ea march 2016

ENTERPRISE AFR

ICA

March 2016 www.enterprise-africa.net

THE BUSINESS MAGAZINE FOR AFRICA’S INDUSTRY LEADERS

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ERICSSON: Facilitating the

Networked Society in Africa

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EDITOR’S LETTER

www.enterprise-africa.net / March 2016 / 3

Welcome to our latest edition…

Joe ForshawEDITOR

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Joe ForshawEDITOR

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Sophie BolderstoneSENIOR PROJECT MANAGER

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// The big news from last month was of course President Zuma’s State of

the Nation Address (SONA). There were big announcements in the business sector and when Finance Minister followed up with a budget speech that also announced spending, it looks like we have much to look forward to as we move through 2016 – despite the ongoing economic uncertainty.

Importantly, big spending was announced for ports, public sector infrastructure, energy, roads and pharmaceuticals – the government even announced the formation of a state owned pharmaceutical company, Ketlaphela, which will provide anti-retroviral drugs to the Department of Health. There will be an investment of R7 billion into new port facilities, a R100 million investment to boost local tourism, a R5 billion fund to support businesses effected by the global slowdown, millions to support businesses effected by the droughts, and R865.4 billion over three years for public sector infrastructure – R250 billion of which will be spent on completing the Medupi, Ingula and Kusile power plants.

The sceptics were of course out in force, claiming that the investments will never be realised of that they are unaffordable, but we remain positive and we are looking forward to seeing money flowing through the economy.

This will help the growth of modern businesses; companies like Ericsson who take our lead feature spot this month. This innovative Scandinavian business has been doing great work in SA and Africa more widely for a number of years and this looks set to continue as the company experiments with 5G technology.

As always, we want to hear from you. If you have a story, get in touch: @EnterpriseAfr1

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4 / March 2016 / www.enterprise-africa.net

CONTENTS

06/NEWS:The Month that was...A round up of some of the latest news stories in the industry

08/FEATURE: ENTERPRISE WINECreated with Passion and VigourOne of the country’s most important exports, and also hugely popular with localcustomers, South African wine is today globally recognised and lauded as some of thebest available on the planet.

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

12/ERICSSON :Facilitating the Networked Society in Africa The world of communications technology is changing rapidly. One of the drivers of this change is Ericsson, a global leader in equipment, software and services that enable mobility. The speed of change is extremely evident in Africa, a market with huge growth potential. We talk to Fredrik Jejdling from Ericsson to find out more about operations in this explosive ad exciting sector…

12/


CONTENTS

20/VODACOM:Vodacom Displays Positive Results in Strong Message to Market After being named as one of South Africa’s Top Employers and being recognised as one of the country’s most reputable brands, Vodacom is backing up this success with an excellent set of quarterly results.

26/SPAR SOUTH AFRICA:Industry Leaders, Top Employers and Still Searching For Growth Despite the economic climate which is hampering the development of many of South Africa’s large companies, SPAR’s strategy and focus on people is allowing it to grow and take advantage of opportunities all over the continent.

36/DEBSWANA:Mining Diamonds, Enriching the Nation?Debswanas management has come up with a clear-cut strategy to navigate this rough market.

44/LIFE GREEN GROUP:Beautifying SA’s Concrete JunglesLife Green Group provides complete green solutions to clients across Southern Africa.

50/CEF/PETROSA:Sparking a Turnaround in SA’s Energy Mix There are a number of initiatives under way to redevelop South Africa’s much-discussed energy sector.

56/ZAMBEEF:Feeding the NationIn Zambia, a country where food production and distribution is a prolific and complex issue, there is a great onus on governments and businesses to provide sustainable and affordable foodstuffs to the populace.

62/INDUSTRIAL LOGISTICS SYSTEMS:Stand and DeliverAs a leading expert in supply chain logistics consultancy, Industrial Logistics Systems represent the pinnacle of prosperity and achievement in their field.

68/BMW SA:BMW Keeps Foot On the Gas in SA Investment into facilities, the release of new models and an ongoing marketing push look set to deliver positive results for BMW in South Africa.

72/NEOLIFE:Rebrand Boosts Growth for NeolifeThe Neolife business in South Africa tells a story of success in a commercial sector where so many others have failed.

76/ADVANCED GALVANIZING:Working Hard in an Industry inNeed of GalvanisationWorking in a steel industry that has seen more than its fair share of challenge over the past few years is no easy feat

80/DE KEUR:A Fruitful Business in a Fertile IndustryBased in the Koue Bokkeveld, close to the town of Ceres, De Keur is taking advantage of the land that has been blessed with extremely fertile soils.

84/SUN PHARMA/RANBAXY SA:Providing Treatment to SA for 20 Years This innovative organisation is leading the way in SA and will continue to be a healthy asset for customers all over the country.

88/J&E CASH & CARRY:Wholesome WholesaleAs the consumer market begins to trend more towards value for money over brand or company loyalty.

20/ 36/ 44/


NEWS ROUNDUP

NEWS IN BRIEF

GOVERNMENT ESTABLISHES PHARMACEUTICAL COMPANY The SA Government has established a state-owned pharmaceutical company that will supply anti-retroviral drugs to the Department of Health.

“I am happy to announce that the state-owned pharmaceutical company, Ketlaphela, has been established. The company will participate in the supply of anti-retroviral drugs to the Department of Health from the 2016/17 financial year,” said President Zuma, during the SONA.

President Zuma said the country’s HIV policy turnaround in 2009 has led to a massive rollout of HIV testing and treatment for 3.2 million people living with the virus.

“This has contributed immensely to healthier and longer lives for those infected. We acknowledge the contribution of partners in the South African National Aids Council [SANAC] which is chaired by the Deputy President [Cyril Ramaphosa],” said Zuma.

The next step, said Zuma, is the revival of prevention campaigns especially amongst the youth. Health Minister Dr Aaron Motsoaledi will soon announce a “major campaign in this regard”, he said.

President Zuma said life expectancy for both male and female South Africans has improved significantly at 62 years across the genders. This is an increase of eight and a half years since 2005.

The economy grew by 1.3 percent in 2015, Statistician General Pali Lehohla announced last month.

“According to the latest preliminary indicators, the annual real estimate of Gross Domestic Product (GDP) for 2015 increased by 1.3 percent compared with 2014,” said the Statistician General.

The economy grew by 1.3% in 2015, down from 1.5% in 2014 and 2.2% in 2013.

The nominal GDP is estimated at R3 991 billion for 2015 – R194 billion more than 2014.

The main contributors to the

increase in economic activity in 2015 were finance, real estate and business services, the mining and quarrying and the wholesale, retail and motor trade; catering and accommodation industry.

Lehohla said finance expanded by R44 billion, government expanded by R40 billion, trade expanded by R30 billion, transport expanded by R14 billion.

A negative contribution was recorded by the agriculture, forestry and fishing industry. Agriculture decreased by R1 billion to R83 billion.

South Africa attracted R64.3 billion in Foreign Direct Investment (FDI) in the first three quarters of the current financial year, surpassing the target of R45 billion, says Telecommunications and Postal Services Minister Siyabonga Cwele.

Addressing media last month, he said South Africa remains a competitive business and investment destination, despite challenges in the global economy.

“For citizens, the

investment means an opportunity to work, to develop their skills, earn a sustainable income and feed a family,” Minister Cwele said.

He was chairing the International Cooperation, Trade and Security cluster media briefing, which was held in Cape Town.

Minister Cwele said South Africa continues with its engagements with the European Union (EU), which is its largest trading partner and foreign investor.

“Over 2,000 EU companies are operating within South Africa and have created over 350,000 jobs.

“The EU also contributes … about R1.5 billion to infrastructure development for domestic and regional programmes through the Infrastructure Investment Programme,” he said.

In 2015, South African exports to the EU amounted to more than R216 billion, half of which were manufactured goods.

GDP INCREASES BY 1.3 PERCENT IN 2015

SA ATTRACTS R6.4BN IN FDI


NEWS ROUNDUP

President Jacob Zuma committed R7 billion for new port facilities in his SONA last month.

This follows the adoption of a Public- Private-Partnership model for port infrastructure development by Transnet National Ports Authority.

Delivering his State of the Nation Address in Parliament in February, Zuma said government was concerned that South Africa did not own vessels while the country is surrounded by about 3000 kilometres of coastline.

“Through the oceans economy segment of Operation Phakisa, we are

trying to solve this challenge.“I am pleased that two bulk

carrier vessels have been registered in Port Elizabeth, and a third tanker in Cape Town under the South African flag,” he said.

The Operation Phakisa Big Fast results methodology was launched in 2014 and implemented in the ocean economy, health, education and mining sectors.

Another positive Operation Phakisa development has been the launch of a fuel storage facility in Cape Town, bringing an investment of R660 million.

GDP INCREASES BY 1.3 PERCENT IN 2015

R865.4B TO BE SPENT ON PUBLIC SECTOR INFRASTRUCTURE

SA OPENS SOLAR-POWERED AIRPORT

Government and state-owned companies (SOCs) is set to spend R865.4 billion on public sector infrastructure, over the course of the next three years.

This announcement came as Finance Minister Pravin Gordhan tabled the 2016 Budget.

“Over the next three years, government and state-owned companies have committed R865.4 billion for investments in housing, roads, rail, public transport, water, electricity and community infrastructure,” said the 2016 Budget Review.

It said government is strengthening its collaboration with the private sector, labour and civil society, to speed up implementation of the structural reforms set out in the National Development Plan. Public-sector infrastructure spending over the medium term is expected to total R865.4 billion.

Environmental Affairs Minister Edna Molewa has congratulated the Department of Transport on the official opening of South Africa’s – and Africa’s – first solar-powered airport in George.

Transport Minister Dipuo Peters launched the project that is spearheaded by the Airports Company of South Africa (ACSA) at a special ceremony in the city in February.

Most of the airport’s energy needs will be supplied through 200 square meters of photo-voltaic (PV) panels. PV technology generates electricity from solar radiation providing a renewable and clean energy source

In its first phase, 750kw will be generated through this clean energy source, which is sufficient to meet the airport’s daily needs. This is expected to increase with plant capacity in future.

“This ground-breaking initiative shows that government is well on track in transitioning South Africa to a low-carbon, inclusive, resource efficient and climate resilient economy and society,”

the Minister said.“What has been achieved at George

Airport is also the result of successful collaboration in the green economy sector between government, entities such as Airports Company South Africa (ACSA), and the private sector.

“The new solar-powered airport will rely on cost-effective, renewable sources to generate energy, and simultaneously support South Africa’s greenhouse gas emissions reduction targets,” says Minister Molewa.

GOVT SETS ASIDE BILLIONS FOR NEW PORT FACILITIES

FEATURE

CREATED WITH PASSION AND VIGOUR

One of the country’s most important exports, and also hugely popular with local customers, South African wine is today globally recognised and lauded as some of the best available on the planet. The producers, big and small, are rich in heritage and tradition and have been making wine of the utmost quality for generations. At Enterprise Africa, there’s nothing we love more than handcrafted produce straight out of Africa so we’ve taken it upon ourselves to review and recommend some of our favourite wines, not based on price or region, but based purely on taste and enjoyment…

EDITORIAL BY: Sam Hendricks, Hal Hutchison, Joe Forshaw

ruby colour. The flavours of plum and black cherry are strong in the taste and a smoky liquorice-cassis essence makes for an interesting nose.

Meerlust, which is currently marketing a very good range of red and white wines that are all produced on the estate in Stellenbosch, was named by the first owner of the property, a German immigrant named Henning Huising. Meerlust means ‘pleasure of the sea’ because of its unique locations just five km from False Bay.

Another fantastic bottle to look out for is the 2013 Merlot.

L!FE MOSCATO ROSÉ 2013 - ORIGIN WINESPerhaps made with a less traditional approach, L!FE Moscato Rosé from Origin Wines uses grapes from different locations around the Western Cape. The

brand is an exciting new idea from Origin Wines that looks to develop the fruitiness in the wine and push the flavour as well as the concept of living life to the maximum. Other variations in the range include a Merlot, a Sauv Blanc and a Rosé, and each is branded with a different slogan; L!FE is to live, L!FE is to discover, L!FE is to share and L!FE is to Celebrate. The bright, pastel coloured bottles also make for eye-catching marketing. You’ll also notice that this Moscato features a unique reseal tool to ensure optimum freshness and actually allows you to ‘pop’ the cork more than once!

The Moscato Rosé has a vibrant pint colour with fresh floral notes. You can also notice subtle hints of peach, strawberry, orange blossom and nectarine. The sparkling rosé is obviously sweet and cheerful; typical of the Muscat grape, and would be a great accompaniment to a sweet desert or a

MEERLUST RUBICON 2010The Meerlust Estate is one of the oldest in South Africa. Owned by the Myburgh family since 1756, it continues to produce award winning wines which are recognised globally.

The Meerlust Rubicon 2010 is a deep bodied red wine is one of the finest wines that has been produced in SA in recent times. This particular wine is considered by many to be worthy enough to purchase for investment purposes. Kept in cellar to age and increase not only in body and flavour but also value for up to 15-20 years, the 2010 Rubicon is truly a masterpiece from Winemaker, Chris Williams.

The flavour is dry and fruity and screams out for a juicy meat, beef or venison, to accompany it. Because of the composition of the wine (62% Cab Sauv, 24% Merlot, 12% Cab Franc and 2% Petit Verdot), you get a classic Bordeaux-style blend characterised by an opaque deep


© WOSA

ENTERPRISE WINE

CREATED WITH PASSION AND VIGOUR


© WOSA

FEATURE


services include blending, bottling, analysis, treatment, bulk wine supply and brand development and it also boasts IFS, BRC and IPW standards, and Organic Accreditation, DLG approval and Fairtrade accreditation.

For something a little extra, try adding a couple of drops of lemon juice to the glass for a flavour sensation!

FAIRHILLS UNSUNG HERO SHIRAZ 2011 Another Brand from Origin Wine is Fairhills, a unique and progressive empowerment concept where success is intertwined with the development of the community. Located at the foot of the Du Toitskloof

mountain range in the Western Cape, the idea is a cooperation between

camembert and cranberry starter. Because of the fun-factor that goes

with this bottle, as well as the attractive design and easy drinking style, this would make an excellent gift.

Origin Wine is one of South Africa’s top wine exporters and after starting with just three employees, the company now exports more than 80 million litres of wine each year. The company’s

Origin Wine and producers in South Africa’s Breedekloof valley. The Fairhills brand produces a number of great wines including a Chenin Blanc, a Sauvignon Blanc, a merlot Pinotage and a Cabernet Sauvignon but the wine that really peaked our interest was the Shiraz.

Coming under Fairhills sub-brand, Unsung Hero, this Shiraz has a fantastic tannic structure and does not dry the mouth too much like others from the price range. The flavours range from light berry, strawberry, cranberry and plum with a spicy, oaky twist. It’s not acidic, not over powering and has a long dry fruity finish. It’s perhaps too easy going and at 14.3%, Winemaker Alain Cajeux really packs a punch.

There are more complex Shiraz’s out there but for the price, this beats most Australian and American brands and would suit anyone who likes a smooth, slightly earthy, fruity flavour – don’t forget it’s also comes with Fairtrade accreditation so you know buying this wine is helping more than just the estate owner.

Enjoy slightly above room temperature with red meat, dark chocolate and strong cheese.

LYNX VIOGNIER 2014 The Lynx wine estate is located in Franschhoek and is run by Owner/Cellarmaster Dieter Sellmeyer, Winemaker Helgard van Schalkwyk and Farm Foreman Quenton Daniels. Situated on the foothills of the Klein Drakenstein Mountains, the

estate boasts an enviable position but interestingly is the smallest the valley producing fewer than 7000 cases each year.

The wines from Lynx are multi-award winning and despite the size of the operation, the company continues to make a big impact with many accolades from all around the world.

The Viognier grape is often underused by many estates and doesn’t take the limelight but at Lynx

this delicious variety is a real stand out selection.

The taste is creamy with grapefruit and honey elements. It has floral notes and you can pick up peach and very light orange flavours. This makes for an extremely clean, smooth and silky finish. There is no harshness or sting in the mouth perhaps down to the oak used in production; this is an extremely well-crafted wine.

For a wine of this quality you would often have to pay much more; this is a real bargain and we feel it is worth investing a few cases to be enjoyed up until around 2018.

Obviously, it works wonders with creamy chicken or fish but we would recommend consuming with sushi.

LYNX SHIRAZ SYRAH 2014 A wine described by any award winning estate as their flagship carries a significant weight of expectation, in this case the Shiraz produced from the Syrah grape delivers emphatically.

