Group FEATUrE
1391 Corrugated april (SAmag)_82.5x117.5mm_REPRO.indd 1
Keboes Fruit Farms is a producer of table grapes for the export and local market. Karsten Group has been a firm believer in the fact that people who work there should take centre stage in all farming activities as it forms a core part of the business. Sharing profit and ownership is the backbone of the business. “We will always look to expand and grow,” Karsten concludes. “You can’t sit back and defend your position. We are a growing company and we want to expand. We want to expand in the UK. We want to expand in China. We have our office there and we want to expand. “Also, in South Africa, there is still a lot we can do.” Karsten Group products will be on our shelves for generations to come. Karsten and his family have an operation going that is mutually beneficial to themselves, employees and South Africa. END 106 www.southafricamag.com
2011/04/11 2:54 PM
WEST AFRICA: GOOD INVESTMENT OPTION FOR SA With its markets growing at a clip, West Africa looks increasingly attractive. It is a good investment option for South Africa. Experts agree that local companies should start marketing their goods and services there now to take advantage of growing export opportunities. And there are plenty of them. West Africa Business Review is designed to help unlock the potential.
CONTENTS
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G4S NIGERIA JOHN HOLT PLC
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All the latest business news from West Africa
Ivory Coast Visafone leader pleads for
acquires
Ivory Coast President Alassane Ouattara has made a plead for order, as troops formerly loyal to his ousted rival Laurent Gbagbo flocked to his banner despite ongoing violence. UN peacekeeping chief Alain Le Roy told reporters there was still fighting and “quite a lot of looting” despite Ouattara’s victory over Gbagbo’s attempt to cling to power. Ouattara’s election victory has been recognised by the international community, and most countries have welcomed Gbagbo’s downfall, however troops from both sides have been accused of atrocities during the conflict. The new president has vowed to create a truth and reconciliation commission to investigate any allegations, and has given himself two months to restore order. Ouattara also called on the International Criminal Court to probe massacres carried out in the west of the country, where both his troops and Gbagbo’s were accused of taking part in the massacre of hundreds of civilians.
Visafone has further strengthened its market position by acquiring Multilinks Communications Limited’s CDMA mobile assets. Multilinks is arguably the oldest mobile phone company in Nigeria, having been operating in the country for over 15 years. Telkom Limited agreed to sell Multilinks’ CDMA business to Visafone Communications Limited for N8.1 billion ($52 million). At the signing of the agreement in Johannesburg, South Africa, Jim Ovia of Visafone said his company recognised that this deal will solidify its position in the Nigerian marketplace and was committed to offering world-class voice and data solutions to existing Multilinks customers. He said: “This transaction brings us closer to achieving our target of 10 million subscribers within three years. We believe that the superior technology offered by CDMA, combined with a subscriber base of 4.2 million active subscribers will enable Visafone to continue as a game-changing innovator in the Nigerian marketplace.” The union of Visafone and Multilinks creates a total active subscriber base of 4.2 million.
order Multilinks
108 www.southafricamag.com
GLO 1 West African oil Asian buyers shun
in April
West African oil prices at multi-year highs have started to ward off Asian buyers who are instead opting to import cheaper Saudi barrels, according to reports by the Reuters News Agency. Shipments of west African crude oil east are set to fall to 1.58 million barrels per day (bpd) in April, down nearly 10 percent from 1.75 million bpd the previous month, data obtained by the news agency revealed. “From March, the number is definitely down,” Reuter’s said, quoting a West African trader. Crude oil differentials for the benchmark West African grade Qua Iboe rocketed to
launches services in
Ghana
Glo 1, a high capacity undersea fibre-optic cable, more than two-and-a-half has connected Ghana to West year highs in late March as Africa and Europe. regular buyers of Libyan oil The 9,800km long submarine sought alternative supplies cable network, the first project in West Africa, it said. of its kind to be executed Crude oil from the region entirely by a single organisation, mostly comes from Africa’s berthed on the beaches of Osu, two top producers Nigeria in Accra. and Angola. The Glo 1 facility has been China -- a regular buyer built with leading technologies of West African oil -- will backed by Globacom and import around 760,000 bpd Alcatel-Lucent and is set this month compared with to transform the country’s slightly over 1 million bpd in communications landscape and March, data showed. present Ghanaian businesses Traders said they expect with new opportunities of Asian imports to remain low bridging the digital gap between in May because of strong Ghana and the rest of the world. competition from U.S. and “These are exciting times European refiners coming indeed for Ghana and the rest out of planned maintenance of Africa, as Glo 1 comes in to this spring. offer immense opportunities for businesses across our continent and enable them to compete on an equal footing with their counterparts elsewhere in the world,” According to a report in the Financial Times, Tullow Oil plc is Said Dr. Mike Adenuga Jnr, seeking to buy a further 3.5 percent stake in Ghana’s offshore Chairman of Globacom Limited. Jubilee field for $300 million. Citing unidentified industry officials in Ghana, the newspaper ”Glo 1 is here in Ghana to deliver transmission capacity said Tullow planned to buy shares controlled by EO Group, which will radically change the associates of Ghana’s former president John Kufuor. country’s economic landscape Tullow Oil confirmed it was in preliminary talks to purchase the shares, which would raise its stake in the oil field to close to and indeed, that of our sub-region.” 26.5 percent, the FT said.
Tullow Oil to buy more shares in Jubilee field
www.southafricamag.com 109
Safe
Secure AND
Managing Director of G4S Nigeria, percy raditladi, tells Jane Bordenave what makes Nigeria such an exciting growth market and how security is evolving in the country.
110 www.southafricamag.com
G4S Nigeria
G
4S Nigeria is the leading security provider in the country and part of the largest security company in the world. It has been present in the country in its current form since 2005, although its history goes back decades through acquisitions made by G4S over the years. The organisation offers a full range of services, from personal security details to manned premises guarding or fleet tracking. With annual revenue of over £32 million and 5000 members of staff, G4S Nigeria is the third largest G4S operation in Africa, after South Africa and Kenya. These figures become even more impressive when you consider that in 2003 the combined revenue of the two firms that became G4S Nigeria was £4 million. The secret, says Managing Director Percy Raditladi, was diversification. “The company
diversified its revenue stream from manned security over the years to operating emergency response vessels in the Niger Delta. Our services grew to include risk management consulting and journey management after the acquisition of ArmorGroup Nigeria in 2008.” While manned security – i.e. guarding – still accounts for 70 percent of the organisation’s revenue, its investment focus is to grow other business areas. “Our current major capital expenditure is in the refurbishment of our two emergency response vessels and renewal of our journey management fleet.” G4S is also embarking on a joint venture this year with one of the largest document and data companies in Africa, which will be its biggest overall investment. “This will be a 50/50 joint venture operation, which we plan to launch in the second quarter of this
We have the ability to tailor our services to our clients’ needs, big or small
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G4S Nigeria
year and will be by far the largest data and document management company in Nigeria,” says Mr Raditladi. It is no surprise that these are the three areas of business that G4S Nigeria is hoping to expand, given the trends Mr Raditladi is seeing in the marketplace. “In line with the growth of the economy in Nigeria, we see mayor opportunities developing in the Oil and Gas sector, of course, Financial Services and Telecommunications. We have a very strong presence in the Oil and Gas sector already and there are some other very lucrative opportunities in the protection of crude gas pipelines. We are planning further secure solutions in the Financial Services, which could include cash management, where our presence is currently limited.” The firm is also seeing growing interest in maritime security, particularly in the provision of emergency response boats. Additionally, in the telecoms sector, it sees interest in its traditional manned security at base
transceiver stations – more commonly recognised as cell phone towers. While the company has many different services to offer, it works hard to ensure that life is made as simple as possible for the client. “Our value proposition is the ability to offer our customers a bundled service, rather than single product lines,” explains Mr Raditladi. “Our strategy is to partner with our customers for the longer term through output based services, which allows them to reduce their security costs, improve their revenue and meet ever changing regulatory requirements.” He also cites the organisation’s global reach as another competitive advantage. “We are one of only a few security companies capable of handling large, complicated contracts that pay for service over longer terms. As part of the G4S Group, we have the financial muscle to handle this kind of requirement and it is something few of our competitors can manage. Consequently, we have the ability to tailor our services
G4S Nigeria has the potential to be the largest business within G4S Group in Africa
112 www.southafricamag.com
G4S Nigeria
INTERNATIONAL UNIFORMS NIGERIA LTD International Uniforms Nigeria Limited was incorporated in Nigeria in 1980. The company produces protective clothing and uniform for Security, Hospitality, Health and Industry personnel. Among its many patrons are G4S Nigeria Ltd. The company is currently seeking reputable foreign investors to partner with it in its expansion programmer to take advantage of the growing Nigeria and West African market. Particular in the oil and gas sector.
