Enterprise Africa March 2019

AFRICA

THE BUSINESS MAGAZINE FOR AFRICA’S INDUSTRY LEADERS

March 2019

www.enterprise-africa.net

CDC Reaches its Ambitious 2020 Investment Target Exclusive interview with Dr. Ayanda Vilakazi BD. Head of Marketing & Communications

ALSO IN THIS ISSUE:

Power Developments / Dimension Data / Argon Asset Management / BFS

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EDITOR’S LETTER

EDITOR Joe Forshaw  joe@enterprise-africa.co.za SENIOR PROJECT MANAGER Sam Hendricks  sam@enterprise-africa.co.za SENIOR PROJECT MANAGER Tommy Atkinson  tommy@enterprise-africa.co.za PROJECT MANAGER Shannon James  shannon@enterprise-africa.co.za PROJECT MANAGER James Davey  jamesd@enterprise-africa.co.za PROJECT MANAGER Sam Applegate  sama@enterprise-africa.co.za FINANCE MANAGER Emily Taylor  finance@enterprise-africa.co.za SENIOR DESIGNER Liam Woodbine  liam@enterprise-africa.co.za CONTRIBUTOR Manelesi Dumasi CONTRIBUTOR Karl Pietersen CONTRIBUTOR David Napier CONTRIBUTOR Timothy Reeder CONTRIBUTOR Colin Chinery CONTRIBUTOR Benjamin Southwold CONTRIBUTOR William Denstone

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Now is a crucial time in the South African business community.

Leadership changes at key organisations, and preparations for political elections make for a tumultuous run up to the financial year end.

Prasa, Cell C, DHL Express SA, Microsoft SA, HP, Petra Diamonds, Alexander Forbes and many more have all announced new appointments in top roles recently, and these new leaders will have their work cut out.

The National Treasury has revised economic growth projections down from 1.7% to 1.5%, and the medium-term future remains subdued with projections only getting up to 2.1% by 2021.

But in this environment, the innovative and ambitious companies are those that thrive. So, Enterprise Africa is bringing you stories from industry leaders who have all faced change to stay at the top of their game.

Business Furniture Solutions, a leading office solutions supplier, has made the jump from simple distributor to manufacturer, and is reaping the benefits. Argon Asset Management is changing to become more of a wholistic wealth and finance management business. Dimension Data, one of the leading tech businesses in SA, is investing in BPO capability in Canada. Power Developments is embracing change in the market and investing in micro-living. Pierre Cronje is developing a furniture range which is slightly more affordable but still high-quality in order to open up new market segments.

Without a refining of strategy and refocus of activity, these organisations might have been facing a different future.

Instead, they continue to lead the way in their respective sectors, despite ongoing economic and political uncertainty which is a continuing drain on commercial activity.

Perhaps your business has had to take action to change course. Perhaps a new strategy has breathed new life into our operations? Talk to us online and let us know. @ EnterpriseAfri1

Editorial & Design +44 (0)20 7193 2735 E. info@cmb-media.co.uk www.cmb-media.co.uk CMB Media Group does not accept responsibility for omissions or errors. The points of view expressed in articles by attributing writers and/or in advertisements included in this magazine do not necessarily represent those of the publisher. Whilst every effort is made to ensure the accuracy of the information contained within this magazine, no legal responsibility will be accepted by the publishers for loss arising from use of information published. All rights reserved. No part of this publication may be reproduced or stored in a retrievable system or transmitted in any form or by any means without the prior written consent of the publisher. © CMB Media Group Ltd 2019

Joe Forshaw EDITOR

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

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06/NEWS: The News Snapshot A round up of some of the latest news stories from around the country

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

8/COEGA DEVELOPMENT CORPORATION CDC Reaches its Ambitious 2020 Investment Target As one of South Africa’s top performing State Owned Enterprises (SOE’s), the CDC is an organisation that constantly achieves and exceeds on its targets for job creation, SMME development, training and development, investment attraction and economic development.

After a challenging 2017, the CDC started to make significant progress in 2018 and is now looking forward to an extremely exciting future, with many new strategic investment projects set to advance the sterling reputation of this world-renowned Special Economic Zone and infrastructure development business.

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CONTENTS

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INDUSTRY FOCUS:INFRASTRUCTURE 17/SANRAL SANRAL Maps Out Plan for Horizon 2030 INDUSTRY FOCUS:MANUFACTURING 24/BFS-BARKER GROUP GROWTH, CONSOLIDATION THEN GROWTH AGAIN 33/PIERRE CRONJE Carefully Crafting a Future-Proof Strategy 39/CAPEWELL SPRINGS AND METAL PRESSINGS SA Manufacturer Announces Strong Upgrades INDUSTRY FOCUS:FINANCE 45/ARGON ASSET MANAGEMENT African Asset Management With A Global Outlook 50/ALEXANDER FORBES SOUTH AFRICA Financial Well-Being: Secured INDUSTRY FOCUS:PROPERTY 56/POWER DEVELOPMENTS Power Working on new Concept for Cape Town Living

69/ 62/SAOTA Constructing A Fearsome Global Reputation INDUSTRY FOCUS:TECHNOLOGY 69/DIMENSION DATA Increasing Dimensions 75/ABB SOUTH AFRICA Power and Automation Pioneers INDUSTRY FOCUS:ENGINEERING 78/LITHON PROJECT CONSULTANTS ‘Let Us Rise Up and Build’ the Call from Lithon’s Visiopreneur Director INDUSTRY FOCUS:TOURISM 89/THEBE TOURISM GROUP TTG Celebrates SA History with Unique New Attractions INDUSTRY FOCUS:MINING 96/PETRA DIAMONDS Petra Holds All the Jewels INDUSTRY FOCUS:SECURITY 100/BLUE SECURITY Minimising Danger In Durban

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BLACK INDUSTRIALISTS PROJECTS ATTRACT R13.2BN The 131 projects that have been approved under the Black Industrialists Scheme have resulted in increased investments and job creation.

“The approval of these 131 projects of black entrepreneurs has leveraged over R13.2 billion of private-sector investment, about 9 500 new jobs created and 8 900 retained in a wide range of manufacturing sub-sectors,” Trade and Industry Minister Rob Davies said.

The Black Industrialists Scheme is the incentive programme of the Black Industrialists Policy which aims to promote the participation of black industrialists as manufacturers in key sectors of the economy as identified in the Industrial Policy Action Plan (IPAP).

Going forward, Davies said the dti will increase efforts of providing financial, market access, capacity building and technical support to approved Black Industrialists in collaboration with state-owned companies, other government departments and the private sector.

Davies further announced that in 2018, 22 trade missions and 20 national pavilions were undertaken across the world, where the dti supported companies to showcase their products and services.

Over 800 enterprises were assisted and approximately R4 billion export sales were recorded.

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Minister Blade Nzimande

STIMULUS PACKAGE TO CREATE JOBS, BOOST ECONOMY Transport Minister Blade Nzimande has announced a R3.5 billion stimulus and recovery plan with measures that will ensure that government gives priority to the areas of economic activity that will have the greatest impact on youth, women and small businesses.

“The stimulus and recovery plan consists of a range of measures, both financial and non-financial, that will be implemented immediately to firstly

ignite economic activity, secondly restore investor confidence, thirdly prevent further job losses and create new jobs, and fourthly to address some urgent challenges that affect the conditions faced by vulnerable groups among our people,” Nzimande said.

He said the R3.5 billion budget for the stimulus package will unlock R13.1-billion investment in critical and strategic road infrastructure

PRESIDENT OPENS GAMSBERG ZINC MINE President Cyril Ramaphosa has opened the new R5.5 billion Gamsberg zinc mine.

Alongside Minister of Mineral Resources, Gwede Mantashe and Northern Cape Premier, Sylvia Lucas, Ramaphosa hailed the opening of the mine as an important milestone for the Northern Cape and for South Africa.

According to Vedanta Zinc International, the Gamsberg mine forms part of the Black Mountain Mining operations and will exploit one of the largest known, undeveloped zinc orebodies in the world, creating jobs for more than 2000 people.

Vedanta is an Indian-based organisation and the Presidency suggests that this investment has solidified the relationship between the two nations and triggered a new wave of industrial and economic development in the country.

NEWS SNAPSHOT GROWTH REVISED DOWN TO 1.5% IN 2019 National Treasury has revised down the South African economy’s growth to 1.5% in 2019.

In the 2019 Budget Review document, Treasury said Gross Domestic Product (GDP) has been revised down since the Medium Term Budget Policy Statement (MTBPS) tabled in October 2018.

The document attributed the drop in forecast from the 1.7% tabled at the MTBPS to 1.5% – to a fragile recovery in employment and investment, and a less supportive global trade environment.

“The weaker outlook projects a slow improvement in production and employment following poor investment growth in 2018, and a moderation in global trade and investment. The medium-term outlook is subdued, with GDP growth projected to reach 2.1% in 2021, supported by a gradual improvement in confidence, more effective public infrastructure spending, and a better commodity price outlook than previously assumed,” noted the document.

This as South Africa’s GDP growth slowed from 1.3% in 2017 to an estimated 0.7% in 2018.

The 2019 Budget revisions take into account weaker investment outcomes in 2018, a more fragile recovery in household income and slower export demand than expected due to moderating global growth.

KEY INFRASTRUCTURE DESIGNS FOR SKA COMPLETED All essential infrastructure designs required for the first phase of the world’s most powerful radio telescope – the Square Kilometre Array (SKA) – have been completed.

The SKA is a collection of thousands of antennas spread over 3000km which will work together as one gigantic, virtual instrument creating a radio telescope at least 50 times more powerful and 10,000 times faster than any other radio telescope currently in existence.

The telescope will be made up of many large antennas and other types of radio wave receivers that will be linked together via optic fibre cables which are constructed in South Africa and Australia.

For the last five years, engineers have been hard at work at their sites in Murchison,

Western Australia and the Northern Cape designing all the essential infrastructure required for construction of this complex global project.

Following the successful review of the key infrastructure components, the project will now move on to the bridging phase, the Department of Science and Technology said recently.

This phase will bring together all the individual detailed designs of elements of the SKA and integrate them on a system level.

“I am proud of the sterling work by our engineers who are part of the SKA project.

“I have no doubt the expertise and best practice developed during the delivery of this precursor telescope enabled the INSA [Infrastructure South Africa] consortium to meet the SKA Organisation’s stringent standards for

infrastructure design,” said Minister of Science and Technology, Mmamoloko Kubayi-Ngubane.

South Africa’s Department of Science and Technology has already invested more than R760 million in infrastructure for the MeerKAT radio telescope, which was completed in July last year in Carnarvon, the Northern Cape.

Once completed, the radio astronomers will use the SKA to understand how stars and galaxies formed, how they evolved over time; what the so-called “dark-matter” is that occupies 95% of the universe; how magnetic fields formed and evolved in the universe and how they influence astrophysical processes; to investigate the validity of Einstein’s theory of relativity, and perhaps detect life elsewhere in the universe.

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COEGA DEVELOPMENT CORPORATION

CDC Reaches its

Ambitious 2020 Investment Target PRODUCTION: Manelesi Dumasi & the CDC

As one of South Africa’s top performing State Owned Enterprises (SOE’s), the Coega Development Corporation (CDC) is an organisation that constantly achieves and exceeds its targets for job creation, SMME development, training and development, investment attraction and economic development. After a challenging 2017, the CDC started to make significant progress in 2018 and is now looking forward to an extremely exciting future, with many new strategic investment projects set to advance the sterling reputation of this world-renowned Special Economic Zone (SEZ) and infrastructure development business.

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Cemza Cement

INDUSTRY FOCUS: INFRASTRUCTURE

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The new South Africa has seen five Presidents attempt to fuel the economy, once described as the engine of Africa because of its mineral wealth. But today, GDP growth has slowed, the economy is often labelled as unpredictable, and South Africa has been overtaken by Nigeria as the continent’s biggest economy (32nd in the world according the IMF’s 2018 report). Traditionally, the drivers of the economy have been the South Africa’s State Owned Enterprises (SOE’s) – those businesses that provide large scale employment and build highly valuable international partnerships, often in infrastructure development. However, the country’s SOE’s have been under the spotlight recently, often highly criticised for poor management, weak governance and overall ineffectiveness.

But this is not the case at CDC, a SOE under the Eastern Cape Provincial Government and Department of Trade and Industry (DTI), which manages the Coega Special Economic Zone (SEZ) under the Special Economic Zone Act No. 16 of 2014. A shining light among the country’s SOE’s, the CDC is celebrating its 20th year of operation by continuing to do what it has done best for two decades – successfully attracting investment, creating employment opportunities, promoting small business development, providing training and

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skills development for the indigenous communities, reducing poverty and inequality, as well as helping investors to thrive.

At the Coega SEZ - a 9003-hectare prime industrial site and gateway to African and world markets, situated in the eastern side of the bustling Nelson Mandela Bay Metro – amazing development has happened. Since its establishment in 1999, Coega has changed dramatically. Previously unused greenfield coastal land - now offering resident investors many national and municipal incentives including 15% corporate tax, rebates, discounts on rates and services and duty incentives, among others – is currently a completely transformed industrial, manufacturing and business hub which aims to drive local and foreign direct investments (FDI) in export-oriented industries, positioning South Africa as the hub for Southern African trade.

To date, 43 local and international investors have chosen Coega as their home and right now, much activity is underway onsite as some of the most recent additions begin to make their ambitions a reality. CDC’s Head of Marketing, Brand and Communications, Dr Ayanda Vilakazi, explains.

“CEMZA Cement (formerly known as OSHO Cement), a R600 million investment, is in the final stages of

// WE ARE APPROACHING THE LAST YEAR OF OUR FIVE-YEAR 20152020 STRATEGIC PLAN AND WE HAVE ALREADY ACHIEVED AND EXCEEDED OUR INVESTMENT TARGET // completing the construction of the cement grinding plant, and is expected to begin production in Q1 2019,” he says.

“HELLA Automotive, a R50 million expansion, is due to complete construction in the middle of 2019 and production should begin before the end of the year.

“BAIC SA - a R11 billion investment - according to latest reports, should complete the construction of their Semi Knocked Down (SKD) assembly plant by Q2/3 2019. Production is expected to start materialising at the end of 2019 or beginning of 2020. BAIC SA is planning to produce 50,000 vehicles per annum when they begin production, and ramp that up to 100,000 vehicles per annum within the next five years.

“The construction of the 7000 m² warehouse for the manufacturer of gas cylinders for MM Engineering, a R350 million investment, has been completed and is expected to begin production this year.

“Akacia Medicals, a R100 million investment, is planning to complete construction towards the end of this year and will be ready to begin production, thereafter.

“The R100 million expansion of Agni Steel SA, a steel recycling and processing plant, is expected to be completed within the next 24 months.

“The world-class deep-water container transhipment hub for sub-

COEGA DEVELOPMENT CORPORATION

Saharan Africa, the Port of Ngqura, is also undergoing expansion. The 18m depth Chart Datum Port of Ngqura’s expansion is being developed in phases.

The expansion includes the Manganese ORE Export Terminal: C100-C101, as the port plans to become a global leader in manganese ore exports. Export Terminal expansion includes storage capacity of 1222 Mtpa. In addition, Liquid Bulk Facility: B100 is planned by Oiltanking Grindrod Calulo (OGTC), who intend to construct and operate the liquid bulk handling and storage facility. Another development includes the establishment of a ship repair facility in the long-term. Finally, the port plans to become an energy hub, importing LNG and supporting Coega’s gas to power programme.”

Strategic projects in the pipeline at Coega worth more than R280 billion include the R80 billion crude oil refinery plant that will be processing crude oil into final fuel products. It is expected to be built at Coega and is estimated to create more than 26,000 jobs (construction and operational).

“This oil refinery will completely change the Eastern Cape’s economic landscape. It is going to contribute towards drastically reducing the migration of skills to the other regions, such as Johannesburg, Durban and Cape Town,” says Dr Vilakazi.

The pre-feasibility study for the refinery was completed in 2012/13, however the feasibility study is expected to be completed in December 2020.

The front-end engineering duration will take 14 months to complete, while construction duration is expected to take three to four years, with the muchanticipated start of operations in 2025.

The refinery is expected to contribute a massive 5.5% per annum to the EC economy.

Going forward, all of these projects will require a constant supply of skills and expertise in different areas of operations, from research to engineering and project management. Therefore, continuous skills development is critical for the region; it will improve the Eastern Cape’s

competitiveness through increased worker productivity and ensures a smooth flow of production and avoid skills gaps.

“What is exciting for us is that the aforementioned investors are already employing a large number of people during the construction phase. The much-anticipated milestone is the start of production; we hope more people will be employed during the operational phase on a sustainable basis,” says Dr Vilakazi.

BUOYANT BEGINNINGS 2018 was a tumultuous year for the investment environment in South Africa. Notwithstanding the longterm government policy, the National Development Plan 2030, political instability locally and internationally did not help to improve the investment climate. Geo-political instability and

macro-economic factors including international market volatility and Brexit are some of the externalities that have contributed to a very challenging business environment, which negatively impacted on FDI and economic growth in South Africa. Operating within the eco-system, the Coega SEZ is not immune to these challenges. The SEZ found itself “swimming against the tide,” notwithstanding that FDI grew in 2018 by 446% to $7.1 billion, according to a United Nations report. This was after a sharp decline in FDI since 2014.

Despite this reported increase in FDI, it is not enough. More FDI is required to stimulate economic growth in South Africa. The World Bank has projected that the South African economy will grow by a meagre 1.3% in 2019.

The South African Treasury projected an economic growth slowdown from

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INDUSTRY FOCUS: INFRASTRUCTURE

1.8% to 1.7%, this year. Subsequently, the Finance Minister, in the 2019 budget speech, highlighted that the economic outlook has weakened since the 2018 mini budget, with GDP growth now projected to increase from 1.5% to 2.1% in 2021 compared to forecasts of 1.8% for 2019 and 2.1% for 2020, last February.

“Such low levels of growth will certainly put a lot of pressure on FDI promotion agencies like Coega to attract more investment that will stimulate jobs,” says Dr Vilakazi.

But as the year closed in 2018, some positive sentiment emerged, and the atmosphere was positive, with President Cyril Ramaphosa’s constant iteration that South Africa is ‘open for business.

“We are very encouraged by the effort of the President to stimulate economic growth; we are equally thrilled to hear of his plans to attract $100 billion of investment over the next five years,” says Dr Vilakazi.

Consequently, after a slow start to 2018, the CDC as of February 2019 (one month before the end of its financial year) has already attracted 10 new investors with an investment value pledged of R1.491 billion, exceeding the investment target by 215%. Dr Vilakazi is buoyant about the rest of 2019 and the future.