Another superb choice of grape by the Lynx Estate, the Syrah variety has an interesting background and can now be found in most of the world’s notable wine regions – part of the success is attributed to its favourable aging potential.

It is a little more expensive than the Viognier but still represents far greater value for money than you would anticipate for a wine that has already received recognition and awards, combine this with the aging potential of the grape and it could represent another attractive investment.

The taste of this bottle is layered with ripe fruits, mainly berries, with hints of clove and vanilla which gives a smooth finish to fantastic, rich wine that is full of taste.

As expected, it pairs beautifully with red meat and spicy food but we would also highly recommend this as an accompaniment to a cheese board.


ENTERPRISE WINE

FREDRIK JEJDLING - PRESIDENT & REGIONAL HEAD ERICSSON SUB-SAHARAN AFRICA

© ERICSSON

ERICSSON

Facilitating the Networked

Society in Africa

The world of communications technology is changing rapidly. One of the drivers of this change is Ericsson, a global leader in

equipment, software and services that enable mobility. The speed of change is extremely evident in Africa, a market with huge

growth potential. We talk to Fredrik Jejdling from Ericsson to find out more about operations in this explosive and exciting sector…


PRODUCTION: Karl Pietersen

// The telecoms industry in Africa has been one of the most important sectors in

the growth story of the continent in the past two decades. The number of internet users on the continent grew at seven times the global average, with more than 3600% growth between 2000 and 2012, to 167 million users, according to data from Internet World Statistics. But while communication infrastructure development has been fast and widespread, Africa remains relatively under-connected in terms of fixed broadband, with rural areas having little or no access to any kind of online service. The majority of people access the internet through a mobile phone, and Kenya makes for a good example - the Communication Commission of Kenya reported 330,000 mobile subscriptions in 2001 compared to 30 million in 2013 and internet

users grew from 200,000 in 2000 to over 19.6 million at the end of 2013, a stunning 9700% growth. There’s no doubt, telecoms is a booming market - between 2004 and 2007 the African telecoms market grew three times as fast as the world’s average and by 2005, the continent had invested $5 billion on telecoms infrastructures. However, it’s estimated that less than 1% of Africa’s internet users has access to a fixed broadband connection and although Africa accounts for 15% of the world’s population, only 6.2% of the world’s internet subscribers are Africans.

So what is the next step? How can the continent continue with its development and include more and more people? It’s a very difficult question. Fortunately, there is a huge amount of work going on on the ground, by innovative companies who

are passionate about not only internet connectivity, but about telecoms as a whole and the opportunities that mobile broadband brings.

Ericsson is one such organisation, focused on providing equipment, software and services to enable transformation through mobility.

“We want to be an active part in the ecosystem and drive growth,” says Fredrik Jejdling, President and Regional Head, Ericsson sub-Saharan Africa.

Ericsson’s products and services have been hugely important for the growth of the market and the company is actively working on new solutions to add to its already burgeoning portfolio.

“We’ve seen explosive growth of voice connectivity, it’s grown to 700-800 million subscriptions over the last few years and will grow up to

ERICSSON

one billion in five years’ time. We have penetration with 3G and 4G of around 100-150 million at this stage, but that’s likely to grow up to 800 million in five years’ time. While Africa doesn’t have the penetration levels that many other markets have, (although Cape Town probably has penetration of 100% with mobile broadband) it is very diverse and is in the process of adopting these technologies. It’s going faster and I would say that the consumption patterns are similar to India and even faster in some cases.

“Mobile data traffic is doubling every year and that’s a big thing for us to keep up with. We are in the relatively early stages but the adoption of these services is happening a lot faster than in any other markets,” explains Jejdling, who has been running things for Ericsson in Africa for the past three years.

AN AFRICAN OPERATIONStemming from its roots in Sweden, Ericsson has a long history in Africa since its first business within South Africa and Kenya in 1896. Sweden and South Africa in particular enjoy a very positive relationship and in January, President Jacob Zuma met with Swedish Prime Minister, Stefan Löfven to discuss the warm and strong bilateral relations between the two countries.

Jejdling, who is originally from Sweden but who has worked extensively in India, says that working in Africa has been an incredible experience and seeing the impact of the growing industry is particularly pleasing.

“I think it’s been a fantastic three years so far and it’s a privilege to be in a market where the telecom and technology evolution has a profound impact on an individual level and how we can connect the unconnected, facilitating services such as banking and

//MOBILE DATA TRAFFIC IS DOUBLING EVERY YEAR AND THAT’S A BIG THING FOR US TO KEEP UP WITH//

entertainment that 80-90% of people could not access previously.

“I’ve been in Africa for three years and I’ve had the privilege to run Ericsson in sub-Saharan Africa for that period of time. We started in South Africa but are now present in more-or-less all the African nations. I try to travel as much as possible because I believe even though South Africa is a big market for us, it’s very important to be visible with the customers and also talk to the regulators and government officials in each country,” he says.

Ericsson is always developing products and services that complement what it calls the ‘Networked Society’. The company has a vision of more than 50 billion connected devices beyond 2020 and whether it’s through smartphones, tablets or laptops, or machines and devices, Ericsson will play a big role in order to meet growing demand.

“In a market where you don’t have a lot of fixed line data infrastructure, the profound impact on mobility and broadband becomes high so the main focus is to build out the 3G and 4G networks, and that is happening at a rapid pace, to satisfy the strong underlying consumer demand. A lot of the networks that we have are more than doubling data traffic year-on-year in the big metros so we see a big pent up demand.

“We also believe here in Africa that the impact of broadband mobility is positive as it drives other services which have a profound impact on people. That includes media and TV distribution over the mobile networks – 85-90% of people in Africa don’t have access to content in a relevant way, largely due to the pricing and distribution of TV. There you start seeing what impacts these networks have beyond the mere data,” says Jejdling.

Financial inclusion is the perfect example of how the growing telecoms industry is helping people to become more involved in mainstream society, especially those people from rural


BUSINESS PROFILE

Africa. Take Kenya for instance – mobile money transfer system, M-Pesa, was developed in 2007 and spread quickly, now boasting millions of users and often being praised for allowing people access to the formal financial system and for reducing crime in an otherwise largely cash-based society. Services like this would not be nearly as efficient or successful without the work of companies like Ericsson, providing top-of-the-range technology.

“We have around 700 million Africans who are not banked and who stand outside of the financial system. Our mobile banking solutions and other banking solutions enable them to be financially connected.

“Our focus is about mobile

broadband, it is about TV and media, it is about mobile banking, and it is about operating with customer networks in sometimes complex environments,” says Jejdling.

And the demand for services and technology in Africa is no less high-profile than in any other part of the world. Consumers want the best technology at the best price and the myth that Africa is behind the times is quickly becoming exactly that – a myth.

“I don’t think people are less discerning when it comes to quality or service in Africa compared to the rest of the world. A lot of the services will go directly digital and not pass through the physical stage and so we might see a faster development of the

digital services based on innovation for necessity in these markets,” says Jejdling.

“It’s foolish to say that Africa will be served by lesser or lower quality; I just don’t believe that, I think it will be the same as the rest of the world but I think the service offering might be more utilitarian in nature given that certain practical services will be digitised quicker in this market because there is no alternative in the bricks and motor world. Banking is the obvious example but also media distribution and consumption. I think the quality pattern will be the same and I think this will surpass the rates of the other markets but I think the offerings in nature will be slightly different,” he adds.

TALKING 5GThe next big step for the telecoms industry, not just in Africa but around the world, is the jump from 4G to 5G. This next generation of mobile broadband is expected to become widely available by 2020, and will be around 50 times faster than 4G - making it possible to download a two-hour

//IT’S A PRIVILEGE TO BE IN A MARKET WHERE THE TELECOM AND TECHNOLOGY EVOLUTION HAS A PROFOUND IMPACT ON AN INDIVIDUAL LEVEL AND HOW WE CAN CONNECT THE UNCONNECTED//


ERICSSON

film in a single second. At Mobile World Congress 2016 in Barcelona, one of the industry’s biggest trade shows, many of the big name players announced their intentions for 5G development.

“We are working on developing 5G,” says Jejdling. “For us it’s important to focus on all the technologies we develop. We still do a lot of work on 2G which is still relevant in Africa. We still do 3G and primarily 4G as this is the technology that is deployed the most globally at this stage. I would say that we spend around $5 billion each year as a company on R&D and we always look ahead and see where the future sits but the topic under discussion the most right now is 5G – all the infrastructure

that’s rolled into that and how different the industry data networks will be built out to serve this IT environment that will be better served with 5G rather than 4G. From a technology perspective, 5G is almost there.”

In Barcelona, Ericsson announced a number of plans that involve 5G and its development. Specifically, Ericsson will partner with Cisco and Intel to develop and trial what is expected to be the industry’s first 5G router. This router is expected to enable business and residential customers to achieve significantly faster networking speeds, lower latency, and the ability to handle exponentially more Internet-connected devices.

Ericsson, along with partner SK Telecom, also made the announcement that it had succeeded in trials and achieved a cumulative 20Gbps of data throughput in an outdoor environment using the 15GHz frequency band with two simultaneously connected mobile devices of a downlink bit rate of over 10Gbps each. This is an important development for future 5G commercial services.

The company also announced partnerships with a host of different global companies that involve developing new technology platforms and the ‘Internet of Things’ (IoT) - the network of physical objects; devices, vehicles, buildings and other items embedded with electronics, software, sensors, and network connectivity; that enables these objects to collect and exchange data.

//FROM A TECHNOLOGY PERSPECTIVE, 5G IS ALMOST THERE//

Confiance embraces a multi-disciplinary spectrum in developing telecoms infrastructures. Our range of services covers, but is not limited to, Network Planning, Optimization & Quality Assurance, Telecom Implementation and Project Management. We are

capable of picking the best practice partnering model in supplying cost effective turnkey solutions.

We operate in Tanzania, Kenya, Uganda, DRC, Rwanda, Zimbabwe, Mozambique, Botswana, Madagascar, Senegal, Angola, Gabon and more. Confiance believes in building long-term relations with clients, maintaining the highest quality safety standards and commitment to construction and telecommunication standards and practices. Our management and technical teams are constantly anticipating the growing needs of our clients and market in general; this in turn keeps us prepared to provide the necessary offering that our clients require.

Tanzania: +255 784 309141 / Zimbabwe: +263 779 669096 / Angola: +244 923 600300 / South Africa: +27 72 506 6752Email: [email protected] / [email protected] / Web: www.confiancenet.com

Our services include:• E2E Multi-vendor Multi Technology

(GSM/cdma, UMTS, LTE) Radio Network Planning

• Transport and Core Network Planning• E2E Network (RF, CS & PS Core) Optimization• FTK Network Rollout & Implementation• Network Performance Benchmarking• Turnkey IBS Service Delivery (LTE, 3G, 2G)• Construction & Civil Works• Optic Fibre Solutions


BUSINESS PROFILE

AT&T, Cable & Wireless, Amazon Web Services, 20th Century Fox, Quanta, Geely Auto and Qualcomm are just some of the companies that have announced partnerships with Ericsson at global level.

In Africa, Jejdling explains that developing products and services to enhance the customer experience is a focus right now.

“We are talking a lot about the customer experience,” he says. “We are launching products around expert analytics which you can use to monitor the customers and link individual customer satisfaction and drive overall satisfaction networks by understanding individual consumers – we work a lot on these type of things to generally make the experience better for the customer.

“We have a product called NuVu which is a Video On Demand (VOD)

system, very suitable for Africa and based on affordable downloads for content viewing. It’s based on utilising the networks when they are not being used. It’s not a streaming service and we believe it’s well priced for price sensitive consumers.”

Importantly, as well as investing in innovative products and partnerships, Ericsson is also keen on physically growing its footprint in order to serve potential customers in new geographic markets.

“If there’s an opportunity in the market we will take it,” Jejdling says. “Nigeria and South Africa are big markets and then there are fast growing markets with lower GDP levels like Rwanda and the DRC but they can be more opportunistic. You need telecoms in all markets and we look at it to make sure it makes sense. Mobile customers

are global in nature so we need to serve them across the whole of Africa.”

THRIVING IN DIFFICULT TIMESInterestingly, even during times when the economic climate is not fostering prosperity, Ericsson, and the wider telecoms industry, has managed to continue to post positive results.

“We publicise our results for the region, in 2014/15 we recorded growth of around 18% so that indicates a strong build up in major markets linked to 3G and 4G,” Jejdling explains. “Of course, we monitor the economic situation and we see the commodity prices and currency depreciation, and we understand the impacts but that is the reality for everybody doing business in southern Africa.

“With our business there is underlying, unsaturated demand for our services. The operators have a growing data volume to take care of.

“Our long term perspective is that we’re positive on Africa but we need to look into the short term macro-economic issues that everyone doing business is faced with in Africa,” he adds.

Growth in telecoms is important as it can quickly stimulate growth in other areas of the economy. This is why Jejdling says it’s so important for the government and the regulators to create a positive, flexible, easily managed environment.

“Every country that has a clear national broadband plan typically has a better chance of succeeding in this area. Creating an environment conducive for investment and growth, where the rules are known

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TO SERVE THEM ACROSS THE WHOLE OF AFRICA//


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to all the participants, is a big task for governments.

“The whole environment of telecoms is a little bit more than just supplying equipment and services to customers and operators. For an environment in telecoms to thrive, there needs to be a standardisation process around spectrum allocation meaning that we try to influence and work together with government and regulators to bring best practice from other markets.

“It’s about trying to coexist with the regulators, governments and trying to be relevant with the operators and find solutions that work in Africa together.

“Government, regulators and operators need to have a common agenda to create a telecom environment that is conducive to growth and the benefit of this is far reaching beyond the telecom sector - other industries will be transformed and GDP will grow,” he says.

But, of course, the downside (or the upside in Jejdling’s view) is that a stable environment with big growth opportunities quickly attracts competition.

“When you have a market that has the prospect of growth, it quickly attracts a lot of competitors which is good. What we try to focus on is being the best and most relevant for our customers. If they feel like they’re getting a good service, a good product and a good relationship from us then we hope that would be the best way to fend off competitors but they are certainly here.”

Some cities in sub-Saharan Africa are becoming known for their scientific and technological environments and as such, the continent is now home to some of the world’s most forward thinking, innovative and pioneering telecoms businesses.

“We are certainly market leaders but it’s difficult to compare. 10-15 years ago, we have around 15 serious competitors but now there is just a handful left and each has different strengths. We are strong in mobility and TV and media but our competitors may have moved into handsets when we exited,” Jejdling explains. “It’s a constantly changing environment; in many of the new sectors, our traditional competitors are not even active and we find new competition.”

Ericsson’s knowledge, skills, ability, experience and global reach mean that it will remain a leader in Africa despite the economic

situation and the advance of its competitors. As the telecoms market grows and demand continues to exceed supply, the need for technological solutions will become more prominent and companies that have global expertise and experience on the ground in Africa will enjoy a thriving market place.

With the onset of 5G and IoT, and with a generation of people that doesn’t expect to wait for anything, these are indeed exciting times for the telecoms industry and Ericsson and it now remains to be seen how quickly this novel organisation can develop its Networked Society – where anything is possible.

//IT’S ABOUT TRYING TO COEXIST WITH THE REGULATORS, GOVERNMENTS AND TRYING TO BE RELEVANT WITH THE OPERATORS AND FIND SOLUTIONS THAT WORK IN AFRICA TOGETHER//

ERICSSON

+27 11 844 [email protected]

www.ericsson.com/za

ERICSSON


VODACOM GROUP CEO, SHAMEEL JOOSUB

VODACOM

Vodacom Displays Positive Results in Strong Message

to Market

After being named as one of South Africa’s Top Employers and being recognised as one of the country’s most reputable brands,

Vodacom is backing up this success with an excellent set of quarterly results for the period ending 31 December 2015.


PRODUCTION: Joe Forshaw

// Vodacom sent out a clear message to all stakeholders last month – business is good. As

news of the company’s quarterly results for the period ended 31 December 2015 began to reach the inbox of interested parties, it quickly became clear that the mobile operator had yet again worked hard to bring about healthy figures.

Vodacom reported normalised group revenue up by 7.6% to R21.7bn on the back of strong demand for data. Group data revenue rose by 27.5% to R5.5bn, representing 32% of service revenue. The customer base increased by 6.8% to 65.2m, with data customers up by 14.5% to 30.3m.

These results highlight the strength of the company which was named by Brand Finance at the end of last year as one of the top three most valuable brands in the country.

In November, when the company announced the results for its third quarter of 2015, Vodacom Group CEO Shameel Joosub said: “There are good opportunities ahead of us… In the second half, we plan to invest more into fibre and other new growth areas by building the right capability to ensure we sustain growth into the next year” and this strategy seems to have paid off.