to our clients’ needs, big or small.” Despite its impressive grows and extreme flexibility, particularly for a company of its size, G4S Nigeria does have its challenges to face too. “The main challenges we face are either infrastructure related or are obstacles to business that are specific to this country, both of which drive up costs,” says Mr Raditladi. The lack of continuous power from the national grid poses a major problem – it costs three times more to use generators than electricity generated by the national supplier, however then the national supplier can only meet around 25 percent of the energy requirements. Additionally, property costs are very high 114 www.southafricamag.com
and concerns regarding corruption deter most from securing business in the government sector. More than anything, though, Mr Raditladi says the main challenge is pricing in the service sector. “To make decent return on this sector, any business must make at least a net margin of 17 percent, which means we have to charge in excess of 30-40 percent above the market. The costs are driven by the inability of the government to reimburse private sector of excessive taxes paid through Withholding Taxes (the government collects tax in advance and never pay it back as they say they have no funds- which one needs to make huge profits to offset this with their tax bill). As a
result a low margin business is highly unlikely to make enough profit to recover tax paid in advance through Withholding Tax. As long as the government is unable to reimburse the private sector, businesses treat Withholding Tax as sales tax, which they pass on to the customers. For tax compliant international companies like G4S, it is difficult to compete with nontax compliant local companies on price, but any business with low profit margin eventually goes under.” Despite these challenges, Mr Raditladi still sees Nigeria as one of the most exciting places to be doing business. “G4S Nigeria has the potential to be the largest business within G4S Group in Africa. Certainly within five years
we will have passed G4S Kenya and will have doubled our revenues and workforce.” He doesn’t expect this to be a quick or ‘organic’ growth – more a complete step change. “To get from where we are now to that point will require a complete change in our culture and management style. Employing entrepreneurial managers as well as focusing on business development initiatives will get us there quicker. The era of security being restricted to only talent from the Army and Police has come to an end. We are now employing business leaders who have a vision to run our companies and make them profitable and business savvy. We will need to move out of the wasteland into the meadow and by that I mean that our business has to be able to attract talent from top institutions and universities. We can no longer feed from crumbs; we need to be providing security advice to corporates and governments. Staff development and talent management is what will make us beat competitors and become a force to reckon with.” END
Corportate partners of: AAT Holdings Poland (Novus) & Future Fibre Technologies (FFT) UK
Tonisona Worldwide Solutions Our clients include: Shell Petroleum Development Company (SPDC), Agip, Total, G4S, OMS Exxon Mobil & Chevron
WE SPECIALIZE IN: > PPE, Industrial Wears & Safety Equipment > Consultancy Services (community affairs inclusive) > Oil Field Services/Equipment > Pipeline Maintenance & Instrumentation, Painting and Sandblasting > Procurement & Supply > Civil Works > Logistics,Transport, Marine Electronics and Marine Services > Waste Management & Public Health Consulting > General Supplies > Base Station Radio, Fixed/Mobile/Portable Radio Equipment > Biometric Access Control Equipment and Accessories > CCTV, Perimeter Intrusion Detection (PID) And Alarm Systems > Fibre Optics Pipeline Security and Third Party Interference (TPI) Live Online Detection and Monitoring
www.tonisonaworld.com Managing Director/CEO: Mr Moses Tonworio Abrakassa NIGERIA OFFICE: LIBERIA OFFICE: #7 Panama street, off Odili Road, Smythe Road, Sinkor Old Road Trans Amadi industrial Layout. 1000 Monrovia 10, Liberia. P.O Box 6255 Trans Amadi, Port Harcourt, Tel: +231 (0) 6605514, 5543863. Rivers State Nigeria. Tel: +234 (0) 8035508750, 8076261593. Email: info@tonisonaworld.com
F ighting bac k AND RETURNING TO
profit Since 2008, John Holt Nigeria Plc has fallen on hard times. But this conglomerate doesn’t give up easily. It has been doing all it can to fight back.
116 www.southafricamag.com
John Holt
J
ohn Holt has over the years grown to become a key player in various sectors of Nigerian economy, offering quality products and services through a network of branches nationwide. Just recently, the company - in partnership with UKbased FG Wilson - set up a generator assembly plant with the aim of adding value to the Nigerian economy by providing jobs for talented Nigerians. However, with a few exceptions, recent years haven’t been too kind on the firm. Yes, John Holt, a dominant force in the conglomerate sector of the Nigerian economy, has wide and successful business units with interests in engineering, oil and gas, air condition assembly, leasing, property and boat building, but it has fallen on hard times. It operates three major divisions, namely technical products and leasing services, Yamaco/marine and property. “The company has suffered losses in recent years,” admits Dr. Christopher Ezeh, Senior Executive, Holt Properties & Group Marketing. “John Holt Plc started with the effort of a man named John Holt from Liverpool, England,” he continues. “In 1862, at 21 years old and with only £27 in his pocket, John
John Holt plc started with the effort of a man named John Holt from Liverpool, England. In 1862, at 21 years old and with only £27 in his pocket, John sailed from Liverpool to West Africa to engage in trading. His first business venture was established in Lagos in 1897, focused on the distribution and export of farm produce
sailed from Liverpool to West Africa to engage in trading. His first business venture was established in Lagos in 1897, focused on the distribution and export of farm produce. “As a subsidiary, John Holt was incorporated in Nigeria in 1961 and in 1974 John Holt became a Limited Liability Company quoted on the floor of the Nigerian Stock Exchange. “Majority shares in John Holt Plc are held by our parent company; there has always been steady collaboration between John Holt Nigeria and John Holt UK,” he adds. John Holt has transformed from being a mere produce-trading outfit into a conglomerate with diverse business interests. It is also in partnership with several international companies such as Yamaha of Japan, Angus Fire of UK and Rosenbauer of Austria. “We strive to be consumer-focused and cost effective with the goal of achieving long term growth for all our stakeholders,” Dr. Ezeh says. “We engage in the assembly, sale, lease, and service of power and safety equipment, and the warehousing and inventory management of consumer and other goods in Nigeria.” Okay, so since 2008 - and it has been well documented - John Holt Nigeria Plc has fallen on harder times. But this www.southafricamag.com 117
John Holt business
r eview
isn’t a company that will give up easily. It has been doing all it can to fight back. “Recently Almarine, our boat building division, successfully produced a state-of-the-art, mass transit 40-seater boat; the first to be built by a Nigerian company,” Dr Ezeh says. In October, the firm announced it had diversified into the real estate business with over N7.0billion property portfolio and ongoing development in the Federal Capital Territory (FCT) in its efforts at restructuring its business model to return to profitability. According to Dr. Ezeh John Holt intends to use its 118 www.southafricamag.com
professional expertise in the area of property and real estate investment to awaken the fortunes of the conglomerate. “We expect a significant improvement from last year’s showing. This is as a result of the ongoing restructuring activities and exploration of new business ventures,” says Dr. Ezeh. “Facility development is the major thrust of activities to reposition our Property Division. We have a property portfolio currently valued in excess of N7Billion, which we are preparing for full deployment. Efforts in this regard have started in earnest. “We currently have a staff strength of over 600 and
