Enterprise Africa October 2020

AFRICA

THE BUSINESS MAGAZINE FOR AFRICA’S INDUSTRY LEADERS

October 2020

www.enterprise-africa.net

Crossfin Enters Level 1 in ‘Really Promising’ State Exclusive interview with Crossfin Technology COO Anton Gaylard

ALSO IN THIS ISSUE:

Autotrader SA / Alligator / Dis-Chem / African Underground Mining Services

EDITOR’S LETTER

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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 James Davey  jamesd@enterprise-africa.co.za PROJECT MANAGER Chris Wright  chrisw@enterprise-africa.co.za PROJECT MANAGER Chris Fairhurst  chrisf@enterprise-africa.co.za FINANCE MANAGER Chloe Manning  Chloe@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

Published by Chris Bolderstone – General Manager E. chris@cmb-media.co.uk Rouen House, Rouen Road, Norwich NR1 1RB +44 (0) 1603 855 161 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 2020

With the country still recording thousands of new Covid-19 cases each week, and unfortunately hundreds of deaths, it is now crystal clear that businesses have a long-term issue to deal with. The thought that the situation might abate as time passed has proven to be false.

Now, companies must plan for the much longer-term with their reactive and recovery strategies. Yes, vaccines are close, but they remain rushed and uncertain. Even when the roll out begins, it will be some time before adoption is large enough to consider the problem solved.

However, it’s not all bad news. At its core, the problem is simply another challenge that businesses must adapt to. This is something that every entrepreneur quickly becomes adept in.

Juggling different issues while problem solving and jumping hurdles is the life that every business faces – now is no different.

With that in mind, we talk to some that have done things right. Those that have turned the corner and are now starting to operate in a more normal way, with more normal projections. Crossfin Technology is a great example.

A fintech provider across southern Africa, this business was fast to change strategy and is now reaping the benefits.

COO Anton Gaylard tells us that the year is actually looking like it will end up quite positive. Alligator, custom product specialists, adapted its operations to assist South Africa with the problem. MD Stephen Marks tells us that the company produced more than a million face masks during lockdown and is now planning to grow as demand returns. Art, design, manufacturing and fashion business Carrol Boyes was already reeling after losing its founder and CEO in 2019, but the company picked up two international awards in the first half of 2020, proving that by focussing on quality there can be some light in these dark times.

While it will remain tough for some time, there are always opportunities in southern Africa, and many businesses are already taking advantage. Let us know how your company is changing. LinkedIn and Twitter is where you’ll find us.

Joe Forshaw EDITOR

GET IN TOUCH  +44 (0) 1603 855 161  joe@enterprise-africa.co.za www.enterprise-africa.net

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8/ CROSSFIN TECHNOLOGY Crossfin Enters Level 1 in ‘Really Promising’ State After finally entering lockdown Level 1 in a strong position, Crossfin Technology is taking the ‘glass is half full’ approach to business, choosing to be optimistic about the future. This ambitious fintech investment company is refusing to let negativity dampen its spirits and is planning for a strong end to 2020.

8/ 4 / www.enterprise-africa.net

CONTENTS

14/

INDUSTRY FOCUS:FINTECH 8/CROSSFIN TECHNOLOGY Crossfin Enters Level 1 in ‘Really Promising’ State

40/CARROL BOYES Synthesis Between Art & Function Proves Perfect Business Model

INDUSTRY FOCUS:RETAIL

INDUSTRY FOCUS:AUTOMOTIVE

14/DIS-CHEM Innovation Helps Healthy Dis-Chem to Serve

46/AUTOTRADER SA Searches Surge During Lockdown

INDUSTRY FOCUS:MANUFACTURING 22/THE BEVERAGE COMPANY Drinks Still Pouring at The BevCo 28/ALLIGATOR Trust Alligator for One Stop Shop Solution 34/BSI STEEL Seasoned BSi Steeled for Strong Growth

INDUSTRY FOCUS:MINING 52/AFRICAN UNDERGROUND MINING SERVICES Resilient AUMS Remains Contractor of Choice in Africa INDUSTRY FOCUS:FINANCE 60/SURESWIPE Safe Cashless Virtual Vouchers to help Revive Retailers

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THE FOSCHINI GROUP BUYS 382 JET STORES

The Foschini Group (TFG) has officially bought 382 stores of the Jet business from Edcon.

In July, TFG entered into an agreement to buy certain commercially viable stores and selected assets of Jet for R480 million.

4800 Jet stores’ staff will now become employees of TFG. Currently, TFG has 29 retail brands across clothing, footwear, jewellery, sportswear, homeware, cell phones,

and technology products, from value to upper market segments, in more than 4085 outlets across 32 countries.

Group Chief Executive Officer Anthony Thunström was pleased with the deal and said TFG would be able to boost Jet using technology.

“Our strategic focus is on driving sustainable economic growth through successful businesses and investment in retail, local manufacturing and digital transformation, as well as skills

development in Southern Africa. Jet ticks every one of these boxes – it is a great brand, it will support further localisation of supply chains and the business will be able to benefit from TFG’s advances in digital transformation,” he said.

The group had initially anticipated acquiring approximately 371 Jet stores in five countries, but it will now take on close to 425 stores in total.

CSIR MARKS 75 YEARS OF INNOVATIVE EXCELLENCE Higher Education, Science and Innovation Minister, Dr Blade Nzimande, has congratulated the Council for Scientific and Industrial Research (CSIR) for its contribution in shaping the country’s science, engineering and technology landscape.

The Minister’s message comes as the CSIR marked 75 years of conducting research aimed at improving the quality of life of all South Africans on 05 October 2020.

The council was established through an act of Parliament in 1945 with the organisation’s executive authority being the Higher Education, Science and Innovation Minister.

Within a few months into the

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COVID-19 pandemic in South Africa, the CSIR repurposed some of its laboratories in support of government’s drive for a massive roll-out of testing and is one of the leading organisations in the development of much-need ventilators and rapid testing kits; and the tracking and tracing Covid-19 cases across the country.

“Over the years, I have been observing, with great pride, the work that the organisation does; work that has made a huge contribution to our country. We are proud of what the CSIR has achieved in the past 75 years through science, technology, engineering and innovation.

“We also pay tribute to the

leadership; the scientists and all the support staff, who over the years, particularly since the new dispensation into our democracy, have passionately, and are continuing to contribute to the transformation of the organisation,” he said.

“The CSIR has been committed to pushing boundaries in our quest for excellent research, technological innovation, and industrial and scientific development. This is evident in the many sectors of our economy that you are impacting through the support you provide to government and the citizens, addressing the majority of the focus areas outlined in the National Development Plan,” he said.

NEWS SNAPSHOT

President Cyril Ramaphosa officially launching of the Mooikloof Mega Residential City (photo GCIS)

MOOIKLOOF MEGA CITY TO ADDRESS HOUSING FOR “MISSING MIDDLE” President Cyril Ramaphosa has launched the Mooikloof Mega Residential City in Tshwane, Gauteng, which is geared to address the housing needs of the “missing middle”.

