Capewell Springs & Metal Pressings

CAPEWELL SPRINGS

CAPEWELL SPRINGS AND METAL PRESSINGS

SA Manufacturer Announces

Strong Upgrades PRODUCTION: Karl Pietersen

Capewell Springs and Metal Pressings is a South African manufacturing business investing in future growth by bringing on board a new plating plant. While some are negative about manufacturing in the country, Capewell is evaluating every opportunity and carving a nice niche for itself as MD, Emile Coetzee explains. www.enterprise-africa.net / 3

INDUSTRY FOCUS: MANUFACTURING

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Driving local manufacturing in South Africa has long been a ‘high priority’ of government and the private sector. The benefits are obvious and hold the potential to become widespread, quickly. Job creation, economic development, GDP growth, and a reduced balance of payments can all be addressed by an upswing in the country’s manufacturing activity.

But manufacturers in the East have managed to drive prices through the floor while always improving delivery on quality. It’s not only South African manufacturing that has been clawed back by the East – all over the world, manufacturing operations have seen trade move to China or similar.

However, today there is a localisation drive in South Africa. Communities recognise the need to be making things in the area, and not bringing unnecessary bulk quantities in from overseas. Even President Ramaphosa said in October, while opening the Jobs Summit in Johannesburg, that localisation to create

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employment is high on his agenda.

So, Enterprise Africa talks to Capewell Springs and Metal Pressings, the Cape Town-based high-volume manufacturer of metal products, about whether this localisation drive is having an impact, and if companies like Capewell are excited about a future in manufacturing.

“Many people have learned their lessons going East,” explains Managing Director, Emile Coetzee. “Look at textiles for example – they were importing wires for a saving but when things went wrong, or when fashions change, it becomes very difficult and expensive to turnaround. People have experienced both the imports, and the costs associated with that, and the local manufacturing and the benefits that go with that. The DTI has helped by raising the import duties to support the local manufacturer. But, on the other hand, you have economies of scale. The UK makes one Nissan model on one line and that equates to more than the total number of cars made in

// VARIETY IS OUR BEST FRIEND AND WORST ENEMY. IT KEEPS US ALIVE BUT KEEPS US VERY BUSY // South Africa – we only serve 0.7% of the global market. People look at how we can get numbers back from Europe or China and economies of scale is sometimes the problem. The cost of the tooling and the set-up of some of these international companies is high. We try and accommodate it where possible and we have seen some success. As a factory, you have to gear yourself to be competitive, you have to be able to make smaller quantities affordably, and you have to invest in automation. It’s always a balancing act.”

Capewell makes metal pressings, springs, wire forms and strip springs, and is also happy to perform individual jobs for clients. Its design and tool

CAPEWELL SPRINGS AND METAL PRESSINGS

room are highly-equipped and ISO 9001:2015 approved. Part of the global KERN-LIEBERS Group, headquartered in Germany, Capewell is recognised for quality manufacturing.

“We do everything in-house and we outsource very little of our work,” says Coetzee. “We have a R&D department in-house for design and we have a tool room in-house to build progression tools to make our products. We also do our own maintenance and building of machines.

From the tool room, we have our production and we make wire forms and flat parts along with a wide variety of other products. We do our own heat

treatment processes, hardening and tempering in-house, and then products go into the plating plant.”

CAPITAL INVESTMENT In order to further entrench its position as a manufacturing industry leader, Capewell has recently invested in new plating capabilities that will allow for improved capacity, quality, efficiency and variation. With the company’s previous plating facilities reaching the end of their useful life, when a client reached out with an opportunity, Coetzee was only happy to accept.

“This plating plant is really crucial to our process. 60-70% of our products

are plated through this plant. Because of the age of our current plating plant, we felt it had passed its expiry date and was going to become very maintenance intensive,” he says.

“We found an opportunity through one of our clients who were needing to sell their plating plant as they were not doing as much of that work anymore.

It was in very good condition and so we struck a good deal. We have an engineer who decommissioned it and is recommissioning it on this side, and that should be done soon. The plant has a much larger capacity and we can now do a barrel of plating every 15 minutes.

It will save water and comes with a

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INDUSTRY FOCUS: MANUFACTURING

// WE ARE SEEING THAT THIS YEAR HAS A DIFFERENT FEEL TO IT AND THERE IS SOME CHANGE IN THE ECONOMY AND WHAT WE’RE DOING - THAT MAKES US EXCITED AND WE WILL CONTINUE TO DO THE BEST WE CAN //

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modern effluent treatment plant.

“It also brings the opportunity for new business,” he adds. “We have clients who import some products and they compare the quality of plating and aesthetics they get with what we offer from our current plant. Currently, we can’t get near to that quality but with our new plant we will be able to deliver world-class quality standards. It’s fully automated and programmable and can run various different cycles.”