“We are approaching the last year of our five-year 2015-2020 strategic plan and we have already achieved and exceeded our investment target by 492%.

Despite the difficult investment climate and challenges over the past four years, we have worked very closely with our stakeholders locally and internationally in order to meet our objectives.

“Our success was recognised at the 16th Annual National Business Awards (Oscars of South African business) in Johannesburg, last year November. The CDC received the Top Performing Public Sector Award - a much sought-after accolade by all public sector companies.

The award celebrates national, provincial and local government departments, parastatals and/or agencies that have achieved remarkable performance results in the last financial year. The CDC

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has won this award three times within a short period of five years. No other SEZ, trade and investment promotion agency, and public sector company in the country and throughout SADC has won this award three times within the five-year period,” explains Dr Vilakazi.

“It shows that we are not just blowing our own horn when we say we are currently doing very well, despite a tough economic climate. Those who look to us for guidance and support with the development of SEZ in their regions are also beginning to reap the benefits of many years of collaboration, mentorship and knowledge sharing. For example, the Richards Bay SEZ in KwaZulu-Natal recently announced that they have concluded R3 billion in investment deals, bringing the total number of signed investors to eight. We worked very closely with the Richards Bay SEZ in earlier years to ensure they grow and contribute towards job creation in that region.”

LOOK EAST STRATEGY Perhaps one of the most important and exciting investment at the Coega SEZ recently is the R11 billion investment pledged by BAIC SA (Beijing Automotive International Corporation of South Africa), which is currently the largest single investment in the automotive sector in South Africa in four decades.

Beijing Automobile International Corporation (BAIC) is a wholly owned subsidiary company of BAIC International Development Co. Ltd, which was founded in 1958. The Beijing Automobile International Corporation’s R11 billion investment in the Coega SEZ is one of the outcomes of the Sixth Forum on China-Africa Co-operation (FOCAC) held in Johannesburg in December 2015, in which the IDC and BAIC signed a Memorandum of Understanding to establish the new US$800 million Original Equipment Manufacturer facility in South Africa to manufacture passenger vehicles. In July 2018, President Ramaphosa and China’s President Xi Jinping unveiled the first ever BAIC-made vehicle assembled in Africa.

// WE ARE THE ONLY SEZ IN SOUTH AFRICA THAT IS SERVED BY TWO MAJOR PORTS IN CLOSE PROXIMITY – THE CONTAINER DEEPWATER PORT OF NGQURA AND THE PORT OF PORT ELIZABETH. THE CAPACITY OF THESE TWO PORTS COMBINED IS OVER TWO MILLION TEU’S // As a result of the cooperation between the two countries, according to the UN report on FDI, last year China committed around R193 billion in new investment into South Africa.

WHY COEGA? So what is so special about the Coega SEZ, what attracts major international brands to a location that is not immediately adjacent to the major economic metros of the country?

According to Dr Vilakazi, it is precisely this location as well as a bouquet of other benefits which makes Coega not only the location of choice in South Africa, but also across the entire continent.

“We are strategically positioned on the main southern hemisphere east-west shipping route,” he says. “We are the only SEZ in South Africa that is served by two major ports in close proximity – the container deepwater Port of Ngqura and the port of Port Elizabeth. The capacity of these two ports combined is over two million TEU’s and there is no other SEZ in the country with such capacity,” says Dr Vilakazi.

South Africa has approximately

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INDUSTRY FOCUS: INFRASTRUCTURE

// WE ARE THE ONLY SEZ IN THE COUNTRY CURRENTLY THAT HAS FOUR CUSTOMS CONTROL AREAS (CCAS) IN THE LOGISTICS AND AUTOMOTIVE ZONES // 10 SEZ’s - including Richards Bay, East London, Saldanha Bay, Maluti-A-Phofung, Musina/Makhado, OR Tambo International Airport, Atlantis and Dube TradePort – but the success of Coega is unmatched.

“Simply, the achievements at Coega in the past four years are arguably greater than any other SEZ in South Africa,” Dr Vilakazi claims.

He says that existing infrastructure which includes electrical substations, telecommunications networks, bulk water and sewer networks, roads, railways and more world-class modern infrastructure, combined with a number

Coega Dairy

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of tax and duty incentives, offers any potential investor the opportunity to simply ‘plug in and play,’ a strategy that has proved to be very successful for the Coega SEZ. “We offer a ‘plug and play’ environment that enables investors a quick turnaround of their investment.

Without a ‘plug and play’ model, it would have taken BAIC SA, for example, not less than six years to complete their SKD facilities and realise their investment.

Instead, it has taken BAIC SA only two years from when they turned the sod in August 2016 to the first assembled vehicle off the production line in July 2018,” says Dr Vilakazi.

Concerned about local and regional legislation and business regulation? Not a problem - the CDC is well-versed in integrating sizeable operations into the local environment.

“We have world-class support systems, for example, in ICT; engineering; architecture; infrastructure development; human capital and project management solutions. We are the only SEZ in the country currently that has four customs control areas (CCAs) in the

logistics and automotive zones. This is important because a CCA is a dutyfree zone. In addition, there is the ‘state of the art’ one-stop-shop facility to assist investors with services. For example, we have established protocols regarding accessing services from the local municipality, such as approval of building plans, access to water and other critical services.

“In addition, we offer in-house services to investors, which include amongst others, recruitment and selection; corporate travel solutions; three-star accommodation facilities; 1000-seater conference centre, a newly built four-star hotel in Bluewater Bay; skills portal (gateway to opportunities with 350,000 candidates); and a labour management system (Nceda),” says Dr Vilakazi.

An important value proposition for investors is access to incentives.

Incentives are provided by the DTI at a national level as well as the Nelson Mandela Bay Municipality, locally. The DTI provides the following incentives: Industrial Development Incentives; Trade, Export and Investment Incentives;

COEGA DEVELOPMENT CORPORATION

Broadening Participation Incentives Black Industrialists Scheme (BIS) and Incubation Support Programme (ISP) - as well as sector specific incentives.

In addition, the local municipality offer the following incentives: Financial and non-financial support to investors and industry clusters. New investments that create 50 or more permanent jobs, depending on which sector the business operates, could benefit from the joint financing of feasibility study and/or business plan development; rebate on municipal building plan approval costs for approved investments; discounts on rates and services for new investments; and discount on municipal land and buildings. In addition, the investment must qualify as a medium or large business or be equal in size to a medium or large business - as defined by the National Small Business Amendment Act (2003) - in that the investment must employ more than 50 permanent staff, generate minimum turnover of between R5 million and R15 million, have minimum asset values of between R2 million and R5 million, and the investment must be a new investment or expansion, and must be of a commercial or industrial nature on land zoned for industrial or commercial activities.

Still unsure if Coega is the right place for your business? A total of 93% of current investors at Coega feel that the SEZ and its Logistics Park - where Volkswagen South Africa is located- are ideal locations for industries. “The most important benefits for investors located at Coega is the ease of doing business and its world-class infrastructure,” says Dr Vilakazi.

About 92% of the investors expressed positive sentiments about the future prospects of Coega, with some stating that it will become either a logistics or fast-moving consumer goods manufacturing hub of choice in the country. Most investors are of the opinion that the Coega SEZ offers a secure business environment and support services infrastructure.

Not yet convinced, the CDC is

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certified in the following ISO standards: ISO 9001; 14001; 20001; 27001; 31000; and OHSAS 18001.

As a state-owned enterprise, the CDC is audited by the Auditor-General of South Africa. Since inception 20 years ago, the CDC has achieved an unqualified audit opinion.

“Our organisation complies with various legislation, regulations, and maintains high levels of corporate governance, including King IV on corporate governance,” says Dr Vilakazi.

Ultimately, ROI is the gold that every investor is searching for, and away from Coega, that is challenging to find.

Fortunately, the Coega SEZ has a long and demonstrable history of delivering ROI for investors.

“The majority of the current investors at Coega have increased their productivity and profitability since locating in the zone. In the process, they

have increased their workforce due to expansions and the demand for their products and services.

“More investors can benefit from Coega’s success which stems from visionary leadership, shareholder support, supportive local communities, and efficient management of the zone.

“Investor satisfaction is our priority at Coega. We have a dedicated, competent, and hardworking workforce that put our investors first, all of the time.

“Therefore, why look elsewhere in the country for your future investment when you could join the company of the 43 successful resident investors in the Coega Special Economic Zone,” concludes Dr Vilakazi.

WWW.COEGA.CO.ZA

www.enterprise-africa.net / 15

SANRAL

SANRAL Maps Out Plan for

Horizon 2030 PRODUCTION: Karl Pietersen

A new long-term vision and a number of major projects helping to develop South Africa’s ‘economic arteries’ make SANRAL one of the most important SOEs in the country. This major road construction and engineering firm is pumping money into the economy and helping to drive the growth of SMMEs all over South Africa. Horizon 2030, aligned with the NDP, is a new strategy that will ensure the business continues to deliver on its mandate for the people of South Africa. www.enterprise-africa.net / 17

INDUSTRY FOCUS: INFRASTRUCTURE

// IF PEOPLE NEED TO MOVE FROM ONE END OF OUR COUNTRY TO ANOTHER, THEY NEED TO BE ABLE TO DO SO IN A SAFE AND RAPID MANNER, USING INFRASTRUCTURE THAT IS RELIABLE, AND THEIR JOURNEY MUST BE ENJOYABLE //

18 / www.enterprise-africa.net

//

Never far from controversy, South Africa’s National Roads Agency Ltd (SANRAL) is a state-owned company that aims to be a world leader in the provision of a superior national road network. In South Africa, around 160,000km of the entire network is classed as paved road, and SANRAL is responsible for around 22,000km. The country has more than 450,000km of gravel road, and more than 130,000km of un-proclaimed gravel road, bringing the grand total to around 750,000km – making South Africa’s road network the tenth largest in the world.

A journey from Cape Agulhas in the south, to the Limpopo River separating SA and Zimbabwe in the north, will take more than 20 hours and you would cover more than 2000km.

And it is SANRAL’s roads that would ensure the journey is smooth and easy. Tasked with financing, improving, managing and maintaining the national road network – or the ‘economic arteries’ of South Africa – this business is vital to the prosperity of the country.

The vision of the country-critical organisation is to ‘ensure our national road transport system delivers a better South Africa for all.’

But its business is not easy and SANRAL finds itself facing a funding crisis, struggling to satisfy demand, and the company has been the butt of negative sentiment thanks to an ongoing e-toll dispute with Gauteng road users. However, under the direction of CEO Skhumbuzo Macozoma, SANRAL continues to deliver significant projects that impact heavily on local communities and modernise the road network for the benefit of all.

The civil engineering-Masters Degree educated, former-CSIR and Department of Transport employee joined SANRAL as CEO, replacing Nazir Alli, in 2016 having previously served two terms on the company’s board. The Johannesburg native knew

SANRAL

that when he joined SANRAL, the first job would be to restore confidence, trust and positive perception in the parastatal. He is doing this by successfully and consistently delivering vital projects.

“In 2018, against a difficult background, there were some significant highpoints that served to remind us just how important the national road network is in facilitating the movement of goods and services and connecting people to economic opportunities,” he says.

“On the N2 Wild Coast Road we started with the construction of the 1.1km long bridge across the Mtentu Gorge. On completion this will be the longest main span cantilever bridge on the African continent.

An upgraded N2 will significantly cut

down travel time between Durban and East London and create new opportunities for growth and development along the eastern seaboard.

“Inland we started with major improvements to three intersections on the N14 between Olifantshoek and Kathu. This road connects the Northern Cape with the urban metros in Gauteng and plays a vital road in the lives of people who live in contiguous rural communities.

“On the N2 north of Durban the new Mount Edgecombe intersection is complete. This improved stretch of road and intersection brings relief from congestion for commuters travelling to the KwaZulu-Natal North Coast and further stimulates the growth of the tourism and leisure

industries in the region.

“In Mpumalanga, work is progressing on the N11 near Middelburg in the Steve Tshwete District. This includes the reconstruction of the existing road and the widening of the Kranspoort Pass, an infrastructure investment of more than R415m.”

HORIZON 2030 In October 2017, SANRAL unveiled its new long-term strategy, titled Horizon 2030. This decade-long plan details how the company will move forward, learning lessons from the past to address modern challenges.

In 2018, the company entered its third decade managing the country’s roads and Horizon 2030 paves the way forward as Macozoma explains.

“If people need to move from one

www.enterprise-africa.net / 19

INDUSTRY FOCUS: INFRASTRUCTURE

// AS A DYNAMIC ORGANISATION WHICH PLACES HIGH VALUE ON INNOVATION AND MODERNISATION, WE EMBRACE THE CHANGES AND ARE LOOKING FORWARD TO WORKING WITH NEW AND EXISTING STAKEHOLDERS ON OUR JOURNEY TOWARDS HORIZON 2030 // end of our country to another, they need to be able to do so in a safe and rapid manner, using infrastructure that is reliable, and their journey must be enjoyable.

“The publication of Horizon 2030 was a seminal moment in SANRAL’s development as the stateowned company responsible for managing South Africa’s primary road network. The strategy provides the organisation with a new, shared vision and identifies the actions that are required to meet our objectives over the next decade. It confirms SANRAL’s reputation as a progressive entity within the South African public sector and a leading agency in the

20 / www.enterprise-africa.net

fields of engineering, construction and road management within the global environment.”

Safety is a particularly strong area of focus set out in Horizon 2030.

“We are going to elevate road safety to a pillar in the company,” he says. “Although law enforcement is not our responsibility, when we have built safe roads, operations tend to make our roads unsafe and so we want to contribute and support law enforcement agencies by developing technology that will make it easier for us to manage behaviour by drivers.

“The improvement of reputation does not rest in how much money you spend on communication. It is about

demonstrating to the public that you are true to your mandate, and in everything that you do, you have the best interests of the citizens of the country in mind.”

Horizon 2030 has been deliberately aligned with South Africa’s National Development Plan (NDP), a wider government framework which aims to eliminate poverty and reduce inequality by 2030.

PROJECT FOCUSED “The road to success is always under construction” - a famous quote from American actress Lily Tomlin, and it is certainly true at SANRAL. With several large projects underway right

SANRAL

ENGINEERING PASSION AND A DREAM FOR TRUE ECONOMIC TRANSFORMATION Why Merchelle’s? Merchelles’ core values are to always make a difference, by adding value, striving to meet Client objectives, taking the environment and communities into consideration, providing exposure and growth for others in need, whilst striving for true economic transformation. The company remains committed not only to living up to industry standards, but to exceed them, setting the bar for small professional businesses.

Merchelle’s wishes to thank its Clients, fellow consulting engineering firms and suppliers for their invaluable support which has contributed significantly to the growth of the company.

100% Black Woman-Owned & proudly a Level One B-BBEE company

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//THE IMPROVEMENT AND EXPANSION OF KEY ECONOMIC CORRIDORS, HAVE SUBSTANTIALLY IMPROVED MOBILITY AND IN THE PROCESS, STIMULATING ECONOMIC GROWTH IN THE KEY PRODUCTION CENTRES AND AREAS WITH DEPRESSED ECONOMIC POTENTIAL //

now, 2019 looks set to be a busy and exciting year.

In the Eastern Cape, SANRAL will build Africa’s second-longest main span bridge near Lusikisiki over the Msikaba gorge as part of the N2 Wild Coast project. It will also be the third highest bridge in Africa at 195m above the valley floor behind the Bloukrans bridge (216m) and the Mtentu bridge (under construction at 223m). Construction is set to begin in 2019’s Q1 and be completed in 2021.

In the Joe Gqabi District Municipality in the Eastern Cape, where 22% of SANRAL’s total network is located, the company has a number of ambitious projects in various stages. SANRAL’s investments - which include upgrades, improvements and construction of the R56, R58, N6, R391 – are helping

© Chris Kirchhoff

to drive the development of various SMMEs in the region.

In the Eastern Cape, SANRAL announced at the end of 2018 that it would begin a resurfacing project between Grahamstown and Fort Beaufort along the R67. The works cost R226 million and saw just over 70km resurfaced.

In November, Deputy President David Mabuza called for all SOEs, including SANRAL, to begin delivering on projects that will alleviate poverty in the country.

“The SOEs have made a significant contribution to the economy, social development and poverty reduction in South Africa since 1994. A range of SOEs continue to provide essential economic and socio-economic infrastructure and services in this regard.

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INDUSTRY FOCUS: INFRASTRUCTURE

© Hannelie Coetzee

“They are also playing a key role in enhancing skills, promoting entrepreneurship and opening up opportunities for job creation. We can

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only reduce poverty by generating income through sustainable jobs and business opportunities,” he said.

Mabuza was keen to highlight

SANRAL’s impact on the wider economy, especially through the stimulation of SMMEs. “The improvement and expansion of key economic corridors, have substantially improved mobility and in the process, stimulating economic growth in the key production centres and areas with depressed economic potential.

“This enables job creation and income generation. A few examples are the Gauteng Freeway Improvement Project (GFIP), the Gateway and Umngeni Interchanges in KZN, the Gauteng-Durban Corridor and the N2 Wild Coast which have been a good training ground for the development of SMMEs from Grades 1 or 2 to Grades 3 to 5.

“The SMMEs are put through an intense 24-month training program

SANRAL

and trained in road construction trades in order to equip and enable them to pursue opportunities in SANRAL’s mainstream national projects or other projects in provinces and municipalities.

“SANRAL also has a skills development program that capacitates people across various levels. In high schools, it focuses on providing scholarships in Maths and Science, and in universities and TVET colleges SANRAL gives higher education bursaries in engineering and technical careers. Support is also provided to Universities in postgraduate research,” he said But, despite this success, SANRAL still has serious funding issues to smooth out. In October 2018, Macozoma suggested that the company needed R120 billion to

sustain the country’s road network, and fuel levies were not enough to bridge the gap. It continues to wrestle with e-tolls in Gauteng, and was voted down when it came to introducing e-tolls in Cape Town.

“The needs, priorities, engineering principles and spending efficiencies must inform future spending allocations,” he said.

Overall, SANRAL’s work is highly valued, highly significant for the future of South Africa, and vital for the continued modernisation of the country’s infrastructure. To date, its performance continues to be strong. “SANRAL only has 4.1% of our infrastructure in poor or very poor condition. International benchmarks are to keep this below 10%,” Macozoma reminded when talking at the opening of the new Mount

Edgecombe intersection.

SANRAL is a constant in South Africa, in a market that can so often be uncertain. For more than 20 years, this expert company has tied corners of the country together while paving the way for success for business and individuals. Now, with Macozoma pushing Horizon 2030 and working hard to restore trust, the future does look bright.

“As a dynamic organisation which places high value on innovation and modernisation, we embrace the changes and are looking forward to working with new and existing stakeholders on our journey towards Horizon 2030,” Macozoma says.