Launched by the President on Sunday, the public-private partnership development seeks to assist the missing middle -- people who earn too much to qualify for fully subsidised housing but who don’t earn enough to afford debtfinanced housing in areas of their choice.

The President was joined by the Public Works and Infrastructure Minister Patricia de Lille; Human Settlements, Water and Sanitation Minister, Lindiwe Sisulu; Gauteng Premier David Makhura, City of Tshwane Administrator, Mpho Nawa and Balwin Properties CEO, Stephen Brookes, at the launch.

The Mooikloof Integrated Development is the outcome of a successful public-private partnership between the developers Balwin Properties, the provincial government and the City of Tshwane.

The development has a total project value of over R84 billion and is one of the 62 Strategic Integrated Projects (SIPs) that were gazetted at the end of July.

The listing of the SIPs followed the inaugural Sustainable Infrastructure Development Symposium (SIDS) in June, which managed to unlock over R340 billion in private sector investment in key economic sectors.

“That we are already seeing the brick and mortar results of this strategic infrastructure project is immensely encouraging.

“...When I said last year that we must Khawuleza or hurry up in meeting our people’s needs, the City of Tshwane and the province took heed,” said the President.

The first phase of the project is residential developments, and some 50 000 sectional title units are planned.

Once completed, the Mooikloof Mega City may end up becoming the world’s largest sectional property development, with land also earmarked for schools, shops and offices.

“I once again congratulate all who have made this occasion possible.

What we are seeing is impressive indeed, and I look forward to seeing this form of integrated development being expanded to all parts of the country,” said the President.

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CROSSFIN TECHNOLOGY

Crossfin Enters Level 1 in

‘Really Promising’ State PRODUCTION: Manelesi Dumasi

After finally entering lockdown Level 1 in a strong position, Crossfin Technology is taking the ‘glass is half full’ approach to business, choosing to be optimistic about the future. This ambitious fintech investment company is refusing to let negativity dampen its spirits and is planning for a strong end to 2020.

8 / www.enterprise-africa.net

INDUSTRY FOCUS: FINTECH

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In the second quarter of 2020, the South African economy contracted by 51%.

This represented one of the largest shrinkages ever recorded. The national lockdown put in place to curb the spread of coronavirus was the key driver, with household spending slumping by almost 50% while stores and other businesses were forced to close. The environment was similar around the world, but South Africa’s already weak economy was ill prepared for such a drastic contraction.

Many jumped on the news and tried to contextualise to demonstrate that the situation is not as bad as it seems and that the figures must be viewed as part of a wider picture, but most agreed with Statistician-General Risenga Maluleke who descried the development as a severe punch in the gut for the country’s economy.

However, while times are certainly challenging for many, those that have been nimble and prepared effectively are already beginning to see green shoots. Crossfin Technology, a leading African independent fintech group that backs innovative companies focussed on solving specific everyday pain points that are not adequately covered by existing products in the market, has felt the impact of lockdown and has had to make changes within its portfolio. But Chief Operating Officer, Anton Gaylard is positive about the future and tells Enterprise Africa that Crossfin is already seeing an upswing.

// IT GOES TO SHOW THAT WHEN YOU HAVE TO WORK, YOU WORK REGARDLESS – THERE WAS ALWAYS ACTIVITY GOING ON TO FEED MOUTHS AND PAY BILLS // 10 / www.enterprise-africa.net

HOPE FOR THE BEST “We were quite fortunate as we took the stance of ‘plan for the worst, hope for the best’,” he says.

“Coming through the Covid experience as the lockdown levels are reduced, all of our businesses are doing better than the worst-case scenario, and some are already back to the budget levels of pre-Covid. Those that were most effected are now back to 80-90% of pre-Covid volumes. It has been a nice bounce back, and we are happy and comfortable with where every one of the businesses are.”

South Africa entered Level 1 lockdown on September 21 and the subsequent freedom restored movement and activity which has helped businesses to rebuild. Although Stats SA suggested that even finance – usually a robust sector, able to weather many storms - did not escape the contraction. “The finance industry, which includes banking, insurance services, real estate and business services, fell by 28.9%,” Stats SA said.

“The businesses in our group that were focussed on serving SMEs have felt the brunt of lockdown, particularly those in the payments and lending side of the business,” admits Gaylard. “The SMEs that they would normally service were either completely shut down or trading way below par.

“Those that service enterprise clients and the financial services sector were able to weather Covid a lot more resiliently than those that service the SME sector, but across the board are trading really well at the moment.

Funnily enough, those that trade in the informal market are actually trading ahead of budget. It goes to show that when you have to work, you work regardless – there was always activity going on to feed mouths and pay bills.

In the main, we are very happy with how the portfolio has performed in these trying times and there seems to be a lot of activity, interest and opportunity in the different businesses – particularly in the last month. Things

// ALL OF OUR BUSINESSES ARE DOING BETTER THAN THE WORST-CASE SCENARIO, AND SOME ARE ALREADY BACK TO THE BUDGET LEVELS OF PRE-COVID // are boding really well for the financial year that is coming.”

Moving forward and Crossfin is choosing to be optimistic. The group made up of Retail Capital, Adumo (which includes SureSwipe, Innervation and iKhokha), Saratoga, Crossgate Holdings (which includes Crossgate Technologies, Kinektek and Efficacy Payments) and Crossfin Ventures (which includes TrueID, Atura, BXchange iMali, Nobuntu and Clandestine) - is emerging from lockdown slowly but in a secure position as it continues to serve clients without interruption. Although the daily activities of the portfolio never ceased, operations behinds the scenes had to change.

“We only started to lift our heads as we came into Level 2 as we started seeing the return of SMEs to trading. 85% plus of those are now back trading and those that are still closed are waiting for Level 1 to fully materialise. Of course, there will be some fallout, but the glass is either half full or half empty. You have to be cautious in your outlook and we will take the glass is half full view but be cautiously optimistic. We understand that the Covid situation will not be over anytime soon, we are trying to manage the risk and look at the opportunities that present themselves, because there are many opportunities,” says Gaylard.

“Most businesses moved to a work from home mode, except where there was a call centre involved. There, it

CROSSFIN TECHNOLOGY

was reduced to rotational teams, and offices have been reduced to a place where people are looking for space, connectivity and quiet times where they can go to work if they want to rather than feeling compelled to go.

“We have been able to work really well remotely,” Gaylard adds. “In fintech, we are used to making the most of technology, we are used to working remotely, and if you look at our business at Crossfin group level, all of the company’s primary home bases are in South Africa with head offices in Cape Town, Johannesburg and Durban so we were invariably operating remotely at some point in time pre-Covid.”

He says that the key to switching working environments is a change in mindset. If this can be achieved, then success in a remote working set up is easy to come by. He even suggests that,

in the future, Crossfin could downscale its office presence significantly and operate any shared working space as more of a social space, more as a ‘club house’ where people can come together to share ideas and engage pro-actively, rather than somewhere people are forced to attend between certain hours each week.

12 TO 18 MONTH’S INTERRUPTION The positivity experienced by Crossfin is certainly welcome, but the difficulty of 2020 so far has, as with all businesses, pushed out the company’s strategy timeline. Pre-Covid, Crossfin had set itself the target of becoming the leading independent fintech provider in Africa by volume and value by 2022.