personal development is encouraged at every level. We are well aware of the importance of developing staff skills in breadth and depth so we can better face the challenges that businesses like ours are regularly confronted with. “Generally, the industry is growing and getting very competitive because it is becoming increasingly sophisticated. Customers have easier access to information which enables them to compare product or service offerings very quickly and make informed decisions on what works best for them, not the manufacturer or service provider. There is also
growing collaboration among stakeholders in the industry, which has increased the pool of available expertise and allowed for the application of international best practice.” Dr. Ezeh says John Holt is on the path to recovery having fully restructured in its determined effort to return to the path of profitability. “We now have in place dynamic management capable of moving the company to the next level,” he says. The company’s net assets for the year ending September 2009 was N2.943billion, rising by 32.33 percent when compared with the 2005 figures of N2.224 billion. In the same vein, it recorded N19.453 billion as turnover in 2009 representing a decrease of 11.6 percent when compared with 2008 financial year’s figure of N20.881 billion. “We have managed to rectify many things and re-aligned the business. We expect to return to profitability,” Dr. Ezeh says. “We are making use of the opportunities
in the oil and gas industry, especially in the area of fire protection,” he adds. “We have been able to rise to the high demand for firefighting equipments and tools in the country” John Holt Plc recently exhibited at the IFSEC West Africa’s security, fire and safety exhibition in Lagos where it unveiled its latest security/safety technologies targeted at improving operational efficiency of both private organisations and government in the Nigerian economy. Dr. Ezeh says the array of fire-fighting equipment exhibited at event is set to improve home and offices safety measures in the country. For over 20 years, John Holt has remained a key distributor of fire-fighting and safety equipment made by its two partners – Angus Fire of the UK and Rosenbauer of Austria, who are world leaders in safety equipment manufacturing. “IFSEC offered a platform to educate the www.southafricamag.com 119
John Holt
market and raise awareness about our range of latest fire fighting products, make new contacts and meet existing clients, and also network with other companies,” says Dr. Ezeh. “We help individuals and organisations to examine the kind of risk they are exposed to and with this we are able to know exactly what kind of equipment to deploy in order to meet their specific needs. “The partnerships with Augus Fire and Rosenbauer are strategic,” Dr. Ezeh continues. “The two companies offer very high quality products which align with the John Holt brand image and customers’ expectations of John Holt products. “Rosenbauer and Angus products are accepted all over the world; but you know, similar to the purchase of insurance, some of our people here in Nigeria are a bit reluctant to stock up on these products,” he adds. “They tend to wait until things go wrong before they start scrambling for solutions. Our participation in this exhibition is part of our wider plan to promote awareness and enlightenment.” 120 www.southafricamag.com
Dr. Ezeh insists that Nigeria is still a good place to do business. “When your business is tailored towards meeting the specific needs of the Nigerian people, it is a very good place,” he says. “The operating environment cannot be said to be perfect but it is robust enough for many sectors to thrive. However, more work is needed in the area of provision of infrastructure so businesses can really take-off and be better positioned for global competition. Another major challenge is the proliferation of fake and substandard products offered as cheap alternatives. We in John Holt remain committed to our quality promise and take the time to explain differences between our products and what is considered cheaper alternatives. When you think about it, these supposedly cheaper alternatives, which cost more long term due to numerous repairs and replacements, are actually more expensive to own. John Holt customers know this.” We’re sure John Holt has a big role to play in shaping Nigeria’s future. Expect some big announcements in the near future. END
su
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Investing in Africa’s agriculture Agriculture in Africa is one of the biggest opportunities in the world today. There is a huge demand for food, which will not diminish and Africa has the capacity to provide this. African Governments realise that they can no longer afford to ignore the agricultural potential that their countries have. China, for one, looks to Africa as a solution to its food security problem. Agriculture is set to boom and South Africa could be the hub. I hope you enjoy this supplement.
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CAPE HERB AND SPICE DU ROI LABORATORY COMPASS BAKERY GATTI ICE CREAM FOX & SWAN SWEETS MIDMAR LIQUORS 121
All the latest African Food & Agriculture News
Deadline looms
for mineral rights
compensation Mineral holders who forfeited their rights when the Mineral and Petroleum Resource Development Act came into effect have until the end of April to lodge claims for financial loss suffered, Agri SA has said. Those who forfeited their rights when the act came into effect on April 1, 2004, have until April 30, to lodge claims for financial loss suffered as a result of alleged expropriation. Agri SA was awaiting a ruling by the High Court in Pretoria on its legal dispute with the state in which it claims that the application of the relevant act entails expropriation of mineral rights. This would mean that mineral right holders who can prove they suffered financial loss as a result thereof should be entitled to compensation. “The state holds a different view in this regard. Agri SA intends to take the matter further, if necessary, to the highest court in the country,” Nic Opperman, director of natural resources at Agri SA said in a statement. “Even in the case of an unfavourable outcome, the deadline of 30 April 2011 for claims will remain applicable.” He said Agri SA has compiled a guideline for instituting claims for compensation, which has been forwarded to all provincial agricultural unions affiliated with the organisation. 122 www.southafricamag.com
Agri SA is South Africa’s leading agricultural trade association. It is a federal organisation, which promotes on behalf of its members, the sustainable profitability and stability of commercial agricultural producers and agribusinesses through its involvement and input on national and international level. It represents more than 70 000 small- and large-scale commercial farmers.
Nigerian Banks told to increase
lending
to Farmers Nigeria’s central bank Governor Lamido Sanusi said commercial banks should increase lending to agriculture to at least five percent of total loans this year to boost farming output. Lending to agriculture currently makes up 1 percent of credit by banks, Sanusi told a meeting of the Bankers’ Committee in Lagos, Nigeria’s commercial capital. Farming contributes the biggest share of Nigeria’s economic output and employs more than half of the 150-million population, according to the statistics office. Nigeria’s government is trying to reduce its dependence on oil exports to help sustain economic growth, Sanusi said. “That agriculture contributes 40 percent of GDP and is the largest employer of labour and yet receives one percent of lending is not good enough,” he told reporters.
DIAMOND FOODS BUYING PRINGLES IN $1.5B DEAL
Diamond Foods Inc. is buying Procter & Gamble Co.’s Pringles chips business in a $1.5 billion deal, the biggest in a string that have given the maker of Pop Secret popcorn and Kettle chips a growing share of the snack aisle. The deal also completes P&G’s exit from all its major food businesses. The maker of Tide and Pampers has sold off Folgers coffee, Jif peanut butter, Crisco Shortening and Sunny Delight drinks in recent years. The Pringles deal is structured to create a new company under the Diamond Foods name. P&G shareholders will get about 57 percent of the combined company, while Diamond shareholders will own about 43 percent.