WWW.NRA.CO.ZA

www.enterprise-africa.net / 23

BFS-BARKER GROUP

Growth, Consolidation

Then Growth Again PRODUCTION: David Napier

The BFS-Barker Group comprising of Business Furniture Solutions and Barker Street Office Furniture is one of the leading names when it comes to kitting out office space in Southern Africa. With offices in Johannesburg, Pretoria and Cape Town, and a high volume manufacturing facility in Johannesburg, this is a business that is readying itself for another strong period of growth. Founder and group CEO, Elan Kabb talks to Enterprise Africa about bringing the company from nothing to a major industry player.

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INDUSTRY FOCUS: MANUFACTURING

//

The market for corporate office furniture in Southern Africa is significant.

Perhaps one where work often goes unnoticed, this industry sector is a strong, growing corner of the wider furniture manufacturing industry, and its impact is notable. According to Business Wire: South African manufacturing sales of furniture amounted to R16.2bn in 2017, an increase of 6.6% on the previous year.

A total of 2200 registered companies in the furniture manufacturing sector, employing around 26,400 people, contributed about 1% to manufacturing GDP and 1.1% to manufacturing employment.

Making the most of manufacturing and distribution is the key to unlocking the massive potential. Sales alone can only take you so far and manufacturing without a clear path to market can be challenging. So, bringing research, design, manufacturing, sales, marketing and distribution under one roof to vertically integrate the value chain makes for a highly successful offering.

This is the story of the BFSBarker Group. The group incorporates Business Furniture Solutions, a full-service office solutions provider and stockist established in 2003, as well as Barker Street Office Furniture, a large-project office furniture manufacturer established in 1986. With not much more than a can-do attitude, the company has grown from a simple buy-and-sell operation to become an end-to-end service provider from design and manufacturing to implementation.

As a level 2 Black Empowered, and 60% Black-owned group of companies, headquartered in Johannesburg, the BFS-Barker Group is working with some of the top corporate names, providing unique, quality office furniture and support for businesses small and large.

With the acquisition of Barker

26 / www.enterprise-africa.net

// EVEN THOUGH WE HAVE HAD HUGE GROWTH SPURTS IN THE PAST, WITH ALL THE ELEMENTS COMING INTO PLACE, WE ARE WELL POSITIONED TO CONTINUE OUR PATH OF GROWTH // Street Office Furniture in 2017, and the creation of the BFS-Barker Group, BFS has indeed made the South African office furniture industry sit up and take notice.

FROM HUMBLE BEGINNINGS Starting out in the family business, selling domestic residential furniture, Kabb learnt the industry from the ground up. “My father was an entrepreneur and taught me all about business. When I looked at branching out on my own, I was more comfortable taking risks thanks to the lessons I had learnt from him,” he tells Enterprise Africa.

At that time, the domestic furniture market was undergoing changes, and with his entire family exposed to the B2C environment (where Far Eastern imports were taking over), Kabb decided to explore a similar but different market and he saw the potential of the corporate office furniture market.

“I started the company when I was 28, working from home, as a one man show. Initially, we were just a buy and sell business and we were not really distinct from our competitors at that stage as we were still learning the industry.”

BFS found success through innovation. “Initially, in 2003, we grew the business through internet marketing, as there were very few people in this space then. No one understood Google or online marketing and that was where we got in, at exactly the right time.

“At that stage we didn’t even need to go out and find business, it simply came to us. The business grew organically but slowly giving

us time to build relationships, and grow the reputation of the brand. An early turning point for us came when we secured a large profitable deal that financed our first showroom,” he says. “Thereafter, it was an iterative process of testing and spreading risk. We learnt our way, and then increased our ambition as we grew.”

BFS first built capacity and process quality before starting to target some large clients, where they could have an impact across bigger infrastructure. From there, they had confidence to go out in the market knowing BFS would be able to deliver.

“We got to a point where we needed to be more in control of the larger supply chain and become vertically integrated. We needed to manufacture for the purpose of feeding our branches in Pretoria, Johannesburg and Cape Town,” details Kabb. “We had a critical mass where, if we could manufacture for ourselves, we could achieve a higher margin and control more of the process.”

In 2017, this strategic goal became reality with the acquisition of Barker Street Office Furniture.

Together with the manufacturing capabilities, Barker Street also had

// WE BASICALLY DO EVERYTHING IN-HOUSE AND OUR CAPABILITY TO DEVELOP PRODUCTS IS EXCEPTIONAL //

BFS-BARKER GROUP

an established customer base in the corporate market, a high level of technical manufacturing skills and project management expertise suited for the large corporate market.

Recently, major banks and government businesses, tech companies, automotive producers, and many more have placed trust in the BFS-Barker Group.

Barker Street recently furnished the head office and a number of branches for Barclays Bank in Mozambique. The scope of their work includes, the back office furniture, bank hall furniture and bulletproof teller counters. The banking industry has become a niche for Barker Street with customers in Zambia, Botswana, Namibia, Mozambique and South Africa. In South Africa, with Absa and its new corporate identity, there is an entire range of furniture to match their new brand that is being developed. Barker Street also completed a project for over 400 African Bank branches in 2018.

“In Botswana, we undertook an intricate project with the Botswana Unified Revenue Service in a brandnew building in Gaborone. In South Africa, we recently completed a project for BMW for the office and factory in Midrand and Rosslyn respectively. We are currently manufacturing for a project for MTN where we are producing 450 high specification workstations. Depending on the complexity of the product, we can complete similar projects in four to six weeks,” says Kabb.

Considering the humble beginnings of BFS, the success that has been achieved is remarkable and a testament to what can be achieved with hard work and perseverance.

“I started the business 16 years ago with R14,000 in my pocket and didn’t take a salary for the first year.

We are very fortunate that we are now dealing with top corporate businesses, but it took many years to get here,” adds Kabb.

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www.enterprise-africa.net / 27

INDUSTRY FOCUS: MANUFACTURING

// WE ARE ALREADY BASED IN PRETORIA, JOHANNESBURG AND CAPE TOWN AND THE NEXT STEP FOR US WOULD BE TO GROW IN OTHER POPULATION-DENSE CENTRES //

28 / www.enterprise-africa.net

GROWING, CHANGING In the early 2000’s, the industry was more structured with manufacturers supplying dealerships who in turn sold to end users. Whereas today, there are very few actual office furniture dealerships that remain, manufacturers are mostly supplying direct to businesses, especially larger corporates, as they have the required infrastructure to support their needs, and are more competitively priced. What is left of the dealerships are mostly smaller “agents” that don’t have the infrastructure and competitive advantage behind them.

“There has been a lot of change in the market over the 16 years we’ve been in the industry, and looking back it probably would be a lot harder to start over today and achieve what we have,” explains Kabb.

Today, after realising steady growth until 2017, and then achieving significant expansion through the acquisition of the Barker Street manufacturing facility, the BFS-Barker Group is building for the future and preparing for a major growth push.

“After acquiring the factory, we are currently in a consolidation phase having just grown the business staff complement by three and a half times and our premises size fivefold,” explains Kabb.

“We are now gearing for the next growth phase which will come through product development and strategic targeting of lucrative market segments.”

The 11,000 m2 manufacturing facility is both impressive and diverse.

It consists of a sheet metal and engineering factory with its own powder coating plant, a woodwork factory and an upholstery factory which affords the BFS-Barker Group the ability to combine these processes and materials to design and manufacture distinct and unique products.

“We basically do everything inhouse and our capability to develop

BFS-BARKER GROUP

products is exceptional.” says Kabb.

“Because there is so much furniture in the market that is very ordinary and generic, the challenge for any business is to have exclusive product which is cutting edge. We currently have a large range of products that are recognisable as our own and we are focussed on leading the market, whether it’s through unique components or styles, and for this purpose we have a research and development team constantly bringing through new concepts and products.”

Growth for the BFS-Barker Group will also occur by accessing new regional markets and, while the company already holds a presence across the country, Kabb says gaining a foothold in all the big

cities to be close to local clients is a goal for the company.

“We are already based in Pretoria, Johannesburg and Cape Town and the next step for us would be to grow in other population-dense centres.”

“Although we have done projects nationwide, having a larger national footprint does allow us to build a greater reach when searching for new opportunities and for ongoing servicing of clients in those areas,” he says.

The BFS-Barker Group will look to take advantage of government incentives that exist to bolster the manufacturing space, such as the Manufacturing Competitiveness Enhancement Programme.

“We are looking at how we can use government initiatives

to enhance our manufacturing capabilities. If South Africa wants to grow export, then it must grow manufacturing and we are gearing for that growth. That said, we have just experienced significant growth and don’t want to be reckless with our growth so it has to be measured and responsible”, says Kabb.

“When an economy is not growing at the rate that it should be, it does not mean that every company in the country is growing at the same rate. There are some companies that are going backwards but there are some that are striving forwards. GDP growth is just an average. If you are a diverse and progressive company with good strategies for management and delivery then you can grow, even in a tight market.”

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INDUSTRY FOCUS: MANUFACTURING

FORGING AHEAD The BFS-Barker Group has an experienced management team, some of whom have grown with the business from inception. However, an enterprise comprising so many areas requires a diverse set of skills and to address this they have appointed Hillel Cohen (formerly from the Bidvest Group) as the Chief Operating Officer.

“I have always tried to work more on the business rather than in the business, not wanting to get consumed in the operational requirements.” says Kabb. “The management team basically run the business operationally and that has allowed me to step back and identify growth and acquisition opportunities which I could then harness.

“With the arrival of our new Group COO at the start of 2019 stepping into the production and operational leadership position, I will now be able to focus more exclusively on directing the business from a product

30 / www.enterprise-africa.net

development, marketing and sales point of view.”

However at the BFS-Barker Group, the goal is not to be the biggest. Kabb has never been concerned about having the largest stores, biggest factory or most employees – his focus is on delivering the best products and services while striving for constant improvement.

“Sometimes it’s good to have long-term vision and aspire for growth but those goalposts always shift.

We take the mindset of wanting to continually improve and we know there is no end to where that mindset can take us. We don’t want to be the biggest – we just want to do better today than we did yesterday and better tomorrow than we did today.

If we can do that then we will achieve a lot.”

There are only a handful of companies that compete for contracts at the top end of the office furniture supply space and, being long-term

investments, these contracts can be few and far between so it is vital that the BFS-Barker Group stands out from the crowd. Kabb cites the company’s experience and longevity, alongside its range of high quality products and services aimed at creating functional and inspiring workspaces as key differentiators.

“It’s increasingly easy to source suppliers in today’s internet age,” he admits. “However, it can be difficult to know who is credible and who is reliable. As with most business support industries, the office furniture industry has evolved over the years, in alignment with current business practices and management trends. What differentiates us is the ability to understand how our client businesses operate and be able to propose contemporary product and layout offerings that will enhance and improve our clients ability to grow within their own field of business. To this end, we remain constantly aware

BFS-BARKER GROUP

of the business practices in successful global businesses, technological improvements and the latest products, materials and manufacturing processes within the office furniture industry. This enables us to optimise our broad manufacturing capability as well as a wide service offering.

We have stock solutions for clients to pick off the shelf, we have a rental division for an interim solution, we have finance solutions where people can lease to own, we have a range of design services and the ongoing ability to service the customer.”

By 2024, it is expected that the global market for office furniture will increase year-on-year by 4.7% CAGR, reaching US$94200 million and with South Africa as the second largest exporter of furniture on the continent, behind Egypt, the BFS-Barker Group will be targeting a big chunk of the export business as it continues to expand with clients across southern Africa.

After a relatively flat 2018 from a GDP growth and investment perspective, opportunities should become more apparent in 2019 with government trying desperately to attract new FDI into the country.

During his State of the Nation Address, President Ramaphosa highlighted that new investment is critical in his vision for the future.

“We have worked together – as government, labour, business, civil society and communities – to remove the constraints to inclusive growth and to pursue far greater levels of investment,” he said. As stability, certainty and confidence returns to the economy, investment spends on things like office upgrade and furniture renewal quickly begins to flow. And the BFS-Barker Group is prepared.

In recent years, the manufacturing industry in South Africa has been criticised for failing to create jobs and contribute to the reduction of poverty and inequality. The economic

environment cast by a challenging political situation has not created a fluid and easy market for any business let alone manufacturing. But these economic concerns are not deterring the BFS-Barker Group. In fact, they are looking forward with appetite.

“We still have a lot of capacity to grow the factory and I think we can expect to create more jobs.

Realistically, we hope to double our staff complement in the next year or two – not that that’s a goal in itself – but we have the capacity and ability to create work with an increased market share” says Kabb.

“Even though we have had huge growth spurts in the past, with all the elements coming into place, we are well positioned to continue our path of growth,” he concludes.

WWW.BUSINESSFURNITURE.CO.ZA

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PIERRE CRONJE

Carefully Crafting a Future-Proof Strategy PRODUCTION: Karl Pietersen

Art, perfection and exclusivity are the kind of descriptions that you might get from someone talking about furniture manufactured by Pierre Cronje. For more than three decades this highquality, high-price bespoke producer has been crafting the best that South Africa has to offer. But times are tough, and the company is going through a transitional period as it looks to ensure its position in the future. Founder Pierre Cronje talks to Enterprise Africa about his challenges.

//

Industry-leading fine furniture manufacturing business Pierre Cronje is going through a transitional period. Featured in Enterprise Africa back in December 2016, Pierre Cronje was servicing clients in the super-wealthy category – high net worth individuals, wine farms, golf estates, game lodges, and corporate headquarters – providing bespoke wooden furniture including chairs, tables, cabinets, desks, floors, roof trusses, doors and much more.

Driven by the vision of Founder and namesake, the company had become iconic for its ability to manufacture the finest cape country furniture.

But today, Pierre Cronje is consolidating. The economic climate in South Africa over the past 18-months has resulted in slower spending and investment at the highest end of the market, and the project pipeline which previously kept the company busy has been postponed until certainty returns to the market.

Because of this uncertainty, Pierre has decided not to replace people as they have left the business. Today, the company is down from 180 to 100 people; it’s showroom in Johannesburg is gone, and the struggle to discover a creative successor has become very real.

“Times have been tough,” admits Pierre. “We are continuing and we have expanded into new products but there is no denying that times are tough. We have consolidated and things are harder than they have been, but we are confident that things will improve.

“Our reduction in people is not through making people redundant, it’s just natural attrition. We will not replace people who leave until demand returns to the market.”

Ever the optimist, this experienced entrepreneur is already underway with new strategies that he hopes will bring the business back into the race.

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INDUSTRY FOCUS: MANUFACTURING

UNCERTAINTY RULES “The economic climate is the issue,” he says. “Our clientele is the super-wealthy and they are not short of money, but they are unsure about the future. When it comes to what we sell, they are holding back. They are even holding back on building new houses - they are waiting to see what is going to happen here and it is likely that will continue until after our elections in May. “We have started doing a lot of solid wood floors with French oak which we are importing from sawmills in France. We are doing some indigenous yellowwood floors and they have become a large part (around one third) of our turnover. That is the way an entrepreneur has to work – if your traditional products slowdown, you have to look for something new.”

Solid wood herringbone, parquet, and wide plank floors are on trend and Pierre Cronje supplies some of the best

// EVEN THOUGH IT’S BEEN LONG AND HARD, I’VE LOVED IT AND I WOULDN’T CHANGE IT FOR ANYTHING // 34 / www.enterprise-africa.net

in the business. Working closely with architects and interior designers, the company delivers a personal service which helps to add value and durability to a property.

“We have just completed a big project at Quoin Rock wine farm – that was an amazing project where no costs were spared to ensure a world class venue,” details Pierre. “It took us 18-months and was the biggest single project we had last year. We are quoting on similar projects but there isn’t a lot out there in the market right now. Even with the big wine farms, we have quoted and projects have been put on hold.”

In an effort to gain traction in other market segments, outside of the very top echelon, the company has started producing a new range of furniture at a slightly lower price but maintaining the quality on which Pierre Cronje has built his name.

“Sometimes people suggest moving to board for table tops or veneer for cabinet backs, but we have said that it will never happen,” he insists. “We will always stick to using real solid wood and that is our core principle, but it doesn’t always have to be so elaborate. Clever design is something that looks good but doesn’t cost as much to make. Timber and labour are both very expensive so if we can reduce in some areas then that is clever.

“We have recently designed some pieces that are simpler to make – still solid wood, still made really well – but CNC friendly. This means we retain quality but improve speed and can access some lower sectors of the market. However, we are very careful to ensure that we are not seen to be becoming ‘not the Rolls Royce’ so marketing is very important.”

Pierre is adamant that the business will never become a ‘mass producer’ and will always retain its unique character.

His signature still adorns every piece that leaves the workshop, and becoming a cut and paste operation is simply not in his interest.

“The East are very competitive and are making reasonable furniture at a very good price. Competing with those imports is suicide. We will stick with where we are. The bulk of our turnover is bespoke. If someone wants a specific cupboard for a specific area with a specific function, we can do that. It’s the same with tables. We have to watch that we don’t complete with cheap imports – those are mass produced, ours are handmade. People do appreciate the art and craftsmanship in that, even though it does cost a lot more.”

FAST FASHION, SLOWING? In his 32 years at the helm of Pierre Cronje, and many more active in the furniture industry, Pierre has seen various

PIERRE CRONJE

fashion trends come and go. With wood, the colours, textures and feels that are desired in the home tend to move every few years. But right now, the fashionable

material is oak, in pale colours, and this trend has lasted for some time. “I’m still waiting to see where it will go next. It went from mahogany which

is quite red, alongside a bit of beech and maple, to dark brown oak, like old English antique furniture, and then it progressed to pale and grey woods.

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INDUSTRY FOCUS: MANUFACTURING

There is no yellow but straw colour oak and grey wash are still holding strong.

I always try and stay on top of where world trends are going colour-wise and wood-wise,” he says.

“Timber finishes used to be solvent based, ie thinners or spirits, but they are now totally banned in Europe and have been replaced by water-based products which are fast becoming available here.

These tend to be non-yellow products and they are holding strong. Shades of grey are still very popular. It’s long overdue for change and normally in fashion things don’t last for this long,” he adds.

In an effort to predict and prepare for the next swing in trend, Pierre Cronje has introduced an ash range, and is looking at rustic finishes.

“Maybe, but not definitely, we might be looking at a bit more of a rustic style. It’s been quite refined – we are

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doing quite a few rough-sawn textured finishes, and in Europe they are doing more textured floors rather than plainly sanded smooth.

“We have introduced European ash – as an entrepreneur you have to be quite quick off the mark and as soon as we see something we will get to it. That is what is great about owning the factory, we can jump to a new finish fairly quickly.”