“We have taken a view that it could take 12 to 18-month’s longer to reach our big hairy audacious

goal (BEHAG) because of the Covid situation but we are not phased, there’s a lot of positive momentum.

“We are beyond worst case scenarios that we had planned for.

None of the businesses will perform as badly as what we had put down as a worst- case scenario and from a shareholder perspective, we have made sure that each of the businesses were supported and well-funded should they have experienced a worst case scenario. The fact that they have all well outperformed that worst case scenario is really promising,” says Gaylard.

For Crossfin, the realisation that its businesses have come through the challenges reasonably unscathed (so far) is very welcome. During the early stage of lockdown, the board came together to look at what the organisation as a whole could offer to

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INDUSTRY FOCUS: FINTECH

support the country. The government was looking for support in distribution of funding, the public were desperate for money to flow, and businesses were eager for some sort of support. By grouping the service provisions across the Crossfin portfolio, a comprehensive package of support was proposed but ultimately not utilised.

“Certain bits of the portfolio participated in certain elements of relief type solutions, but nothing came through in mass from a national or governmental level where we could really put clout behind something to help out, and that was a little disappointing,” admits Gaylard. “They relied on incumbents to deliver what was required and the result was long delays initially. If they had of turned to some new independents that were well positioned and ready to help, we could

12 / www.enterprise-africa.net

have done things very quickly. A lot of passion, time and effort was put out to say that we are here to help but it wasn’t taken up in the volumes we would have hoped for but the intent was good and the teams helped where they could.”

ACQUISITION TRAIL After acquiring SMME funding business Retail Capital in 2018 and card payment acceptance company Sureswipe in 2019 and fintech start-ups BxChange iMali and truID earlier in 2020, Crossfin remains hungry for growth and, after coming out of lockdown successfully, is on the lookout for further acquisition opportunities in the short-term and long-term future.

“There are three transactions underway at the moment,” explains Gaylard. “One material transaction at a Crossfin portfolio level, one within

a portfolio company and one at a Ventures level but I cannot talk about those yet. Two we started working on before Covid and we put them temporarily on hold so that we could understand where things were going and have now picked up again. The other, we started engaging as we entered lockdown and we continued throughout as it is an opportunity which we are excited about. They will all be finalised this year.”

In order to achieve its vision of

// ACROSS THE PORTFOLIO, WE ARE ACTIVE IN 13 AFRICAN COUNTRIES IN SOME SHAPE OR FORM //

CROSSFIN TECHNOLOGY

being the leading independent African fintech group, Crossfin is also looking across the continent for opportunity.

“We have been looking at a couple of investments outside of South Africa and we did get quite far down the road with one but Covid has slowed that down. Our strategy for next year will be to make one or two acquisitions outside of South Africa but in Africa.

It has always been part of our general strategy. Across the portfolio, we are active in 13 African countries in some shape or form. With the networks that we have here in South Africa, there are so many opportunities that come knocking on our door so it can become hard to lift our heads and look north of the border but it is certainly our intent.”

Of course, before any major progress can be made, advancements must be made globally to eradicate the Covid-19

issue. While South Africa has moved down through lockdown levels, there remains a high number of people testing positive for the virus and this continues to strangle the movement of money within the economy, albeit at a slower rate compared to the first half of the year.

However, all at Crossfin can rest assured that the senior management team has been through tough trading conditions before and has experience in navigating the most difficult of environments.

“As a team, the first was the 2000 dotcom crash. The second was the major 2007/08 financial crisis, and now we have this. There have also been a few storms in-between. We have been together in some shape or form through all of those and we have always been very quick to respond,” confirms Gaylard.

“We got the portfolio planning and prepping within a week and ensured

we had the hatches battened down. It was also a great opportunity to ensure businesses were streamlined and were thought through in terms of processes and efficiency. Then we had to hunker down and support businesses as best as we could until we got into Level 4 and Level 3 so we could plan to come out on the front foot.”

While the stories and figures spark fear regarding the economic picture in South Africa, Crossfin acts as an example and proves that there are still shining lights in the market. Now more than ever, it is important to plan as much as possible while seeking out and taking advantage of opportunities, and that is exactly what Crossfin is doing.

WWW.CROSSFIN.CO.ZA

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DIS-CHEM

Innovation Helps

Healthy Dis-Chem to Serve PRODUCTION: David Napier

Dis-Chem now refers to orders through its website that contain certain items as the ‘Corona-identified basket’. Hand sanitisers, disinfectant wipes, alcohol solution, masks, cold and flu medicines and immune boosters have become staple but as demand has surged, Dis-Chem has managed to continue supplying those in need. www.enterprise-africa.net / 15

INDUSTRY FOCUS: RETAIL

//

As lockdown measures ease in South Africa – moving from Cyril Ramaphosa’s Level 4 to an ‘advanced Level 3’ on June 1 – more and more people get back to work in order to help the country move forward. As employers welcome people back, safety has never been of higher concern. There is now a shared responsibility – globally – for everyone to do their part to keep each other safe. In the workplace, this means safe spacing, hand sanitising, face covering, advanced cleaning, and more. If people feel sick, there is now an expectation to display responsibility and stay at home, even if it could impact you financially. In South Africa (at time of writing) almost 2% of people who contract the virus will die. Globally, available data suggests that most people who pick up the Coronavirus suffer mild symptoms before making a full recovery.

Nevertheless, precautions must be taken to avoid unnecessary fatalities and serious cases which strangle healthcare systems.

Louw Nel, Political Analyst from independent political and economic research organisation, NKC African Economics, stated recently that South Africa’s harsh lockdown has allowed time for the health sector

// WE WILL REVIEW THE SITUATION ON A REGULAR BASIS AND WILL CONSIDER REOPENING THE TESTING FACILITIES ONCE WE ARE ASSURED THAT THE VARIOUS LABS CAN COPE WITH DEMAND // 16 / www.enterprise-africa.net

to get ready for what is certainly a lengthy battle against the virus.

“The lockdown has given the health sector time to prepare for the inevitable surge in infections, and the coming weeks and months will severely test the plans and contingency measures put in place during this period as South Africa gets back to work,” he said.

In the workplace and in the community, hand and respiratory hygiene remains essential in the containment of the virus and the World Health Organisation continues to urge individuals and businesses to do everything possible to ensure cleanliness.

South Africa’s leading pharmacy and health business, Dis-Chem, has positioned its brand as the go-to supplier for everything needed to shield against and kill Coronavirus. Founded in 1978

by Ivan and Lynette Saltzman, Dis-Chem has grown to become a Southern African powerhouse in its industry, commanding a retail network of more than 160 stores and a flourishing online business.

Designed around its ‘Pharmacy First’ idea and an ‘Everyday Low Prices (EDLP)’ strategy, Dis-Chem was thriving before the pandemic and is now an essential link in South Africa’s frontline fight against it.

PRE & POST Like most businesses, looking back is now a pre and post pandemic onset activity. Pre pandemic, Dis-Chem had continued to do what it had become famous for doing for so long, growing exponentially.