CITY OF TSHWANE TO STRENGTHEN AGRICULTURE The South African City of Tshwane will strengthen agriculture with a support programme for farmers to create sustainable livelihoods, it said in a release early April. “The programme will be implemented pursuant to the observations made in the United Nations’ 2005 Halving Hunger report, which argues that agriculture can contribute to Millennium Development Goal 1 in two ways; firstly by stimulating food production and secondly by kick-starting economic development,” spokesman Console Tleane said in a statement. The farmers support programme would have three categories. The first category would be targeted at household food production, he said. Support would be through the expansion of the provision of agricultural starter packs, training and capacity programmes to households that had food gardens. The second category would strengthen community projects. This would involve the provision of agricultural starter pack programme to community projects, training and capacity programmes, on-farm infrastructure development, access to market and finance, as well as mechanisation schemes. The third category would in the form of support to emerging farmers.
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ASTRAL FOODS DENIES
Ivory Coast CHICKEN ACCUSATIONS
lifts ban on cocoa
exports
Astral Foods has denied claims it has done nothing to stop a subsidiary from selling short measure chicken products. The National Regulator for Compulsory Specification (NRCS) based in Cape Town claimed County Fair, a division of Astral Foods, was selling short measure chicken products and that all attempts to get the company to correct and or withdraw its non-complying products from the market failed. Astral Foods denied that it had not rectified the situation. “We have agreed our interpretation of the law has been incorrect but we have rectified it,” Theo Delport, MD for the Poultry Division of Astral Foods, told Sapa. He said it was a “once-off” violation, which had not been malicious, but a misinterpretation of the act regarding the process of “glazing” chickens.
MOZAMBIQUE Ivory Coast’s President Alassane Ouattara has formally lifted a nearly three-month ban on cocoa and coffee exports as well as on related tax payments. “The president of the republic orders that the measures suspending coffee and cocoa exports as well as tax payments be lifted,” Ouattara’s television channel, TCI television, said. The export ban in the world’s top cocoa grower had been in place since January 24 as Ouattara sought to deprive his presidential rival, Laurent Gbagbo, of the country’s main source of foreign revenues. Gbagbo was captured by Ouattara’s forces on 11 April after weeks of fighting, allowing Ouattara to take charge. Ouattara says everything is in place for cocoa exports to resume immediately. 124 www.southafricamag.com
TO HIKE FOOD PRICES
Mozambique will hike food prices but will offer other aid to the poor in the hope of staving off north Africa-style protests or a repeat of deadly riots last year, an official has said. Subsidies on bread and rice will end in June, but families earning less than about two dollars a day -- meaning about 90 percent of Mozambicans -- will instead be able to buy a basket of basic foods at reduced prices in certain shops, Antonio Cruz, director of policy analysis in Mozambique’s planning ministry said. Cruz said high prices were a driving force in both the protests that have swept across north Africa this year and deadly riots that shook the Mozambican capital last year. “These protests are a sign that the cost of living is very high,” he told AFP. For a second year in a row senior government officials will not get a pay rise, he added.
Cape Herb and Spice
The
SPiCEof LiFE Managing director of The Cape Herb and Spice Company, paul Jibson, tells Jane Bordenave how the organisation has grown from a wheelbarrow vendor to one of the premier providers of dried herbs and spices in the world.
t
he Cape Herb and Spice Company is a Cape Townbased producer of high quality herb and spice products to the retail sector. The organisation was founded by Irene Ivy and started its life operating out of a wheelbarrow on the city’s waterfront in 1992. Having had great success using this model of selling to passing trade, Ivy decided to formalise the
business, registering it in 1994. The company now exports its goods around the world, as well as serving the local market. The registration of the company in 1994 is what really brought it to the next level of operation and made it what it is today. “There was a two-fold driving force in the Cape Herb and Spice Company officially registering its business in 1994,” explains managing director Paul Jibson. “Firstly,
we began providing private label goods to a local food retailer in South Africa. Secondly, at more or less the same time, we got our first export order form the United Kingdom. In order to progress, we had to become officially registered.” Approximately three years ago the firm sold a majority stake to Liberty Star Consumer Holdings – a private label manufacturing solutions provider to all retailers in www.southafricamag.com 125
South Africa. Over the intervening years, The Cape Herb and Spice Company has evolved to primarily become an export operation producing private label goods. “70 percent of our revenue comes from exports, while the remaining 30 percent is from domestic sales,” says Jibson. “In terms of private label to own label products, the split is 80/20. What this means is that of all the herbs and spices we produce, 80 percent is sold under the name of a store of brand such as Co-operative and Jamie Oliver in the UK or Woolworths in South Africa. The remaining 20 percent is sold as The Cape Herb and Spice Company products.” This method has produced an enterprise with annual revenue of over £11.5 million.
KEEPING IT LOCAL The Cape Herb and Spice Company prefers to keep almost all of its manufacturing and business operations in house at its Cape Town factory and office. This approach allows it to keep all its threads together and maintain its focus, whether that is warehousing, logistics, production or distribution. It aids the research and development process as it can be approached in context. The company has also chosen to pursue a strategy of mechanised production with human input, rather than all-out automation. “Our process has to be flexible in terms of quantity and variety of product. Full automation would restrict us in this area, while our current way of operating, using machines but also keeping people working on the production allows us to be more responsive to our clients’ needs.” Innovation has always been important to all aspects of the company’s business and its constant drive in this area is an important part of its evolution. “One of our earliest examples of innovation was the development of an 126 www.southafricamag.com
Cape Herb and Spice
adjustable transparent disposable grinder – that is a single use container with a grinder attached. While these are fairly commonplace now, in the late 1990s, Cape Herb and Spice Company was the first business in the world to develop this kind of product,” recounts Jibson. The organisation held that niche for many years, however as more and more competitors began to use the same design, it began to lose this defining edge. “In our industry, the only barrier to entry is finding the moulds for the grinder mechanism and a way of filling the containers – which can be done by hand if necessary,” Jibson says. “So we had to reinvent ourselves otherwise we would lose ground to the competition.”
modern, which we launched at the end of last year,” says Jibson. “It is still as robust as before but the shape has totally changed. We also set about redesigning the labelling, making it more ‘funky’ and eye-catching, while maintaining simplicity.” It was not just the aesthetics that changed, but also the range of available sizes. “We used to only produce 100ml grinders, however now we are able to provide a selection of larger and smaller volumes up to 325ml,” Jibson explains. Another area of innovation has been in the sterilisation process of the herbs themselves. “There are lots of challenges inherent in this business, but reducing or eliminating the levels of micro-organisms present in the product while retaining quality is one of the biggest,” says Jibson. “Our business is export focused, so we have to meet the most exacting international standards in order to be successful.”