South Africa’s House & Garden magazine is predicting that 2019 will see a strong focus on free standing wooden dining benches, wooden vanities and darker, moodier colours.

SUCCESSION Before Pierre Cronje started his business, he had gained education in computer science before working in the financial services industry. After quickly realising insurance wasn’t for him, he thought about going back to university to study

architecture, but his father convinced him to get into engineering. Eventually, he took a job as a structural engineer but quickly became disillusioned. He started his own company doing what he loved, working with furniture, in 1987.

Today, Pierre is 67 years old and has managed to convince his son Taillefer to join the business. Taillefer devotes his time to running the business-side of Pierre Cronje and is focussed on HR, accounts, sales and management, and his involvement allows Pierre to focus on the creative, artistic side of the company – “he is very good at what he does, and we get on extremely well working together, but he is not interested in the creative side.”

Pierre looked to his daughter to take up the creative role but admits that she “has no interest in furniture and no interest in joining the business”, so the search goes on.

“I do have to think about succession. We have to find someone, and we haven’t yet, to handle the creative side. It’s tricky as creatives don’t always see eye to eye, and creatives certainly don’t always see eye to eye with the business minded. I go to my son and explain that we need new equipment and he simply says ‘no way – go and get more orders, and then we can look at it’,” Pierre laughs.

“This is a complex business to run on the creative side. To stay alive, you have to be innovative and I love that. We bring in new products every year and we have a real passion for furniture – we need someone who has their head in the magazines as that is exactly what our clients are doing. If we can find the right person, and the economy develops, there is no reason why we can’t get back to where we were, or go further.”

PIERRE CRONJE

+33 384 73 76 50

EXCITED OR APPREHENSIVE? Going forward, the success of Pierre Cronje will depend on the state of the economy in South Africa - and how this impacts people’s willingness to invest in quality furniture – the ability of the company to penetrate new market sectors, its ability to constantly deliver quality, and the succession plan that Pierre puts in place.

// PEOPLE DO APPRECIATE THE ART AND CRAFTSMANSHIP IN THAT, EVEN THOUGH IT DOES COST A LOT MORE //

Always full of hope, Pierre is cautiously optimistic that all will fall into place.

“We have been in business for 32 years and we have seen ups and downs. When things are at the bottom of the cycle you think they are never going to turn around but there is certainly potential in the country for an upswing. When it happens, we will quickly expand again.

“I believe that, if Ramaphosa stays in power, we can realise great potential in this country.

“The general sentiment is positive and hopeful, but people are still waiting.

I am forever hopeful that things will turnaround – they always have in the past.

Recently, we have been faced with power issues because of Eskom and we have had to close the factory for two hours each day. That is, hopefully, now behind us.”

After not taking any new apprentices last year, for the first time ever, Pierre is reviewing the situation and hoping to restart the programme so that desperately needed manufacturing skills development can continue.

“Even though it’s been long and hard, I’ve loved it and I wouldn’t change it for anything,” he says.

This artistic business has ridden the waves in the past, and always come out committed to its principles and at the very top of the industry. When Pierre clears this next set of hurdles, it is likely that this perfectionist will accelerate back to top speed and drive the fine furniture industry in Cape Town once again.

WWW. PIERRECRONJE.CO.ZA

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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 / 39

INDUSTRY FOCUS: MANUFACTURING

//

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

Cargo Compass SA

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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.

WWW.CAPEWELL.CO.ZA

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ARGON ASSET MANAGEMENT

African Asset Management With

A Global Outlook PRODUCTION: Timothy Reeder

Argon Asset Management offers that rare, and perfect, blend: An African investment firm with global standards. From offices in Cape Town it has been growing investor wealth since 2005, and CEO Dr Manas Bapela took us through how he sees this leading ownermanaged company taking an even larger slice of an increasingly important African sector. www.enterprise-africa.net / 45

INDUSTRY FOCUS: FINANCE

Argon Asset Management CEO Dr Manas Bapela

//

While still a relatively young industry in South Africa, asset management is a hugely important one, which continues to grow at pace. Total private wealth held in South Africa has risen to US$722 billion, and High Net Worth Individual (HNWI) wealth has also increased to US$306 billion.

Even further growth is forecast within the industry, as the number of South African HNWIs is expected to increase by 28% to reach approximately 56,000 by 2027. Africa as a whole is rife with opportunity today, currently representing some 15% of the world’s population but contributing just 3% of the world’s GDP and less than 1% of its stock market capitalisation.

Wealth continues to increase and the result is a situation which is quickly changing. There is a constant

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upturn in demand for goods and services, and sound financial sectors and fund industries are developing across the continent alongside legal and regulatory frameworks which rank among the top in the world.

KEY PLAYER IN GROWING MARKET Offering institutional products including equity, bond, Multi-Asset Class and flexible income funds, as well as a growing range on the retail side like the celebrated Argon BCI Balanced Fund, Argon Asset Management prides itself on being an active, research-driven investment management company, committed to building trusted partnerships which are built on mutual understanding.

In large part, its success has been its ability to pair remaining a proudly African company with benchmarks which are recognised worldwide.

// WE HAVE INVESTED A LOT OF TIME AND RESOURCES TO DEVELOP A STABLE, EFFICIENT, AND WORLD-CLASS OPERATIONAL PLATFORM // “We have invested a lot of time and resources to develop a stable, efficient, and world-class operational platform,” the company sets out.

“We apply a wide range of security measures that include disciplined adherence to local compliance processes and international best

ARGON ASSET MANAGEMENT

// THE STRATEGIES WHICH WE HAVE PUT IN PLACE ACROSS ALL OUR PRODUCTS HAVE REALLY ENABLED OUR FUNDS TO STACK UP WELL AMONG THE BEST // practice to ensure that your money, investment and personal information is in safe hands at all times.”

At the helm is CEO Manas Bapela, a mathematician originally and later a quantitative analyst. He began at Argon Asset Management as its Head of MultiAsset Class before working his way up

through the business, and knows a thing or two about what it means to keep his company at the top of the pile in African wealth management.

“Building a sustainable Argon Asset Management means growing the business through a variety of strategies in order to gain more assets,” he outlines, “but how do you make sure that this is done in a sustainable way? The answer is always the same: it comes down to the right governance and delivering on client expectations in a sustainable manner. We really appreciate the importance of good governance and it dictates everything that we do.”

This is crucial, particularly with the financial uncertainty which continues to prevail in the country and in wider Africa, according to Bapela. We hear so often of an economy plagued by slow

growth rates, coupled with the political unrest hopefully to be resolved in the upcoming election, and exemplary control and stewardship of a company can be a deciding factor for some investors, Bapela explains.

“By and large in South Africa, I feel at the retail level that people are primarily guided and driven by past performance and make inferences from there,” he begins. “It is the foreign flows which are more likely to be impacted by macro-economic factors and questions of uncertainty, however; not so much our local retail investors buying into our funds, but more the external investors from other regions and countries.

“They are much more concerned by issues of politics and how things are run, and governance within state-owned entities in particular - how those are likely to affect growth. Asset allocators

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INDUSTRY FOCUS: FINANCE

Argon Asset Management CEO Dr Manas Bapela

will look into all of the macro-economic factors depending on the type of fund.

If you can’t set the right culture and tone at the top, as the governing body or the boss, it doesn’t matter how good the operating executives you have are, things are likely to fall apart.”

DIVERSITY IS KEY The vast majority of the wealth under Argon Asset Management’s control remains institutional, something which Bapela is keen to change. The company has amassed a broad product offering on both the retail and institutional sides, which it hopes will lure in a wider set of customers moving forward.

“We would like to get the man on the street entrusting us with his assets,” Bapela says. “There are a lot

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of big players already in this space, but we believe that we differentiate ourselves from them due to our product performance and the processes around our portfolio construction.

“These elements will continue to enable us to deliver great results in a sustainable manner. We believe in incremental value added, so that over time you can see that, on a cumulative basis, there is significant outperformance of benchmarks.”

With this view to expanding the retail arm of what Argon Asset Management does, Bapela recognises the key role that independent financial advisors (IFAs) could play in accomplishing this goal. Their ability to offer advice to clients and recommend financial products from the whole of the

// WE REALLY APPRECIATE THE IMPORTANCE OF GOOD GOVERNANCE AND IT DICTATES EVERYTHING THAT WE DO // market makes them invaluable to Argon Asset Management’s bid for retail growth.

“I am looking now at really focussing on the IFAs,” Bapela reveals.

“I want to make sure that we use them to really grow the retail part of our business, because currently I feel that it is not really being pushed along as

ARGON ASSET MANAGEMENT

much as it could. Our products are performing very well, so we have obviously succeeded in optimising current performance; this should make it much easier for us to successfully relaunch this key strategy to our longterm planning.”

SUCCESS AMID CHALLENGING CIRCUMSTANCES “Volatility has been high,” Bapela says of the market conditions over the last 12 months, “so it has been crucial to have strategies that allow one to harness it.” In the securities market, volatility is often associated with big swings in either direction. In most cases, the higher the volatility, the riskier the security.

“Those Multi-Asset Class investments that don’t have exposure

to offshore investments, for example, struggled to beat their targets - inflation plus 4 or 5% - because the asset classes which those funds invest in really haven’t performed well.

“The challenge comes then, when you start to try and find where the better returns are hiding.”

This has long been a strength of Argon Asset Management - finding these hidden returns - and Bapela goes on to outline some of its star performers over recent months. “Take as a starting point our flexible income fund, which has done phenomenally well: it delivered more than 12% over a 12-month period to December 2018, a really good return relative to what any other asset class would have delivered.

In fact, the fund averaged 12% per year over rolling three and five year periods to December 2018.

“We are looking at rolling this one out to the retail platform, because it is one of the favourites among the advisers with whom we have been interacting.

“Our Equities fund has also delivered terrific returns relative to its benchmark,” he continues. “Take the year to December 2018, for instance: an active return averaging 4% above the benchmark to our clients is a stellar outperformance.

“Bond funds tend to be another tricky asset class, which has historically been a tough one to tempt prospective clients into, but again ours has outperformed the benchmark consistently by more than one percent over short and long periods to December 2018 and we have seen a rise in interest since the turn of the year for significant investment.

“The strategies which we have put in place across all our products have really enabled our funds to stack up well among the best,” Bapela explains, “and any of them would be superb additions to the retail platform. Absolute return funds, equities and flexible income funds - these are the ones we will be going big with as we drive our retail strategy and our proven performance will be a huge enabler.”

POWER IN PEOPLE Behind all of this continued celebration as thoughts turn to the future will be assembling a peerlessly strong team. “One of the overarching objectives as we grow the team is focussing on the youngsters and giving them opportunities,” Bapela says of Argon Asset Management’s approach to this key area.

“We envisage doing even more of this going forward. With us it is a threeyear programme during which we work on them, before they graduate. They may choose to move to other firms; we do not force them to stay here with us, but we really try to keep hold of the ones we think will succeed with us.

“In addition to this graduate training programme we also work with University of the Western Cape students, right through their studies, an initiative that I helped to pioneer - we tutor them on a variety of subjects, give them exposure to our facilities and job-shadowing opportunities. The bulk of them are from previously-disadvantaged communities, so we also give them funding where needed. That idea of nurturing talent and educating the young has never left me.”

In this respect as well, Argon Asset Management is bucking the trend in order to secure the very best people to take the business forward. “For us it is critical to ensure that we build a pool of talent for the country,” Bapela wraps up, “particularly those who would never have had these opportunities otherwise.

“It is easy to go to big universities like a lot of established firms do and just select the cream of the crop, what we are saying is that kids who are often neglected, can also go on to be great portfolio managers, or investment analysts, or accountants.

These are individuals we want to give opportunities to and more often than not, they go on to surprise us.”

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ALEXANDER FORBES SOUTH AFRICA

Financial Well-Being:

Secured PRODUCTION: William Denstone

Today, Alexander Forbes is one of Africa’s leading financial services organisations, offering integrated retirement, investment, life and insurance solutions which serve to create, grow and protect clients’ investments. “Alexander Forbes is committed to creating solutions, growing relationships, and protecting our clients’ wealth and assets,” the group sets out.

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INDUSTRY FOCUS: FINANCE

//

Strongly rooted in South Africa with headquarters in Sandton, the Alexander Forbes Group’s roots can be traced back almost 85 years to the first half of the twentieth century. It has been active in South Africa, which remains its main focus, since 1935, having grown its market share to now encompass sub-Saharan Africa and the Channel Islands.

The majority of its operating income and profit from operations, 93% and 97% respectively, is derived from South Africa, with Emerging Markets remaining a key long-term growth prospect for the group as it continues to diversify and grow. “As a business, we’re constantly moving forward,” the group states. “We were born from an entrepreneurial spirit.”

Through a combination of innovating, challenging and disrupting conventions the group

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aims to lead and shape the African investment industry. Alexander Forbes currently has a presence across eight countries and employs more than 3000 people. “We help our clients to secure a lifetime of financial well-being and security,” Alexander Forbes sums up of its global aims.

“Our vision is to be Africa’s most innovative, forward-thinking and trusted global investment provider, steering our diverse clients on a comfortable journey towards holistic financial well-being.”

RESULTS TAKE A HIT Alexander Forbes has long demonstrated an ability to shift and evolve in response to the dynamic investment market - it is one of the elements that has kept it at the top for so long. It is a complex and rapidly evolving world in which it operates, and progress has been the result

// OUR VISION IS TO BE AFRICA’S MOST INNOVATIVE, FORWARD-THINKING AND TRUSTED GLOBAL INVESTMENT PROVIDER // of a deep understanding of and engagement with so many diverse clients, across different savings and investment pools, to help them achieve consistent and responsible investment outcomes.

No business has been immune to the pressures of the current market uncertainty, and Alexander Forbes is having to be more resilient and creative than ever before in order to stave off the negative effects on

ALEXANDER FORBES SOUTH AFRICA

Committed to ensuring a South Africa where 90% of learners pass mathematics, science and languages with at least 50% by 2030

 the bottom line. A tumultuous 2018 was capped by the announcement in December of a R45m loss in the company’s interim financial results.

However, there is more to such an apparently bleak picture than meets the eye. The revelations came after the company was rocked by the failure of a software program that cost a colossal R339m, which was expected to have a significant impact on the interim results. Quick to react, Alexander Forbes is scrapping the ill-fated project, which was aimed at changing the company’s IT infrastructure.

// THE BUSINESS HAS BEEN RESILIENT THROUGH A VERY TOUGH ECONOMY //

 The cancellation of the project certainly cost dearly, but the financial services company was still able to report operating income up 6% to R1.9 billion in the six months to September. Profit from operations declined by 3% to R442 million but, had the company not written off the R52 million worth of operating expenses, operating profit would in fact have increased by 9%.

“This was the major drag on earnings,” new CEO Dawie De Villiers told CNBC Africa. “We ended a contract with our IT provider so there were exit payments that had to be made to get us out of it. This was a big program that we embarked on more than two years ago that just didn’t work out for us and didn’t deliver what we wanted from it.

“IT is one of the major things that

underpins our business and enables us do it well,” De Villiers was keen to point out. “Now, we will decide where we want the business wants to go and then use IT to get us there, rather than just for the sake of it.”

LOOKING FORWARD “Under the circumstances we are pleased,” said de Villiers to MoneyWeb of the period under review. “The business has been resilient through a very tough economy. One must understand the effect that SA’s low GDP growth has on our business. Add to that employment levels – we fight hard to service a client, but when job shedding takes place that has a negative effect on our bottom line.”

The growth in operating income was generated by strong performance across the business. In particular,

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INDUSTRY FOCUS: FINANCE

// WE NEED A SIMPLE STRATEGY THAT EVERYONE BUYS INTO AND THAT THE MARKET UNDERSTANDS // Investments grew 16%, Consulting & Retirements grew 7%, and Emerging Markets grew by 10%. The group will have surplus cash of R1.2 billion after the annual dividend of R307 million is paid to shareholders.

Turning its attention to what

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is to come, Alexander Forbes has a number of strategies to further bolster the recovery, both in place and in development. Perhaps top among them is Ambition 2022, a five-year strategic plan, “designed to transform our business by unlocking its potential and characterised by our strategic anchor of ‘a lifetime of financial well-being and security’ and an investment thesis of generating strong ‘cash flow plus growth.”

It represents a shift from a business-to-business model to one that is characterised by a broader focus on servicing corporates, public sector, smaller businesses and individuals.

Additionally, Dawie de Villiers

has given himself until March to come up with a new blueprint to reinvigorate the company and refocus on what it does best, feeling that in recent years it has somewhat abandoned its core business.

“At its core, the company should be an advice-led business with superior advice services for corporates and individuals,” de Villiers stated. “We kind of drifted away from being an advisory business and if we set up the business that way we will surely succeed.

“The business is also too complex. I committed to the board and clients that by March I will come with a plan that will inform our future

ALEXANDER FORBES SOUTH AFRICA

strategy and simplify our business for the market to better understand what we are doing.

“A lot of the business is performing well, but it is important to regroup. We need a simple strategy that everyone buys into and that the market understands.”

NEW MARKETS The collaboration with 100% blackowned healthcare consultancy firm Evo Financial Services gives Alexander Forbes an invaluable opportunity to contribute to the B-BBEE profile of the health consulting business landscape. The sub-contracting consulting work has

an initial value of R12- million.

“Alexander Forbes is committed to finding suitable channels to strengthen our supply chain, deliver shareholder return and in turn contribute to South Africa’s growth,” said Alexander Forbes Health Managing Director, Butši Tladi. In this partnership, Evo will benefit from operational support from Alexander Forbes in specialised areas such as actuarial, risk management and call centre capability.

“The partnership with Evo will enable Alexander Forbes to penetrate markets in which we are currently under-represented,” said Tladi. “Evo already has an

exciting pipeline of business opportunities and our collaboration will improve their conversion rates and fast-track their ambition to become a formidable player in the industry,” Tladi concluded.

“We recognise our responsibility to facilitate and support empowering opportunities in line with the national agenda of developing and growing a robust economy.”

WWW.ALEXANDERFORBES.CO.ZA

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POWER DEVELOPMENTS

Power Working on

new Concept

for Cape Town Living PRODUCTION: David Napier

Power Developments, the turnkey property development business of the Power Group, is working on a number of exciting projects across a range of market sectors in the residential, commercial and retail industries. One project in particular, a new micro-living apartment complex in Woodstock, Cape Town, is proof of the innovative nature that underpins everything Power Developments is about.

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Albert Road, Woodstock

INDUSTRY FOCUS: PROPERTY

//

As a leading property developer in the Western Cape, with reach across South Africa, Power Developments is a specialist turnkey property solution provider boasting a history of successful projects stretching back over a number of years.