For the 12 months ending 29 February 2020, the company displayed good results which it put down to good Return on Invested Capital (ROIC) and cost control.

Group revenue was up 12% to R24 billion and total income increased by 9.8% to R6.8 billion. The company rolled out new stores and continued to claim market share.

CEO Ivan Saltzman was optimistic in what was already a constrained macroeconomic environment.

“The Group continues to report revenue growth ahead of market growth. Overall revenue was 12% higher at R24 billion, which was on the back of a 10% increase in revenue growth in the previous financial year.

Retail revenue rose 11% to R21.8 billion with like-for-like retail sales growing 4.0%, which is commendable considering selling price inflation of 2.2%. Retail gross margins improved, with dispensary margins under pressure in a competitive market.”

But by the end of February the picture was about to change. By March 5, the first case of Coronavirus

INDUSTRY FOCUS: RETAIL

had been confirmed in South Africa following the initial discovery in December in China.

As the pace of change quickened, major adjustments were required in all businesses and Dis-Chem was no different. Demand for products soared as the public hunted for hand sanitiser, face masks, medicines and more. But on 26 March President Ramaphosa announced complete lockdown for an initial period of 21 days to contain the spread of the virus.

Listed as an essential business, DisChem was allowed to stay open but conditions were imposed. Saltzman’s tone changed.

“The Group approached the end of our financial year in February 2020 amid growing concerns about the rapid spread of the coronavirus and its potential impact. Since then, the

world has been turned upside down by this pandemic and its devastating economic, health and social consequences,” he said.

Looking to the future, he was buoyant about post-lockdown opportunities for digital innovation and praised the business for its resilience.

“The past financial year can be characterised by the continued weak macroeconomic environment in South Africa that has severely constrained consumer spending, and which has been evident in the declining basket size and spend. I am very pleased, however, that our focus on ROIC, cost control, operational adaptability and strategic agility has provided some benefit in this extremely tough trading environment. These factors have all, ultimately, resulted in DisChem reporting positive results with

R

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improved market share across all our core categories.

“Overall, the COVID-19 lockdown period has seen a revolution in terms of Dis-Chem’s e-commerce programmes. There was sales growth of 375% on these platforms during March; sales increased 262% month-on-month in April, while the first two weeks of May saw another exponential surge of 490%. Although this phenomenal growth has originated on the back of the situation presented by COVID-19, we were

// AS DIS-CHEM, WE ARE WELL PLACED TO BE PART OF THE SOLUTION //

DIS-CHEM

already leveraging our e-commerce strategy and innovation, which is led by our overall purpose of winning and retaining patients and customers. Our intent remains on increasing our store footprint, while driving secondary retail opportunities through innovation. We are, for example, enhancing customer convenience through our courier pharmacy DisChem Direct and our 325 in-store, corporate and travel clinics. We also have Click and Collect in every store and we intend to continue investing in ongoing enhancements to our e-commerce platform.”

THE SHOW MUST GO ON Like all businesses, Dis-Chem has had to adapt and continue – even as many were told to stay away from stores and hold up inside – and this has resulted

in invention and resourcefulness.

Dis-Chem has a number of schemes which have continued throughout the current crisis and this is testament to the size and desire of the company to be an integral player in everyday life.

In May, the Dis-Chem foundation donated 5000 blankets to people in need to help them stay warm during the winter. Dis-Chem social media channels promoted health and well-being tips to ensure natural immunity in people remained strong. The company partnered with other big businesses to ensure rewards schemes were available to help with purchasing. The likes of Momentum Multiply, Discovery Health, Legacy Lifestyle and more are all now onboard. Also in May, the Dis-Chem Random Acts of Kindness Movement promised three

months of R150,000 donations to help Afrika Tikkun feed those in need. The Dis-Chem Foundation also partnered with FutureLife to serve 50,000 healthy meals to children in need. Children were able to receive important vaccinations at DisChem Well Baby Clinics – vital for stopping the spread of flu and other conditions. The company continued its support for the Million Comforts scheme in which businesses match the purchases of sanitary products and donate to underprivileged girls, helping them to stay in school. DisChem was also instrumental in the construction of a new water source in Dixie, Mpumalanga where the only water came from an unsanitary river. To celebrate Mandela Day, Dis-Chem donated 6800 masks to smaller organisations that could not

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INDUSTRY FOCUS: RETAIL

// THE GROUP APPROACHED THE END OF OUR FINANCIAL YEAR IN FEBRUARY 2020 AMID GROWING CONCERNS ABOUT THE RAPID SPREAD OF THE CORONAVIRUS AND ITS POTENTIAL IMPACT. SINCE THEN, THE WORLD HAS BEEN TURNED UPSIDE DOWN BY THIS PANDEMIC // afford PPE to help curb the spread of Coronavirus. All the way through lockdown, Dis-Chem was steadfast in its continuation of discount products and loyalty rewards to ensure people could get what they need – not an easy task while navigating a business environment which changes daily.

Perhaps Dis-Chem was better placed than most to see out this crisis considering the nature of its

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activity, but the fact remains that the Coronavirus pandemic came as a totally unexpected hurdle and needed fast, efficient and effective interventions to ensure safety or staff, customers and continuation of business. All things considered, the company has done very well in all aspects as it continues to serve South Africans in a changed marketplace.

“As Dis-Chem, we are well placed

to be part of the solution,” Saltzman said. “We have the largest and most consistent clinic offering and we are expanding the service scope of our Clinic sisters as well as investing in Telemedicine technology across all our clinics to increase the reach and reduce the costs of specialist services for patients. I am excited about the fruition of our vision for Dis-Chem, to play a significant role in bringing affordable healthcare to the many South Africans that are in need.

“Our many strategic advantages will ensure that we transition through this period as a united team and emerge even stronger than before COVID-19.”

The next hurdle for the business to jump will be the reinstatement of the its Coronavirus drive through testing facilities in Gauteng which

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DIS-CHEM

were taken offline and halted indefinitely because of a backlog at labs, impacting the speed of results.

“We are constantly following up with the various laboratories, but they are being forced to prioritise urgent

// OUR MANY STRATEGIC ADVANTAGES WILL ENSURE THAT WE TRANSITION THROUGH THIS PERIOD AS A UNITED TEAM AND EMERGE EVEN STRONGER THAN BEFORE COVID-19 //

hospital tests. The number of labs that can do the tests is limited and we are spreading our load across as many as possible. Another factor affecting the speed of testing and obtaining results is the reduced number of flights around the country, so transporting tests to the labs from outlying cities and other remote stations is delayed,” said Lizeth Kruger, Dis-Chem’s national clinic manager in a statement.

“We apologise for the delays and assure our customers and public that we are doing everything in our power to get results to them as quickly as we can.

We will review the situation on a regular basis and will consider reopening the testing facilities once we are assured that the various labs can cope with demand. The pandemic and the rising numbers are leading to panic, and we urge consumers only to get tested if they develop symptoms,” Kruger added.