“We successfully executed on our strategy and achieved another quarter of improving revenue trends,” Joosub said in February. “The two biggest highlights in the quarter are the accelerated service revenue growth of 7.2% in South Africa and the 6.8% increase in the Group customer base to 65.2 million. In South Africa, the take-up of our personalised offer ‘Just for You’ was excellent and contributed to the 15.9% reduction in effective voice rates.

VODACOM

The International segment delivered robust service revenue growth of 15.2%.

“Our performance in the quarter reflects the positive impact from our substantial network investment of R9.5 billion across all our operations in the nine months.”

The company has taken the lead when it comes to investment in mobile data is looking to develop its share in this growing market in future.

“We have expanded our network coverage and increased data speeds to secure network leadership,” said Joosub.

“Customer demand for high speed mobile data is growing across our footprint, supporting a 27.5% increase in Group data revenue. Active data customers increased 14.5% to 30.3 million as we increased sales of more

affordable data devices in the quarter. “We expect revenue growth to

taper slightly into our last quarter of the financial year due to a stronger prior year comparative and a weaker outlook for the consumer in South Africa due to the drought and weaker exchange rate,” he added.

Vodacom is operational in in Tanzania, the Democratic Republic of Congo, Mozambique and Lesotho and provides business services to customers in over 40 African countries such as Nigeria, Zambia, Angola, Kenya, Ghana, Ivory Coast and Cameroon.

In South Africa, Vodacom reportedly boasts more than 23 million customers and claims a huge share of the market. The company’s marketing campaigns are fierce, costing huge

//WE SUCCESSFULLY EXECUTED ON OUR STRATEGY AND ACHIEVED ANOTHER QUARTER OF IMPROVING REVENUE TRENDS//

amounts of money, reaching vast numbers. Rugby, motor racing and football are just some of the areas where the brand is represented strongly. Some industry experts say that, similarly to Coca-Cola, Vodacom’s relentless marketing is one of the key drivers behind the company’s success.

In good news for Vodacom’s marketing people, the company was being lauded for the excellent work it has done building relationships with its most important resource – its employees.

TOP EMPLOYERIn October, the Top Employer Institute, headquartered in the Netherlands, named Vodacom as one of the country’s top employers, and number one in the telecoms sector, saying: Our comprehensive independent research revealed that Vodacom Group Limited provides exceptional employee conditions, nurtures and develops talent throughout all levels of the organisation and has demonstrated its leadership


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BUSINESS PROFILE

status in the HR environment, always striving to optimise its employment practices and to develop its employees.”

At the award ceremony honouring the country’s top HR performers in Johannesburg, Vodacom Group’s Chief Human Resource Officer Matimba Mbungela said: “We have been certified in one country. Our starting point is South Africa and we are anxiously looking forward to our participation in the rest of the continent.

“I always say that people development is a key priority for the business, not only for HR. We link our people development strategy to our overall business strategy. We ask, where is the business headed in the next three to five years? People talk about data explosion; data has grown a lot in telecoms. Consumers see this happening now but in the industry we planned for this three to five years ago. In doing so, we had to find out what capabilities are needed in the business. This explosion did

not happen by mistake, it was planned and therefore we had to invest in our capabilities to make sure we make the best of the opportunity.”

With more than 7400 employees across numerous African nations, Vodacom’s HR structure has become a major part of the business that can quickly decide on the future success of the company.

“We have invested significantly in the right HR operating framework, technology and optimal HR practices to deliver value to the business,” said Mbungela.

STRONG BRAND IMAGEMarketing the company effectively and creating an environment that allows employees to flourish has had a hugely

//WE HAVE EXPANDED OUR NETWORK COVERAGE AND INCREASED DATA SPEEDS TO SECURE NETWORK LEADERSHIP//


positive impact on Vodacom. Apart from the obvious success of robust financial results, the company has also been recognised as one of South Africa’s most reputable brands and specifically, the Most Reputable Mobile Network Operator in the country.

In a study compiled by Plus 94 Research and supported by the Mail & Guardian, the country’s top spenders on advertising were put under the microscope and the results were collected and presented as the Top Companies Reputation Index (TCRI).

The study finds which of 50 largest advertising spenders have high public visibility and engagement. Overall, 167 companies were rated in the 2015 Index with Vodacom coming out on top.

“At Vodacom, we strive to be transparent, credible and accountable

to our customers, employees, suppliers and partners,” said Vodacom’s Group Chief Officer for Corporate Affairs, Maya Makanjee.

“We are humbled by the vote of confidence in our brand and that our efforts to engage and uphold good governance and management are acknowledged. Furthermore, maintaining a good working environment and contributing to the communities within which we operate have all contributed to our success. Over the years, we have seen how our positive reputation has impacted positively on the growth of our brand and have come to understand the key drivers of our reputation, amongst which are business performance in areas such as innovation, customer service, being a good employer and a

responsible corporate citizen.“As a leader in the

telecommunications sector it is important that we maintain a solid reputation. We will continue with our integrated approach towards managing our reputation to ensure that we remain in good standing with all our stakeholders and be a benchmark for good business practice,” says Makanjee.

All of the success that Vodacom has realised in recent months are helping to create a base for ongoing growth in the future. As the company expands into new areas, particularly with mobile data, it can develop assuredly in the knowledge that its employees are well catered for and its customers hold the brand in high-esteem.

//AT VODACOM, WE STRIVE TO BE TRANSPARENT, CREDIBLE AND ACCOUNTABLE TO OUR CUSTOMERS, EMPLOYEES, SUPPLIERS AND PARTNERS//

VODACOM

082 1960 www.vodacom.co.za

VODACOM


SPARSOUTH AFRICA

Industry Leaders, Top Employers and Still Searching For Growth

Despite the economic climate which is hampering the development of many of South Africa’s large companies, SPAR’s strategy and focus on people is allowing it to grow continuously and take advantage of opportunities all over the continent.

PRODUCTION: Manelesi Dumasi


//A shining light in South Africa’s business sector, SPAR has, for more than 50 years, been

leading the way when it comes to retail strategy and customer service. Now operating across the entire rainbow nation, as part of the global group, SPAR has not allowed economic, political or social issues to slow its rapid growth. Now occupying a strong position among the top three supermarket groups in South Africa, and a top player in the global market (2nd by number of stores), SPAR is planning on further strengthening its grip on the SA market, offering industry leading service to customers and playing a bigger role in developing the communities in which it operates.

In February, the company announced a robust set of results,

claiming that sales had increased by 14.1% from R24.5 billion to R28 billion for the 18 week trading period to January. Its subsidiary companies showed strong growth and liquor sales in particular were impressive, showing more than 12.5% growth – ahead of the market trend.

CEO Graham O’Connor says that although there is growing competition, SPAR remains a firm favourite in the SA market place and this is down to an ambitious growth strategy.

“In South Africa, we are a big player,” he says. “We are the second largest supermarket group operating in the country. The market is very competitive between Pick n Pay, Shoprite and ourselves and now new players like Massmart coming into the equation.

“Our core business is independent

wholesaling to independent retailers. We’re a voluntary trading group with retailers who own their own business and operate under the same banner which is SPAR. They operate in the retail space with support from ourselves and the SPAR group.

“In terms of the group, we’re at about 4,500 people and in the wider retail group it’s probably in the region of 25,000 people.

“Business has been very good, we’ve had strong growth in South Africa and we’ve acquired an Irish business two years ago which has done very nicely for us and will continue to do so – business has been strong,” he adds.

THREE DECADES OF GROWTH O’Connor joined SPAR for the first time 29 years ago as a Group Accountant. He became the Head of the SPAR KwaZulu-Natal division in 1987 but in 1997 he left the group to start his own industrial catering business and became a partner in five SPAR retail stores. He returned to the group in 2014 as Chief Executive

SPAR SOUTH AFRICA

Clover Industries Limited (“Clover” and/or “Group”), a branded foods and beverages Group, has enjoyed a long and successful history as part of the development of South Africa’s dairy and fast moving consumer goods industry. Clover has been a household name for 117 years, with listings on the Johannesburg Stock Exchange (JSE) on 14 December 2010 and on the Namibian Stock Exchange on 22 April 2015. Today, Clover is a leading and competitive branded consumer goods and products group operating in South Africa and other selected African countries with core competencies in production of dairy and non-dairy beverage consumer products, distribution of chilled and ambient consumer products and sales and merchandising of consumer goods.

Clover’s strategic pillars and competitive strengths drive the business forward as a sustainable and growing branded consumer goods giant. Its roots are firmly established in the South African dairy industry and Clover strives to provide its customers with nutritional food and beverage products of the highest quality.

With an eye on expansion, we have diversified our product offering by acquiring and developing additional brands and currently produce 70% percent dairy related products and 30% non-alcoholic beverages and food products.

The Group’s business platform spans throughout the value chain from collection at the farms, production to sales and merchandising, and integrates key value-added support services such as logistics, supply chain management, sales and merchandising. Clover’s market penetration coupled with its value-added services offering and high frequency of delivery, positions the Group to exploit attractive opportunities for organic and acquisitive growth.

Clover only sources raw product from quality suppliers and loyal producers in order to fill consumer demand. We procure approximately 600 million litres of raw milk annually from 173 producers. Products are produced at one of our 16 production

facilities, all of which are ISO-9001 and HACCP certified. From farm to shelf, our products go through our standard 55 point safety check and testing procedure.

Clover has one of the best outbound call centres in South Africa to ensure that our network of about 2 500 permanent merchandisers can provide service to over 3 000 retail and wholesale outlets, dispatching to about 14 550 delivery points throughout South Africa using approximately 552 trucks daily. Throughout this process, we aim to be a responsible corporate entity by constantly reviewing and implementing the latest technologies that will reduce our carbon footprint. Responsible environmental excellence makes us way better than our peers.

Since listing on the JSE, we have burst into the Top 10 favourite brands awarded by the Sunday Times, and have been experiencing steady market growth. Clover’s dual listings on the Namibian Stock Exchange and the JSE provides local investors with an opportunity to directly participate in the Group’s value creation as well as provide input on the strategic direction of the company.

At Clover, we believe that doing good, is good business and that investment capital should be measured as a whole. Investment in people and societies is the key to a sustainable future. That is why our CSI project achieves immeasurable results and has won numerous awards.

Our CSI project is not a social “responsibility”, but Clover Mama Afrika is a facilitator and an enabler, improving the lives of South African communities. This is done through upliftment, training and empowering people which is at the heart of Clover’s vision and mission.

Driven by exceptional performance under the guidance of our dynamic and forward thinking senior management team, Clover is now ready and geared towards future expansion. As an iconic and trusted brand, Clover has strong exportable skills and a solid foundation in all facets of our business.

//CLOVER AT A GLANCE


back 29 years, we were on the peripheral, operating small stores and battling to compete with the opposition. As time has gone on and we’ve become more professional, we’ve competed better in a range of areas and become bigger and better.”

Refreshingly, this is not a company

enormously in that time – we’re much more competitive in a range of areas,” he says. “We’ve become much more price competitive, we have bigger stores, the sales in our stores are excellent, the quality of our retailers has improved over time, and with all those things combined we’ve made a radical change. If you look

Officer taking over from long-standing predecessor Wayne Hook. Looking back over three decades of involvement with SPAR, O’Connor says that much has changed and the business is now a completely different, much more competitive organisation.

“We have improved our game

Thank you Spar for your continued support in growing the Clover brand.

together

We are ®

15167

15167 Spar Enterprise 250X176.indd 1 2016/03/04 1:35 PM

BUSINESS PROFILE

that is happy to sit still and is always looking for growth – even during tough economic situations. In July 2015, SPAR announced the opening of two new stores in South Africa, one in Oudtshoorn and one in Plattekloof. The store in Oudtshoorn is run by a team of three husband and wife entrepreneurs - Johnny and Isabel Forbes, Heinrich and Raba Terblanche and Skillie and Petra Pretorius. According to SPAR, the store has “a clean, bright, modern interior with good signage throughout. It has a large deli and bakery section and a solid grocery offering.”

In Plattekloof, the newly revamped SUPERSPAR has a fabulously bright, freshly stocked interior and has essential conveniences such as a large parking lot, an instore florist, a coffee shop, a butcher and a TOPS liquor store right next door.

The Western Cape is strategically important for SPAR and so the company will soon undertake an expansion of the regional distribution centre.


“We’re about to embark on a big expansion of our Western Cape distribution centre and we’re continuing to expand our wholesale footprint so we’ll be spending something in the region of R400 million in the next year through capital expenditure,” explains O’Connor.

“We’re always looking for opportunities to expand our business, whether it’s into Africa or the rest of the world. The opportunities are there because SPAR operates in 42 countries worldwide and there are big opportunities that arise from that.”

AFRICAN SPARIn October 2015, SPAR International

announced plans to grow its footprint in Africa with the opening of stores in Douala, Cameroon and Lilongwe, Malawi. The company also stated that it was planning a further three SPAR sites in Cameroon including a Hypermarket in Yaoundé. This followed on from the announcement of growth in Nigeria where the company has opened a new flagship store in Murtala Muhammed Airport in Lagos, and a hypermarket in Port Harcourt.

SPAR International Managing Director, Dr Gordon Campbell said: “Five years ago we identified the major potential for growth of the SPAR brand in Africa. Building strong partnerships,

sharing international best practice and adhering to the SPAR principles of focusing on freshness, quality, choice and customer service has meant that SPAR is now at the cutting edge of retail in the region. SPAR South Africa has been a key enabler of this expansion and has made a major contribution to the success across the African continent, sharing best practice and experience with new partners.

“Our partnership approach, as well as the flexibility and adaptability of our brand, has resulted in an offer that can meet the various needs of the modern African consumer. Recent developments in Cameroon and Malawi are an example of how success can breed success in SPAR with established partners contributing their knowledge and expertise to make new market entry a great success.”

O’Connor says: “We have moved into Zimbabwe, which is a difficult market,

//THERE’S BEEN A WHOLE RANGE OF CHALLENGES THAT HAVE COME TO THE FORE BUT WE HAVE ADDRESSED THOSE//


SPAR SOUTH AFRICA

BUSINESS PROFILE

and we’ve also made moves in a couple of other African countries as well. When opportunities arise, we will certainly go and make a move. Our model is different to the chain stores that are already there. We like to find a local partner and then operate on that basis and we are busy with that now.”

BUILDING ON A STRONG PLATFORMThe supermarket/retail environment in South Africa is extremely competitive. Established big name players, who have also spread into Africa, are providing stout competition for SPAR and this means SPAR businesses have to work hard internally to drive customer loyalty.

“We have independently owned stores with retailers who are very entrepreneurial and that certainly gives us an edge,” says O’Connor. “Our drive on fresh and our drive on store upgrades helps us – we try and do major upgrades to 20% of our stores each year, which is much more than opposition, and

that helps us stay ahead. The fresh food ratios in our stores are higher than our opposition and we’re concentrate hard on that and we believe that gives us an edge.

“Tough opposition is one thing, the tough economy is another. It has created pressure and has forced consumers to be selective and look for value for money. There’s been a whole range of challenges that have come to the fore but we have addressed those.”

And it seems like consumers have welcomed SPAR’s efforts as it continues to post strong results and encourage customers through the door even though

research released recently by Retail Price Watch suggests that SPAR is not the cheapest brand on the market.

The research website compared the prices of 50 national brands from SPAR, Pick n Pay and Checkers stores across the country from 2012 to 2016. In January 2012 a basket of 50 identical grocery items cost R1,033 in SPAR, R1,036 in Checkers and R1,058 in Pick n Pay – a differential between Spar as the cheapest and Pick n Pay as the most expensive of only 2.4%. By January 2015, the same basket cost R1,120 in Pick n Pay, R1,214

//WE HOPE TO IMPROVE OUR BRAND IMAGE, MAKING SURE THAT’S TOP OF MIND WITH OUR CONSUMERS. WE WANT TO PLAY A MAJOR ROLE IN THE COMMUNITIES WE SERVE AND DRIVE THE BUSINESS FORWARD//

//SPAR SOUTH AFRICA HAS BEEN A KEY ENABLER OF THIS EXPANSION AND

HAS MADE A MAJOR CONTRIBUTION TO THE SUCCESS ACROSS THE AFRICAN

CONTINENT, SHARING BEST PRACTICE AND EXPERIENCE WITH NEW PARTNERS//


in Checkers and R1,237 in SPAR. Pick n Pay came in cheaper but the difference between the three stores remains marginal at 3.1%. By January 2016, the basket was the least expensive (R1,281) at Checkers, R1,316 at Pick n Pay and R1,351 at SPAR, with the differential widening to 5.4%.