As part of the widely recognised Power Group of companies, founded in 1983, Power Developments can provide a total solution, handling all aspects of a project from conceptual design, development rights acquisition, installation of services, sales and marketing building and construction, and finally handing over the product to end users in the residential, industrial, retail and commercial space.

As the biggest supplier of affordable housing in the Western Cape, Power Developments lists among its milestones the first, and largest, integrated residential development in South Africa, Pelican Park, which consists of more than 3200 houses.

Other previous successes include the multi-award-winning marina development Thesen Islands in Knysna, Brackenridge Private Residential Estate in Plettenberg Bay, and Featherwood Retirement Estate in Gauteng.

Currently, Power Developments is underway with a number of exciting projects which are set to further bolster its impressive portfolio. Senior Development Manager, Nick Ferreira talks to Enterprise Africa about ongoing projects which are keeping the company busy. He says that a new apartment building in Cape Town will be very interesting for a range of different end users.

1 ON ALBERT “It is an apartment building development that we are developing with some partners,” he begins. “It is based in Cape Town in the suburb of Woodstock. The area is going through urban rejuvenation, there is a lot of change happening and there are a number of new buildings coming online thanks to its central location.

Our building is one of the first you can get into as you move out of the city.”

Formerly the site of old industrial buildings, next to the railway line into Cape Town station, 1A Albert Road will be home to 143 high-spec apartments which provide a perfect living situation for first time buyers or investors looking into the buy-to-let market.

“We have purchased a number of parcels of land adjacent to each other and we are developing the project over two phases,” says Ferreira. “We embarked on the first phase, launching the product around 18 months ago.

Our concept for this development is what we call micro apartments – quite a common product globally, especially in the urban centres of the UK and USA where space is limited and land is very

// WE EXPECT TO FINALISE IN THE NEXT FOUR MONTHS AT WHICH POINT WE CAN START CONSTRUCTION WHICH WILL TAKE APPROXIMATELY 16-18 MONTHS //

expensive. To make the end product more affordable you have to reduce the size of the unit. These are small units – around 20-25m2 and they are self-contained. They come equipped with everything you need. The building will be a smart building with electronic access control, communal facilities (including a swimming pool), and on the ground floor there will be a retail space. The idea is that you can live in the building and, even though it is a small space, you can move between the communal spaces and access everything you need. It is conveniently located right next to the main bus routes and an Uber stop – it is very convenient for people wanting to live in the city.”

A stone’s throw from Cape Town City Hall and the Grand Parade, where Nelson Mandela gave his famous speech on release from prison in 1990, this development will be ideal for young professionals. Its central location is complemented by fantastic design delivered by award-winning architects Louis Karol, and interior design from leading hotel room designer Grant Gillis of Delta Interiors.

“The attractiveness of it is that the unit price point is low. Compared to what you can afford in the city of Cape Town, there is very little at this price.

It is targeted towards young couples, single professionals, students and investors,” details Ferreira.

“It is two buildings – the second building is slightly bigger – and when both are completed the retail areas will combine to offer a generous space. We are also looking at offering communal utility space and office space where board meetings can be held, with access

PROUD SUPPORTER OF THE POWER GROUP lsmith@maraismuller.co.za • www.maraismullerhendricks.co.za • +27 21 887 1021

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POWER DEVELOPMENTS

// OUR CONCEPT FOR THIS DEVELOPMENT IS WHAT WE CALL MICRO APARTMENTS – QUITE A COMMON PRODUCT GLOBALLY // to Wi-Fi, perfect for a small business.”

Sales have progressed well and construction of the micro-living apartments looks set to begin by the middle of the year.

“We’re about 80% sold out and we are quite close to getting into the ground. We expect to finalise the development approvals in the next few months at which point we can start construction which will take approximately 16-18 months. We are targeting the end of next year for delivery of units to the end users. We will also keep some stock for ourselves which we will manage on a commercial basis or consider selling on to a rental pool fund,” says Ferreira.

“80% of the units are around the R1million mark and, with a bond, in a very short space of time it will become more cost-effective to own rather than rent in the city. From that perspective, it’s a very attractive offering. It’s especially attractive for first-time buyers and for parents who want to send children to varsity as it is so centrally located, close to all the university campus sites, the Cape Peninsula University of Technology and the smaller varsity colleges.”

THE VINES In a rather different style of project to Albert Road’s micro-living concept, The Vines at Eerste River, between Cape Town and Stellenbosch, is a Power Development site where 84 properties have been put up ranging from 42-65m² with two or three bedrooms to choose from, and prices ranging from R426,000 – R675,000. Launched in 2016, the

project is now almost complete.

“We are handing over the final few units right now,” explains Ferreira.

“The benefit of the discounted land gets passed on to the end user. We would ordinarily have a certain land value attached to a property and that would impact the selling price. In this case the land value is zero and it makes it more affordable for the end user.

The end user benefits as the property is cheaper, the Human Settlements departments fulfils its mandate, and we deliver.”

Power Developments has a lot of experience working on projects like this and is well-versed when it comes to partnering with government to provide affordable housing.

“The government owns lots of property and, specifically for Human Settlements, their mandate is to

provide affordable housing for the market. Periodically they put parcels of land out to tender where a developer like us can propose a product, a market, a selling price and, if the tender is successful, the government will put the land in for free. The Vines is one example of this, but we have worked like this on a number of similar projects,” says Ferreira.

He highlights two other projects in the Western Cape, one on the corner of Old Faure Road and Stratford Avenue in Blue Downs, and on the corner of the R300 and Hindle road.

“The Vines is just under 100 houses and we have two similar projects in Cape Town which we are busy with – Belle Vue Estate, which is around 195 units, and Brentwood Meadows, which is around 120 units.

Belle Vue is about halfway complete

Element Consulting Engineers are proud to be associated with the Power Group (Developments) We appreciate the opportunity of doing business with you for the past 28 years and offer our best wishes for your continued success.

Element Consulting Engineers, Management and staff, March 2019

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INDUSTRY FOCUS: PROPERTY

Bridgewater Apartments

and Brentwood is about to start. We also have a similar developments of around 150-200 units in George which is the same model.

“These are very attractive products, providing free standing homes for first time home buyers, with additional subsidies that are available to certain qualifying individuals, and we can facilitate the whole process - we have our agents who know the system very well.”

To date, The Power Group has built homes for more than 40,000 families.

BRIDGEWATER In 2017, Power Developments announced that it would deliver the Bridgewater Apartments – a block of 54 luxury units nestled within the Sitari Country Estate in Somerset West. The Sitari Country Estate is a multi-awardwinning development which offers

residents the convenience of being on the Old Main Road into Cape Town but the country-feeling of being in the shadow of the Hottentots Holland Mountain range, surrounded by Klein Zeekoevlei Wetland.

These generous apartments boast breath-taking views over the estate and are kitted out with to the highest specification.

“Bridgewater Apartments is what we call a medium-to-luxury development in the outskirts of Cape Town,” explains Ferreira. “It is inside and existing security estate development that is happening in the area. We have developed a 54-apartment block and we have largely sold them all on the open market. The development is completed and we are just finalising the sale of the last few units which we kept back.

“The medium-to-luxury market

is important for us and that includes the apartments we are putting up in Woodstock and a new planned development at Green Point. We’ve done a lot of retail and commercial stuff and sometimes we are just the builder, sometimes we build and sell, sometimes we build and keep – it depends on the project. Our focus evolves as the market evolves.”

Across Bridgewater Apartments,

// WE ARE BUSY WITH BELLE VUE ESTATE, WHICH IS AROUND 195 UNITS, AND BRENTWOOD MEADOWS, WHICH IS AROUND 120 UNITS //

Thank you Power Group for turning our ideas into reality Jay de Wet: 072 022 0022 // www.otba.co.za // jay@otba.co.za

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POWER DEVELOPMENTS

the Vines, Albert Road and Belle Vue, you can see the diversity and quality of Power Developments, and why is it recognised as an industry leader.

DEVELOPMENT Even in what has been a challenging environment for project-based businesses, and with construction still suffering with a major lack of confidence, Power Developments is consistently reviewing growth and expansion opportunities. Having historically displayed the ability to work cross country, and cross border, Ferreira says that the company will always look at the chance to grow in new geographies.

“We are always looking at opportunities to grow and KZN is just one option,” he says. “We’ve also looked at Johannesburg - it depends on the product. We review every opportunity that comes across our table. Some are joint ventures and some are traditional developments – we are always looking at projects in our focus market which is Cape Town and the Western Cape and

we do look at expansion in other areas of the country. We also have an office in Namibia where we are developing property for a project we have been working on for a couple of years. In Johannesburg we have completed some projects in the past but we have not yet been active in KZN.” Fortunately, being part of the wider Power Group allows Power Developments to be flexible in the market and bring different solutions to clients.

“We have a number of different business lines and that gives us the opportunity to adapt,” details Ferreira.

“We have pipeline products where, if one is struggling, we can put the pressure on another to pull through. We do have a construction division where we can internalise and gain control over how things happen and how fast they happen. We don’t exist to create work for our construction division but there is definite synergy and benefits for both companies if it makes sense – we look at it on a project by project basis.”

This portfolio strength makes for a formidable market presence, and leaves Ferreira confident about what the future holds for Power Developments.

“The market has been depressed and we see that in a number of our developments where sales have slowed down. There has been pressure but we are seeing a slight upturn in the last month or so where it looks like the stats will come through showing a lot of interest in our products. We trust that those stats will evolve into sales and that will give the market the opportunity to recover.

“We are in a cyclical environment and that is the same for every business – there are ups and down. We are confident that things will be turning around and we have to be positive about the future.”

WWW.POWERGRP.CO.ZA

Pelican Park

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SAOTA

Constructing

A Fearsome Global Reputation PRODUCTION: Timothy Reeder

One of South Africa’s leading architectural firms, SAOTA’s innovative and dedicated approach to the design, documentation and execution of projects globally has seen it become an internationally sought-after brand. The company enjoyed a decorated 2018, with its global reach continuing to expand and allowing SAOTA to take on more complex and highly celebrated work.

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New Engineering Building - UCT

INDUSTRY FOCUS: PROPERTY

//

“We strive to promote a service marked by excellence both in our buildings and in addressing the needs of our clients, with the focus on high standards and elegance.” This is SAOTA’s mission statement right from the outset, and, driven by the dynamic combination of Stefan Antoni, Philip Olmesdahl, Greg Truen, Phillippe Fouché and Mark Bullivant, a shared vision has been developed which is instantly recognisable around the world in their designs.

SAOTA is positioned to offer expert services to the full set of key marketplaces: corporate, institutional, commercial and residential.

The company began life specialising in villa-style single residence buildings, and even the creative minds at its heart would have

Yalikavak - Bodrum, Turkey

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had difficulty picturing the business as it stands today. Over the past more than 30 years SAOTA has grown both in scope and reputation, and is now able to take on notable projects numbering hotels, multi-residence apartment buildings, government buildings and more.

GLOBAL FOCUS As SAOTA’s expertise has grown, so too has its reach. Having grown from its strong roots in South Africa, 85% of SAOTA’s clientele is now international.

This has seen the firm compete projects in some 86 countries. Its footprint now covers five continents and includes highly technical work which spans some of the world’s most exclusive locations.

Philip Olmesdahl, who has notched up over 20 years at SAOTA, describes the scale of the shift in focus since his early days with the company. “We

have a good spread around the world,” he outlines, “and we are localising in particular areas. Excluding Greece, we have seen nice growth in all of our targeted regions worldwide, and we have a good spread of both residential and commercial property; among these are much larger scale master planningtype jobs in Turkey and Spain.”

Its international capabilities have been instrumental in shielding the company from the pressures felt by others caused by volatile African markets, and SAOTA’s leaders want to achieve a balance between domestic and global prosperity moving forward. “When we first moved out of South Africa, a lot of our work was still on the continent,” says Olmesdahl of SAOTA’s gradual move to today’s worldwide coverage.

“Up until a few years Africa remained

SAOTA

// WE ARE PROUD TO SERVICE THE AFRICAN REGION AND ARE WORKING TO REGROW MARKETS THAT HAVE SLOWED // a substantial part of our business, but that has changed substantially since our moves into the USA, Europe, the Middle and the Far East.

“Africa is not as prosperous any more due to a number of different reasons but Nigeria, Kenya and South Africa remain busy, and Senegal, Congo and Ivory Coast still have projects. We are proud to service the African region and as a result we are putting a lot of effort into re-growing

markets that have slowed.”

Trust is being placed in the quality of SAOTA’s work from an ever-expanding proportion of the globe. This is largely down to a design philosophy that connects function and form, and the pursuit of true architectural design to create appropriate solutions wherever they may be required.

It is also the SAOTA focus on achieving maximum value which has led to these global invitations to design, build and create some of the most highly prestigious projects in recent years. In turn, increased exposure to the global marketplace has seen SAOTA flourish, lending it blank canvases in the form of cities and contexts to allow inspiration to radiate from its unique approach to design.

GLOBAL RECOGNITION Success in SAOTA’s industry can be measured in two ways. Contract awards for prestigious projects in far-off lands is an obvious indicator that a job is being well done, but the physical awards provide tangible proof of the progress being made. SAOTA is no stranger to either form, but 2018 was a remarkable year for prizes, even by its own lofty standards.

Characteristically, SAOTA was celebrated both at home and abroad.

The inaugural edition of Spice Lifestyle Honors took place in December, organised by lifestyle channel Spice TV to acknowledge excellence in the African fashion and style industry and recognise outstanding work by brands, individuals and lifestyle curators.

SAOTA was delighted to be crowned Design Company of the Year, amid an

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INDUSTRY FOCUS: PROPERTY

Yalikavak - Bodrum, Turkey

extraordinarily strong field, boding very well for its big to bolster its African presence in the short-term.

At the completion of the Clifton Terraces development, a luxury suite of apartments in Cape Town’s famously affluent Clifton suburb, Director Greg

Truen spoke of the commercial success that had followed a pleasurable design experience for the company. “It’s largely complete at this point, and it’s largely been sold,” he said. “It’s looking amazing and we are very happy with the way the whole thing has turned out. It’s a

fantastic building from an architectural point of view and it’s been pretty successful commercially as well.”

His high praise was mirrored as Clifton Terraces was recognised for innovative excellence at the SAPOA Property Development Awards 2018, in the Residential Developments category.

It is the most prestigious programme of its kind within the South African commercial real estate sector, and a primary objective is to define excellence in the property industry.

Clifton Terraces is located in one of the most sought-after locations in Africa, surrounded by the worldrenowned Clifton Beaches and nestled between Lion’s Head and Table Mountain. “A key consideration of the design was blending the building into the natural surroundings using its overall form, its deep overhangs and a restrained natural palette of materials,” said SAOTA Director Mark Bullivant of the thought process that paved the way for the award-winning design.

DOUBLE GONGS FOR DOUBLE BAY In Australia, meanwhile, overlooking a sheltered bay within Sydney’s worldfamous harbour, you will now find SAOTA’s Double Bay, billed as a “youthful yet sophisticated contemporary family dwelling.” Set in a north-facing cove in Sydney’s vast natural harbour, the site borders a recreational park and a public pier which juts out into the bay and efficiently creates private,

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SAOTA

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sheltered spaces for family living, whilst maximising wide outlooks towards the water and beyond.

SAOTA, together with Architects in Association Tanner Kibble Denton (TKD), gathered an award at the Trends International Design Awards 2018 (TIDA), in the category Australia Architect New Home 2018. Now in its fourth year, TIDA recognises

// WE STRIVE TO PROMOTE A SERVICE MARKED BY EXCELLENCE, WITH THE FOCUS ON HIGH STANDARDS AND ELEGANCE //

outstanding homes by architects and designers across a range of countries.

A shining example of SAOTA’s strength in collaborative working, TKD worked closely with the client to ensure that SAOTA’s detailed design was delivered and a dream home subsequently realised. Following this award, Double Bay has also been put forward for the TIDA International Category, but while we await news of this probable triumph, Double Bay has also been feted at the most high-profile event in the building industry calendar, The Master Builders Association of NSW (New South Wales, Australia) Excellence in Housing Awards.

Standing out from over 400 entries across the state, Double Bay was awarded the top prize in the Contract Houses (new builds) category.

“When visiting our clients in the

newly completed Double Bay home, we were struck by the extremely high level of finish, accuracy and craftsmanship that had been achieved in the final product,” Philip Olmesdahl commented upon receipt of the prize. “Horizon has achieved something special in the construction of this home that does full justice to our design, and this one-of-akind harbourside site.”

There was not a single visible defect that we could identify,” he continued.

“Our experience of the build process with Horizon was a productive collaboration between all parties, and we look forward to working with them again in bringing another project to life.”

WWW.SAOTA.COM

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DIMENSION DATA

Increasing

Dimensions PRODUCTION: Colin Chinery

Global systems integrator and managed services provider Dimensions Data is bringing the world’s best technology with service support to help businesses achieve greatness.

“We are wherever our clients are at every stage of their technology journey,” says Grant Bodley, CEO of Johannesburg-based Dimension Data Middle East and Africa.

//

South Africa is fast-positioning to become a globally competitive player in the digital revolution space.

Already best-placed of African countries to benefit from the potential of information and communications technology, South Africa’s ICT sector has been boosted by President Cyril Ramaphosa’s recent State of the Nation announcement of a Presidential Commission on the Fourth Industrial Revolution.

Seen as a national overarching advisory mechanism on digital transformation, it will stimulate a technological revolution to improve and advance the lives of South Africa’s citizens and business.

LEAD PLAYER Among the front players in this technologic quantum leap is Johannesburg-headquartered Dimensions Data, market leader in the ITU industry, founded in 1983 and

helping organisations achieve through digital infrastructure, hybrid cloud, and cyber security.

Part of the $8b turnover Nippon Telegraph and Telephone Company (NTT), one of the world’s largest telecommunications service providers, with offices in 47 countries and 28,000 employees, Dimensions Data “delivers globally and regionally wherever our clients are at every stage of their technology journey,” says Grant Bodley, CEO of Dimension Data Middle East and Africa.

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INDUSTRY FOCUS: TECHNOLOGY

“We are proud to be part of a global systems integrator and managed services provider that designs, manages, and optimises today’s evolving technology environments to enable its clients to leverage data in a digital age.

“We invest heavily in innovation to bring together the world’s best technologies, from consulting, technical and support services to a fully managed service, to our global client base.”

While the potential of other countries in East Africa is “exciting, they don’t have quite the same scale as Kenya,” says Bodley.

“We do business in Uganda and Djibouti and starting to look at Ethiopia. It’s quite a significant country, quite technologically advanced, and while we don’t have a presence there

right now, Ethiopia is an attractive market, one where we are doing a deeper analysis with the possibility of entering it sometime in the future.”