Importantly, face masks, hand sanitiser, antibacterial hand wash, virus killing cleaning products, healthy products that boost immunity, and much more continue to be made available to people through Dis-Chem through various channels to make things safer and easier for customers. Dis-Chem is changing, and like the business environment in South Africa, things are happening fast. Fortunately, this is an organisation with the means and ambition to stay up to date and in line, all the time caring for people’s health.

WWW.DISCHEM.CO.ZA

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THE BEVERAGE COMPANY

Drinks Still Pouring

at The BevCo PRODUCTION: David Napier

South Africa’s leading independent manufacturer and distributor of carbonated soft drinks, energy drinks, mixers and still beverages has proven its ability to overcome challenges many times in the past and is now ready to continue delivering for local communities at an affordable price.

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INDUSTRY FOCUS: MANUFACTURING

//

In 2018, a new soft drinks company was formed after the merger of several strong local players. The Beverage Company was born after the combination of Little Green Beverages and Softbev – both industry leaders and powerful brand owners in South Africa. Softbev had a strong presence in Gauteng, Kwa-Zulu Natal and the Western Cape thanks to subsidiaries Shoreline and Quality Beverages; and Little Green Beverages was strong in the Eastern Cape, Mpumalanga and Gauteng.

Among the brand owned by Little Green Beverages and Softbev was Coo-ee, Jive, Refreshhh, 7UP, CapriSun, Mountain Dew, Pepsi and Pepsi Max. With this mighty portfolio, five excellent manufacturing plants, 1000 employees and nationwide coverage, The Beverage Company (The BevCo) had quickly built a presence that might one day challenge the market leaders.

SPARKLING SECTOR The industry was in a good place.

Soft drinks as a segment incorporates energy drinks, sports drinks, teas,

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water, juices and carbonated soft drinks. In 2017, the market had total revenues of $7,191.8m, growing at a compound annual growth rate (CAGR) of 7% since 2013. 2017 saw 9,096.2 million litres consumed, a CAGR of 5.3% since 2013. The industry was growing and The BevCo was looking to capitalise on new trends and a boom in demand from certain demographics.

Europe, North America and the Asia Pacific regions represented the largest geographies for the industry and, while on a small contributor, Africa had massive growth potential. South Africa in particular was attractive for international brands thanks to its modern retail infrastructure, as well as good bottling operations.

In November 2019, James Quincy Global CEO and Chairman of The CocaCola Company completed a tour of African operations and commented on the immense potential in the region.

“Having operated in Africa for over 90 years as a local business in every country, we believe Africa is a region that will increasingly influence the growth trajectory of our global

// THE BEVERAGE COMPANY IS SOUTH AFRICA’S LEADING INDEPENDENT MANUFACTURER AND DISTRIBUTOR OF CARBONATED SOFT DRINKS, ENERGY DRINKS, MIXERS AND STILL BEVERAGES // businesses in just a few years,” he said.

“It is clear that Africa is indeed a region that will increasingly influence the growth trajectory of global businesses and we have taken some bold measures to strengthen the Coca-Cola System in Africa for long term growth, enhancing our capacity to continue to win in the continent’s increasingly competitive landscape.”

Of this, The BevCo wholeheartedly agrees with its rival. “One of our driving forces remains relevance in the local communities. We want to find ways to contribute that are relevant to our communities and impacts on them,” former CEO Michael Benjamin told Enterprise Africa in 2019.

Today, The BevCo remains committed to its community targets and uses its brand mix to ensure customers have quick and easy access to the drinks they want.

“Our brands represent some of the most loved local hero and global champion beverages in South Africa and abroad,” the company states. “Each has its own heritage and personality, some formed through South African culture and others through international influence. All our brands have become trusted household names that are of superior quality. We strive to enhance the lives of our consumers by offering choice and variety at an affordable price.

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INDUSTRY FOCUS: MANUFACTURING

Eastern Cape Production Plant

“With a national footprint and distribution supply-chain, we provide customers and consumers with high-quality beverages at a more affordable price.”

But even with this promise at the forefront of all minds in the business, there was no avoiding fallout from the Covid-19 pandemic.

Five manufacturing plants, which were set to be upscaled, had to ensure new safety strategies were implemented.

Delivery and retail networks were slowed, and the system struggled as people in South Africa were forced to stay at home while the worst of the virus spread was contained.

FRESH NEW CHALLENGES All but essential retailers such as supermarkets and pharmacies were closed and this route to market for The BevCo products caused a headache for leadership. Even many of the countries small spaza shops were closed while

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// WITH A NATIONAL FOOTPRINT AND DISTRIBUTION SUPPLY-CHAIN, WE PROVIDE CUSTOMERS AND CONSUMERS WITH HIGH-QUALITY BEVERAGES AT A MORE AFFORDABLE PRICE // the number of people visiting stores declined dramatically.

Fortunately, drinks were part of the essential group of products allowed to move restriction free during lockdown. The FMCG industry was hit hard by the lockdown with retailers having to find innovative new ways of serving customers – such as e-commerce, emailing of shopping lists to stores for collection, mobile payment, and contactless collection – and where manufacturing plants were forced to close, the industry was left with a big problem.

Massmart suggested that half yearly losses could be 42%, Pick n Pay warned that first half annual

profits would be down by half, and in September the grim news that the South African economy – already struggling pre-Covid – had shrunk by 51% as a result of the lockdown.

But it was not all bad news.

Digital retailers including the likes of Uber, Netflorist, Takealot and more report huge surges in demand. For The BevCo, at its heart, this problem is simply another hurdle to overcome.

“There have been headwinds over the past few centuries and people have found ways to thrive, growing really sustainable and powerful companies,” Benjamin said.

A major challenge came back at the end of 2017, just as The BevCo

THE BEVERAGE COMPANY

Isando Johannesburg DC

was preparing its launch as a new company. Water in Cape Town was running out and the dreaded ‘Day Zero’ – the day when drinking water in the city would officially dry up – was fast approaching. Businesses and the general public were urged to take preventative measures immediately.

As a major water user, the company new it must act.

“We embrace the premise of a ‘good corporate citizen’ and actively consider and implement initiatives which positively impact the lives of our staff, their families, our communities and the environment in which we work,” The BevCo said.

“We believe that business can support the upliftment of society and that our activities should align with the government’s economic development policies.”

The business quickly implemented changes at its Cape Town facility.

“Severe drought and water shortages have been experienced over recent years in the Cape region of South Africa. Accordingly, we have been thinking smarter about our water usage, which is good for the environment and – of course – good for business. The successful implementation of numerous initiatives has resulted in: Our water usage ratio has reduced from 1.8 litres water per litre product to 1.3, putting this facility as one of the best in the world for this measure; and cost savings of over R1.8 million since Jan 2017.”

Clearly, The BevCo is a problem solver and within its subsidiary businesses, it has the experience to overcome challenges and ride out the storms in the economy. Thanks to its hard work pre Covid, the organisation now holds a strong position through its brands and its manufacturing plants, and because of its size, it has the ability

to meet the needs of the community.