We had to reinvent ourselves otherwise we would lose ground to the competition
A REVAMP What was needed was a revamp, which, two years ago, is exactly what happened. The company wanted to keep the acrylic container-built in grinder combination, so it focused on redeveloping the design. “We developed a container that was sleeker and more
STRINGENT REGULATION Perhaps ironically, for an export business, the country www.southafricamag.com 127
Cape Herb and Spice
with the most stringent regulations regarding microbial content is South Africa. However, the methods used to meet these levels of acceptability can damage the product. The most commonly used system for the sterilisation of herbs and spices before packaging is irradiation. This is not surprising, as the process kills absolutely everything, but it is, for The Cape Herb and Spice Company not the most desirable solution. “There are other standard methods available that will clean the product to the necessary standards, but these can ruin the natural oils of the product, which gives it its flavour, as well as causing discolouration,” says Jibson. The Cape Herb and Spice Company took it upon itself to engineer away from irradiation, but find a process that did not compromise quality either. Working with the University of Stellenbosch, the organisation came up with was an innovative freezing technique that is entirely unique. “This has put us at the forefront of innovation in this area – achieving
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optimum sterilisation without compromising taste,” says Jibson. And what of the future? This is a fast-moving and competitive market, how does the Cape Herb and Spice Company intend to stay ahead of the curve? “Our current mission statement is to be the preferred herb and spice manufacturer and provider to the retail industry globally. Our vision statement for the next five years is much the same, except that we would also like to be investing in new categories and categories within categories. For example, we currently produce only dry products, however in the future we hope to also look at manufacturing cooking pastes – particularly the fruit-based niche. We also want to increase penetration into the domestic market; this is very important for our progression as a business, particularly with the Rand as strong as it is currently. This will be quite a step change for us, but we hope to achieve it both through natural growth and also any acquisition opportunities that present themselves.” END
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2010/10/25 10:12:56 AM
Banana TISSUE CULTUrED
PLANtS IN DEMAND
F
or consumers in temperate countries, the banana is the perfect fruit. It is easy to eat, delicious to taste and packed with energy, vitamins and minerals. However, less than 15 percent of the 100 million tonnes of bananas and plantains grown in the world each year find their way to the supermarket shelves of importing countries. The remainder are grown in millions of backyard gardens of farm households, mainly in
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tropical countries. There, the produce is eaten locally, most often as a staple food, or sold to support a local cash economy. Consequently, millions of lives depend on the humble curved fruit. In subtropical South Africa, some 250 growers farm about 12,000 hectares of Cavendishtype dessert bananas. While it is an important crop with high local demand and consistently good prices, South African bananas are not exported, mainly because certain climatic constraints lead to quality problems which
Du Roi Laboratory provides highly specialised and focused agricultural products and services to customers regionally, nationally and internationally.
are not acceptable on the discerning markets in Europe. Overall, however, subSaharan Africa produces 30 million tonnes of bananas and plantains, providing staple food for more than 100 million people, and accounting for 35 percent of global banana and plantain production. As described by Thomas Dubois, a Belgian scientist with the Consultative Group on International Agricultural Research (CGIAR), “We cannot underestimate the importance of the banana to Africa. What rice is for China, and potatoes are for America,
Du Roi Laboratory
that’s what bananas are for certain countries in Africa.” Bananas and plantains are particularly susceptible to certain debilitating diseases, to the extent that media warnings were recently given that edible bananas may disappear within a decade. While this is not likely to happen, it does emphasise the need to develop new disease-resistant varieties to counter the threat of diseases like panama disease, black sigatoka and various banana viruses. The vulnerability of bananas to these diseases arises from the lack of resistant varieties as well as from the practice of propagating new planting material vegetatively by taking suckers from infected plantations. Farmers are often unaware
of any infection and unwittingly spread the diseases further afield. An alternative approach has been revolutionising the export banana industry over the last 20 years, which for some countries has been a major component in its rehabilitation. This is tissue culture – propagation by cloning, using the growing point of a banana sucker. These are multiplied up in a laboratory, rooted, acclimatized and grown on for field establishment. The main advantages of these propagation units are: (a) Plants are free from diseases and nematodes (b) Plants are juvenile, vigorous and physiologically- superior, leading to higher yields in the field (c) The ability to multiply new
varieties rapidly for distribution (d) The ability to transport any quantity of plants long distances, rapidly and safely. In Letsitele, in the Limpopo Province of South Africa, is one of the world’s foremost banana tissue culture laboratories, Du Roi Laboratory. Du Roi Laboratory is one of three large banana tissue companies worldwide and the main cornerstones of this organisation - proven quality of product, breeding of competitive new selections, virus indexing initiatives and excellent customer relations - have contributed significantly to the company’s worldwide image and business performance. Du Roi laboratory specialises in the production Banana bunches in pack shed ready for packing
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Du Roi Laboratory
and distribution of disease-free, virusindexed, and genetically-improved tissue culture banana plants, mainly of the Cavendish dessert type which is most in demand. Here, about eight to 10 million banana plants are produced annually for sale to the Southern African market, as well as to West and North Africa, the Middle East and South and Central America. Large multinational companies of 3000 or more hectares, with massive funding and technical resources and expertise, and which service the major importing countries like America and the EU, make up one segment of the Du Roi client and customer base. Then smaller commercial growers with farms of from 50 to 500 ha, and who sell their produce to local markets, make up another segment of Du Roi business. Finally, there is a vast number of smallscale banana farmers throughout Africa who desperately need the tissue culture technology of Du Roi, but where access to financial assistance, chemicals, and technical advice, are unavailable. According to Dr John Robinson, a horticulturist and Technical Manager at Du Roi Laboratory with 30 years experience in banana research and management, the small-scale farmers are really struggling with a lack of access to technology and finance. “The use of tissue culture material would benefit them tremendously and provide a stock of disease-free plants to establish in clean land and arrest the spread of soil-borne diseases. “They also need disease-resistant material to be able to withstand the onslaught of endemic air-borne diseases, in an environment where they cannot afford expensive chemical control methods, or
We cannot underestimate the importance of the banana to Africa
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have access to the best horticultural advice. This is a challenge that Du Roi is trying to take up with international banana organisations like Bioversity (previously INIBAP), and the National Agricultural Research Organisations in Countries like Uganda and Kenya, who are also trying to help the small-scale farmer.” Du Roi Laboratory has focused on the improvement of their plant material. Dr Robinson says, “I must emphasise that Du Roi Laboratory produces genetically –improved plants, not genetically-modified plants or GMO’s.” The breeding programme, based on the phenomenon of somaclonal variation, has been a feature of Du Roi’s technical innovations over the past 10 years and many superior, elite single clone selections have been produced, internationally evaluated and commercially distributed with good results.