Metal is plated to add new characteristics to the original material.

Whether it’s for aesthetics, strength, durability, weight or something else, metal plating is now vital for the operations of some businesses. After investing into this new plating plant, Capewell can approach new customers and build sustainable partnerships.

“Our client, from who we purchased the plant, will now come to us for plating work and there are other companies that are closing plating operations and are looking for suppliers of quality plating.

We will now have the capacity to take on electro plating and justify the investment into the new plant.

“We ended up paying about a quarter of what we would have for a new plant that didn’t include a water effluent treatment system. There’s also a lot of work that goes into preparing for a new plant like this – new floor, civil work, and that makes up a lot of the cost which would have been the same for a new plant,” says Coetzee.

The savings that Capewell have made by not buying a brand-new plant outweigh the fact that what they now have has, maybe, a 20-year lifespan rather than the full 25 but “the cost makes it worth it” according to the MD. As soon as the new plating plant is operational (expected early March), the company can press forward with new developments for eagerly waiting customers.

“We are working with a client where we have spent a significant amount

CAPEWELL SPRINGS AND METAL PRESSINGS

// WE WERE COMPETING WITH CHINA AND THE GOVERNMENT RAISED THE IMPORT DUTIES TO 15% WHICH, TOGETHER WITH THE WEAK EXCHANGE RATE, HELP US TO REGAIN MARKET SHARE // of time getting the product perfect.

The client looked at it and decided we needed to improve the aesthetics, so we decided to wait for the plating plant before we run new samples. If we can get approval from this client - they do currently import - then we think we can bring some of that manufacturing back to South Africa at the same quality,” enthuses Coetzee.

A GROWNIG CONCERN Located in Epping, Cape Town, Capewell Springs has been plying its trade in the local market since 1981. In the early 2000s, the company was targeted by KERN-LIEBERS which was looking for entry into the South African market to better serve its local customers. Since then, the company has been growing steadily despite the challenging economic environment.

“KERN-LIEBERS wanted to be where their clients were but they needed a spring manufacturer to complete their offering. They saw Capewell as the perfect fit and negotiated with the owner before taking the business. At one stage, two of every three cars had a KERN-LIEBERS retracting spring as part of the safety belt,” says Coetzee.

The automotive industry is very important for Capewell and, currently, the company is producing

a number of components for the auto-manufacturing sector. But its reach spread far and wide, and Coetzee is proud of the company’s diverse product portfolio.

“There was a new automotive deal that was struck and goes from 2020 to 2035. That involves a big drive for localisation, and we expect to benefit from that,” he says. “A lot of clients are sending us drawings and we are now benefitting from the localisation interest. We just picked up some new business that is a direct result of the localisation push in the automotive market.

“Variety is our best friend and worst enemy. It keeps us alive but keeps us very busy,” he laughs.

“Automotive, agriculture, construction, lighting, electrical, manufacturing and textiles are just some of the industries we serve. We are actually the last company on the continent that manufactures underwear and swimwear wire.”

As the local textile industry has been decimated, only a few businesses remain strong enough to carry a range of product lines that contain wire. Capewell manufactures for all of these companies.

“We were competing with China and the government raised the import duties to 15% which, together with the weak exchange rate, help us to regain market share,” says Coetzee.

SA OPERATION Thanks to its long history, and significant brand strength, Capewell Springs and Metal Pressings has solidified its position atop the industry and customers from all corners of the country know about the capabilities of this engineering and design partner.

Currently, while Capewell is expanding with its client base, Coetzee is not looking for physical expansion away from Cape Town.

“We supply the whole country and we transport goods from one end to the other. Because of us having an

entire production process in house, to set that up elsewhere and split the work we already have would not be feasible. We are ISO 9001 certified and we do all our quality treatment in house, with our own plating, and the product goes out. There is no point duplicating that anywhere else on the continent. The company has been in existence since 1981 and because of that, people find us.”

But the company’s reach will hopefully grow as its customers push their presence across southern Africa.

“We do try and sell to wholesalers as we don’t always make a finished product. We are really keen on our customers going out and selling their products, which contain our products, to the big sites around southern Africa.”

And despite its German ownership, the company enjoys important independence that allow for quick, nimble decision making.

“We run a unique set up here in terms of our technology and clients – it’s different to a lot of our German subsidiaries. Capewell has always been independent and we run it as a private company but the advantage we have is a lot of networking opportunity, a lot of support, and a lot of partners who can assist whenever we need it,” says Coetzee.

This pioneering, persistent and progressive business is proof that manufacturing in South Africa works. It is proof that localisation is important.

“It’s been a challenging time” admits Coetzee, “but we are seeing that this year has a different feel to it and there is some change in the economy and what we’re doing - that makes us excited and we will continue to do the best we can. There is a lot of drive, a lot of business coming our way, and a lot of opportunity,” he concludes.

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