“The Beverage Company is South Africa’s leading independent manufacturer and distributor of carbonated soft drinks, energy drinks, mixers and still beverages. [We] produce a wide spectrum of own brand, private label and franchise brands. All are equally important to our business. We strive to enhance the lives of our consumers by offering choice and variety at an affordable price,” the company says.

And with the future looking so bright for the industry pre-Covid, there is now no reason that The BevCo cannot regain momentum and continue to “build an African legacy of true excellence.”

WWW.THEBEVERAGECOMPANY.CO.ZA

www.enterprise-africa.net / 27

ALLIGATOR

Trust Alligator

for One Stop Shop Solution PRODUCTION: Manelesi Dumasi

By becoming a one stop shop for clients needing branded merchandise, Alligator has built lasting relationships and a reputation for quality that has helped it to continue through the Covid-19 pandemic while building lean capacity for the future. “Investing in creativity is of paramount importance,� Managing Director, Stephen Marks tells Enterprise Africa. www.enterprise-africa.net / 29

INDUSTRY FOCUS: MANUFACTURING

//

Founded 66 years ago in Cape Town, custom product specialist, Alligator, has grown significantly and is now an industry leader in design, manufacturing, sourcing and supply of promotional and retail products. The company works from its manufacturing facility in Epping to provide a one stop shop for companies looking for branded products and corporate marketing that goes beyond the traditional. The likes of Nedbank, KFC, Coca-Cola, Nissan, BMW, Canon, DHL, Discovery, Vodacom, KPMG, and many more have chosen Alligator as a trusted marketing partner.

In October 2018, Managing Director and second-generation family leader, Stephen Marks told Enterprise Africa that the company was busy gearing up for expansion to better serve clients, and add to its already strong and star-studded customer base. By investing heavily in technology,

// DESIGN AND INNOVATION ARE AT THE HEART OF OUR BUSINESS MODEL //

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lean manufacturing principles, and the local economy, Alligator would become an internationally renowned organisation that could weather the storms in the SA economy and continue to grow.

“The long-term vision is to maintain steady year-on-year growth at competitive prices, whilst providing a safe and secure environment for all staff to work and grow,” he said.

Today, much progress has been made. Like its namesake, the company is sharp, efficient, agile and strong.

CLAWING MARKET SHARE By investing heavily in lean principles, Alligator has managed to handle all aspects of business faster and has seen the company move towards a more corporate set up.

“We have moved on from a family run business to a much more professional and structured operation,” explains Marks. “We have invested heavily in human capital to ensure improved customer service and satisfaction. This has led to the business developing a strong senior management team, one capable of managing the business in a completely professional manner with or without the founding family.”

The company now works towards to the vision: ‘To be the brand that creates products that bring our customer’s brands to life’, and the mission statement: ‘Alligator prides itself on exceeding customer expectations through the design and supply of creative product and merchandising solutions underpinned by ethical business practices for the benefit of all stakeholders’.

Since October 18, there has been expansion of the product range to help the Alligator brand grow among clients old and new.

“Alligator is now even better positioned to offer an even better and more efficient one stop shop solution for customers where brand identity is of the utmost importance,” says Marks. “In addition to our already extensive service offering, Alligator is proud of our end-to-end service offering for client uniforms.

All products are meticulously designed in-house to best represent each individual customer’s needs whether the customer is a fast food chain or a bank. Thereafter, the program becomes one of stock control, quality control, complaints management and ultimately client service in quick turnaround time to pick, pack and deliver.”

By adding new technology to this process, real time data is now available which is beneficial for both Alligator and its clients.

“During the lockdown where revenue dropped significantly, we put our focus into our new cloudbased ERP system, a project we commenced 12 months prior to the lockdown. A project such as this is a huge undertaking, but the rewards have been massive. All our ‘full solution on-line shop clients’ now have live data being pushed through to the website - such as stock on hand - as well as the ERP system pulling information from the website directly into our ERP system e.g. sales orders,” details Marks.

ALLIGATOR

LOCKDOWN BITES Like so many organisations, the lockdown period in South Africa has infringed on the business of Alligator in a big way. Retailers, manufacturers and FMCG companies have been put under extreme pressure while the flow of money in the economy was effectively halted.

But the manufacture, sourcing, and distribution of premium branded goods forms a vital part of many marketing strategies.

Branded merchandise leaves a lasting impression – the Promotional Products Association International regularly undertakes research which reveals that distribution of promotional products is advertising you can feel. The PPAI states that 88% of people remember the advertiser on a promotional product. Research

also suggest that promotional products are ideal for creating awareness with 82% of people saying they own one and 47% saying they have kept them for over a year.

According to Promotional Products Work, a campaign that involves tangible promo materials is the only advertising your customers will thank you for. With this in mind, Alligator could not simply stop or pause its work. Instead, the company adapted to the environment and delivered vital products for clients.

“Since Covid and lockdown, Alligator has obviously been impacted like all other companies,” admits Marks. “In April when lockdown was first introduced, we converted our bag manufacturing facility into a mask manufacturing facility. We invested more capital in

// INVESTING IN CREATIVITY IS OF PARAMOUNT IMPORTANCE // dye sublimination printing machinery which gave us the opportunity to produce face masks for all our major clients. This proved to be a successful investment as we went on to produce more than one million face masks.

“Now that Lockdown in SA is at Level 2, we have definitely seen an upswing in revenue. It will take some time to get back to the levels of last year, but we are definitely getting there.”

All facilities at Alligator are stateof-the-art and prior to the Covid-19 outbreak, the business had invested in new machinery, upgrades, lean

www.enterprise-africa.net / 31

INDUSTRY FOCUS: MANUFACTURING

consultants and human capital. This helped position the business strongly for any eventuality.

“The factory has made huge strides over the past year thanks to continued support from both the DTI (Department of Trade and Industry) and our lean manufacturing consultants,” highlights Marks.

“We have focused our efforts on transforming the factory into a firstclass manufacturing facility. DTI has given support with the purchase of the latest and most modern machinery giving the factory every chance of being able to compete on a worldwide scale. We are continuously looking for new technological advances to improve not only the factory but also every aspect of the supply chain. This, together with our lean consultants’ advice on how to implement best production practices is starting to bear fruit. Obviously,

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the long-term goal is job creation in a happy and sustainable workplace environment. This must be South Africa’s main goal, employment.”

OPPORTUNITY IN CHAOS? Over the past three decades, Alligator and the Marks family at the helm have overcome social, economic, political, financial and technological change and the company now sits proudly atop the market in South Africa. Many business threats have come and gone, and Alligator has survived and thrived through all. By creating new partnerships, looking at new opportunities, being innovative and agile, and by focussing on ethical business practices, the company will continue through the Covid crisis and the economic decay, always continuing to deliver.

“Both the political and economic environment in South Africa still offer

unique challenges. Things can change very quickly. A political comment or the slightest concern of corruption can have a major impact on the ZAR from one day to the next and as Alligator is a net importer this can have a devastating effect on the performance of the company,” says Marks. “This brings a whole lot of challenges when you are a trading company.