SOUTH AFRICA-CANADA VENTURE But the Johannesburg company’s latest expansion takes it out of Africa, and 8,300 miles north west to Toronto with the acquisition through its subsidiary Merchants, of Millennium 1 Solutions, of one of Canada’s fastest-growing Business Process Outsourcing (BPO) solution providers.

Millennium provides contact centre, credit card, and back office and administration services to Canadian organisations primarily in the financial services, insurance, and retail sectors.

Merchants – Johannesburg-based, with offices in Cape Town and Durban

- is one of South Africa’s leading customer management outsourcing solution providers, designing, building and operating contact centres across the globe.

With Millennium’s North American strengths, capabilities and expertise particularly in credit card and financial services - complementing Merchants’ offerings in areas and verticals such as telco, retail, airlines, and service desk, the synergies are clear, dovetailing Dimension Data’s strategic vision for the Merchants Group.

“We looked at our commercial and off-shore capability, to Canada’s proximity to the USA, and the fact that North America has the biggest BPO market.

“And with Millennium 1 we can now access the North American market

Helping make Africa resilient Africa will only achieve its economic potential if its companies can manage risk and recover from disaster effectively.

Today’s global, digital economy is 24/7 and no company will long survive a protracted period of closed doors.

Companies increasingly must demonstrate to business partners that they can mitigate risks, and recover quickly from any disaster.

“Business continuity helps companies look at their risk and recovery plans holistically, taking into account people, processes and technology,” says Michael Davies, CEO of ContinuitySA. “And as the threat landscape has become so volatile, we now have to think in terms of business resilience—the ability to respond to, and recover from, even unexpected, unplanned-for disasters.”

For these reasons, ensuring the right business continuity strategies and capabilities are in place have been made a board responsibility in governance codes worldwide, including South Africa’s King IV. “This year, we celebrate 30 years as the leading business continuity and resilience company in Africa, and we have the clients and awards to back that up. But more important still, we are really proud of the work we have done, and will continue doing, in creating awareness about business continuity across the continent,” he says. “Africa has enormous economic potential, and if African companies can demonstrate that they have credible business continuity plans and capabilities, they can take their rightful place in global supply chains. Supply chains are only as strong as their weakest link, so it’s vital to be able to demonstrate that one is resilient.”

ContinuitySA operates the continent’s biggest network of recovery centres, with more than 20000m2 of space in South Africa (Gauteng, the Western Cape and Kwa-Zulu Natal) as well in Botswana, Kenya, Mozambique and Mauritius. It is a Gold Partner of the Business Continuity Institute and a Gold Partner of Veeam.

The company was acquired by Internet Solutions, a member of the Dimension Data Group, in 2014. “Thanks to our links with Dimension Data, we can offer African clients access to an unrivalled network of data centres to provide a truly global solution.”

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INDUSTRY FOCUS: TECHNOLOGY

and provide it with services from South Africa,” says Bodley, Dimension Data Middle East and Africa CEO since October 2015.

FINANCIAL SERVICES ACCELERATOR “The other exciting thing is that Millennium 1 is that it is focussed primarily on financial services, with a card processing capability I would like to bring to South Africa.

“Financial services are a really significant market for us, as is retail, so we can leverage some of that IP around card processing and the like.

“It’s a whole new value proposition which we can bring to our South African customers, and with this new enabling footprint sell into the North American market. Overall it’s an exciting opportunity for us.”

Nine months after the Millennium 1 acquisition, Bodley stresses the virtues of operational continuity and staff retention.

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“It’s important for us not to put in wholesale changes. You must make sure you retain the staff and that the staff in turn feel they are part of an organisation with which they can identify. The last thigh you want is to have a lot of attrition and lose key people.

“So the first six months saw us bedding down the business and leaving it relatively autonomous. The next 18 months will see us bringing about synergies - and by this, I mean sharing technology platforms, transporting or leveraging IP.” The process of absorbing and developing Millennium 1’s card processing capability and potential in a South Africa – North America twoway flow, should see results within the next months.

“We are already engaging with some of the financial services here in South Africa and have appointed an individual out of the banking world to lead the Go-to market for us.

“There are some compliance issues which we need to get certified and embedded in the South African business before we can fully transact.

“But we have started engaging the market and showing the type of services we are delivering to a large part of the Canadian tier two banks and large retailers, and which we believe we can bring into the South African market.

“We hope to land this capability here within the next couple of months, and I believe a number of aspects will resonate with some of South Africa’s financial institutions.”

TOP EMPLOYER Dimension Data’s outstanding success in transforming and enhancing client performance was recognised last year with the 2018 Microsoft Modern Workplace Transformation Partner of the Year Award - with another Dimension Data division, Britehouse,

DIMENSION DATA

named South Africa Partner of the Year.

The two were among a global field of top Microsoft partners demonstrating excellence in innovation and implementation of customer solutions based on Microsoft technology.

“Microsoft is a really significant partner for us and highly relevant across all enterprises and public sectors,” said Bodley.

“To be recognised by an operation of Microsoft’s nature and stature as a leading player and partner, re-enforces that we are on the right track, and gives clients confidence that they are dealing with systems integration with a track record.”

The Workplace Transformation Partner of the Year Award was related specifically to its success in transforming the modern workplace, and says Bodley, “shows we have unique IP, understand that the workforce is changing, and can leverage technology to increase communication and collaboration, reduce costs and other benefits.”

// WE HAVE STARTED ENGAGING THE MARKET AND SHOWING THE TYPE OF SERVICES WE ARE DELIVERING TO A LARGE PART OF THE CANADIAN TIER TWO BANKS AND LARGE RETAILERS, AND WHICH WE BELIEVE WE CAN BRING INTO THE SOUTH AFRICAN MARKET //

Optimised efficiencies and workplace harmony are central to the Dimension Data philosophy, a mindset that has seen it named a Best Employer by The Top Employers Institute, the global authority on certifying excellence in employee conditions.

“We have been recognised as a Top Employer for a number of years, and this is a really critical part of our culture and how we do business.

“We are a people business in a technology industry, and as such we need to have the most skilled people in the industry working for us.

“To do this you create fertile soil to attract them, a good people and culture policy, investing in areas like training, internships and development.

“And this has come to bear, and being recognised is a great accolade, and one that helps us attract new young, bright talent.

“As long as I am around, certainly in our geography, we will never stop investing. I spend a great deal of my time making sure that I’m connecting with the 14,000 employers, communicating with them, and sharing the vision.

“It’s really rewarding when you see these young people come through and start making a real difference in the market.”

The MEA region is a notably strong and important contributor to overall global performance.

“East Africa is an exciting and significant part of our business. The first six months were slow however primarily because of the contended Kenyan election - but since then business has picked up nicely.”

POST-ELECTION PROTECTORIES Elections are currently the X for Uncertainty factor, with General elections in South Africa on May 8th to elect a new National Assembly and new provincial legislatures in each province.

// WE ARE ALREADY ENGAGING WITH SOME OF THE FINANCIAL SERVICES HERE IN SOUTH AFRICA AND HAVE APPOINTED AN INDIVIDUAL OUT OF THE BANKING WORLD TO LEAD THE MARKET FOR US // This will be the sixth election held since the end of the apartheid system in 1994 and will determine who becomes the next President of South Africa.

Could the post-election landscape emerge as one more positive for business and industry?

“I’d like to think so. At present there’s a degree of uncertainty, and the economy’s flat. As soon as we get through the elections in May I think you will start seeing a lot more investor confidence, and this will work its way through to technology.”

In the meantime, the fact that despite everything, Dimension Data has managed to continue to grow is pleasing, says Bodley. “But it’s not at the pace we would like. We want to grow faster; that’s our aim and our strategy.

“As far as South Africa is concerned, I’m still optimistic that we are an attractive country for investment once we have stabilised some of the uncertainty relating to the political landscape.”

WWW.DIMENSIONDATA.COM

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ABB SOUTH AFRICA

Power and Automation

Pioneers PRODUCTION: William Denstone

We all know ABB as a global leader in industrial technology, with a history of innovation spanning more than 130 years. Present in South Africa since 1992, the group has a strong local manufacturing capability with three sites around the country, and continues to be behind some of the landmark projects on the continent today.

//

ABB is a pioneering technology leader in power grids, electrification products, industrial automation and robotics and motion. One of the world’s foremost power and automation engineering companies, it develops solutions for the secure and energyefficient transmission and distribution of electricity.

TECHNOLOGICAL GIANTS With a portfolio ranging from robots that can print cars and huge electrical transformers to control systems that manage entire power networks, ABB seeks to increase productivity in utilities, industry and transport and infrastructure settings globally.

The group’s complete solutions for utilities include electrical power

infrastructure for transmission and distribution networks and power plant automation, while on the industries side, ABB takes care of systems, products and services in mining, metals and minerals.

Innovation is at the forefront of everything that ABB does, with a long history and a rich heritage of technological innovation having

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INDUSTRY FOCUS: TECHNOLOGY

// ABB PROVIDES A WIDE RANGE OF INNOVATIVE SOLUTIONS FOR THE RAIL SECTOR AND REMAINS THE PARTNER OF CHOICE FOR ENABLING A STRONGER, SMARTER AND GREENER GRID // seen it pioneer many of the power and automation technologies that drive modern society: ABB delivered the world’s first power-from-shore solution for an offshore rig, and introduced the first high voltage direct current (HVDC) technology more than 60 years ago.

Today, it is responsible for around half the world’s current HVDC installed base.

ABB scientists and technologists are endlessly innovating an exhaustive range of products, systems and services that increase energy efficiency, reliability and productivity. With more than four decades at the forefront of digital technologies, ABB is a leader in digitally connected and enabled industrial equipment and systems, and has amassed an installed base of more than 70,000 control systems connecting 70 million devices.

Panarama Main Terrace

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ABB IN AFRICA ABB has been present across Africa since 1926, and had its first office in Cairo, Egypt where it continues to manufacture a range of power and automation products to serve the rising local demand for increased electrical infrastructure. Now more than 80 years later it also holds major offices in key countries throughout the territory, including in Algeria, Morocco, and Kenya.

In South Africa, ABB’s head office, logistics and manufacturing centre is located at Longmeadow, Johannesburg, a new R500 million premises boasting 17,800m2 of office space and 22,000m2 of warehousing and factory. Here is the hub of several important manufacturing operations, including medium voltage switchgear, high voltage protection and a robotics programming and servicing centre.

“Longmeadow was designed with an impressive depth of research and focus on design, construction and facilities management automation, resource efficiency, recycling and ongoing minimal environmental impact,” says ABB of its headquarters, “to ensure that the site is a shining example of ABB environmental best practice.”

Energy efficiency was at the forefront of the facility’s design, and key green elements have been incorporated, including solar panels, a grey-water recycling system and energy-efficient lighting. According to ABB, “the building has enabled a major reduction in energy use, unprecedented in South Africa, and sets a new benchmark for energy efficiency in green buildings in the country.”

ABB’s projects not only in South Africa, but also further

ABB SOUTH AFRICA

afield in Africa, have long garnered attention for their creativity and attention to detail, no matter the job. Take for example the major 2004 work undertaken to upgrade Algeria’s power grid, through supplying turnkey substations and control systems. Or, more recently still, completion of the biggest rehabilitation project in the history of Egypt’s hydroelectric power industry, modernising the Aswan hydroelectric power plant.

In South Africa itself, ABB hit the headlines for installing the control system, software and instrumentation solution for all six of the 800-MW generating units at Kusile. The supercritical plant is set to be the world’s fourth-largest coal-fired power station. Along with the Venetia mine expansion, ABB is having great success in ongoing large-scale South African projects.

ON THE RAILS Next in a long line of landmark operations for ABB is the supply of substation equipment and engineering solutions for a 530-kilometre long high-speed electric line, to connect Dar es Salaam and Makutupora. It is by no means ABB’s first foray into rail territory, having already manufactured traction transformers and associated products for some 240 freight locomotives to boost South Africa’s expanding electric rail fleet.

This new project is part of a larger plan to provide a crucial link between Tanzania’s most important port of Dar es Salaam and the country’s interior hub, which also serves as a vital crossroads for northsouth railway linkages.

Tanzania, home to well-known game parks and destinations like Mount Kilimanjaro remains largely rural but aspires to become a regional transport hub between its port cities and hinterland areas

and neighbouring land-locked countries. When complete will create a development corridor to sustain future growth.

ABB’s equipment will help power two separate but adjoining eastwest rail lines – the Dar es Salaam – Morogoro railway line (DSM), and the Morogoro – Makutupora railway line (MDM). The new high-speed electric rail line will replace a slow, narrow-gauge line built more than 100 years ago and no longer suitable for the high-speed transport of cargo and passengers.

ABB will deliver a complete engineering solution and most of the key products, such as the substation automation control and protection system and ABB AbilityTM OCC (Operational Control Centre).

“ABB is pleased to be part of

Tanzania’s pioneering effort to build the first modern electric rail infrastructure in East Africa and encourage sustainable mobility in Africa,” said Patrick Fragman, head of the Grid Integration business unit, a part of ABB’s Power Grids division.

“ABB provides a wide range of innovative solutions for the rail sector and remains the partner of choice for enabling a stronger, smarter and greener grid.”

WWW.ABB.COM

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LITHON PROJECT CONSULTANTS

‘Let Us Rise Up and Build’

the Call from Lithon’s Visiopreneur Director PRODUCTION: Karl Pietersen

Namibia-based Lithon Project Consultants – a leading African engineering firm – is readying itself for expansion across the continent. Busy preparing for construction of the Otavi Rebar Manufacturing Plant, Founder and Executive Chairman, Adriaan Grobler tells Enterprise Africa about the company’s growth strategy as well as his plans to drive social change in Namibia and beyond.

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INDUSTRY FOCUS: ENGINEERING

//

Visiopreneur Adriaan Grobler started Lithon Project Consultants in 2002 after realising that the purpose in his life is to make a significant impact in the lives of people.

Drivers of infrastructural and social change, Lithon (the Greek word for cornerstone) is based on the Word of God, strongly value driven and focussed on its people.

Grobler describes a visiopreneur as someone who sees a better tomorrow, takes action and executes to achieve. “Call it a dreamer and a doer all in one.”

He has set his sights on developing a better, brighter, stronger future for Africa, and he hopes to do it through Lithon Project Consultants by constructing roads, buildings, sewers and other infrastructure, but also by contributing to social upliftment

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through various funding initiatives.

Lithon has successfully completed more than 200 projects and the company is currently involved in many more that are in various stages of development. Grobler, who has personally overcome serious health issues to remain at the forefront of the industry, explains that consistency is key to the success of his business.

“Starting up and growing a business is easier than keeping it going sustainably year after year – and that is where we are right now,” he tells Enterprise Africa. “Times are tough, the depression we see has been going on for the last 10 quarters, and for us to expand into Africa, we need cash, so we are diversifying to drive revenue. We are focussing on private-public partnerships and seeing how we can find a different solution for our clients while

bringing the money, technology and understanding politics.”

Another vital factor is collaboration. Reaching out, connecting, and achieving together has been a cornerstone of Lithon’s success. “The time of being just a consultant is gone,” says Grobler.

“In the old days, you could be appointed by a client and complete your project, but now, if you don’t come with a full solution you will end up as a subcontracting consultant picking up bread crumbs.

We want to be agents of change by creating projects and helping to finance them too.”

TURNKEY PROVIDER A significant selling point for Lithon Project Consultants is its experience in the industry and its ability to offer a complete solution that goes right

LITHON PROJECT CONSULTANTS

VISION: To be a wealthy, well-developed city with modern infrastructure, offering world class service.

MISSION: To effectively and efficiently serve the community of Otavi and grow into a prosperous, innovative, sustainable and economically vibrant city by 2030 MY CITY, MY DREAM Operational Office: PO Box 186, Otavi // Windhoek Office: Lithon Project Consultants, 37 Feld Street, Windhoek

from feasibility studies and project planning through to design, tender preparation, site supervision, project management, quality control, and many more related services.

“We are now one of the top five firms in Namibia,” states Grobler.

“There are two legs of the business right now – Lithon Project Consulting and Lithon Developers.

Currently, the development

// WE WANT TO BE AGENTS OF CHANGE

BY CREATING PROJECTS AND HELPING TO FINANCE THEM TOO //

business is working on three affordable housing projects; bringing a greenfield project, preparing concepts, taking it through pre-feasibility stages, and moving to the EPC stage from where you can create a bankable and operational project.”

This expertise has resulted in Lithon Project Consulting being asked to help bring about the development of a new steel plant in Otavi, close to the Etosha National Park.

The Otavi Rebar Manufacturing Plant will use scrap metal sourced from around Namibia and its neighbours to produce 300,000 tons (annually) of billets and rebar (8mm to 32mm). The products are vital for the development of local manufacturing, building and construction industries. The

project is owned by Otavi Rebar Manufacturing (Pty) Ltd of Namibia and NORIC of Switzerland. On completion, it is suggested that the new plant will employ some 300 people. Currently, Lithon is targeting start of construction for August 2019.

“It will be tough. If we manage to achieve it, I will be very impressed,” admits Grobler. “We would like to get to financial close by the end of this year, and that will be viewed as a success.

Over the next two months we will be busy putting together the information memorandum which the financial arranger, Nedbank, can use to start arranging capital. Projects of this nature are complex, especially on the legal side, so there is a chance that delays can creep in. But we are still on target and we believe that it will be done.”

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INDUSTRY FOCUS: ENGINEERING

Recognising the need for ambitious projects that create jobs, in a time where Namibia is faced with economic contraction of 0.2% in 2018, the government has thrown itself behind construction of the Otavi Steel Plant.

“We have a lot of support.

From the very beginning, we have involved the government in the project and they fully back the idea.

The founding President, previous President and current President have all backed the plans, so we are positive,” explains Grobler.

“All companies in Namibia are going through a tough patch right now and the economy is not strong. We are all hoping for a quick turnaround, but we have accepted that it will be a tough

journey,” he adds.

When all arrangements are finalised and workmen begin onsite, the area will be busy for two years.

“We hope that the plant will be in operation by the end of 2021,” states Grobler.

He also points out that Lithon is busy organising the launch of a new development fund to help assist with projects like this, all over Africa, in the future.

“We have created an Urban Infrastructure Development Fund which is like a private development fund with which we will go to the market in March/April to raise capital. We will use it to assist councils with long-term urban planning or installation of services and then selling it to developers

or back to government. We’ve also decided that we will look at a SADC fund, rather than just Namibia, built from Mauritius. We will be seeking mostly impact investors that want to use their money for good, while getting a return but also creating large social impacts.”

For this group of ambitious engineers, the sky is the limit.