O’Connor says that effective marketing and an ongoing focus on company values mean that the company will continue to develop in the future.

“We have a detailed promotional program whether it’s on television, on leaflets or in press, we use all media avenues to promote SPAR to the consumer.

“We hope to improve our brand image, making sure that’s top of mind with our consumers. We want to play a major role in the communities we serve and drive the business forward. We are a values based organisation and we base our whole business on passion, entrepreneurship and family and that’s

absolutely important for us. We see ourselves growing organically and growing our market share in the next few years,” he says.

And of course, while focussing on growth, the company will not ignore its most important asset – its people. In fact, the company is placing a huge emphasis on people development and as a result, was awarded by the Top Employers Institute as one of the country’s best employers for 2016.

The research from the Dutch HR business found that provides exceptional employee conditions, nurtures and develops talent throughout all levels of the organisation and has demonstrated its leadership status in the HR environment, always striving to optimise its employment practices and to develop its employees.

At the certification ceremony in Johannesburg in October, O’Connor said that people development is vital for SPAR.

“Most important for us is succession

planning and leadership development because we believe we need leaders from the ground of the business all the way through. We’re a very culture oriented business and people are our most important asset so for us it’s crucially important.”

By investing in people and partnering with individuals who understand local communities and their needs, SPAR will continue to thrive and develop successful operations in its chosen markets. Further development in Africa and the ongoing growth in SA look set to cement SPAR’s position at the peak of its industry, with no sign of any slowdown anytime soon.

SPAR SOUTH AFRICA

031 719 1900 www.spar.co.za

SPAR SOUTH AFRICA


DEBSWANA

Mining Diamonds, Enriching the Nation?In a hugely important sector to Botswana, the diamond mining industry has taken a knock in recent months. This has made the environment for Debswana, the country’s leading diamond producer, very difficult. Fortunately, management has come up with a clear-cut strategy to navigate this rough market.

PRODUCTION: Timothy Reeder


DEBSWANA

// The story of Botswana’s development and its diamonds is a remarkable one. For a

country that is largely covered by desert and with a relatively low population, its growth in output has been dramatic. Formerly one of the world’s poorest countries and one that has a serious problem with HIV/AIDS, the Botswana of today is very different from the Botswana of pre-1966. After gaining independence on 30 September 1966 has maintained a strong tradition of stable representative democracy, recording good levels of economic growth, with a consistent record of uninterrupted democratic elections and this has allowed commercial trade in the country to thrive.

Like its neighbours, mineral resources are a vital component of the country’s income. This industry provides about 40% of all government revenues and includes production of diamonds, gold, uranium, copper and even oil.

However, it is diamonds that drive the thriving economy that has been realised over the past five decades.

Botswana is home to the world’s largest and the world’s richest diamond mines – Orapa and Jwaneng respectively. Both of these mines, along with two others, Damtshaa and Letlhakane, are owned byDebswana, the world’s leading producer of diamonds by value. It is a partnership between De Beers and the Botswana government, with both parties holding a 50% share. This expert company also owns the Morupule Colliery.

Debswana is a great example of private/public sector involvement and the company has operated successfully, contributing to the growth of Botswana since its formation in 1969. To date, the company has been one of the most prominent contributors to economic security in Botswana,

//WHILE WE REMAIN COMMITTED TO THE PLANS THAT WILL TAKE THIS COMPANY TO 2050 AND BEYOND, WE MUST BE AGILE ENOUGH TO RESPOND TO OBSTACLES AND CHANGING MARKET CONDITIONS//

employing thousands of local people, earning 90% of the governments revenues from exports and creating one third of the country’s GDP.

But in 2016, the globe is experiencing problems that this generation might not have come across before; crashing oil prices, a large reduction in the worlds commodity prices, uncertainty in the Eurozone and China (some of the world’s biggest buyers of diamonds), and falling diamonds prices. These conditions have thrown up a unique set of challenges for Debswana’s management. In 2014, Managing Director, Balisi Bonyongo was confident, saying: “While we are extremely proud of our history, we are very aware that we operate in a complex


© DE BEERS

Debswana’s actions in 2012 separate them from many companies facing the challenges of the current mining market. Under the pall of falling commodity prices, pressure to reduce costs, maintain production levels and profitability, Debswana’s investment in technology in 2012 places it in an enviable position today. One set to reap sustainable rewards in the areas of mining productivity, confidence in production and the ability to maximise the value of its mineral assets. These aspects are recognised by its peers as mining fundamentals, necessary to master in order to survive this downturn and deliver into the future.

Investment in technology: Survival in today’s commodity market demands that all mining companies, across all commodities and operating styles, consider adopting strategies to ‘get more with less’. Investors in this market are clear in demanding even more; namely, that company’s worth the investment are those that demonstrate an ability to withstand today’s pressures and deliver sustainable long term benefits.

Technology is viewed as a key enabler in this climate, providing systems that increase the efficiency of routine tasks as well as identifying opportunities dealing with complex problems. All this, with the common intent to release otherwise, latent value.

Debswana are among few that have invested in this area successfully over many years. A recent announcement of planned investment, specifically in the use of x-ray technology to secure diamond delivery to market, demonstrates its ongoing commitment.

Securing the final product is critically important. Of equal significance though, is maximising the value of the insitu mineral asset and the transfer of this value through the mining chain to final product. It is in this area, that Debswana’s investment in operational improvement technology is poised to pay dividends in today’s climate.

In May of 2012, Debswana established an alliance with Snowden to embed a leading-edge operational improvement system into its Jwaneng, Orapa, Letlhakane and Damtshaa mining operations. The system chosen to supersede the legacy, heavily bespoke data management and reporting systems was Snowden’s Reconcilor product. Built on Snowden’s demonstrated expertise in mining reconciliation, Reconcilor is dedicated to deliver performance improvements to mining operations using industry best-practice principles. Being available off-the-shelf also enables Debswana to access system enhancements and improvements without the need for customisation.

Historically, the field of mining reconciliation has been the domain of the geologist or surveyor, accompanied on occasion by the keen mining engineer and senior management team. Today though, the process is frequently being used by mine management to isolate where issues lie along the mining chain, and to define and trigger appropriate remedial action.

It is in this endeavour that Reconcilor is poised to maximise the value of the mineral asset and drive sustainable production improvements to Debswana’s mines.

www.snowdengroup.com

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BUSINESS PROFILE

and volatile world. While we remain committed to the plans that will take this company to 2050 and beyond, we must be agile enough to respond to obstacles and changing market conditions. We are confident that we are building a sustainable business that can contribute to Botswana’s development story for many decades to come.”

The Chairman of the company was equally as positive. Phillipe Mellier, also the Chief Executive of the De Beers Group, said: “Debswana’s success is shaped by a shared vision and cemented by hard work and perseverance on both sides of this relationship – ensuring that the effort and contribution made, and the rewards earned, are equitable and sustainable.

“We look forward to the decades to come with anticipation and excitement,

knowing that we will continue to deliver on the diamond dream.”

That was in 2014. Today, life in the diamond business is a little more exasperating. Because of the price crash and a slow demand from China, one of the world’s largest diamond consumers and a consumer which De Beers expect to surpass the largest consumer in the world (the USA) by 2020, it’s looking like 2016 will be a year in which instead of ‘delivering the diamond dream’, Debswana will use all of its experience to try and revive the murky market.

But this will not be easy as production of diamonds was also down on previous years. Mellier said in Gaborone at a sightholder meeting in January that 2015 had been difficult: “It felt as though the fates conspired against us” he said, “there were several persistent

headwinds and many unforeseen challenges. Each time it looked as though there might be the opportunity for an improvement, another unexpected problem raised its head.”

But even in these tough times, the Chairman remains positive and urged everyone in the sector to adopt an optimistic stance.

“If we trust the sector’s positive fundamentals, then we can usher in a bright new dawn for the world of diamonds. Let’s look to the future and make 2016 the year that the diamond industry truly regains its sparkle,” Mellier said.

A SPARKLING 2016?Two important strategies that have been adopted by Debswana in the last 12 months to combat the slow market have been consolidation and

40 / Issue No.44 / www.enterprise-africa.net

DEBSWANA

investment in new technology. Unfortunately, due to market

conditions and slowing production rates, Debswana was forced to close its Damtshaa mine for three years or until the market improves. This news came alongside the announcement that the company would also downscale production at its Orapa mine. Debswana also reduced its output expectations from 23 million carats to 20 million.

Company spokesperson, Esther Kanaimba-Senai said: “Debswana

Diamond Company is to place Damtshaa Mine, which is part of the Orapa, Letlhakane and Damtshaa mines, into a care and maintenance programme for up to three years as part of the company’s response to the downturn in the diamond market.

“As a result Debswana has revised its production for 2016 to 20 million carats to match expected levels of demand for rough diamonds.

“This is an unprecedented situation which has impacted the entire diamond

pipeline from rough producers, cutting and polishing companies and the retail sector,” she added.

She was also keen to point out that the company had put huge efforts into preserving jobs by re-deploying affected employees to other parts of the business so that job losses would be at an absolute minimum.

Although news like this quickly throws up negative headlines, there is an underlying expectation from Debswana that this is a temporary issue and the turnaround will come quickly and heavily.

“We are tackling the slow down with prudence, care and vigour. We must not lose sight of the fact that there will be a recovery and we must prepare for the eventual upturn,” said Bonyongo.

“Our mines are becoming bigger and deeper and costs are rising.

//WE LOOK FORWARD TO THE DECADES TO COME WITH ANTICIPATION AND EXCITEMENT, KNOWING THAT WE WILL CONTINUE TO DELIVER ON THE DIAMOND DREAM//

www.enterprise-africa.net / Issue No.44 / 41

© DE BEERS

Our greatest challenge is to remain competitive,” he added.

The Orapa mine exemplifies the optimism for a bounce back. Operations have been reduced but will still run at a production level of approximately one million carats per year in order to maintain plant readiness to ramp up quickly when needed.

The company’s investment in new technology comes an important division: Security. In a bid to consolidate and lose as little as possible, Debswana plans to install new x-ray technology at checkpoints within its mines. These investments were announced in 2014 and the company chose Scannex to supply the x-ray technology (subject to the approval of the Department of Environmental Affairs). Old-school methods of using surveillance and physical searches have proved insufficient and intrusive.

“The Debswana Security department has evolved over the years from being an object of fear, viewed as

policing unit, to as a strategic partner central to the success of our mining business,” said Bonyongo.

“Our Corporate Security is rising to the challenge with a strategy that seeks to position security as a credible, approachable and value-adding business partner with a focus on people, culture, security systems, solutions, investigations and intelligence,” he added.

Scannex x-ray technology has been used in Namibia and South Africa for the past two decades.

The system will reportedly cost Debswana P50 million and while final approvals are granted and talks with the Botswana Mining Workers’ Union are finalised, the company will continue to send the message that these systems are safe, less invasive and more efficient for employees resulting in improved management of the business.

As the company moves through what is set to move through a challenging 2016, these investments, and drive of leadership from Mellier

and Bonyongo, will see Debswana use every resource at its disposal to stimulate its market.

Mellier said in a speech in Gaborone last month: “Another central part of our 2016 plan will be a continued investment in non-proprietary marketing. We will need to find the most effective method of pooling our resources, and the most effective vehicles for delivering the programmes, but we saw the power of diamond marketing (and specifically De Beers’ expertise) at the end of last year and we will ensure that consumers – young and old, eastern and western – continue to celebrate their own facet of forever with the magic of diamonds.

DEBSWANA

+ 267 361 [email protected]

www.debswana.com


DEBSWANA

© DE BEERS


5002818A AEL Print Ad Enterprise Africa fa.pdf 1 2016/02/19 3:55 PM

LIFE GREEN GROUP

Beautifying SA’s Concrete Jungles

Life Green Group provides complete green solutions to clients across Southern Africa. The company focuses on quality while minimising cost but, importantly, brings years of experience and an emphasis on real gardening. Founding Director Oscar Lockwood tells us more…

PRODUCTION: David Napier

// For many people, a beautiful garden is not just a work of art but also a work of heart.

Because of this, the garden is becoming an increasingly important part of any building’s blueprint. Think about it; the corporate headquarters of today’s big-name businesses all have areas designated as garden, small companies have outdoor spaces designed to be welcoming, our homes have gardens for relaxation and our recreational spaces all need to be designed by skilled landscapers to maximise space and beautification – take the modern golf course for example. In the office environment, plants and greens can be hugely beneficial and, in some cases, actually improve productivity.

American Founding Father, Thomas Jefferson said: “No occupation is so delightful to me as the culture of the earth, and no culture comparable to that of the garden,” and world-renowned

French artist, Claude Monet said: “My garden is my most beautiful masterpiece.”

So people have an unwavering love for gardens and natural places and this remains true in the business space. In South Africa, especially in areas like Sandton and Century City, installing greenery in and around the many high-rises and office blocks is big business and no one knows this better than the Life Green Group, the Johannesburg-based, award-winning gardening consultants.

Founded by Oscar Lockwood, Ida-Marie Stydom and Deighton Clegg, Life Green Group has been a growing concern over the years but today is one of the most respected companies in the country’s gardening and horticultural industry.

“Our order book is full. We will never turn away work; we just work harder. 2016 is comfortable in terms of new work. In terms of maintenance work, we continue to grow by retendering


BUSINESS PROFILE

for work on the big contracts. We’re continuously adding to our maintenance book so that will happen regardless of the economy as people are still active and still need to invest in their gardens – they may cut back on certain things but they are still investing in their gardens and understanding the value which is fantastic.”

The company is made up of three divisions: Life Indoors, Life Landscapes and Life Sports Turf. Life Indoors takes care of ‘plantscaping’ which involves indoor potplants – vital for naturally filtering and oxygenising the air in offices. Life Sports Turf installs and maintains sports fields from polo pitches to bowling greens to cricket fields and astro-turfs. This work is popular with schools and Life Sports Turf currently has a number of contracts with SA schools and this work is increasing.

Lockwood, Stydom and Clegg started

their first company in the 80’s in Gauteng and this coincided with the development of Sandton. Their work here caused their reputation to blossom and today Life Green Group is regarded as the ‘go to’ business for office greenery remodelling and garden optimisation.

“Currently, we’re working on the Nelson Mandela Children’s Hospital – that’s a big job. We’re working in Menlyn Maine. We’re doing the Curro Schools in Waterfall and Cape Town. We are doing some interesting jobs in Rosebank and Edenvale. We’re revamping the Stoneridge Shopping Centre in a very interesting way. We’re doing a green wall at the Rosebank Corner,” explains Lockwood.

“We do a lot of work in the Waterfall area of Midrand where we continue to maintain a number of jobs. We done Group 5’s head office, we done the hospital, we done two shopping centres,

so we have a lot of work in that area and we will continue to get more work as the area develops.

“We are busy working on the Sitari Country Estate in Cape Town and we’ll be there for the next four years. It’s a phased development; we’ll do the main boulevards and the side roads and the irrigation infrastructure and all the pipes – it’s a programme which means we will not be standing still for the next four years,” he adds.

INDUSTRY CHALLENGES One of the problems facing the industry right now is the growing number of entrants to the market from multiple service-type organisations. This is causing increased levels of competition but also, driving down the level of quality.

“I hate to say that we’re called the ‘old boys of the industry’ but we are the real landscapers,” says Lockwood. “One of the biggest problems in the industry right now is that the landscaping industry is being corporatized. There are big multinationals that offer multiple

//IN OUR COMPANY, WE ARE ALL REAL LANDSCAPERS – THAT’S FUNDAMENTAL TO GET EMPLOYED BY US//


LIFE GREEN GROUP

services and with that you can become a number in a big cog. In our company, we are all real landscapers – that’s fundamental to get employed by us.

“A lot of companies are now saying that they don’t want multiple services, they actually want to improve the landscape. If you have a multiple services option, your garden will be treated like a floor, or a security guard, or a kitchen or bathroom or cleaner. Gardens require a massive amount of input and knowledgeable people and we have to ensure we add value.

//WE’RE VERY FOCUSSED ON WHAT WE DO AND WE DON’T WANT TO BE A MULTI SERVICE COMPANY. WE WANT TO BE THE BEST LANDSCAPERS – THAT’S SIMPLE//

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BUSINESS PROFILE

“We’re very focussed on what we do and we don’t want to be a multi service company. We want to be the best landscapers – that’s simple,” he explains.

Fortunately, companies that choose to invest in a specialist for their gardening service are seeing benefits. A well-designed and well-maintained garden can help to quickly reduce vacancies and also promote retailers and businesses to customers in a positive way.

“When you have a building that has been emptied after someone moves on, lots of revamps happen and one of the first things that they talk about is getting

the garden done in order to attract a new tenant. Gardens are done to make sure that buildings are relevant, modern and so that they reflect the market place,” says Lockwood.