“In addition, the world in general is in a state of turmoil. Whether it be the political landscape in the US, Brexit, trade wars between nations; all of these things frighten away investment in developing nations and this is of grave concern. However, by re-inventing ourselves and finding new avenues of business, we have managed to continue with our strong growth trend. One thing for sure though, no matter what challenge is thrown at us, the management team and staff are ready for it.”

ALLIGATOR

// EVERY THING WE DO STARTS WITH A CONCEPT OR AN IDEA // There are many examples of Alligator’s nimble and bold approach. The launch of the company’s uniform offering in 2019 showed ambition and allowed Alligator to further a longstanding desire to enter geographic markets across the continent.

“With the development of the uniform offering our reach into Africa has increased and we have managed to make inroads beyond sub-Saharan Africa into East, West and North Africa.

We have also experienced considerable growth in our CrossTrade business between China and many East and West African countries,” says Marks.

Product development has also advanced as clients look for evermore technical and exciting

opportunities. “Design and Innovation are at the heart of our business model. Everything we do starts with a concept or an idea.

Investing in creativity is of paramount importance,” confirms Marks.

“Climate change has been a major consideration when it comes to both product development and how we run our business. Whether it be waste control, energy efficient infrastructure or energy efficient product development (e.g. solar lanterns). There has definitely been a drive towards biodegradable and eco-friendly products from a creativity perspective and a push towards these products from a customer perspective.

This is the way of the future.”

In manufacturing, a sector that has been decimated in South Africa

over the past decade (Stats SA reported a ninth consecutive month of decline in manufacturing in February when a 2.1% year-on-year decreased was published), Alligator is proof that with ingenuity and innovation there is always opportunity to be found.

As the Covid-19 pandemic passes its peak in SA, now is the time to look to the future and plan for re-growing businesses to be more sustainable and resilient against shocks. For Alligator, this will not be a problem.

WWW.ALLIGATOR.CO.ZA

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BSI STEEL

Seasoned BSi Steeled for

Strong Growth PRODUCTION: David Napier

BSi Steel has 35 years experience to call on when it comes to riding out economic challenges. Over the years, this company has been through the peaks and troughs thrown up by the South African economy on many occasions. Strength and efficiency are at the heart of everything it does, leaving it well-placed to grow again.

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INDUSTRY FOCUS: MANUFACTURING

//

The South African steel industry has been part of the backbone of the country for more than a century. The country’s rich iron ore resources have attracted the attention of multinational businesses, and for many years the sector provided a reliable, steady stream of strong product for the domestic and export markets.

But a heavy cloud has formed over the industry in the past decade. Cheap imports, lacking local demand, steep product pricing, poor quality and infrastructural issues have combined to create worry and stress. With the onset of the Covid-19 pandemic, effectively halting construction projects and mining activity, flattening demand across many industry sectors, steel has been hit hard.

In 2017, the South African Journal of Industrial Engineering floated the possibility of the iron and steel industry going extinct, citing a one third decline in production from a peak in 2006 of 9.7 million metric tonnes. Today, production sits at around six million tonnes – for context, China (the world’s largest producer) has an output of more than 900 million tonnes annually.

Imports are now seen as the major threat to the local industry.

Chinese, Brazilian, Japanese, Russian and Indian companies are selling successfully in South Africa. In 2010 iron and steel imports were at 2.8 million metric tonnes, across a range of different products. By 2014, the number had increased by 113% to

// BSI IS IN A VERY STRONG POSITION TODAY WITH SOME EXCITING GROWTH PROSPECTS FOR THE YEARS AHEAD // 36 / www.enterprise-africa.net

// THE STOCKHOLDING AT OUR KLIPRIVIER WAREHOUSE FACILITY IS SUBSTANTIAL WHICH ALLOWS US TO OFFER OUR CLIENTS RAPID TURNAROUND TIMES // almost six million metric tonnes.

This demonstration of South Africa’s deindustrialisation journey was again unwelcomed by local steel manufacturers. Because of the raft of issues facing businesses, many have been overwhelmed. In 2009, CISCO stopped operations; the AMSA Vanderbijlpark mini-mill plant followed in 2012, and then the AMSA Vereeniging mini-mill plant shut in 2015. In 2016, EVRAZ HSVC also closed its doors.

But the figures don’t make sense. By allowing the steel industry to fail, South Africa is losing a major contributor to GDP, an important creator of sustainable jobs, and a key component across many other trades. Steelmaking represents 1.5% of the country’s GDP and accounts for some 190,000 jobs.

According to the South African Iron and Steel Institute, every 1000t of steel produced locally adds R9.2million to GDP; provides three jobs directly and three indirectly; enables domestic procurement spend of R5.3 million, of which R0.5 million is spent with SMMEs; and gives rise to products that could be fuelling industrialisation.

So, the industry now looks to its well-established players, the government, and local industry partners to ensure it is not allowed to crumble and crack.

One of the key players across southern Africa is BSi Steel. This experienced industry expert has all the knowledge and capability to ride out challenges in the sector while ensuring clients have access to the important products needed to fuel their operations.

HISTORICALLY STRONG BSi Steel first opened its doors in 1985 when William Battershill established Discount Steel selling steel tubing to farmers. After just a few years, the operation grew substantially and entered new markets, building relationships with new steel suppliers all the time. By 1995, the company realised the need to enter Gauteng to become more involved in the larger construction projects in the country’s most densely packed region. Garrison Steel was founded, and the company experienced another strong period of growth as South Africa became a democracy. In 2001, the group was renamed BSi Steel before a new warehouse was purchased in 2002, leaving the company owning two facilities and offering strong processing and distribution capabilities.

In 2007, William Battershill and the management team listed BSi Steel on the AltX exchange in Johannesburg, raising R100m in funding which helped to fuel expansion. First, a new site in Klipriver was purchased, and then construction of a new 36,000 m2 warehouse and office building was completed.

The group’s processing division, Shearcut was established and further processing lines were installed.

The steel reseller was now in a very strong position and continued to push for national and international expansion. Between 2009 and 2014, BSi opened new branches in Ghana and Mozambique, adding to the African presence in Zambia, the DRC and Zimbabwe.

In the build up to the 2010 FIFA World Cup, there was a infrastructure boom in South Africa and BSi Steel

INDUSTRY FOCUS: MANUFACTURING

benefitted, but globally the financial crash was causing havoc and it was only a matter of time before South Africa was engulfed in the turmoil. As the fallout became clear, BSi quickly switched its focus to efficiency, wrapping up operations that were losing money and restructuring to ensure long-term viability. After this period of consolidation, BSi was strongly positioned to ensure low cost but large-scale steel distribution across southern Africa. “BSi is in a very strong position today with some exciting growth prospects for the years ahead,” the company says.

STRENGTH AT THE TOP Under the stewardship of William Battershill, BSi Steel has grown its presence and portfolio and is now an industry leading business, vital in

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the operations of its clients.

The company can offer long, flat and tubing products alongside cold formed and roofing products.

Bronze, brass, aluminium and other materials are part of the range.

The company’s processing division brings coil slitting, precision cutting and medium gauge plate cutting among many other services.