He stresses that the Du Roi breeding programme has concentrated on horticultural traits such as shorter plants, shorter cycles and higher yields. “The tissue culture process ensures that thousands of these genetically-improved plants are produced from one meristem, and are entirely disease-free, but unfortunately not disease resistant. “The latter will depend on the continuing efforts of Bioversity and various National Research Organisations, to create the resistant selections that are so much in demand by consumers, growers and by tissue culture laboratories like Du Roi.�
Soil fertility is another production issue that is a concern to small scale farmers and commercial farmers alike. On the one hand, small scale farmers do not have access to expensive chemicals and are forced to use litter and household refuse as the main source of nutrients. Ironically, the large commercial companies do have access to chemical fertilizers but often overuse them to the detriment of soil health and ultimately productivity. In this respect Du Roi Laboratory is very active in promoting organic programmes to its grower clients, and the main
mother block of Du Roi elite single clones is managed on organic principles to emphasize what can be done to build up soil fertility, and to demonstrate this to clients. This is undoubtedly a relevant and important marketing tool for the Laboratory. Du Roi laboratory also has a new insect-proof mother block under plastic, in which mother plants are grown in sterile medium. More and more clients are demanding that their plants are not exposed to pests and diseases of any sort from the original mother block to the final destination, and this facility does just that which www.southafricamag.com 133
Du Roi Laboratory
distinguishes Du Roi Laboratory from many other similar laboratories. In addition, the plant material produced from such a mother block can be traced back by the grower to a single mother plant in the Du Roi fields. This traceability is another unique feature. Being at the forefront of new technology to ensure quality plant material and excellent advice to customers, are important cornerstones to the Du Roi business. The production Manager has an M.Sc in plant virology which is obviously hugely beneficial to the production protocols of the Laboratory which focus to such a large extent on virus indexing and production of virusfree stock for international distribution (another cornerstone of the Laboratory). The technical expertise of the Technical Manager and Production Manager are put to good use in the training programmes, farmers’ Du Roi is situated in the heart of Limpopo in South Africa, one hours drive from the Kruger National Park
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days and banana study group meetings which are offered by the Laboratory to farmer groups in all production areas and in all different countries where the plants are sold. Technical bulletins and management documents on all aspects of the field management of bananas are produced and distributed to all clients as and when required by them. After-sales service visits to farmers in all countries are regularly made by technical staff as well as by the Marketing Director, Alan Davson, who over many years has built up excellent customer relations and a “hands on� approach to solving any problems the client may have. Du Roi laboratory believes many of these technical inputs are unique to the company. Quality management is a strong focus at Du Roi Laboratory and this is continually emphasized to the 140 permanent staff that are involved at all stages of the production cycle. As
evidence of this commitment to quality, DuRoi is now at the final stages of accreditation for ISO 9001:2008. The General Manager, Anne Davson, says “skills shortage is a problem for our company, especially being located 400 km from Johannesburg in a small country town. We keep our eyes open for promising young students, support them to the point where they become qualified, and then offer them employment in the company with opportunities for further development and recognition”. She continues, “We have intensive inhouse and external training programmes for all members of staff during our out of season months (end of March to August) and with more than 50 percent of our employees being semi-literate, we offer adult literacy skills in English up to matric level. We find that black South African women have been underprivileged, thus here in our laboratory we focus on the upliftment and empowerment of these women. Our intention is to develop some of those in our ranks up to management level.” Continuing with the social fabric of Du Roi Laboratory, Anne Davson says that addressing health issues and challenges in the local community, which directly impacts on human resource at the laboratory, is another Du Roi target. “We have linked with the ‘International Organization for Migration’ (IOM) and a local implementing partner, ‘Choice’, and are working to address all healthrelated issues, focusing on life threatening diseases including HIV and AIDS. We are addressing the stigma attached to AIDS and AIDS-related diseases, thereby changing lifestyles and improving quality of life. There are gender issues in Africa with quite a bit of abuse against women, which is also being addressed in this project. Most of our female employees are single mothers, and we have a crèche with fully-
trained staff, offering care, nutrition and teaching up to pre-school age”. Du Roi Laboratory has been perfecting the art of tissue culture production and the distribution to clients worldwide for 20 years. John Robinson summarises as follows: “Growers know they will get from DuRoi a quality product, genetically improved, stable and disease-free. Besides that, every related aspect is addressed during the production, distribution, after-sales service and technical assistance to clients, as well as in the ongoing development of our company staff. All of these attributes are encompassed in the company logo ‘FOR MORE THAN PLANTS’.” END
I must emphasise that Du roi Laboratory produces genetically-improved plants, not genetically-modified plants or GMo’s
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Compass point on the
CAPE oF
GooD CAKES on a location more scenic than commercial, Compass Bakery has grown to become one of South Africa’s top producers of luxury cookies and cakes. Marketing Manager Miguel Howell tells Colin Chinery about its winning mix and strategic ambitions.
S
urfers love Kommetjie, drawn by powerful Atlantic waves that rise over the reefs to crash along the long sandy beach of this delightful rural village 35Km South of Cape Town that some call paradise. Thirty five years ago Bob Horton, a bakery technologist at Woolworths came here to start a business and caught a perfect wave. Partnered
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by two friends, David Bruce, Marketing, and Rodney Cottrell, financial, he founded Compass Bakery and in this beautiful, remote and commercially challenging environment, grew it into what today is one of the top producers of luxury cookies, puddings and cakes in South Africa. The Compass’ range is extensive. It includes baked puddings, brownie
confectionery and dessert, round gateaux, muffins, cup-cakes, Swiss rolls, lamingtons, bar cakes, ring cakes and 77 types of biscuit. And then there are the seasonal and special occasion lines like Christmastime mince pies for which it has scooped top honours in media ‘Whose Are Best?’ evaluations. “In South Africa there are the big biscuit producers and
Compass Bakery
a bevy of smaller ones, we are one of the few medium size companies ,” says Marketing Manager Miguel Howell. “We do a high quality product.” About 30 years ago the Compass’s famous ‘Crunchie’ was born. Master Baker Bob took it along to representatives at Woolworths, hoping to market the bakery’s expertise. Impressed, Woolworths agreed to sell the crunchie in its stores across the nation. It was the start of a business relationship, which like a Crunchie, remains crisp and fresh. Today Compass’s entire biscuit production is packaged and sold under the Woolworth label, accounting for 90 percent of its total turnover. “As a Woolworths supplier we need to be very competitive in the market place and this is a big challenge. Obviously we could over-elaborate the product, but by the time it reached the shelf it would be too expensive and deter the shopper. It’s a fine balance.” The Compass range says Howell is “quality driven, with only the very best raw materials sourced. The work done here is of an exceptionally high quality, creative and with total attention to detail. It’s a significantly hands-on operation, and over the last
...over the last year we have concentrated on product development, an area of the business where we have a team of experienced and dedicated staff
year we have concentrated on product development, an area of the business where we have a team of experienced and dedicated staff.” In South Africa as elsewhere, consumers are increasingly astute, discriminating and demanding, where new eating habits have emerged, with a heightened awareness of the health implications, as for example, excess fat, sugar and salt. Environmental concerns are high on the Compass bearing, and in July it plans to use free range eggs. “The rapidly expanding new market of the Black middleclass is as yet untapped,” says Howell. “There’s a whole new onus on the manufacturer to produce quality products and take full accountability.” This brings implications for recruiting and staff selection. “We need people who can visualise this change in mind set, who themselves are open to change; people who are driven by a passion for the industry and who can help create products that just jump out at you in the market place.” Yet Compass retains a distinctly ‘family’ environment, run by the sons of the founders (who themselves retain an active role). Many employees have worked here for over 30 years. “We try to create opportunity, building people up from the www.southafricamag.com 137
Compass Bakery
floor level so that they end up growing themselves.” Situated in commercially-remote Kommetjie, the Compass Bakery is aware of its role in the community as major employer and contributor to the economy of this corner of the Peninsula. As many as 400-600 workers are employed over two shifts on a 24/7 basis, most from the nearby Ocean View and Masiphumele townships, and a hugely successful Factory Shop serves local customers at discount prices. “We have an ethical sense of responsibility to thousands of dependents of our staff which disuades Compass from considering a switch closer to the hub of the city,” says Howell “Being in Kommetjie brings with it many logistical costs and headaches, but the only movement Compass plans is in our sales graphs. Where we have 400 to 600 at the seasonal top end of the production cycle and in the quieter months between February and March, it goes down to 150-200, until production takes off with the winter pudding programme in May and June followed in July and August with another major earner the Christmas biscuits launch.” Proposed changes in labour laws can affect Compass and other employers, says Howell. “If a change in legislation does arise we would have to keep an optimum number of full time staff and not be able to hire staff according to production capacity, full time staff would therefore have to be laid off at times of lower production, all of which does not aid employment or labour relations.”
Another major issue is rising commodity prices, Finance Manager Derek Koep says. “Wheat prices for example have gone up by a third, largely as a direct result of the Australian drought. The challenge for us is to try and maintain price.” Compass production is located in two separate buildings; one biscuits, the other cake. “Future expansion plans will have to meet enviromental impact requirements, which may limit further development, unless we subdivide our existing large holding to satisfy these new regulations,” says Koep.