WHAT’S IN YOUR GARDEN?So what is it that makes a good garden? How do you design a garden that can complement your business? Firstly, you must ensure your garden is suited to the local environment. Secondly, you must ensure it’s visibly attractive and lastly, you must have green products.

Lockwood is an advocate of an indigenous plants and says that they

have proven their worth during recent dry months.

“There are many things that are essential to a building and one of them is a garden. We live in a hot country so you need trees to cool things down and you need to make sure the building is ergonomically correct in its setting. Trees can help this and create that feel-good factor that’s important for people who drive past, visitors and employees.

“Trees certainly do absorb CO2, this is a fact. As we develop our cities – certainly Johannesburg and Pretoria – these green areas also create urban refuges for wildlife.

“Indigenous planting is becoming more important as this country is short of water and indigenous plants are known for their ability to survive and look good with less water. Where we have gardens with indigenous planting, they have

//WE’RE RELIABLE AND WE’LL GO TO THE ENDS OF THE EARTH TO FINISH A JOB OFF ON TIME AND ON BUDGET//


LIFE GREEN GROUP

been shining this year, especially during the recent droughts,” he says.

Life Green Group’s knowledge of indigenous plants, and gardening more widely, is helping the company to remain at the forefront of the business in South Africa and further afield. “We’ve done work in all of our neighbouring countries over the years,” boasts Lockwood, “we will do it when we’re asked; we’re not going crazy trying to find work and open branches in these places but we are certainly happy to offer our expertise to a job.”

And alongside knowledge, skill and a large existing customer base, Life Green

has an attitude and drive that most companies can only dream of.

“There must be a reason why the architects, developers and project managers are using us. We’re reliable and we’ll go to the ends of the earth to finish a job off on time and on budget. Sometimes, work is not even going out to tender, we are getting it straight away. This is because we are considered to be not the biggest but the leaders,” explains Lockwood.

And it would take some serious hard work to knock these landscapers off their perch. Sitting atop the industry, after years of toil, is exactly where Lockwood

//SITTING ATOP THE INDUSTRY, AFTER YEARS OF TOIL, IS EXACTLY WHERE LOCKWOOD AND THE REST OF LIFE GREEN GROUP DESERVE TO BE//

011 948 9728 [email protected]

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and the rest of Life Green Group deserve to be and as the country and continent continue to announce larger projects, the company is perfectly positioned to take advantage of any opportunity that may arise. The seeds have been sown, the blossom has fallen and the proactive, hands on approach to gardening is bearing much fruit.

By remaining focused and offering quality, this is a company that will grow from strength to strength and set an example to the rest of the industry.

CEF/PETROSA

Sparking a Turnaround in SA’s Energy Mix

Acting CEF group CEO, Siphamandla Mthethwa explains that there

are a number of initiatives under way to redevelop and reinvigorate

South Africa’s much-discussed energy sector.


// In last month’s budget speech,Finance Minister Pravin Gordhan detailed how the

government would spend R865.4 billion on public sector infrastructure, over the course of the next three years. He said that investment in energy will amount to R70 billion in 2016 and over R180 billion over the next three years, as construction of the Medupi, Ingula and Kusile power plants is completed. This followed on from President Zuma’s State of the Nation Address (SONA) when the government reiterated its commitment to resolving the country’s energy challenge as part of the nine-point plan for economic development that was detailed in the SONA of 2015.

But the energy industry in this country is an extremely complex environment, facing many challenges in both the short and long term.

Government is regularly announcing its support for various projects coal, renewable, nuclear and gas initiatives yet the growing demand for energy continues to outstrip the pace of growth of supply.

Two organisations at the heart of South Africa’s energy conundrum are national oil company, PetroSA and its parent company, the Central Energy Fund (CEF).

Enterprise Africa speaks to acting CEF group CEO, Mr Siphamandla Mthethwa to find out more about plans for the future and how PetroSA will fit into the energy mix in a country which is desperate for secure, stable, safe supply.

“For me, the target is to stabilise the business amidst the downturn in the economy and make sure that we preserve cash and find a long-term solution for PetroSA from a sustainability perspective.

“We’ve got a number of pipeline projects. We are investing in the renewables space, especially in solar power stations, together with our department of course. We are also looking at coal mining expansion and we’re also looking at increasing the pipeline capacity from Mozambique - through our company iGas, we


jointly own a company called ROMPCO together with Sasol and the Mozambique government.

“It’s a diversified energy portfolio. The primary mandate is around security of supply and to give assurance to the ministry, especially with liquid fuels, that there is an effective entity in place to supply fuels to the market,” says Mthethwa.

Currently acting group CEO, Mthethwa has been with the company for two years. After working previously with Eskom, he joined CEF and took the role as group CFO. He has been in his current position for around one year.

CENTRAL ENERGY FUNDThe CEF, which reports to the Department of Energy (DoE) and minister Tina Joemat-Pettersson, operates right across the energy sector value chain and has subsidiaries including the

//WE DO HAVE EXPANSION PLANS TO SUPPLY MORE COAL TO OTHER CUSTOMERS INCLUDING EXPORTS POSSIBLY//

aforementioned PetroSA, Strategic Fuel Fund (SFF), iGas, African Exploration Mining and Finance Corporation (AEMFC), the Petroleum Association of South Africa (PASA) and two minority interests in two small renewable energy ventures. CEF also manages two funds – the Equalisation and the Mines Health and Safety funds. Renewable energy activities are managed through the Energy Projects Division (previously the Clean Energy Division).

“We were established in 1977 and today we have around 2000 employees,” explains Mthethwa.

PetroSA, something of a notorious SOC in recent times, is the biggest operation managed by CEF and has witnessed extremely difficult times recently, partly due to the global drop in oil and commodity prices and also thanks to largely depleted fuel for its GTL plant in the Western Cape.

“Our biggest challenge has been with the refinery we own in Mossel Bay through PetroSA,” explains Mthethwa. “It’s a GTL refinery and we also have gas fields offshore which we use but the feedstock is almost depleted so we have invested in a project to get more gas from the surrounding area and that project was not successful so we had to write down around R14 billion.”

That project, named Project Ikhwezi, was a five-well gas drilling programme designed to augment dwindling hydrocarbon reserves feedstock. It was expected to deliver 242 Billion Cubic Feet (BCF) of commercial gas reserves but by the end of 2015, had only delivered 25 BCF of commercial gas reserves from three wells. The project spanned four years but PetroSA said that it “did not derive the anticipated return from its investment”.

“In our business, the falling oil price has had a major impact – especially for PetroSA. The oil price fell from almost $110 to around $45 per barrel and that had a significant impact on our revenue and margins. It also contribute to the write down of our assets,” says Mthethwa.


CEF/PETROSA

Another plan to boost fortunes at the refinery were quashed when plans to build a floating liquefied natural gas (FLNG) import terminal were scrapped in December. A feasibility study found the location to be technically and commercially problematic with meteorological and oceanographic conditions described as ‘severe’, potentially increasing the logistical and gas supply costs of the project.

Despite all of this this, the company is forging onwards and concentrating on the positives. On the financial side of the business, PetroSA was able to repay and refinance an interest bearing debt of R1.5 billion in 2015. There was also an increase in cash generated from operations, from R2.8 billion in 2014 to R3.5 billion in 2015.

The company also succeed in

advancing transformation in the oil and gas industry. In 2015, the company recorded total procurement spend of R8.7 billion on Broad-Based Black Economic Empowerment companies, which equates to 103.1% of discretionary spend. The company also spent R10.3 million on Corporate Social Investment initiatives to uplift historically disadvantaged individuals and communities, bringing the total spent on community develop projects since 2002 to R348 million.

There has also been a focused drive around sustainability and the company embarked on a drive, dubbed BillionPlus, to contain and optimise operating costs, setting itself a target to save R1.25 billion in recurring costs. At the 2015 year-end, savings of R1.1 billion were achieved.

//IN OUR BUSINESS, THE FALLING OIL PRICE HAS HAD A MAJOR IMPACT//

GROWTH WITH ESKOMAfter seeing something of a small change in fortunes in recent times, following the appointment of experience leader Brian Molefe, Eskom is on a growth path, looking to make load shedding and unstable supply a thing of the past. With the (seemingly) imminent completion of the Ingula Pumped Storage Scheme and Medupi and Kusile Power Stations, stakeholders are hopeful.

But CEF is not happy to rest on its laurels and while the development of Eskom is welcome, from a business perspective, the organisation is also keen to expand its reach.

“Eskom is our biggest customer through the Gourikwa and Ankerlig power stations which currently run on diesel - we supply a lot of diesel there. We also supply a lot of coal to Eskom from our mining company, AEMFC.

“Obviously, our intention is to supply beyond just Eskom, to the broader market. We do have expansion


With trucking in their DNA, and value creation in their blood Crossroads create real value in the fuel and chemical market.

While transport solutions create physical optimisation, Crossroads believe that excellent SHEQ performance and High levels of BBBEE and black ownership also create competitive advantage. The one thing one can’t get away from is the fact that over 50% of supply chain costs come from transportation. Our history is rooted in Trucking, but our expertise and our attitude is to create value through comprehensive fuel supply chain solutions. Crossroads is level two BBBEE with over 75% black ownership.

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Fuel supply chain solutions need brawn and brain


South Africa is a country like no other. It has the transformational challenges of a developing nation and the high standards of a developed one. The fuel and chemical distribution sector is exacting in both regards.

The fuel sector was one of the first to be regulated from a transformation point of view after 1994. Most of the players at the time were companies that had opted, as non-negotiable, the global demands for very high standards of safety, health, environment and quality (SHEQ)., These exacting standards were passed on to the the distribution businesses that serviced the sector. Other sectors, the chemical and mining sectors being chief among them, took their lead from the fuel industry, and today have much to thank them for.

Most fuel companies struggled to meet these requirements and preferred to concentrate on less exacting markets. Those who had the SHEQ capabilities were quickly challenged on their transformational credentials. This second requirement separated the transformation-minded men from the boys. Again the field narrowed.

Crossroads is one of those extraordinary businesses that not only survived, but thrived on these challenges. Key was the fact that it has always held SHEQ to be a critical capability. The early recognition that transformation would be important

led it to a position where its black economic empowerment credentials don’t just tick the right boxes, but make it stand out from the fuel transportation crowd. At a black ownership level of over 75%, and with a level 2 BBBEE rating it has few peers. These two qualifications have enabled a growth rate of its fuel distribution fleet over the past five years that is unmatched in Southern Africa.

At Crossroads these high levels of BBBEE and SHEQ have become the base from which they have created further value for their clients. Add to this a South Africa wide footprint to cross-border and bonded transport capability in and to neighbouring states. Blend this with smart-logistics solutions and levels of innovation that supply chain thinking brings to trucking, and you get an inkling of the recipe that make them so appealing to fuel and chemical producers and distributors alike.

“Crossroads is a great South African story” contends Arend du Preez, Crossroads’ CEO. “It has embraced the transformational challenges of the time and at the same time has realised that in a global industry it needs to not only match, but surpass global standards to be great. But at the core of its appeal is not its BBBEE rating, nor its SHEQ standards, enviable as they both are. No, it’s the unwavering belief, that to be relevant to its clients it must add further value and make a difference to their bottom lines and to their balance sheets.”

//CROSSROADSFUEL DISTRIBUTION SOLUTIONS IN SOUTH AFRICA NEED BRAWN, BRAIN AND BBBEE

BUSINESS PROFILE

plans to supply more coal to other customers including exports possibly,” says Mthethwa.

The company’s position, despite recent results from PetroSA, remains strong and it is well placed to breed success in the sector.

“We are a state-owned entity which gives us our own unique position,” Mthethwa says. “Talking about our competitive edge, I would say it’s our people. Also, in certain businesses, the technology sets us apart – we have the only GTL plant in Africa (the first in the world and now the third biggest on earth) and we’re looking to expand capacity of our pipeline form Mozambique.”

But growing the business will take a big effort, especially from marketing, as the image of energy in South Africa has

been damaged in recent times because of mismanagement and interruption of electricity supply.

“We don’t market the company like we should. It’s something we have been doing but not in an aggressive way,” says Mthethwa.

ENERGY DEVELOPMENTS The DoE has long been searching for new and alternative energy solutions to bolster its portfolio; it aims to generate 30% of energy from clean, renewable sources by 2025.

In a recent statement, leading global solar energy conference organiser and CEO of Solarplaza, Edwin Koot said that South Africa has now become an example to follow when it comes to s sustainable government policy on solar power.

“Europe has suffered especially as some governments have unpredictably withdrawn or taxed their incentive schemes. While Spain, Germany, Belgium and Italy have all encountered turbulence and turnarounds in the last 12 months, SA has shown commitment in setting up its solar industry currently moving into round four, maintaining its incentives, and successfully getting projects off the ground. In our recent trip to Dubai, South Africa came up as the case study to follow,” he said.

“In this economy, we are learning that it’s not about size – Suntech, the former world leader, and LDK are now battling – while previously smaller players like Jinko Solar are soaring. It has shown that timing is critical and right now South Africa’s timing is excellent.

“Solarplaza has been witness to the immense positivity and growth in South Africa. There is high energy here and you can enter the market even if there aren’t incentives. From what

//THE TARGET IS TO STABILISE THE BUSINESS AMIDST THE DOWNTURN IN THE ECONOMY//


CEF/PETROSA

we’ve seen, it really can be one of the world’s huge markets, as long as the government stays the course after the next election,” he added.

And then there’s the huge opportunities that exist in the shale gas industry. After booming in the US and proving to be a reliable source, South Africa has investigated its options which are reported to be huge in the Karoo.

The government has already said that it is ready to regulate and monitor companies that have expressed an interest in exploring shale gas in the country.

“The draft regulations, once finalised, will result in a regulatory framework that ensures safe extraction of gas, which will contribute to diversification of South Africa’s energy mix, energy security supply, significantly boost South Africa’s economy and have positive effects on the Gross Domestic Product,” said Thibedi Ramontja, the Director-General of the Mineral Resources Department in December.

“Currently South Africa is a net importer of energy sources such as crude oil, refined petroleum products and natural gas. It is estimated that the Karoo shale gas resources would mean South Africa has the 5th largest reserves, estimated at 485 trillion cubic feet (Tcf ).

“We however take a conservative view of a 30 TcF economically recoverable resource, which is equivalent to 30 times the size of the Mossgas plants,” said the Minister for Mineral Resources, Mosebenzi Zwane, in January.

Before making any decisions on awarding exploration licenses, the department is undertaking studies and consulting with local communities and businesses, mainly the SKA Project, to ensure that no disruption is caused should any licenses be granted.

In other energy news, the Burgan Cape Terminals fuel storage project in Cape Town was launched in December and is set to be completed in 2017 creating hundreds of jobs and have a storage capacity of 118,670 m3. In December it was also announced that Oiltanking MOGS Saldanha had been given environmental authorisation for the development and construction of a R2 billion commercial crude oil blending and storage terminal in Saldanha Bay. Initial reports suggest that the facility will have a total capacity of 13.2 million barrels, comprising twelve 1.1 million barrel in-ground concrete tanks.

These developments and agreements all form part of a wider strategy put in place by the DoE, a strategy that CEF and PetroSA are very much a part of, and will help to

address employment, transformation and secure energy supply.

It is PetroSA’s vision to be ‘the leading African energy company’ by ‘becoming the leading provider of hydrocarbons and related quality products by leveraging our proven technologies and harnessing our human capital for the benefit of all our stakeholders’ and as long as it remains focused on its strengths and sticks to a turnaround strategy, which is set to be tabled in the near future, it will likely achieve this and drive South Africa’s wider energy industry forward.

//SOLARPLAZA HAS BEEN WITNESS TO THE IMMENSE POSITIVITY AND GROWTH IN SOUTH AFRICA//

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www.cefgroup.co.za


ZAMBEEF

Feeding the

NationIn Zambia, a country where food production and distribution is a prolific and complex issue, there is a great onus on governments and businesses to provide sustainable and affordable foodstuffs to the populace. With poor harvests, plummeting market prices, and low wages for farmers, malnutrition and poverty have become daily struggles for many people. Tackling these problems has been taken on not only by the government, but also businesses like Zambeef, who are taking it upon themselves to help feed the nation.

PRODUCTION: Emily Ayson

// In Zambia, ensuring thatthere is plenty of quality food available for an ever growing

population has long been an issue. Whilst the government’s ‘Feed the Future Campaign’ is gradually ensuring that things change; farmers are receiving more education and fairer prices and investment in agricultural research and development is on the rise; businesses are also taking a stand against food shortages.