AFRICAN EXPANSION Lithon already boasts a strong presence in Africa in Namibia, South Africa and Ghana. Its workforce of more than 30 professionals is split across these three regions with plans to expand aggressively in the coming decade. Grobler wants Continues on page 86

Providing excellent, value added construction services to our customers Founded in 1976, Nexus Group is Namibia’s leading building and civil construction group with over 40 years industry experience. Nexus Group and its affiliates are 100% Namibian owned and managed with more than 30% Black Empowerment shareholding.

Nexus Group has proven capability to deliver on a wide range of projects to a multitude of clients in diverse markets. We also have extensive tender capabilities.

Nexus Building Contractors covers the full range of conventional construction which includes: • hospitals, retail centres, residential complexes, office accommodation, educational institutions, hotels & lodges and industrial facilities as well affordable housing for the public sector.

Nexus Civils has capabilities spanning: • Municipal infrastructure - water, reservoirs, sewerage plants, roads, storm water and electrical • Transport infrastructure - roads (Bitumen & Gravel), bridges, airport terminals, aprons and runways.

• Bulk earthworks as well as landfill sites.

In order to maintain a high level of service and support to our stakeholders as well as keep up with the continuous demand for excellence, we frequently invest in our plant.

Being one of Namibia’s leading building and civil construction groups, Nexus group has endeavoured to assist government in achieving its action plan towards prosperity for all Namibians. Otavi Rebar Manufacturing Plant is an important project for Namibia which will boost our local economy. We would like to congratulate Lithon Project Consultants for their dedication on this project and the milestones they’ve achieved.

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Working together for a common objective, to ensure delivery exceeds what was promised

Continues on page 24

+264 67 313 770 nexus@nexusgroup.com.na www.nexusgroup.com.na

Our Firm’s locality, accessibility, efficiency and quality of service delivery to our clients, distinguishes us from the rest.

Dr Weder, Kauta & Hoveka Incorporated specialises in litigation, labour law, commercial law, corporate law, tax law and conveyancing. The Firm currently operates from offices in Windhoek, Ongwediva,Swakopmund and Grootfontein respectively.

The Firm is widely respected and recognised for its professionalism and excellence in service provision. www.wkh-law.com

INDUSTRY FOCUS: ENGINEERING

Dr Weder Kauta Hoveka Inc. On 1 September 2006 two prominent law firms in Namibia namely Dr Weder, Kruger & Hartmann and Kauta, Basson & Kamuhanga Incorporated merged thereby becoming the first truly empowered firm, combining their years of experience and individual successes into becoming the powerhouse that is Dr Weder, Kauta & Hoveka Incorporated. This merger further brought together a unique synergy of professional expertise, experience and skills, offering clients a comprehensive range of services founded on sound business practices and ethics.

The Legal Practitioners practicing at WKH Inc. are all admitted to practice in Namibia in terms of the Legal Practitioners Act and have a combined estimate of more than 350 years’ experience in the legal fraternity between them. The wealth of knowledge of our practitioners is enhanced by a modern approach and appreciation of a contemporary setting which promotes our professional ethos and uniquely compliments our core motto of “service excellence.”

The firm has established itself as the largest conveyancing practice in Namibia consisting of 9 qualified conveyancers with a wealth of experience ranging from housing and agricultural land transactions to sectional title developments and financing structures. WKH also has a resourceful and pioneering litigation practice which is a full service department covering all areas of litigation. Our litigation department consists of 14 litigators, presumably one of the largest in the country. Corporate and Commercial services constitute a major part of WKH’s practice ranging from major mergers and acquisitions to Banking and Insurance related matters.

We have budding commercial law practice consisting of five legal practitioners with more than 55 years’ experience between them.

With 25 legal practitioners in four offices, the legal practitioners at WKH value the delivery of excellent and high quality services in every of the various spheres. Our strength and commitment lies in the diversity and experience of our professional staff that understands our client-centred approach. We aim to be known by the elephant print that we will leave behind. Dum vivimus servimus.

Continued from page 82 to use the Otavi Steel project as a case study for the company’s expansion on the continent, hoping that European partners will see the fantastic opportunities available.

“Our partner NORIC, who is in Africa for the first time, says that

Ndonga Pompstasie

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if we can nail this one then we can take it across the continent. It’s a scalable industry – wherever you have scrap you can put up a plant as it doesn’t make sense to export steel over long distances.”

Lithon’s African credentials are already starting to expand, making it the perfect business

for infrastructural investors to investigate as they search for regional expertise in Africa.

Away from its core markets, the company is busy sealing deals in Nigeria, Kenya, Angola, Mozambique and Rwanda.

“We have signed a Memorandum of Understanding

Ndonga River Pumpstation

LITHON PROJECT CONSULTANTS

for a regional hospital for the government of Kenya. We are looking at projects in Mozambique and Angola where we are looking at special hospital projects. We are in discussions with financial brokers to arrange capital so we can start a medical fund for the construction of large-scale hospitals across Africa where there is a huge market.

Grobler reminds that African conditions favour businesses that can bring a turnkey solution. “In Africa, you have to go in, create a project, and bring the money,” he says. “That is why we are setting up the Lithon Impact Capital Fund.

We will put in the seed capital and try and entice private capital from impact investors to see if it will be possible to start a project. For Africa’s future, my opinion is that private capital must be partnered with government. That means you have to understand politics and economic conditions and look at countries where there is stability.

That is why we have chosen Kenya, and it is also why Tanzania is on our radar. Rwanda is also exciting and we are also looking to sign an MoU with Abia State in Nigeria state of Abia for a long-term project developing a new city. That is a very large project for which we will bring on board other companies and form a consortium. Our whole strategy is around collaboration and pairing with local companies and I believe that is the future of engineering.”

When Lithon has established itself in Africa and has made real progress

// FOR AFRICA’S FUTURE, MY OPINION IS THAT PRIVATE CAPITAL MUST BE PARTNERED WITH GOVERNMENT //

WE DELIVER QUALITY Excel Dynamic Solutions (EDS) is an independent, diverse consulting firm rooted in natural resources discovery and management, engineering project management, data technology and analytics, and subsequently rendering customer centric products and services from the aforementioned practices. The firm is based in Windhoek, the capital city of Namibia.

Consultancy services on offer include: Geology and Environmental Studies Groundwater and Geotechnical Studies Data Analysis, Modelling and GIS Water Management Technology Projects Planning and Management Surveys and Specialized Research +264 (0)61 259 530 / +264 (0)81 152 4420 info@edsnamibia.com / www.edsnamibia.com 11 Strauss Street, Windhoek West

addressing some of the real human issues that exist on the continent, the next target is global expansion.

“We have developed a 30-year strategy which is split in two with the first 15 years focussed on Africa and the second half focussed on the rest of the globe. Personally, I have no plans for retirement or anything like that, I have warned the team that they are stuck with me for at least another 30 years while we work through this strategy,” Grobler laughs.

As he continues to develop the company, he is also busy developing himself so that his dream of making a significant impact in the lives of people can become more of a reality.

“I’m busy with my Masters in Development Finance and my thesis will be on the impact

of urbanisation on human development. This is a passion for me – I believe the only way we can build Africa is when the private sector partners with government.”

Lithon is more than a company simply driven by commercial success. Adriaan Grobler has successfully installed a belief that by helping others solve problems and making a difference in their lives, you can address the need for social upliftment while achieving business success. The Otavi Steel Plant project is a perfect example.

Creating jobs, driving trade, and making a difference in the lives of many Namibians.

WWW.LITHON.COM

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THEBE TOURISM GROUP

TTG Celebrates SA History with

Unique New Attractions PRODUCTION: David Napier

Thebe Tourism Group is preparing to open two extremely exciting new attractions to help further its reputation as a world-class provider of South African tourism draws. A unique hotel in Kruger National Park and a guest house situated in a former residence of Nelson Mandela are just two of the investments that are helping this booming business grow in 2019. www.enterprise-africa.net / 89

INDUSTRY FOCUS: TRAVEL & TOURISM

//

In 1892, work on the Selati Rail line began. Cutting right through the area that is today known as the Kruger National Park, the rail line was intended to connect the rich gold fields in Limpopo’s East, to the port in Maputo (known then as Delagoa Bay). Close to the camp village of Skukuza, the builders of the rail line had to construct a bridge to cross the Sabie River. While construction of the rail line was dogged by corruption and maladministration in its early days, it was eventually completed in 1912 and connected at Komatipoort to the important Eastern Railway Line which brought gold from the Witwatersrand Gold Fields to Delagoa Bay for export.

For decades, the Selati Rail line was the only way to get into and out of the Kruger National Park. Tourists would board the train and head into the park, stopping for the night on the Sabie Bridge, hearing stories from

park wardens and feasting, before continuing the following day. The line was active until 1973 before operations were ceased with travellers choosing the more convenient and common car for transport.

Today, the Sabie Bridge still stands and is a reminder of the important history in the region. In order to preserve the bridge, and bring some contribution to the local community, the Thebe Tourism Group (TTG) has decided to construct a hotel on the bridge, bringing much-needed activity to the area.

Founded in 2001 as a 100%-owned subsidiary of Thebe Investment Corporation, TTG is the oldest black-empowered South African tourism group and has a significant portfolio in tourism and related industries ranging from attractions, hospitality, inbound and outbound tourism, group travel, car rental and business tourism.

KRUGER SHALATI HOTEL In a move which is highly anticipated

by South Africa’s thriving tourism industry, TTG is under way with a build programme that will see the Sabie Bridge restored, a strong of permanent stationary train carriages positioned atop it, and the carriages fully fitted out as a hotel. The Eastfacing wall will look over the river and further into Kruger Park, with guests able to view the sun and moon rises from their room. Instead of the usual office-type setting that you might find at a regular hotel reception, the Kruger Shalati Hotel will make use of the existing Kruger Selati station platform for guests to check in and dine. This area will also be accessible for guests staying in adjacent accommodation in Skukuza.

“It’s going to be a 32-42 bed hotel with two people for each bed. It is set over one of the most iconic rivers that runs through the Kruger National Park

Africa’s Travel Indaba is going green For a few days every year, the African tourism industry comes together for Africa’s Travel Indaba. Indaba, as the trade show is fondly called, is the event to attend – recognised as the continent’s largest tourism marketing event, and one of the top three ‘must visit’ events of its kind on the global calendar. It takes over the entire Inkosi Albert Luthuli Convention Centre (Durban ICC) and the Durban Exhibition Centre (DEC) attracted 1 747 registered buyers, and over 7 000 visitors and 1 100 exhibitors in 2018.

It’s a big event which means it’s likely to have a big environmental impact, so South African Tourism’s (SAT) announcement that they are going to make it a more positive impact through sustainable event management, also known as event greening, has been widely welcomed.

Amanda Kotze-Nhlapo, Chief Convention Bureau Officer, explains, “South African Tourism recognises the importance of hosting events in a responsible manner and which address the triple bottom line of people, planet and prosperity.”

This isn’t the first time SAT has implemented event greening at one of its events. With guidance from the Event Greening Forum (EGF), a non-profit organisation that promotes sustainable events, SAT has been greening its business tourism show, Meetings Africa. These efforts haven’t gone unnoticed. Since 2012, Meetings Africa has won every annual Green Show Award from the Exhibition and Event Association of Southern Africa (EXSA).

The Event Greening Forum Chairperson, Greg McManus, says, “We have been honoured to fulfil an advisory role for Meetings Africa over the years. The SAT team have always been very receptive to our recommendations and to adopting new initiatives, which they have done with great results. We are looking forward to continuing this partnership and success with Africa’s Travel Indaba.”

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This experience bodes well for Indaba, but it is a much larger show. So how will they do it?

Kotze-Nhlapo says that the first step was to conduct an assessment of the show; “This year a baseline assessment was done at Indaba 2018 to gain a better understanding of the environmental impact of the event. This information will be used to develop an event greening strategy that can be implemented at future Indaba events.”

Grace Stead, a sustainability consultant and founder of Steadfast Greening, was contracted via the EGF to carry out the assessment. One of her favourite expressions is “you cannot manage what you cannot measure”. The data she gathered on Indaba 2018 will be critical to mapping out an effective event greening strategy.

However, no one wanted to miss the opportunity to add some event greening practices to Indaba this year. Fortunately, the show organisers and infrastructure providers – Synergy Business Events and Scan Display, respectively – have both worked on Meetings Africa, and were able to draw on their experience to implement the following: An innovative Sustainability Village was created to showcase talented local artisans and SMEs, and their handcrafted goods. All of the items on display were made in South Africa and inspired by local culture and traditions, while some also had a strong sustainability ethos, such as using recycled materials. Instead of traditional gifts, SAT gave gift cards to delegates, allowing them to select their own gifts from this space.

This is perhaps the best example of large scale responsible gifting that has been implemented at an event, in terms of it meeting all three criteria of eco-procurement, social upliftment, and avoiding the unnecessary waste of unwanted gifts.

Re-usable elements were created for the show. Synergy Business Events’ MD, Tiisetso Tau, says, “During the planning phase of Africa’s Travel Indaba 2018 the team looked at ways in which to incorporate the three R’s (Reduce, Reuse and Recycle) where possible.”

By designing re-usable branding and structures rather than single use items for 2018 only, the event waste could be reduced.

Justin Hawes, the MD of Scan Display, says, “For the Sustainability Village, we created modular structures out of raw wood and African fabrics. Two thirds of them were re-used from the Meetings Africa show earlier this year, and they will be re-used over the coming years.”

He adds that a lot of branding was generic, for example using vibrant African fabrics or brightly coloured vinyl panels without any printing on them. This means it cannot date and is more likely to be used again and again.

Special non-scuff vinyl was also purchased to create re-usable floor markers.

The executive exhibitor packages also gave exhibitors re-usable fabric prints. Says Tau, “The artwork provided was printed on fabric. Once the show was concluded, exhibitors were able to take these off their stands, roll them up, place them in their suitcase, and use it at any other events they wish to.”

A different approach to ‘breakdown’ was adopted by the Scan Display crew.

Hawes says, “In the industry we call the dismantling of the show ‘breakdown’. It’s chaotic, as there is very little time to clear the site, and we often have to take down large, complex builds. So, unfortunately, as the name implies, things get broken. As an industry we need to change the way we do this. It should be called deconstruction, or de-rigging. More time should be allowed for it, so more care can be taken to extend the lifespan and re-usability of the building materials.”

He adds, “For Indaba 2018, we had a bigger team and longer for the dismantling of the show infrastructure.

As a result, we could take everything apart in such a way that it is well maintained for future events.”

Of course, this is just the start. Once a clear strategy is put in place for 2019, even greater strides can be made to improve Indaba’s sustainability footprint. Who knows, Africa’s Travel Indaba might be giving Meetings Africa some stiff competition for future green awards.

Africa’s Travel Indaba will take place on 2 – 4 May 2019 at the Inkosi Albert Luthuli Convention Centre (Durban ICC).

For more information please visit https://www.indaba-southafrica.co.za/

INDUSTRY FOCUS: TRAVEL & TOURISM

// THE COUNTRY HAS BEEN PERFORMING REALLY WELL FROM A TOURISM POINT OF VIEW. OUR BIGGEST CHALLENGE REMAINS THE DOMESTIC IMPACT // – the Sabie River. It’s a train that sits over the bridge and we believe that there isn’t anywhere else in the world where you can wake up and look East, straight into the sun from almost every room in the hotel, with the river running underneath,” TTG CEO Jerry Mabena tells Enterprise Africa.

“It will sit 17 metres above the

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river and when the animals come to drink, you can see them straight from your own bed.

“We submitted the bid to build the hotel in 2016 and we were awarded the contract. We are now at the point where we are working and finalising some of the finer details of the design elements.

“It’s under R100 million in terms of investment but the iconic status of the project is the thing that drives us. We think there is a lot that rides on it and while there are a couple of high-end hotels in the Kruger, there is nothing that matches the status of our project.

We think it will create a new energy and a new hype,” he says.

Set to welcome first guests at the end of 2019, the Kruger Shalati Hotel is aiming to create a bush atmosphere, similar to the environment that would have greeted guests 100 years ago

when Kruger’s first Warden, James Steven-Hamilton, received tourists on the train.

Thebe Investment Corporation CEO, Sizwe Mncwango says that TTG has positioned itself as a tourism business that understands South African and African heritage with an unmatched ability to package aspects of this heritage into tangible tourism products for distribution to the domestic and international tourism markets.

TTG Marketing Manager and GM of the Kruger Shalati Hotel, Judiet Barnes says of the train on a bridge project: “Not many people realise that this is where tourism to Kruger started – in the early 1920’s the only way to visit Kruger was by rail; the train would stop in this exact spot. This is likely to become a favourite experience for both international and local tourists.”

Also helping to improve the

THEBE TOURISM GROUP

tourism offering across the local region, TTG has acquired 1400 hectares of additional land close to the Sabie, in partnership with a land claimant community, which is being converted into accommodation, agricultural and nature reserve land.

“We have a number of things that we are doing in the area - on the tourism side and on the food and agricultural side,” explains Mabena.

“There will be a lot of activity that we will be putting into that region beyond the Kruger Shalati, but it will certainly become a flagship being the smallest of all in terms of headcount but the largest in terms of reputation.

“We are putting up tourism facilities which includes a boutique hotel along the river, a gateway to the Kruger, and we are looking at putting up a tented hotel (120-150 guests) to create a different type of offering.

“The plan is to convert a large portion of that land, which was agriculture, into a nature reserve.”

This project, known as the Manela Gateway, holds the vision of

// WE BELIEVE THE COUNTRY’S TOURISM POTENTIAL HAS ONLY JUST BEEN TICKLED, AND BY CREATING PRODUCTS WHICH ENHANCE THE SCENIC BEAUTY AND GLOBAL POLITICAL IMPORTANCE, MORE PEOPLE WILL BE ENTICED TO EXPLORE TOURISM OFFERINGS IN SOUTH AFRICA //

creating an interactive experiential destination in support of Kruger National Park while bringing community ownership of a protected wildlife area to the forefront.

DRIVING TOURISM The number of international tourist arrivals in South Africa is set to hit 19.5 million p/a by 2022. The figure has been rising consistently for more than a decade. In 2006, just over 10 million people visited South Africa from abroad, and that figure was up to almost 17 million in 2018. But, while the numbers are impressive, Mabena says stats could be catalysed in a big way if South Africa can muster its domestic tourists to improve their involvement in the country’s tourism industry, even if it is only just slightly.

“The bigger picture for us about driving Afropolitan engagement,” he says. “The Afropolitan market is your higher earning, black South Africans who are really rising into new economic structures and are beginning to have disposable income to do many things including travel.

We are targeting that market and creating products that talk to that market. From a South African point of view, that is a market that we have not targeted as much as we believe it should be.