There’s a lot happening for Compass Bakery , it is going to be an exciting time and a challenging year
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“Therefore in the current climate we are focusing on internal changes, maximising use of existing space and improving process flow in advance of new buildings. I think this will be more cost effective and easier to implement.” Compass is also looking at a brand makeover, with a new look, new products and new packaging.” It’s quite a comprehensive exercise involving some very exciting plans, including widening the customer opportunity base and expanding our biscuit turnover where we have the capacity to virtually double our current production.” Product reliability and consumer confidence are at the core of the Compass philosophy and range, says Howell. “We want to create a secure and successful future for the company and our employees. In these economically challenging times we are fortunate to be in a sector where, dining out is expensive and people will normally buy feel good cakes to take home. “There’s a lot happening for Compass Bakery, it is going to be an exciting time and a challenging year.” END
Success S weet
taste
o f
Basheer Harnekar tells South Africa magazine more about the secret behind this second-generation family business’s success.
I
t’s about 90 degrees, the sun is beating down; it’s time for ice cream. Strangely enough today – 4 April – is the 119th anniversary of the ice cream sundae: A little factoid for you. I digress; Back to the point. It’s sweltering outside. I need refreshment. I need ice cream. Not just any ice cream will do. I need a Choc-o-Lina. Produced by Gatti Ice Cream, this delicious chocolate milk ice cream is what
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I like to call a taste grenade. And it hits the spot when it’s hot, and when it’s not. That’s why, when given this assignment, I jumped at it. A chance to learn more about something I love. And it wasn’t long before I was salivating, over some pretty impressive stats: Gatti’s Lansdowne facility is over 10 000m2 and full of “cutting edge” equipment, it employs more than 300 permanent and casual staff, and it is the largest African owned Ice Cream Factory on the continent.
Gatti Ice Cream
“Gatti Ice Cream has something of an interesting past,” says director Basheer Harnekar. “This business was built up by my father, Mr. E. D. Harnekar, who in 1964, founded Playtime Lollies just down the road in Lansdowne.” With his wife, four sons and a daughter, Mr. E. D. Harnekar started making
We have a variety of flavours and lots of choice
handmade ice lollies with the taste and quality fit for a king and priced affordably even to the man on the street. “This is the recipe for our successes,” Harnekar says. So who is Gatti? Mr. Gatti, of Italian descent was a master of ice cream having family ties with the great Carlo Gatti. Mr. Gatti, www.southafricamag.com 141
the original owner of Gatti, produced ice cream namely vanilla, strawberry and chocolate flavour. “My father bought the Gatti Ice Cream facility and brand name in 1973, and the production of ice cream continued until 1976, when other lines and flavours were introduced,” says Harnekar. In 1989, Mr. E.D. Harnekar retired and handed over the company to the secondgeneration. Sadly he passed away in 1996 but his staff and customers still to this day speak about him. “The product range has obviously expanded to many varieties of cones, wafers, lollies, flavoured full cream ice creams, coated ice creams, cartons and tubs,” says Harnekar. Distribution includes most major hubs of South Africa, Central Africa, and general retail, including the informal sector and hospitality industry. “We have a number of high quality products, which are competitive on price, but don’t compromise on taste or quality,” says
Harnekar. “Anybody can buy our product: Customers include restaurants, hotels, coffee shops, wholesalers, and retailers. Product is also available direct to the public at wholesale prices. “Of course we have one of the oldest factory shops in the country. It has been going 40-45 years now and it is the largest African owned ice cream factory in Africa. “We moved to the current premises in 2004,” he continues. “It is still in Lansdowne but is a much larger facility. “It has definitely helped us grow as a business.” According to Harnekar, Gatti is performing well as a business and has grown over the last year. “In all honesty, I can’t ever recall negative growth; we’ve always had positive growth in our business, even during times of recession or political change. Of course the growth
We have a number of high quality products, which are competitive on price, but don’t compromise on taste or quality
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Gatti Ice Cream
could have been better had the recession not happened. We could have grown more,” he says. “What is behind that? Well as I explain[ed], the quality of the product and the price is definitely the formula for our success and we continue to grow. Production expands almost every year. We have a clear view of where growth is, where we need to invest, and are continually looking at R&D and new products. In terms of obvious expansion, Harnekar adds, there are several townships
where he would like to get better penetration. “We want to grow in the areas where we haven’t great coverage yet. We are always looking for new business, especially in areas outside of the major cities and hubs.” Of all the wonderful products on offer, the humble vanilla ice cream is the biggest seller, he says. “We sell in the bulk ice cream a lot of vanilla. Vanilla has always been the most popular flavour. But we have a variety of flavours and lots of choice. The
secret to success is being in touch with our market and producing products suitable for our market and at the right price and quality.” What has happened at Gatti is nothing short of remarkable. I’m sure the success will continue. “We have consistently delivered affordable treats that still hold the idea that my started with - the taste and quality fit for a king and priced affordably, even to the man on the street. We hope to continue that long into the future,” Harnekar concludes. END
TM
R.M. Chemical Distributors
SupplieRS of flavouRS, eSSentialS oilS & CheMiCalS to the fooD, CoSMetiC anD phaRMaCeutiCal inDuStRy
223, lansdowne Road, Claremont, 7708 p.o.Box 2056 - Clareinch - 7740 - Cape town South africa tel: +27 21 683-1337/8 email: rmchem@mweb.co.za
KOOGAN PLASTICS
TM
+27 11 857 1345 / 1370 / 2560
Koogan Plastics is a South African plastics manufacturing company, based in Johannesburg. Established in 1982, we have been supplying rigid and flexible packaging to the food, ice-cream, paint, chemical, oil, pharmaceutical and other industries in Africa for almost 30 years. We have a national distribution network, which includes warehousing and distribution centres in Johannesburg, Cape Town and Durban.
Email: info@kooganplastics.co.za Tel: +27 11 857 1345 / 1370 / 2564 • Fax: +27 11 857-2563
www.kooganplastics.co.za
Fox&
Swan S weets Join the chocolaty revolution...
W
e love sweets. And we love them because they make us happy. Where would we be without them? Down in the dumps, for sure. If that’s the case, Keith Swan and Johan Payne, Port Elizabeth’s very own Willy Wonkas, should be given a medal. They have made it their business to ensure we stay happy (aka, get our sweet fix). Their firm, Fox & Swan Sweets, manufactures a 144 www.southafricamag.com
complete range of sweets, for every kind of sweet tooth. “We make things like choc peanuts, choc raisins, slabs, mint imperials, almonds, pink and white peanuts, salted peanuts, peanuts and raisins,” Swan and Payne say. “We are a family run manufacturing business in Port Elizabeth and we have a factory shop outlet. “Chocolate is our business,” he adds. Fox & Swan are on a quest to find perfect, affordable chocolates and sweets.