Companies such as Zambeef are paving the way for sustainable, efficient and affordable food distribution and in the process, also becoming extremely successful. Head of Marketing and Corporate Affairs, Felix Lupinda has stated: “Food plays an important role in

the life of a nation. And there are many challenges affecting food security in the world”. As such, his company are diligently working to ensure that the people of Zambia do not go hungry.

Zambeef is a leading supplier of meat, poultry, cereals and oils to Zambia and beyond, with premises also located in Ghana and Nigeria. Through dedication to ensuring efficient production, fair pricing, the building of business relationships and a staunch commitment to sustainable food sourcing, the company have risen to become Zambia’s leading meat supplier, with an annual revenue of $275 million.

In discussing why Zambeef are performing so well within an often treacherous marketplace, Joint-CEO,


BUSINESS PROFILE

Carl Irwin has said: “Zambeef’s retail and distribution network has been structured to ensure customers have easy and convenient access to all our products.” Evidently, seamless delivery of their goods is of paramount importance to Zambeef, as is their dedication to ensuring that their customers are able to obtain product easily. Furthermore in December 2015, Joint-CEO Francis Grogan also stated: “Zambeef has had a successful operational year despite the challenges in the economy and retains a positive outlook towards its operations and has set sights on continuing to grow its operations in the next financial year.”

Quite clearly efficiency and a positive attitude have both been driving forces behind the company’s success, the magnitude of which is remarkable.

The company as it exists today hails from very humble beginnings.

In 1994, the workforce consisted of just 60 employees, slaughtering around 180 cattle a month in a small rented abattoir. The meat was then transported in a single Land Rover for sale in just two local butcheries. Contemporarily, the company now employ approximately 5800 workers and cull 55,000 cows, 50,000 pigs and six million chickens per year. Today, Zambeef is the country’s second fastest growing retailer, beating stalwarts such as Woolworths, Spar and Shoprite. In 2013 alone, the

company saw a phenomenal 23% growth in revenue and as of 2015 operated from 150 premises, with more to be acquired this year.

However, it is not just the product itself that has contributed to Zambeef’s success. A significant proportion of their income also derives from their cold chain food production – the storage and distribution of product in a temperature controlled environment. The company has concentrated on improving and expanding this arm of the business and as Grogan states: “These are cash generating operations that will form the cornerstone of Zambeef’s future success.”

//ZAMBEEF’S RETAIL AND DISTRIBUTION NETWORK HAS BEEN STRUCTURED TO ENSURE CUSTOMERS HAVE EASY AND CONVENIENT ACCESS TO ALL OUR PRODUCTS//

//ZAMBEEF’S SHARE PRICE IN LONDON HAS PERFORMED PARTICULARLY WELL

AND IS A MEASURE OF THE CONFIDENCE THAT INVESTORS PLACE IN ZAMBEEF

AND ZAMBIA AS A WHOLE//


Such success has undeniably been achieved as in December 2015 Zambeef reported a profit rise of 189%.

Furthermore, in January 2016, it was announced that Zambeef was the best performing food producer at the London Stock Exchange, with share prices doubling from 5.75p to an astonishing 11.5p in just two months. As a result of this, Irwin said proudly: “Zambeef’s share price in London has performed particularly well and is a measure of the confidence that investors place in Zambeef and Zambia as a whole.”

Accordingly, Zambeef’s success is not just down to an astute business acumen, but also to the fact that they strive to operate in such a way that demonstrates reliability, affordability and responsibility.

This point is most evident in the fact that Zambeef has a dedication to ensuring sustainable production of their goods. Not only does this safeguard future supply, but also protects the

environment and creates jobs within the agricultural and farming sectors. This imperative to operate sustainably has been discussed at length by Lupinda, who has acknowledged that “Zambia does have abundant resources in the form of water, arable land and manpower, but there is need to maintain and protect those resources by ensuring they are used wisely”. He goes on to state that “Zambeef has a zero waste policy which tries to keep waste to a minimum and build on value addition and recycling models. For example, the remains from our crop harvesting of wheat and corn are processed to feed the cattle or recycled into organic fertiliser for the fields”. Such a selfless business practice is truly admirable, with such a large company eschewing greed or the opportunity to take advantage of plentiful resources in order to ensure not only their future prosperity, but a continual supply of goods to their customers.

The marketplace will forever be a volatile area for the food sector and it must not be forgotten that extraneous factors such as climate change are also burgeoning challenges that these industries must contend with. But with an approach to food supply and distribution which is both efficient and conscientious, it is no wonder that Zambeef have obtained such a high level of success and are continuing to do so. Undeniably, the company are spearheading a movement in which not only can food supply become a prosperous enterprise but it can make a real impact on the lives of other retailers and indeed, help to feed the nation.

ZAMBEEF

+260 21 [email protected]

www.zambeefplc.com

ZAMBEEF


INDUSTRIAL LOGISTICS

SYSTEMS

Stand and DeliverAs a leading expert in supply chain logistics consultancy,

Industrial Logistics Systems represent the pinnacle of prosperity and achievement in their field. Offering a comprehensive repertoire of services to a customer base that are elite in

their own rights, ILS ensure that their clients’ businesses and reputations thrive alongside their own. In exploring this success, Enterprise Africa takes a closer look at the company and speaks

to Director Clayton Thomas.



INDUSTRIAL LOGISTICS SYSTEMS

//Within an environment wrought with fierce commercial competition, it can be very

difficult for a company to stand out of the crowd. Here in South Africa, a country currently developing in terms of business and trade, consumers are becoming a powerful force, able to demand what they want and when they want it. In doing so, a huge responsibility has fallen on all retailers and service providers to ensure flawless production and supply of their wares, a challenge that is being met by many with the aid of ILS. With the development of over 500 warehouse and distribution facilities under their belt and a client base spanning industries and indeed continents, ILS have undoubtedly marked themselves as South Africa’s most prolific player in the world of supply chain logistics.

For Director Clayton Thomas, the raison d’être behind the business is important yet simple: “Anybody that’s moving products, anywhere in the

world, we’ll assist them in doing that…It’s about ensuring availability – whether it’s a bearing or a can of baked beans.”

To facilitate the movement of goods in a proactive and cost-effective way, ILS offer consultancy and practical input throughout the whole process of warehouse distribution; from planning and building, right through to maintenance and organisation. Consistently adhering to a tried and tested regime of consultancy, the company being their work by fully familiarising themselves their clients’ business; general operations, budgets, spaces, equipment and even storage solutions and furniture. Once this has been achieved, ILS move on to more external research, providing in depth data analysis of sector-specific business

//ANYBODY THAT’S MOVING PRODUCTS, ANYWHERE IN THE WORLD, WE’LL ASSIST THEM IN DOING THAT//

trends and practices, arming their clients with the knowledge they need to anticipate and sate consumer demand. It is this comprehensive service and acute attention to detail has enabled ILS to rise to the forefront of supply logistics and gain contracts from some of the biggest players in South African retail including Woolworths and Shoprite.

Although primarily involved in the retail sector, Thomas reveals that ILS have further stakes in a diverse range of other industries, also providing their services to mining, petro-chemical and pharmaceutical industries. Similarly, their reach is not just limited to South Africa, with the company having completed projects further afield in The Middle East, Europe and Australia. In the United Kingdom alone, supermarket


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BUSINESS PROFILE

giants Asda, Sainsbury’s and Tesco are all clients to ILS and Thomas and the other directors regularly travel internationally in order to solidify bonds with the UK and keep up to date with global standards and trends.

In staying on trend, the influence of internet technology has also been vital to the work of ILS, providing them with a means through which they are able to maintain close contact with their international customers, regardless of the restraints of distance and time

differences. Thomas muses how when they first began trading, international business was practically impossible, but the company’s willingness to continually adapt and integrate the latest technology has allowed their presence to infiltrate markets that were previously completely impenetrable.

These geographical issues are not the only challenges that ILS has had to face and overcome. As with all economies, the South African market is continually changing and some

companies can be hit hard if demand wanes, prices increase or the market becomes saturated with competitor products. However, regardless of the unrepentant ebb and flow of the marketplace and consumer reactions, ILS have managed to seamlessly cultivate and maintain an outstanding market position throughout their 22 year existence.

As Thomas states: “When things are good, we’re building new facilities, when things are tough, we’re helping our customers to be leaner and cleverer in the way they’re doing things.” Evidently then, ILS’s success can largely be attributed to the fact that in delivering to their clients, it’s not just about the physical processes and elements of business, but the fact that company also strives to help companies on an intellectual basis; a wonderfully

//WHEN THINGS ARE GOOD, WE’RE BUILDING NEW FACILITIES, WHEN THINGS ARE TOUGH, WE’RE HELPING OUR CUSTOMERS TO BE LEANER AND CLEVERER IN THE WAY THEY’RE DOING THINGS//



holistic and admirable business strategy.This genuine care for their clients

is also apparent when looking at the key tenets that ILS conducts their business under. Of great importance is consistency, whether this be in the form of procedure, service or even down to staffing. ILS have around thirty members of staff and although the work is coming in thick and fast, clients can rest assured that their cases will always be dealt with by the same people. Furthermore, the forging of good business relationships is key to ILS and they actively promote the fact that they view their business as an extension of their clients’. A rarity for

such a prolific company, this decisive business tool allows ILS to negate any hierarchal relationships that may be perceived as intimidating or exclusive. As such, ILS clearly strive to put their clients’ interests at the very heart of any projects, forming business partnerships based on mutual understanding and respect. Furthermore, ILS highly value the fact that all of their clients – whether large or small – expend an enormous amount of trust in the company and so this should be met with a service that both represents value for money and provides all of the necessary tools for success.

It therefore comes as no surprise when Thomas declares that the company is still going from strength to strength. He makes it clear that the business currently has more work on its hands than they have ever had and this momentum does not seem to be slowing down any time soon.

Taking great pride in their work, a flawless operation and a reputation that spans the globe, ILS is undoubtedly an industry leader, aiding their customers to stand and deliver in the competitive arena of supply and demand.

//ILS IS UNDOUBTEDLY AN INDUSTRY LEADER, AIDING THEIR CUSTOMERS TO STAND AND DELIVER IN THE COMPETITIVE ARENA OF SUPPLY AND DEMAND//

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www.ils.co.za


BMW SA

BMW Keeps Foot On the Gas in SA

Investment into facilities, the release of new models and an ongoing marketing push look

set to deliver positive results for BMW in South Africa.

PRODUCTION: Karl Pietersen

// BMW’s work in South Africa has been a huge driver behind economic development

and technology advancement in a country which has a strong history in the global automotive business. The German car maker opened its doors in SA in 1973 and produced the 3-, 5-, and 7-series models in low volume for the local market. In the 1990’s, following the country’s emergence from international isolation, BMW’s plant in Rosslyn received investment and became fully automated for high-volume production, mainly of the E46 3-series model, which is now sold in SA and also international markets including Japan, Australia, New Zealand and various Asian territories. The plant has also started supplying vehicles to South America and more recently NAFTA.

In February last year, the company celebrated one million 3 Series Sedan’s made in SA and this prompted BMW CEO and member of the Management Board of BMW AG responsible for production, Harald Krüger to say that the South African production site represents a cornerstone of BMW’s global production network of 30 sites in 14 countries, remaining a vivid example of a successful market entry through local production.

Despite challenges faced in recent times - not least industrial action, currency depreciation and economic


© BMW

slowdown – BMW remains stout, and is still a respected and important part of the SA community. This was reinforced when the company announced in November that it would invest significant resources in expanding its operations. This would involve a R6 billion spend on modernisation that will see BMW stop building the 3-Series and replace it with the X3 sports utility vehicle. This transition will be complete by 2019.

Oliver Zipse, chairman of BMW SA said: “At the BMW group, we constantly evaluate our plant allocation to ensure it reflects and accommodates market demand. With the decision to produce the next generation of the BMW X3 in Rosslyn, we strengthen the position of

//WITH THE DECISION TO PRODUCE THE NEXT GENERATION OF THE BMW X3 IN ROSSLYN, WE STRENGTHEN THE POSITION OF SA IN OUR GLOBAL PRODUCTION NETWORK//

SA in our global production network. It also follows our strategy that production follows the market.”

NEW MODELS FOR SAIn other positive news for the company that builds the ‘ultimate driving machine’, announcements were made recently detailing how the exciting new 7-series, M2, M4 GTS and X5 plug in hybrid models will be released in South Africa.

The luxury 7-series is being hailed as “best BMW ever built” by industry critics and is described as opulent, spacious and built for the pleasure-loving driver.

Popular with politicians and business leaders, the 7-series boasts

lightweight design; first-class powertrains, chassis, operating systems and intelligent connectivity and pleasing interior ambience.

“The primary objective in the development of the new car was to create a vision of modern luxury and to exceed our customers’ expectations. In BMW’s eyes, modern luxury is rooted in the most advanced technologies and extremely fine attention to detail. This generation of the BMW 7 Series is the most luxurious, most comfortable and – all round – the best car we have ever built in this class,” said Adrian van Hooydonk, Senior Vice President BMW Group Design.

And it has certainly made an impact on local experts like Janine Van der Post of Wheels24 who said: “Is it the best car BMW has ever built? In terms of technology and engines, yes. The drive in the 7-series is thrilling…” However, it’s important to remember that all models of the 7-series cost well over R1 million so choose wisely.


© BMW

BUSINESS PROFILE

The eagerly-awaited M2 will go on sale in South Africa, in a choice of four colours (blue, white, silver and black) in April. This sporty creation will cost approximately R800,000, which is more expensive than its rivals from Audi and Mercedes-Benz, but if you look at the performance of the car at a recent launch event at the Laguna Seca racetrack in California, you can see that you’re getting a lot of bang for your buck.

CLEAN ENERGY PRODUCTION Away from vehicle sales, in October, BMW made the announcement that its Rosslyn plant would get 30% of its power needs from renewable resources. This would be the result of a biogas project where about 40,000 tonnes per annum of cattle manure and around

20,000 tonnes of organic waste will be fed into digesters that will produce biogas to drive a gas engine for power.

South African renewable energy project company, Bio2Watt, will be responsible for the development of the plant and this is just one step in the company’s journey towards becoming 100% powered by renewable sources by the year 2020.

“Our vision is to draw 100% of our energy requirements from renewable sources with the help of partners such as Bio2Watt,” said BMW SA Managing Director, Tim Abbott.

Bio2Watt CEO Sean Thomas explained some of the benefits of using a biogas plant including; a reduction in the volumes of waste to landfill, thereby helping local municipalities to meet

their zero-waste commitments; creating localised employment opportunities and generation of a storable form of renewable energy, capable of being transported and utilised 24 hours a day, seven days a week.

While all corporate organisations are becoming more watchful of their environmental footprint, this is one of the first steps by a major international player in the automotive sector to drive forward with renewable energy action.

ON-GOING MARKETING DRIVEBMW has one of the world’s innovative and creative marketing departments and its efforts, all over the world, ensure that the brand is held in the highest regard; as it has been for the past six decades.

In South Africa, the auto company made the move to become the Title Partner to the SA Open Championship. The Open is the oldest golfing tournament in South Africa and the world’s second oldest Open Championship. It will now officially be known as the BMW SA Open Championship. Held in Johannesburg

//THIS GENERATION OF THE BMW 7 SERIES IS THE MOST LUXURIOUS, MOST COMFORTABLE AND – ALL ROUND – THE BEST CAR WE HAVE EVER BUILT IN THIS CLASS//


© BMW

BMW SA

in January, at the Glendower Golf Club in Johannesburg, 2016 was the 105th anniversary of this legendary competition.

“Sports such as motorsport, sailing and golf are key global sponsorship pillars for the BMW brand. With this in mind, this local sponsorship initiative – which mirrors the brand’s global sponsorship strategy – sees BMW become the overall naming rights partner of the SA Open Championship. In addition, it gives the brand the opportunity to consolidate its position in golf with a signature event that we hope will grow over time to become the biggest professional event in South African golf,” said Tim Abbott.

BMW also announced in November that it would become the official vehicle partner to the Sunshine Tour with Abbott saying: “We will be providing vehicles for the tour officials to deliver a world-class professional golf series in South Africa, as well as the opportunity to activate our brand at all Sunshine Tour official tournaments should we wish to do so.”

With all of this effort, it looks certain that BMW will thrive in South Africa, and its production facilities are set to become even more advanced thanks to the large investment. All things considered, it would be a brave person to bet against BMW claiming a bigger market share in the next 12-24 months – it looks like life in the fast lane will continue for this German automotive giant.