“The country has been

performing really well from a tourism point of view. Our biggest challenge remains the domestic impact. South African’s travelling locally is a big area of challenge, but a big area of opportunity that we have chosen to focus on. International travellers are looking for major, iconic destinations whereas domestic travellers will look for something different and are happy to travel into the far-reaching areas of the country.”

South African tourism has received significant attention, as a sustainable job creating industry, and government has voiced its ambition to rapidly expand the sector so that as many South Africans as possible can participate. In 2018, international travel as a whole showed significant growth – the fastest growth since 2010 – with 1.3 billion people moving around. Africa as a whole was a beneficiary of the growth, with its new single air market and easing of visa regulations strategy making for a more conducing travel climate.

Even with challenging economic and political situations across various geographies, and in international economies, TTG is committed to driving the industry for its participants and for South Africa.

“We have said to ourselves that we do recognise the challenges in the economy but at Thebe we have a

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INDUSTRY FOCUS: TRAVEL & TOURISM

Jerry Mabena - Thebe Tourism CEO

role to do certain work which is of a developmental nature and to create sustainable economies, particularly in rural areas. We create our own energy in those spaces and we really help the people in those economies.

“We are driven by profit with purpose. We don’t just do things to make money. We do things that build the people around us while we make money,” says Mabena.

A GROWING CONCERN Creating unique African experiences, and specifically South African experiences, that are memorable, manageable and attractive to domestic visitors and those from around the world is no easy feat. For generations, people have travelled to South Africa for its established natural beauty spots, and TTG recognises the need to both promote and care for these valuable assets.

In 2015, TTG purchased the final stake in the Cape Point Concession,

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making it the sole owner famous destination. Located in the Cape of Good Hope, one of Africa’s southernmost tips, Cape Point is close to the region where Atlantic and Indian Oceans meet.

“Our visitors can be assured of our continued excellence on site.

Thebe Tourism Group is eager to improve activities at the site in order to enhance the visitor experience,” said Mabena.

“With some of the things we are doing outside of the Kruger, especially in Cape Town, we really are trying to find the opportunities to create worldclass hubs. Right now, we are at the beginning of our journey and happy to be achieving our goals.”

Mabena is also excited about the development of the Mandela Presidential Centre in Houghton, Johannesburg. The Centre, which is close to completion, will become a tourist centre with meeting facilities and a boutique hotel, designed to promote reflection.

The décor is reported to be very similar to how the house between 1992 and 1998 when Mandela was active and living in the building. In partnership with the Nelson Mandela Foundation, TTG will develop the

// WE BELIEVE THAT THERE ISN’T ANYWHERE ELSE IN THE WORLD WHERE YOU CAN WAKE UP AND LOOK EAST, STRAIGHT INTO THE SUN FROM ALMOST EVERY ROOM IN THE HOTEL, WITH THE RIVER RUNNING UNDERNEATH //

THEBE TOURISM GROUP

nine-bedroom hotel and it is hope that guests will take inspiration from his life. Aimed at the top-end of the market, the centre is expected to attract scholars and diplomatic corps as well as high-end leisure travellers.

“Nelson Mandela was a walker and a traveller who made a difference in the lives of those he met and those he travelled with. He had an impact on the places he touched and left a part of His beloved land wherever he went.

May we continue to be the travellers who make a difference. The Mandela Presidential Centre will be a reflection of this – we are delighted to be able to open the doors to Madiba’s former residence and look forward to sharing it with the world. We could not have wanted a more fitting partner than Thebe Tourism Group in honouring the Mandela legacy in this project,” said Sello Hatang, CEO of Nelson Mandela Foundation.

Mabena added: “We are extremely excited at taking on a truly unique

project in with such an iconic status.

We believe the country’s tourism potential has only just been tickled, and by creating products which enhance the scenic beauty and global political importance, more people will be enticed to explore tourism offerings in South Africa.”

THE FUTURE IS BRIGHT With investments from public and private sector bolstering South Africa’s already magical tourism offering, now is the perfect time for this important industry to come to the forefront of the economy and contribute even further to meaningful transformation. If this happens, TTG can expand its reach throughout southern Africa.

“We are currently focussed very heavily on the South African market, but we want to be world-class. We believe we can be a world-class African company and when people visit us, we want them to experience the

same service they would experience anywhere else in the world.

“The business itself - from the days when we had a grant of R100,000 to start the organisation, to where we are now - is up to R4.8 - 5 billion in terms of market value. That is a summation of all of the investments that we have – listed and unlisted. We have invested in certain entities and disinvested in others and we are moving strongly into the attraction space,” says Mabena.

For this CEO and for TTG, positivity is the order of the day, every day.

“When all is said and done, we do believe that the future is only brighter. We are certainly of the school of thought which suggests that South Africa is still at the beginning of an exciting journey,” he concludes.

WWW.THEBETOURISM.CO.ZA

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PETRA DIAMONDS

Petra Holds All the Jewels PRODUCTION: Timothy Reeder

Petra boasts a diversified portfolio of world-class mines which have produced some of the world’s most important and valuable diamonds to date. The recent announcement of leadership changes, along with enviable interim results, gives much cause for excitement for the future of the independent diamond mining group.

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Loading in operation at the Koffiefontein open pit

INDUSTRY FOCUS: MINING

//

Having blossomed from a junior diamond explorer with a market capitalisation of less than £10 million in 1997, to a leading independent diamond mining group today, Petra’s portfolio comprises four producing operations, and of these, three can be found in South Africa. The fourth is Williamson, Tanzania’s only significant diamond producer based upon the 146-hectare Mwadui kimberlite pipe.

Finsch is South Africa’s second largest diamond operation by production, after De Beers’ Venetia mine, and in 2017 passed 50 years of operations, at which time it had produced nearly 50 million carats. “For a mine to reach this milestone is significant,” COO Luctor Roode told us.

“We’re still going strong and hoping to see many more years added to the life of the mine.”

Cullinan is, again, among the world’s most celebrated diamond mines, not least for having been the source of the two largest stones in the British Crown Jewels. It has gained renown for being a source of large, high-quality gem diamonds, as well as being the world’s most important source of very rare blue diamonds.

Petra was celebrating a profitable decade at Koffiefontein last time we covered the third of its South African diamond mines. Mining first started at Koffiefontein over 140 years ago, and this remarkable longevity is testament to its quality. Petra’s success has always been down to its focus on value rather than volume production, optimising recoveries from a highquality asset base in order to maximise their efficiency and profitability. The

// OUR FOCUS REMAINS TO CONTINUE TO DELIVER OPERATIONAL- AND CAPEX EFFICIENCIES AT ALL OF OUR OPERATIONS //

A team discussion at a waiting place underground at Koffiefontein

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approach has seen it amass one of the world’s largest diamond resources of nearly 300 million carats.

CHANGE AT THE TOP The group announced in February that, as of April this year, Richard Duffy had been elected as the man to foster further growth as Petra’s new CEO, bringing with him 27 years’ experience in mining in both open pit and underground mining having led multiple large-scale mining operations across Africa.

“I am delighted to have been appointed CEO of Petra Diamonds,” Duffy commented. “I look forward to working with a very capable team that has grown the business and laid the foundations for delivering on the recent capital investment programme.”

Petra’s Chairman, Adonis Pouroulis, added: “We are extremely pleased that Richard will be joining Petra Diamonds.

He brings with him an impressive depth of global mining experience which we believe will be critical to drive Petra’s transition from a phase of intensive capital

PETRA DIAMONDS

expenditure and expansion to a focus on steady-state, cash-generative operations.

“We are deeply grateful to Johan Dippenaar for all of the work he has done over the past 14 years to lead Petra through a long period of significant growth and establishing the company as a leading independent diamond producer.”

PLEASING PERFORMANCE Production figures for Petra for the six months ended 31 December 2018 made for pleasant reading, up 10% to 2,019,147 carats and with full year production guidance of ca. 3.8 - 4.0 Mcts maintained.

// PETRA HAS DELIVERED SOLID PRODUCTION IN THE FIRST HALF OF FY 2019 UNDERPINNED

BY A CONTINUED IMPROVEMENT IN SAFETY PERFORMANCE //

Revenue was also on the up, by 8% to US$207.1 million, and the number of diamonds sold increased 15% to 1,736,357 carats.

While Koffiefontein’s run-of-mine (ROM) production remained flat at 25,275 carats, this was negatively impacted during the period by the community unrest concerning municipal service delivery, operational challenges relating to plant availability and a lower than planned grade recovered.

However, since the start of January 2019 additional crushing capacity has been introduced to the plant, employee attendance has normalised and monthly production is expected to ramp up over January to the levels observed in Q1 FY 2019.

Results were also somewhat marred by volatility in Cullinan’s product mix, a feature associated with complex orebodies such as Cullinan’s, which yielded prices at the lower end of historical ranges - a 4% downward movement and around US$10 million shortfall in revenues.

There was continued strong operational performance at Williamson with two good quality pink stones recovered post Period end which are

expected to be sold in February 2019.

“Petra has delivered solid production in the first half of FY 2019 underpinned by a continued improvement in safety performance,” summed up outgoing CEO Johan Dippenaar.

“We are seeing production reaching consistent levels while our focus remains on the delivery of operational and capex efficiencies in order to generate positive free cashflow and subsequent debt reduction.

“Whilst we delivered solid production and continued to improve our safety performance in the first half, we recognise the impact the lower value of the product mix at Cullinan had on our financial results for the period,” Dippenaar concluded.

“During the second half, we will accelerate the installation of drawpoints to improve access across the full footprint of the C-Cut Phase 1 block cave.

Our focus remains to continue to deliver operational- and capex efficiencies at all of our operations.”

WWW.PETRADIAMONDS.COM

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BLUE SECURITY

Minimising Danger In Durban PRODUCTION: William Denstone

Blue Security is a Durban born-and-bred company, taking care of home, community and business security needs. The private security industry in South Africa is among the largest in the world, and Blue Security continues to harness the latest in technology to keep itself safely positioned at the top of the pile.

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INDUSTRY FOCUS: SECURITY

//

As Durban’s leading security provider, Blue Security can draw on almost 30 years of protecting its people and assets to keep them safer than ever. The careful forging of a brand known for being trustworthy, responsible and delivering service excellence has been instrumental in separating it from the abundant competition in the security arena.

SECURE GROWTH In recent years there has been an explosion of growth in the private security industry, not only in South Africa, but also in the rest of the world.

The private security industry in South Africa, though, is among the largest in the world, a fact closely linked to the rising number of high-wealth individuals in South Africa in comparison with the rest of the continent.

Estimates put the number of registered companies at over 9000, and

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the sector employing more than half a million registered active private security guards. This is alongside a further 1.5 million qualified, but inactive, guards, figures which represent many times the available personnel of the South African police and army forces combined.

A steadfast commitment to its central values and being synonymous with reliability has kept Blue Security ahead of the rest, to date, in an industry worth somewhere win the region of R40 billion.

“Reputation is what separates us,” then-Managing Director, now CEO, Hank van Bemmelen, told us last February.

“We drive our brand, deliver excellent service and ensure that we remain community-focussed. We are here to fight crime and nothing else.

“Our core values comprise care, ownership, passion and service and when you get those right, everything else falls into place.”

Blue Security’s policy of constant

// CRIMINALS ARE CONSTANTLY CHANGING THEIR STRATEGIES AND IF WE DON’T KEEP AHEAD OF THEM WE WILL GET LEFT BEHIND // innovation has allowed it to be behind some of the key developments in the security industry in recent memory. Among many others, smart control systems, habitation imitation technology and outdoor beam detection systems have been gamechanging advancements in client and property safety.

“We are beyond the technology where you punch in a code to turn

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INDUSTRY FOCUS: SECURITY

the alarm on or off - everything is now mobile,” van Bemmelen explained. “We are in a space now where we need to adapt to stay in touch with that type of technology. CCTV, video monitoring and picture verification are the big things coming through the business.

“Criminals are constantly changing their strategies and if we don’t keep ahead of them we will get left behind.”

UNDER THREAT? It seems counterintuitive that an industry which has, on so many occasions, shown itself integral to South African society may face turmoil, but this could be a danger as a controversial new bill awaits a Presidential signature into law. The chief criticism of the legislation centres on the Minister of Police’s power to expropriate up to 100% of a foreign-owned security company, and limit foreign ownership of private security companies to 49%.

However, passing this bill in its current form would almost certainly impact upon the private security

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industry as it currently exists. Economist Roelof Botha, speaking to the City Press, estimated that if the bill is signed into law more than 800,000 jobs across various sectors would be lost, as well as about R133-billion of the country’s GDP. “The evidence shows empirically that private security is contributing to the public good,” said Julie Berg, associate professor at the Institute for Safety Governance and Criminology at the University of Cape Town. “There’s a very blurry difference between a private interest and a public interest – they overlap a lot and that’s where the State is resistant to the idea that anyone other than the public police can do that.”

The most recent Stats SA Victims of Crime survey found that the most feared type of crime is house robbery.

In addition to this, the Victims of Crime survey showed public’s faith in the police’s ability to solve crimes has steadily fallen.

In 2011, 64% of people had confidence in the police; this figure dropped to 58.8% in 2015/16. “Crime

// WE DRIVE OUR BRAND, DELIVER EXCELLENT SERVICE AND ENSURE THAT WE REMAIN COMMUNITYFOCUSSED // is rising on a daily basis… police don’t have the resources. People go into private security because they know the police can’t be all over,” commented Andre Rushin, an armed response officer for Secupro Armed Response in Mitchells Plain.

Parliament passed the bill in 2014 after it was talked by former police minister Nathi Mthethwa for reasons of national security, since when it has been awaiting presidential attention.

“When the president came in, he requested an audit of all the bills that need to be assented, and this is

BLUE SECURITY

among them,” explained spokesperson Khusela Diko.

“Ramaphosa also requested advice on the bill from the State Security Agency and we are awaiting an opinion for it,” was the conclusion for the time being.

ON THE SCENE While Durban does, unmistakably, have all the elements to seriously challenge Cape Town and Johannesburg as one of the most elite cities in South Africa, the local police force is still fighting hard to win its war on crime – largely down to the extent of criminal activity which occurs on the beachfront.

Such is the perceived problem that an immense R39 billon has been plunged into targeting the city’s worst offenders.

The city finds itself plagued by four primary crime types, according to South African Police Service (SAPS) data for 2017/2018. Common robbery, theft from motor vehicles, non-residential robberies and property-related crime are all on the rise; Durban Central has

the second highest rate of car and motorbike theft in the entire country, while damage to homes and living areas is another scourge.

Fortunately for all, the sheer number of times that Blue Security finds itself on hand with swift action means that the Durban public are in increasingly safe hands after all.

So often, a crime reported in the news will culminate in Blue Security heroism, and more often than not that crime will be one of the big four currently blighting Durban.

Blue Security spokesperson, Andreas Mathios, described just at the end of January how an alleged shoplifter was arrested on the Durban beachfront after a theft from a shop.“The officer responded to the scene of the crime, tracked the suspect down and recovered the shoes,” he said. “The suspect was handed over to Durban Central SAPS members at the scene.”

In the same period, an armed response officer was able to arrest an

alleged housebreaker. “The suspect climbed over a back wall and broke a window before forcing open a burglar guard to gain entry into the house.

When our officer arrived at the scene he spotted the suspect climbing out over the back wall. He gave chase and managed to arrest him,” Mathios stated.

Durban can be sure it is in safe hands, then, with Blue Security around.

“I have a lot of passion to make a positive change in the world,” Hank van Bemmelen told IOL at the time of his appointment as CEO last October. “My first priority is that the business must fight crime and as in any business our people are our priority.

“It will always be in your blood to fight crime,” van Bemmelen wisely concluded, and Blue shows no signs of quitting any time soon.

WWW.BLUESECURITY.CO.ZA

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EXHIBITION CALENDAR

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

SEAMLESS AFRICA MAR 12-13 | CAPE TOWN Seamless is the region’s leading payments and commerce technology conference and exhibition. The event has separate conference agendas covering the world of Payments, Fintech, Ecommerce and Retail, with one shared free-to-attend exhibition hosting the region’s leading technology providers.

Seamless Southern Africa will once again bring together the payments, fintech, retail and ecommerce innovators from across the continent to explore the newest trends and showcase the most cutting-edge innovations within the industry.

By bringing together thousands of commerce professionals, this is an unparalleled opportunity to experience new innovations in the market, first hand.

NAACAM SHOW 2019 MAR 12 - 14 | DURBAN Leaders of the automotive and component manufacturing, the largest manufacturing sector in South Africa and Africa gather bi-annually to discuss, showcase, engage and network around the big issues and opportunities in the sector. Join 1600+ industry colleagues in March 2019 for the NAACAM Show.

The NAACAM Show welcomes all stakeholders in the automotive value chain, including non-NAACAM members. It is endorsed by the local vehicle manufacturers, through the National Association of Automobile

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Manufacturers of South Africa (NAAMSA), Automotive Supply Chain Competitiveness Initiative (ASCCI), Department of Trade and Industry (dti), National Union of Metalworkers of South Africa (NUMSA) and the Durban Automotive Cluster (DAC).

ENERGY EFFICIENCY WORLD AFRICA MAR 26 - 27 | JOHANNESBURG With increasing electricity prices and supply concerns, property owners, architects and large energy users, including mines, commercial property developers, industrial manufacturers and retailers are continuously looking to source cost-effective and sustainable energy efficient and lighting solutions.

Their most urgent need right now is to identify and evaluate the appropriate energy efficient and lighting solutions to help them achieve their business objectives and limit the vulnerability of being reliant on the grid. The 6th annual Energy Efficiency Show Africa (co- located with The Lighting Show Africa) caters to this need. Dedicated to showcasing the latest services and innovations to improve energy efficiency and lighting in Africa, this is the industry’s go-to event.

The Energy Efficiency Show Africa featuring The Lighting Show Africa, is the leading marketplace and ideas exchange platform for this market as well as for related industries – all hungry for innovative and efficient solutions.

SEAMLESS AFRICA CAPE TOWN ICC MAR 12 - 13 PROPAK AFRICA EXPO CENTRE, NASREC MAR 12 - 15 DECOREX DURBAN DURBAN ICC MAR 21 - 24 ENERGY EFFICIENCY WORLD AFRICA SANDTON CONVENTION CENTRE MAR 26 - 27 NAACAM SHOW 2019 DURBAN ICC MAR 12 - 14 CESA INFRASTRUCTURE INDABA 2019 DURBAN ICC MAR 06 - 07 COMPACK NIGERIA LANDMARK EVENTS CENTRE, LAGOS MAR 19 - 21

THE ALL-NEW NISSAN PATROL. THINK BIG. BIG ON LUXURY | BIG ON POWER | BIG ON TECHNOLOGY visit nissan.co.za