Swan bought the company over 20 years ago – it was a small packing business at the time – and ever since he has been fascinated with sweets. It is a labour of love that is taking the business he bought with partner Colin Fox to new heights. 12 years ago, when Fox retired, Johan Payne became Swan’s partner and is now the MD of the company. “Originally we were doing a lot of packaging work for pharmaceutical clients and
Fox & Swan Sweets
food giants like Cadbury,” Swan says. “We decided to stop doing that and launch our own product.” The firm still does some contract packaging on the side, but the focus has shifted to its own brand. “Basically, we have moved over from supplying other people’s brands to developing our own brand products,” Swan says. Their factory, he boasts, now produces “a fine variety of products”. They sell a lot of it locally and unsurprisingly the firm is a big player in the local economy. “Our brand is growing and we’ve introduced, recently, our own chocolate,” Payne continues. “We started making it in September last year. So we are now selling our own chocolate slabs. “On top of that, we manufacture for three other brands.” Fox & Swan produce about 40 tonnes of sweets a
months, 20 tonnes being chocolate. There is room for more and R&D is a major focus. “We are upping the ante, so to speak,” says Swan. “Our objective in the company is to grow our market and expand our reach. Traditionally, our market has been informal and towards the bottom end, to the hawkers. We have marketed through wholesales and direct to the sellers, the shops themselves. “We have put a lot of effort into improving the quality and taste of our products, the chocolate specifically. “Now, we want to step up and introduce a chocolate covered nougat and chocolate covered Turkish Delight. “We have everything in place and the technology to expand. It is a natural progression of developing our usage of the equipment we have. Those two products are higher market products, compared to what we have been manufacturing in the past.” The firm recently bought
our brand is growing and we’ve introduced, recently, our own chocolate
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Fox & Swan Sweets
The smoothness of the chocolate is amongst the best
a new roller ball chocolate conch machine, he adds. “We brought this conch in from China, and started running it in September 2010,” Swan says. “Before that, we had been involved in manufacturing chocolate for a third-party brand and we were buying back that chocolate for use in our own branded products. We decided that in order to further develop our own brand we needed to start controlling the conch process of our own chocolate. “This will help with our plans - we aim to move into the formal sector. We were selling mainly to hawkers. If we look at that bottom end of the market, it has been seriously 146 www.southafricamag.com
tainted by the loss of about a million jobs over the last 18 months. So we have seen a need to move upmarket and move into the more formal
market areas. “There is a lot of new design going into packaging materials and we are working on creating a brand which is higher than the one we had recently.” Fox & Swan currently runs six lines, and their aim is to have increased market share considerably by year-end. In terms of employees it currently has 70. They are all from the local area. “It is important to us to employ locally,” says Swan. “We have been in the business
“SERVICE IS OUR STRENGTH” ° NATIONAL ROAD TRANSPORT SPECIALISTS ° TRANSPORT OF PAPER & PRINTED MATTER ° TRANSPORT OF HARDWARE & MANUFACTURED GOODS ° FLEXIBLE, FAVOURABLE RATE ° WE COLLECT AND DELIVER
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since 1987 and we have built a partnership with the local community and the people in the immediate area. “We provide employment too for about 2,000 hawkers as well who buy direct from us and supply to various small shops and schools and that type of thing. So, we are providing employment for a significant number of selfemployed people. “Is that important to us? I think it is. We are having a big impact on the local economy.” The family run business is a real South African success story. Swan and Payne’s aim is to continue the good work and leave a lasting legacy for future generations of their
There is a lot of new design going into packaging materials and we are working on creating a brand which is higher than the one we had recently
families and employees. “Retirement isn’t so far off for me,” jokes Swan. “In terms of a legacy, I’d like this to be a viable and growing business that continues to contribute to the future of SA in it’s own way. “I think the sense of family we have here has certainly contributed to our success.” The chocolaty dream of this team is to be admired. 90 percent of product is sold in SA, while some is exported to Namibia and Swaziland. “I think in terms of production of chocolate we’ve made quality a priority. The smoothness of the chocolate is amongst the best,” he concludes. END www.southafricamag.com 147
The home of discount
A bargain doesn’t have to be in lockstep with basement service says Midmar’s Theo Naidoo.
G
eorge Naidoo is one of the liquor industry’s biggest personalities. He was the first Black to launch into South Africa’s liquor trade and has built a business, which now has more than 30 stores across the country – Midmar Liquors. He has shown that a bargain need not be in lockstep with basement service; that
148 www.southafricamag.com
best deals can be served with expertise and customer attentiveness. It’s a formula that has grown a dynamic business in a razor-edged competitive sector. “Back at the beginning it was very hard for non-white people to get a liquor licence. But there was little competition within the sector and margins were a bit higher,” executive director Theo Naidoo - George’s son - tells
Midmar Liquors
South Africa Magazine. “Now competition is a lot fiercer. My father saw a gap, which he wanted to exploit and he has succeeded in doing so. “We are the only Blackowned liquor chain company in South Africa, and it’s been run by my father since day one. And we’ve been a Black owned company since inception and have remained so. I don’t think we’ve punted this aspect enough. “ George opened his first store in the Cape Town suburb of Parow in 1982. He had a staff of four.
A NOVEL APPROACH In a sector dominated by the self-service ethos George Naidoo set out with a novel many would say contradictory - vision: give the public quality wines, spirits and beverages at competitive prices in an informed and shopperfriendly setting. “The Midmar shopping experience is distinctive, not least in a country where customer service expectations are modest,” Theo Naidoo says. “We start serving the customer from the moment he jumps out of a car in the parking lot. He is approached and asked if he has any returns – empties - and then on right through the store, advice and assistance are on hand from a staff trained in-house and moulded around the concept of quality customer service.
When he has completed his shopping we carry the goods out to his car.” Customers appreciate the extent of this service, its detailed and personal nature. And they keep coming back. “We make people feel special,” Theo says. Perhaps surprisingly the Midmar example has won few sector followers; competitors have failed to offer a similar service. “From their side not much has happened on customer service, but on our side it is something we constantly strive to improve. “And if you compare our retail industry with prominent ones across the world, we in South Africa are not very customer-orientated. Not at all in fact. But this is what we at Midmar want to change and especially in our industry.”
our strategy going forward is to expand and keep expanding. That’s something we are not going to give up on
ENTER, RETAIL GIANTS The liquor market is seeing a major, dramatic development, Theo says – the entry of major retailers. Everybody it seems wants to come to the bottle party. “In the past big retailers weren’t allowed to have liquor stores, but our big retail players like Pick n Pay, Woolworths, Checkers, Shopright and the Spar Group are all going the liquor store route now. “Between them there’s probably close on 2,000 applications for liquor stores across the country and it’s getting very competitive. But having said that I don’t think right now they have proper knowledge of the industry, nor anywhere near the range we have. It’s a very limited range in fact, and their pricing is out compared with us.” Midmar’s response is to continue making itself the store of choice. “So we have these destination stores which we believe our customers will continue to frequent. With our buying power we can definitely be more competitive than anybody, even the likes of major supermarkets.” Midmar has been expanding. It has opened several new stores, specifically in Durban and the Western Cape. “We’ve identified those areas where we want to expand,” Theo says. “Our www.southafricamag.com 149
Midmar Liquors
whole strategy is looking for destination stores where people make a point of looking for Midmar as opposed to a competitor or one of the retail stores like Pick n Pay and so on. A place where they can have a good shopping experience, have a wide selection of wine and retail spirits and everything is competitively priced. ”Our strategy going forward is to expand and keep expanding. That’s something we are not going to give up on.”
George Naidoo 150 www.southafricamag.com
Within the Western Cape Midmar is the biggest mover of Brand House products – the joint trade name of Diageo, Heineken and Namibia Breweries, combining the sales, marketing and distribution of some of the world’s top premium brands – and second or third in the whole of South Africa. A major importer of Scotch whisky, Midmar also has its own brand labels, Royal Castle and Three Scotsmen the two biggest. “They’ve been a phenomenal success, quite unbelievable. People are looking for quality whisky at a good price, and these brands are selling more in our stores than the more renowned brands like Bells and J&B. Quite remarkable.” For Midmar customers, joy is to be found at a discount and with personal service, Theo concludes. “Our policy is shopping at a place where you get value for money together with a service that you don’t associate with value for money products. “We offer a top service, open 12 hours a day, six or sometimes seven days a week, and no competitor opens these hours. We are there for the consumer and we want them to keep coming back.” And his preferred drink? “I’m a whisky on the rocks kind of guy. It has to be Scotch.” END
KINGJAMES 20547
ROSES ARE RED, BUT THE ACSA FEATHER AWARDS ARE GREEN. Winner of the 2010 ACSA Feather Award for OR Tambo, Cape Town and King Shaka International Airports, in recognition of service excellence.
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