//IS IT THE BEST CAR BMW HAS EVER BUILT? IN TERMS OF TECHNOLOGY AND ENGINES, YES//

Leather - the ultimate recycled materialEstablished in 1997, GST / Seton AutoLeather is regarded as a pioneer of automotive leather in South Africa, and remains fully committed in creating a sustainable work environment by maximising the use of local raw materials, with leather types including light-embossed, medium-embossed and

deep-embossed leathers, available in full or corrected grain, chrome or chrome-free, throughout its operations which in

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Phone: (27) 11-360-7500

E-mail: Marketing & Sales

[email protected]

[email protected]

BMW SA


www.bmw.co.za


© BMW

NEOLIFE

Rebrand Boosts Growth for Neolife

The Neolife business in South Africa tells a story of success in a commercial

sector where so many others have failed. Following a rebrand and the

release of a number of exciting new products, this a company that is set to thrive throughout

2016 and beyond…


// Direct selling is a proven, successful tool for building a network of customers and

marketing products to a relevant commercial audience quickly and effectively. But somewhere along the way, direct sales has gained something of a bad reputation in some corners, largely due to the negative publicity around Ponzi and pyramid schemes that have been shut down in the past. Some direct sales companies, years ago, didn’t have the integrity they needed, hard sales tactics in which recruits were pressured into buying products or front-end loading were used but today, with the reputation of the industry on the mend, this model is proving hugely positive for some companies and their distributors.

Selling directly to consumers generates referrals and creates demand and direct-selling companies are now focusing on general consumer transparency, leveraging new technologies to reach beyond distributors to general consumers and developing corporate sophistication.

The perfect example in South Africa is NeoLife. The company recently rebranded (previously known as GNLD or Golden Products) and is pushing to build its market share in the healthcare and consumer products industry.

“Unfortunately, because we are a direct selling company, we quickly get thrown into the basket with pyramid or Ponzi schemes,” says NeoLife Executive Vice President for Africa, Marco Taylor. “We are part of the Direct Selling Association which has 36 member companies in South Africa and in 2014 there was a growth of 15% in people joining our industry and sales grew by 5% as an industry so we see more and more people looking at this as an opportunity to trade and in Africa people still like to trade.

“People join our company as they can see the benefit of the product and the value for money the products offer. People also join NeoLife to make extra money.”

Now officially known, globally, as NeoLife, the South African division has undertaken a complete overhaul of its image to modernise and align the business units from around the world.


“We have had an extreme makeover,” explains Taylor. “We renewed the packaging and the look to make our brand fresh and new. We believe people need to look after their health; our mission is to make the world a healthier and happier place. People are conscious of the environment and we have made sure that remains part of our philosophy.

“We’ve come a long way and people are seeing this rebranding as a rebirth of who we are or where we’re going. Even though times are tough, we are very excited about the future and we’re in a building process, getting the brand out there and reminding people who we are, and just by changing our packaging and the way we look, people are picking up the product and seeing that it’s fresh and new and then realising that it’s GNLD or Golden Products and that excites them as it’s a quality brand

//WE BELIEVE PEOPLE NEED TO LOOK AFTER THEIR HEALTH; OUR MISSION IS TO MAKE THE WORLD A HEALTHIER AND HAPPIER PLACE//

that they know and trust,” he says.

NATURAL GROWTH Neolife started in the USA and was founded by entrepreneur, Jerry Brassfield. After selling nutritional products from his home, Brassfield quickly grew the business and today the company is a multi-million dollar organisation.

“The company arrived in South Africa, via Australia, in 1971. Jerry started in a small town in California and grew quickly. Soon, it was all over California, then all over the USA, then Australia, Europe and eventually South Africa.

“Back then, the company was called Golden Products and mainly sold cleaning products. We still sell these products today and they are environmentally friendly, just as they were back then – we were green before

it was cool to be green. “As Jerry acquired more businesses,

we added additional nutritional products based on wholefood concepts and nature,” explains Taylor.

As the company grew in Africa, and around the world, more products were added, there was a need to consolidate the brand and centralise marketing.

“We had different names throughout the world; Africa and Europe were trading as Golden Products, USA and Asia Pacific were trading as NeoLife,” explains Taylor.

“The company grew in Africa, using South Africa as a hub, we started bringing in products in bulk from the US, we package, we re-export, and we realised that the brand is not looking that great. We were looking slightly 80s/90s and we began to ask, how can we be more current? We looked at what’s easy to remember, what’s something that will stick with people, and we felt the brand NeoLife was suitable.

“We call ourselves NeoLife but we make sure people know we are GNLD as that is a well-established brand in Africa.


BUSINESS PROFILE

People still know Golden Products from our two popular products Super 10 and LDC which are light and heavy duty cleaning products,” he says.

HEALTHY PRODUCT LINESThe NeoLife products span different lines; there’s Nutritionals, which include vitamins, minerals and diet supplements; there’s Home Care, which includes carpet cleaner, car wash products and laundry goods; finally, there’s Personal Care, which consists of soaps, facial products and shampoos.

Taylor is excited about nutritional products which are whole food based, backed by NeoLife’s Scientific Advisory Board.

“We have a few products like grain oils, where we extract the material that is good for the cells to assist in a healthy diet, which are extremely popular.

Our product called Tre-En-En is one of our best selling product, we have our Salmon Oil Plus which is a top seller, we have a very convenient packed product called Pro Vitality+, 4 products in one small sachet, where we combine grain oils in the form of Tre-En-En, a multivitamin product, a product called Carotenoid which is an antioxidant that helps to repair cells and boosts your immune system as well as our Salmon Oil Plus capsule.

“Last year we introduced a healthy snack bar. People drive around a buying a doughnut or a muffin and they don’t get nutritional value, so we launched a fruit and nut bar and a chocolate bar filled with nutrition, protein and even omega 3. Both of these flavors are growing. Initially it was released as an add-on to our weight loss portfolio, encouraging healthier snacking, but

we found that a lot of parents liked the product for their children and sales quickly increased,” he says.

The power of NeoLife’s nutritional products has even attracted the attention of some of the healthiest people around – the country’s elite athletes.

“We see more and more sportspeople and athletes approaching us for our nutrition. NeoLife sponsors a Superbike team who use our products and they have won the SA championship back-to-back using NeoLife products. We also have some of the top rugby players asking to use our products as supplements,” Taylor boasts.

2016 AND BEYOND The difficulties of operating in stagnant economic times have been somewhat sidestepped by NeoLife as the company’s target audience is addressed through the direct sales model which is based principally on personal contact with the customer. Nevertheless, Taylor does concede that demand may be slower in challenging times when people are less-flush.

“We feel demand may be a little flat this year because people are being very careful with their money due to the current economical environment in South Africa. However, we see opportunities with our cleaning products as we can show people how you to save money. We expect that we might not have significant growth this year but when you build a brand, you need to be positive and we see the current situation as an opportunity.

“Bad health is an expensive deal. People are stressed, they are not eating properly, there’s an increase in chronic disease and when you come with natural health products people are open to listen, especially when you offer value for money.

There’s no limit to the market for NeoLife; everyone is a potential customer and this of course drives further business. As health and fitness become more fashionable and more

//WE WERE GREEN BEFORE IT WAS COOL TO BE GREEN//


NEOLIFE

on-trend, the company’s products are set to thrive.

“In wholesale or retail, you don’t always see the effect that your business or products will have on people. In this business I’ve noticed everyone from engineers to accountants, teachers to doctor’s start using the product and they start referring it and then they make money and realise how easy it is. It’s an interesting business to look at, especially the sales side of our business, but for the rest – operations, finance, distribution, IT – it’s normal business,” Taylor explains.

He concluded by saying that he is “very excited about the company and the group” and why not? This

is a business with nearly 60 years of global sales experience, internationally respected products that are backed by scientific research, a brand that is valued and recognised by customers, and a growing market that is hungry for further advancement. The next step will be further development on the continent and pursuing further market share in South Africa.

//WE ALSO HAVE SOME OF THE SPRINGBOK PLAYERS ASKING TO USE OUR PRODUCTS AS SUPPLEMENTS//

NEOLIFE


www.gnld.co.za


ADVANCED GALVANIZING

Working Hard in an Industry in

Need of Galvanisation

Working in a steel industry that has seen more than its fair share

of challenge over the past few years is no easy feat but

Belville-based, Advanced Galvanising is making the

best of the tough times and preparing for growth

in the long-term.


// After going through a relatively uneasy period, there was good news for the South African steel

industry in February. According to the World Steel Association (worldsteel), SA steel production rose 2.7% year on year in January to an estimated 650,000 tons. This followed a 16.3% rise in South African steel production to 7.6 million tons in 2015 compared with a 2.8% decline in global steel production to 1.6228 billion tons. In 2015, steel production decreased in all regions except Oceania, which registered a 4.6% gain.

There was a slowdown in production ear on year in the first half of 2015 to 3.2 million tons and this was mainly accredited to the country’s and industry’s ongoing battle for smooth energy supply. But this issue was addressed during Finance Minister, Pravin Gordhan’s budget speech when he announced that the Treasury had plans for R865.4bn in public-sector infrastructure spending over the next three fiscal years, with a big portion allocated to investment in the steel-intensive transport and logistics sector.

So this provided hope to the industry, and this was welcome following ArcelorMittal’s former CEO, Paul O’Flaherty’s damming review of the industry back in September.

“The South African steel industry is under severe threat – yet we believe its future existence and sustainability


is essential to underpin the country’s economic development goals and support the growth of numerous key sectors,” he said in a release for IOL. “Steelmaking contributes more than 1.1% directly to South Africa’s gross domestic product (GDP), and a further 0.4% indirectly.

“The top five steel consuming industries together contribute some R600bn to South Africa’s GDP (15% of the total) and employ more than eight million people.”

So what does this mean for local companies in the steel business? The industry could certainly do with more protection, form a pricing perspective, and more attention from investors, but on the ground, our local steel specialists are performing well, despite all the

//THE TOP FIVE STEEL CONSUMING INDUSTRIES TOGETHER CONTRIBUTE SOME R600BN TO SOUTH AFRICA’S GDP ADVANCED IS THE LEADING GALVANISING BUSINESS IN THE WESTERN CAPE//

negative suggestions.One company which is delivering

first-class service, understanding its customers and tailoring its offerings to them, is Advanced Galvanising – a Bellville-based expert galvaniser that has been operating its specialised facilities for big customers for more than 20 years.

WHAT IS GALVANISING? Galvanizing has become big business over the years, so much so that there is now even a Hot Dip Galvanizers Association Southern Africa (HDGASA). The practice is about protecting metal from rust, prolonging life and minimising operational cost.

Galvanizing involves applying a protective zinc coating to steel (or

iron) by submerging parts in a bath of molten zinc. This forms a coating of corrosion-resistant zinc which prevents corrosive substances from reaching the more delicate part of the metal and the zinc also serves as a sacrificial anode so that even if the coating is scratched, the exposed steel will still be protected by the remaining zinc.

Historians says that the process was invented in India but over the years, with the development of new technologies and discovery of new materials, the process has become extremely efficient, safe and trusted – galvanizing is extremely popular in the auto industry and also with steel and iron wire rope production.

The major benefits of galvanizing include prolonging life of metals,


BUSINESS PROFILE

reducing maintenance costs over time, increasing reliability, increasing erection time, making inspection easier and faster, and it is also a relatively quick and complete process.

Advanced Galvanising is an expert and CEO, Johan Louw tells Enterprise Africa more about the business: “Advanced Galvanising is a galvanising plant in Bellville. The Prima Group has obtained a share in 1993, and during 2006 we became the proud single owners of the business.

“Advanced is the leading galvanising business in the Western

Cape, with a bath size of 14m long, 1.4m wide and 3m deep, and does hot-dip galvanising for a variety of clients in the steel and related industries.

“We galvanise fences, security gates, boat trailers and many other steel constructions. Our process entails covering steel in zinc to prevent rust. Galvanising presents a number of advantages, which makes it the preferred method for rust prevention. These advantages include low costs, easy application, low maintenance costs and durability.

“We are open 24/7 and look

forward to serving our customers.” The Prima Group has three other

operating divisions; Prima Service Stations, Prima Tyres and Prima Properties.

Right now, with the industry positioned the way it is, it is essential for companies to focus on their core business and drive growth through quality service offerings. Advanced Galvanising are doing just that, not over stretching the company and growing at a rate that suits the company and industry.

When strength returns to the

//GALVANISING PRESENTS A NUMBER OF ADVANTAGES, WHICH MAKES IT THE PREFERRED METHOD FOR RUST PREVENTION. THESE ADVANTAGES INCLUDE LOW COSTS, EASY APPLICATION, LOW MAINTENANCE COSTS AND DURABILITY.//



sector, with opportunities for export being discussed, there will be huge opportunities and companies that have a track record of success in the steel sector will be called upon to drive growth further. Also, as the economic tide turns and money flows from the government back through the economy, construction, automotive and a number of steel-dependent industries will grow. The focus here must be on the long-term and the opportunities that will come further down the road. Advanced Galvanising is well positioned to use its western-cape operations as a spring

board to new markets and considering the company is SABS ISO 1461 certified and a member of the HDGASA, offering collection, delivery, design and a host of complementary services, it is in a perfect placed to grow in the future.

//ADVANCED IS THE LEADING GALVANISING BUSINESS IN THE WESTERN CAPE, WITH A BATH SIZE OF 14M LONG, 1.4M WIDE AND 3M DEEP, AND DOES HOT-DIP GALVANISING FOR A VARIETY OF CLIENTS IN THE STEEL AND RELATED INDUSTRIES //

2877 Albertina Sisulu Road, Technikon, Roodepoort, South Africa

T. +27 11 760 6000 | chemplus.co.zaE. [email protected]

Leaders in Surface Chemistry

We manufacture and supply process chemicals, both nationally and globally, for use in the galvanizing industry.

Our unique product range includes:• Acid degreaser• Reduced fuming and splashing flux, lowering zinc consumption• Environmentally-friendly passivator for galvanized services• White rust-remover and surface shine-restorer, for field application• Drain aids• Alkaline degreaser• Pickling inhibitors• Low dross and low ash generating fluxes• Galvanized surface treatment for painting• Wire Drawing Soaps

SUCCESSFULLY SERVING YOUR INDUSTRY FOR OVER 20 YEARS



www.primagroup.co.za


DE KEUR

A Fruitful Business in a Fertile Industry

Based in the Koue Bokkeveld, close to the town of Ceres, De Keur is

taking advantage of the land that has been blessed with extremely

fertile soils. Famous for its production of deciduous fruit, this region and this company

are hugely important to the South African fruit

export industry.


//South African fruit exporters are experiencing differing fortunes right now. The

economic landscape has had conflicting effects and the ongoing work of the government and private sector to open up new international markets is providing new opportunities for business.

Following the global economic slowdown of 2009, South African farmers experienced a challenging few years because of lacklustre demand in local and international markets and less consumer spending power. For commercial farmers, the weakening Rand has caused its fair share of problems, making technology and machinery from international suppliers more expensive but making South African products more attractive to international customers.

The continuing development of the relationship between the USA and South Africa through the AGOA (African Growth and Opportunities Act) has started to bear some fruit, literally, after the first consignment of litchis was sent to America. Assistant US trade representative for agricultural affairs and commodity policy, Sharon Bomer said recently that the US was ready to help SA as there is huge demand for avocados, mangoes and other fruits to go along with wine, macadamia nuts and citrus fruits that are already being sold in America. “We are fully on board to work with SA to find a way forward to make sure that the food safety and animal and plant health issues are adequately addressed, and we are making progress,” she told BDlive.

The SA government are also working hard to increase fruit exports to Russia after the industry saw a 15% decrease at the end of 2015 – this effort has been welcomed by Russia who have been feeling the effects of sanctions from Europe and the West.

Europe remains one of South Africa’s most important trade partners and the export of fruit here is big business – especially to the UK which has long been a big importer of SA products.


One company that has particular expertise when it comes to successfully exporting to Europe is De Keur. This family-run business has been supplying apples, pears, nectarines, peaches and plums, and onions and butternuts to local and export markets for decades.

Founder, Charl (Tippie) du Toit, acquired the farm ‘De Keur’ in the Koue Bokkeveld for £9600 on March 28th 1934 at a public auction. The transaction was completed under the stunning old oak trees that can still be found on the farm today. As a pioneer of ethical farming, Tippie passed on excellent

//EQUIPMENT IS CONTINUALLY UPDATED AS NEW TECHNOLOGY BECOMES AVAILABLE TO INCREASE EFFICIENCY AND IMPROVE FRUIT HANDLING//

practices and principles to his sons, Charl and Gys who developed the farm into the industrial operation that it is today, focusing all their effort on producing quality fruits.

Activities take place across four main farms (De Keur, Rocklands, Leeuwrivier, De Hoop/Môreson) and a packing facility in Ceres.

“We are committed to supplying safe, quality assured, fresh and wholesome fruit that meet or exceeds our customer’s requirements and importantly comply with industry standards,” the company says.

“We pride ourselves at being

at the forefront of technology and agricultural science, as it’s paramount to increasing productivity and providing sustainability for the long term.”

TECHNOLOGY Without today’s modern technology, the business of fruit farming would not be worthwhile from a commercial perspective. The traditional methods of picking and packing by hand, in the hot and tiring weather, are now a thing of the past and at De Keur, the focus is very much on staying at the forefront of the industry when it comes to new technology that can help the business grow.

“Our focus is to pack the right quality fruit, in the best and most effective manner, following the cold chain regime which ensures the longest shelf life possible, in order to suit the needs of the consumer,” the company says.


BUSINESS PROFILE

“We also strongly believe in staying up to date with new innovations and technology in the fruit packing industry. Equipment is continually updated as new technology becomes available to increase efficiency and improve fruit handling. Multiple lines also give us the flexibility to pack differing varieties and package sizes simultaneously.

“We keep up to date with the latest agricultural technology and best practices by engaging with specialists in key areas to ensure that we address the short and long term needs of our business. The aim of all technology is to transfer information effectively throughout the business in order to maximise productivity, efficiency and above all, quality.”

Technology forms such an important part of the process so De

Keur is investing at all levels and that includes pest control and food safety – two of the most significant areas when exporting.

“We rely on a scientific pest management system, which in conjunction with expert consultants, allows us to minimise disruption to beneficial organisms, such as bees, while protecting our produce against harmful ones such as codling moth and scab.

“We manage and monitor the cold chain from the farm all the way to our clients, so that we can guarantee a quality product to the end consumer,” says De Keur.

THE CHALLENGE OF THE DROUGHT Even with the most advanced equipment and technology in the

industry, there are certain things that cannot by countered and one of them is a drought.

South Africa has experienced terrible droughts in recent months – the worst in 30 years according to the SA weather service – and the country is not out of the woods yet as droughts are expected to continue as a result of the weather effect known as El Niño.

Ceres and the Koue Bokkeveld valley has had its fair share of problems, receiving just half of the annual rainfall with the region’s most important dam, Koekedouw Dam, at 35% of its 17.2 million cubic metre capacity at the end of November.

Most fruit farmers in Ceres have been able to manage but are now having to be strategic with water usage. “For optimal production of pome fruit, farmers in the region between Ceres and the Koue Bokkeveld and Witzenberg Valley need 8000m3 to 9000m3 of water per hectare from mid-September to the start of May. With dam levels so low, farmers only have access to between 40% and 60%. In effect, water has to be managed carefully to

//THE AIM OF ALL TECHNOLOGY IS TO TRANSFER INFORMATION EFFECTIVELY THROUGHOUT THE BUSINESS IN ORDER TO MAXIMISE PRODUCTIVITY, EFFICIENCY AND ABOVE ALL, QUALITY//


DE KEUR

reduce the impact of a possible supply shortage,” said Louis Reynolds from Fruitful Crop Advice.

Sappi recently announced that it had seen an increase in demand for export packaging in its fruit department and with the resurgence of citrus fruit exports to parts of Europe and the growth of demand from the US, this is going to be an important time for the industry and any slowdown because of drought, or anything else, will be seriously detrimental for business.

FRUITFUL FUTUREAlready a big supplier to European markets, De Keur is positioned strongly for the future, despite the local challenges of drought and economic instability. The company calls huge international clients including Tesco

and Marks & Spencer its customers and thanks to accreditation from the British Retail Consortium (BRC), Carbon Footprint, the Ethical Trading initiative, Global G.A.P and SIZA, it has an excellent base from which to launch into new markets.

With Russia and the USA both opening up opportunities, and with growing local and European markets, the current set of du Toit leaders have a fantastic opportunities to grow this fantastic organisation.

“In recent years a number of the ‘next generation’ has joined the business fulfilling a number of key roles from general management, production and marketing to packaging and administration. This generation is proud to be associated with the De Keur legacy that their grandfather Tippie

began in 1934, and they look forward to nurturing the legacy for generations to come,” the company concludes.

+27 12 546 8721

+27 12 546 0602

[email protected]

www.harvestbags.co.za

DE KEUR

+27 (0) 23 315 [email protected]

www.dekeur.com


SUN PHARMA/RANBAXY SOUTH AFRICA

Providing Treatment to SA for 20 Years

There has been a lot of chop and change at Ranbaxy or Sun Pharma in South Africa in recent years. The company’s global ownership has

changed, the demand for products is always shifting and there has been uncertainty about major contracts. Nevertheless, this innovative

organisation is still leading the way in SA and will continue to be a healthy asset for customers all over the country.


// In recent times, things have not been easy for South Africa’s pharmaceutical companies.

After decades of sustained growth and development, these companies have become global leaders in research, innovation and production of a range of products, but after the 2009 financial crash and with the emergence of a global market full of competition, our pharmaceuticals businesses are finding things a little more difficult.

According to world-renowned professional services company PwC, “the challenges are well known and include declining profitability, thinning pipelines, growing generic competition, and skyrocketing operating and marketing costs… Companies will need to decide how to satisfy contending stakeholder demands while pursuing sustainable growth in a competitive market.”

Of course, the pharmaceutical business relies on the success of other markets. The performance of the wider healthcare industry can impact on pharma trade and in South Africa right now, the healthcare industry is navigating its own set of challenges


including the price vs. value war, the number of under-insured and uninsured people and the ongoing concern surrounding quality of care.

However, despite the bleak economic outlook that the country is now facing, pharmaceuticals companies are well positioned to build on a robust history.

According to Deloitte, South Africa’s pharmaceutical market, the largest in Sub-Saharan Africa, totalled an estimated $3.9 billion in 2013 and is anticipated to grow up until 2018 by an average of six percent a year, to an estimated $5.1 billion – perhaps this was a driver behind the decision announced recently in President Zuma’s SONA that the government

//WITH THE ENHANCED RESOURCES, TECHNOLOGY AND OPERATIONAL CAPABILITIES, WE ARE NOW ALL SET TO SERVE CUSTOMERS EVEN BETTER//

has formed a new pharma company, Ketlaphela, which will focus on the supply of anti-retroviral drugs.

Another pharma-company that has seen much development over the past few years is Ranbaxy, or Sun Pharma.

Sun Pharma South Africa is ranked amongst the top eight generic pharmaceutical companies in the country and is engaged in the sales and distribution of generic prescription, over-the-counter (OTC) and originator prescription products. The company also offers generic anti-retroviral (ARV) medicines to needy patients in Southern Africa, supporting national governments in their effort to control the AIDS epidemic.

With a state-of-the-art production

facility in Roodepoort, Sun Pharma manufactures analgesics, cold, cough and flu preparations, anti-histamines, anti-hypertensives, CNS drugs, vitamins and minerals, and a comprehensive range of OTC products, all of which are manufactured in various dosage forms including tablets, capsules, oral liquids, creams and gargles. These are marketed in the South African as well as neighbouring markets.

In 1996, Indian-owned firm Ranbaxy Laboratories Ltd opened its doors in South Africa as part of the company’s global growth strategy. In 2010, the company opened its $30 million state-of-the-art manufacturing facility, the Be-Tabs Pharmaceuticals Manufacturing Plant, just west of Jo’burg – the company’s third facility in Africa.

BUSINESS TRANSFORMATIONAt global level, Ranbaxy began to perform poorly under the management of Japanese company, Daiichi Sankyo and in 2014 it was announced that


BUSINESS PROFILE

Sun Pharma would take over the business, particularly interested in its strong presence in the USA, in a deal worth $4 billion. In 2015, the deal was finalised bringing Ranbaxy under the Sun Pharma umbrella, creating the world’s fifth largest specialty generic pharmaceutical company.

In South Africa, the business remained running as normal but welcomed greater resources.

“It is an important milestone in our long association with the industry,” said CEO Desmond Brothers.

“The combined entity will be branded ‘Sun Pharma’, which has a stronger global recognition. There will be no change in the name of the legal entity in South Africa and will remain Ranbaxy Pharmaceuticals (Pty) Ltd. With the enhanced resources, technology and operational capabilities, we are now all set to serve [customers] even better.”



However, sources close to the Indian headquarters have been quoted in local media as having doubts over some of the South African operations. Some reports have suggested that Sun Pharma may not be keen on taking the South African HIV medicine program forwards, after it won the $140 million contract to supply drugs in 2010.

In some of its business divisions around the world, especially in Europe, Sun Pharma has made it clear that it is looking to divest.

“For Sun Pharma, the focus has been the US and rest of the world markets, while Ranbaxy has a huge presence across the world. The company will divest unprofitable geographies in Europe, as well as the API business which is not a priority for the new owner,” said Sarabjit Nangra, VP, research-pharma, Angel Broking.

Interestingly, at a global sales level, the company has been trying for some time to bolster its presence in North America and the acquisition of Ranbaxy has gone some way towards helping this. But one of the main barriers to the new market has been problems with quality control. Some Indian-manufactured products have not met US standards but there has been reports suggesting that the business could look to its subsidiaries in countries such as South Africa, where quality standards are high, to supply to the lucrative American market. However progress in this regard is yet to be seen.

“We have invested significantly on new equipment, which will enable us to improve our output capability — and this is very much an ongoing

process. For the local business we are presently well equipped to supply to South Africa and our four neighbours (Botswana, Lesotho, Namibia and Swaziland). We are currently working to develop as a South African manufacturing hub to supply to Ranbaxy operations in sub-Saharan Africa,” the company said.

“We are looking at high volume movers across all therapeutic classes and will look to bring in the top new molecules in the prescription arena as well as to expand our existing OTC business.”

In a recent financial report, for the third quarter 2015, Sun Pharma Global MD, Dilip Shanghvi said: “Our results for Q3 indicates sequentially improving quality of business and performance. This is despite adverse currency movements and increase in R&D investments. The synergy benefits of the Ranbaxy acquisition have begun

to reflect in our financials. We remain committed in allocating required resources for enhancing our specialty and complex generics pipeline.”

The results highlight the strength of the company and its influence in the industry and while its Rest of the World (ROW) business is still a growing concern, it seems that Sun Pharma will devote the necessary resources to operations like South Africa that perform well and are well managed.

//WE HAVE INVESTED SIGNIFICANTLY ON NEW EQUIPMENT, WHICH WILL ENABLE US TO IMPROVE OUR OUTPUT CAPABILITY//


012 643 2000 Khaleeq.Zakariya@ sunpharma.com

www.sunpharma.com/south-africa


J&E CASH & CARRY

WholesomeWholesale

As the consumer market begins to trend more towards value for money

over brand or company loyalty, the business of commercial

buying and selling can become hazardous for any retailer. However, J & E Cash and

Carry in Pretoria are a quintessential example

of a company that are diligently working to not only secure their own future, but the future of their dedicated customers too.


// Having reached its 70th year in business, J & E Cash and Carry is one of South Africa’s oldest

wholesalers. A family run legacy, it is currently the fourth generation of the Joosubs at the helm, doing all they can to preserve and continue the excellent service and reputation of the company.

J & E as it exists today is a far cry from its humble beginnings back in 1945. Once a conventional wholesaler run by an entrepreneurial father and son, over the years the company has transformed into a multi-locational, internationally recognised supplier of wholesale goods.

Specialising in stock holding, delivery and export, J & E proffer a vast range of wares including locally sourced groceries, home and electricals, health and beauty, stationary and hardware. Evidently, with such diverse stock the company ensure that they maximise all potential revenue flows, but much of their reputation also lies in the fact that they are solely dedicated to trade business only.

With a complete focus on customer care and retained loyalty, J&E operate under the motto ‘we will not compete against our own customers’. The company eschews selling directly to the consumer marketplace in order to ensure that their commercial customers receive the best prices and are able to go on to make profits of their own. This in turn has enabled J & E to forge strong,


prolonged relationships with their client base and guarantee the repeat business which is essential to the company and their reputation.

Similarly, J & E are well known for being leading suppliers of branded goods. For instance, in 2011 they became the key distributors to Unilever SA, even having to purchase second premises in Hermanstad to run operations. As such, their customers have peace of mind that they will be able to resell quality household names affordably.

The success of the company is evident by the fact that in 2012, they undertook a massive operation to

//ONCE A CONVENTIONAL WHOLESALER RUN BY AN ENTREPRENEURIAL FATHER AND SON, OVER THE YEARS THE COMPANY HAS TRANSFORMED INTO A MULTI-LOCATIONAL, INTERNATIONALLY RECOGNISED SUPPLIER OF WHOLESALE GOODS//

upgrade and increase their shelving capacity and also invested in more forklifts and trucks. Accordingly, more stock can be held for longer and with less potential to be damaged and efficiency in distribution has been increased. As such J&E are easily able to cope with the demand of the South African customers, but have also been able to extrapolate business to the international marketplace, exporting to Africa, Asia, Europe and The Middle East.

In such a competitive marketplace, J&E are evidently playing their part to ensure that their customers are able to both receive and offer value for money and reliable service. Such is the

reputation of the company that it is no wonder that they are being recognised and appreciated on an international level and will undoubtedly continue to do so for many more years.


J&E CASH & CARRY

+27 (12) 327 5000info@ jecc.co.za

www.jecc.co.za

EXHIBITION CALENDAR

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

RAND SHOW 201625 MARCH - 03 APRIL 2016The Rand Show is the largest consumer event of its kind on the continent. It consistently provides valuable exposure, creative promotional opportunities and direct engagement with the largest audience available at any consumer event in South Africa.

CAREER INDABA16 – 17 MARCH 2016Career Indaba provides students, parents and teachers with practical knowledge on how students can succeed in their lives after school and studying by hosting interactive workshop sessions and two days of networking opportunities with top corporates companies and further education institutions. Visitors are guaranteed to get real advice, from real people, free of charge.

POWER GENERATIONWORLD AFRICA 201615 – 16 MARCH 2016Power & Electricity World Africa is the annual forum where industry professional come and learn how to develop sustainable, clean and bankable world class energy generation projects throughout the African continent. Tens of thousands of executives and business leaders from across Africa have attended the show over the last 19 years.


//TABLE OF ALL EVENTS:SECUREX WEST AFRICA 2016 Landmark Events Centre, Lagos 01-03 March

CIBEX EAST AFRICA 2016 Kenyatta International Conference Centre 03-05 March

HEAVY DUTY 2016 Cairo International Convention & Exhibition Centre 16-21 March

PROPAK AFRICA 2016 Expo Centre, Nasrec 15-18 March

PROFESSIONAL BEAUTY Cape Town ICC 13-14 March

ON SITE POWER WORLD AFRICA 2016 Sandton Convention Centre 15 – 16 March

AFMA FORUM 2016 Sun City South Africa 01 - 03 March

THE SOLAR SHOW Sandton Convention Centre 15 - 16 March

Ò

Ò

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Being at the forefront of the global hydropower industry, Voith com-bines experience with innovation. We offer turnkey plant solutions applying to both the field of power generation and the area of storing electric power. Voith is also a reliable and experienced partner for

A strong Africa – with renewable Energy.

modernization and services of hydropower projects, replacing and enhancing components to improve the efficiency of existing plants.

With more than 140 years’ expe-rience in the field of hydropower, Voith Hydro is well equipped to continue delivering excellence in hydropower in the years to come.

www.voith.com

A Voith and Siemens Company

WACS 3

YZERFONTEIN

MTUNZINI

MARSEILLES

MOMBASA

NAIROBI

KIJITONYAMA

Beitbridge

MIDRANDISANDO

DURBAN

CAPE TOWN

MUMBAI

LONDON

DJIBOUTI

Ramatlabama

Asia Pacific

Geneva

Sexial

KAMPALA

Milange

Mutare

MahambaOnskeepkans

Fujairah

LagosAccra

FRANKFURT

AMSTERDAM

Paris

Zobue

MAPUTO

North America

5

4

2

3

1

SEACOM 1

TEAMS 4

Main ONE 2

EASSY 5

POINT OF PRESENCE (PoP) Transmission

MEET ME POINT (MMP)

SEACOM NETWORK

SEACOM PARTNER NETWORK

POINT OF PRESENCE (PoP) Transmission and IP

DAR ES SALAAM

STOCKHOLM

First Telecommunications and Internet Service Provider in Africa to:/ provide international sub-sea optical fibre connectivity to the east coast

of the continent

/ significantly lower communications costs through an open-access network model

/ remove national and international infrastructure bottlenecks by providing city-to-city

bundled pricing

/ facilitate research & education through sub-cost bandwidth

The Backbone of Africa

seacom.mu [email protected]

ea march 2016

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