“As a specialist division within the BSi Steel Group, Shearcut prides itself on efficient customer service and accessible technical processing expertise to both internal and external customers, Shearcut is proud to be PWC ISO 9001:2008 certified by the internationally renowned certification body PwC,” the company states.

“Shearcut has over the recent years made significant investments

in terms of high spec machinery and equipment in order to boost the division’s processing capability and capacity. Our professional management and planning team seek to provide a personalised service while offering customers flexibility on lead times and JIT (justin-time) delivery options.

“By working in partnership with you, we are able to help enhance your product performance, improve your efficiency and help you to create more sustainable solutions. The stockholding at our Kliprivier warehouse facility is substantial which allows us to offer our clients rapid turnaround times. For our premium clients we offer a strategic stockholding that will always be available along with other general grades. We provide

BSI STEEL

a JIT service that should reduce client stockholding costs.”

In 2019, BSi Steel gained its Level 4 BBBEE rating from BDO South Africa and continues to support various CSI initiatives, particularly those focussed on skills development. This is a company that always has one eye on the future.

“BSi Steel is committed to being a responsible member of the communities within which it operates. We believe we have significantly improved the lives of our fellow citizens by investing time, effort and money in a variety of organisations and projects,” the company says.

As economic conditions in South Africa have become increasingly unpredictable and unstable, further catalysed by the Covid-19 pandemic,

BSi has been forced into some efficiency strategy adjustments, but remains an active and important supplier to South African and southern African construction and infrastructure projects. The full product range remains available in all areas, and the company is confident its pricing remains competitive.

There are green shoots in the industry and the company has many opportunities to look forward to.

In September, the country’s largest steel producer, ArcelorMittal, said it would refire the second blast furnace at its Vanderbijlpark operations as steel demand increased. Industry analysts put this down to a rebound following the need for projects started before national lockdown to be completed. This will add another 600,000 tonnes of flat steel to output

and the company warned it will still require exports to make the move viable – even while supplying retailers and traders who have low stock after lockdown.

For BSi Steel, stock level is not an issue, distribution is smooth and well-practiced, and the efforts of the DTIC to level the playing field for the SA steel industry are encouraging. Through many economic challenges, BSi has remained strong. This time around it is unlikely to be any different.

WWW.BSISTEEL.COM

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CARROL BOYES

Synthesis Between Art & Function

Proves Perfect Business Model PRODUCTION: Manelesi Dumasi

Carrol Boyes business strategy and guiding principles have surrounded initiating a perfect synthesis between art and function to produce fantastic designs based on the human form. 12 months after he death, the business continues to produce brilliant, artistic products in what is a tough time for the country’s retailers.

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INDUSTRY FOCUS: MANUFACTURING

//

For more than 30 years, the Carrol Boyes business has been creating uniquely South African products, expertly crafted in South Africa, that reflect the personality of its founder.

Internationally acclaimed, Carrol began her career in 1989 after leaving her job as a teacher to focus on the development of her art manufacturing business. She studied Sculpture and Fine Art at the University of Pretoria before moving to Cape Town. Her initial designs were in the jewellery space and were made from clay.

Eventually she began selling copper items on a small scale from home before opening a market stand in Greenmarket Square. After just three years of operation, Carrol Boyes had factories in Limpopo and Cape Town, and the business was blossoming.

By 2019, the Carrol Boyes brand was recognised around the country

and had also stamped its mark on other international markets, namely Australia. With 22 stores in South Africa, availability in 15 David Jones stores, stocked by 130 outlets in Australia, and exported to more than 30 other countries, the special designs dreamt up by the founder have captured the imagination of buyers.

Sadly, in August 2019, Carrol passed away following a brief illness at the age of 65. At this point, she had ensured her interest in the human form, sculpted attractively into useful products had spread throughout the business. She had encouraged diversity and empowerment, but above all creativity. Expanding the reach of the company, she had interests in wine and art as well as home and kitchenware that provides functional beauty.

Before her death, Carrol spoke of the brand and how she was proud of what it had become.

“From the age of nine, I always wanted to be an artist and I think that the business was the end result of

// NEVER BE ORDINARY - BE EXTRAORDINARY AND THROW IN A BIT OF NAUGHTINESS EVERY NOW AND THEN AND KEEP LAUGHING. NEVER LOSE YOUR SENSE OF HUMOUR // years of working towards being the person that I wanted to be,” she said. “I didn’t want to go through my life never testing my creativity. I’d like the brand to continue long after I am gone. It was never my intention for it to grow to the size that it is today – it has surpassed my wildest dreams and I like to know that from a South African point of view, it remains a South African icon and that the South African public can be proud that we have created this brand that can be sold across the world.”

CONTINUED GROWTH Today, Carrol Boyes’ top products include cutlery and dinnerware, office and bar products, home décor, textiles and other accessories.

“My favourite piece of all time is the man water jug – to give that as a gift, I think you’ve got a classic. The other gift that is amazing to give is the soul mate salad servers,” Carrol said in 2019.

When Carrol passed away, her brothers John and Charles stepped in to manage the business. With a strong senior management team, all of whom had dealt directly with Carrol in the past, and clearly understand her direction and desire for creativity, the flair was certainly not dampened. But a steady hand was needed to help guide the business in what was a turbulent economic environment.

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CARROL BOYES

including handbags, sunglasses and other products under a new brand that would complement the Carrol Boyes style of a blend of art and function. There was also talk of introducing electronics such as toasters and kettles to add to the already strong kitchen segment.

“A lot of Carrol Boyes’s customers love displaying their products, which is exactly what we as a company want them to do. And those are the items like a toaster and a kettle that you leave our on your counter that go very well with your canisters and your bread bins and paper towel holders,” said Charles.

However, like for almost all businesses 2020 and Covid-19 has swept in to create difficulty.

2019-2020 YEARS TO FORGET In May, the Carrol Boyes business joined with several others to form

// I DIDN’T WANT TO GO THROUGH MY LIFE NEVER TESTING MY CREATIVITY // the Mid-Sized Independent Retailers (MIR) Group. Because of the strangling of spending as a result of national lockdown, many retailers have been left struggling as customers still fear returning to stores and the socially distanced nature of how retailers must now operate means selling under capacity. The MIR Group is designed to help retailers to survive.

Members includes the Cape Union Mart Group brands, Hi-Tec SA, Toys R Us, Bargain Books, Under Armour, Fashion World, Carrol Boyes, Cellucity, Exclusive Books, Coricraft, Dial-a-Bed,

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“Carrol’s got a massive archive of drawings and design ideas that she left for us. In the last year, when she got sick, she said to me ‘Charles, I’m going to produce enough articles that you don’t have to think about design for the next five years’,” Charles Boyes told the Sunday Times in 2019.

The brothers, who have been involved since the early days, promised to continue with the company’s growth strategy and also hinted at diversification to help attract new, younger customers.

“Our motto has always been ‘we want to be the gift of choice’, but now we want to change that to not only be the gift of choice but to own the home,” said Charles.

In 2019, the plan was to bolster the product range and attract new customers by introducing fashion lines

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INDUSTRY FOCUS: MANUFACTURING

Computer Mania, Crocs, Trappers, Choice Clothing and BT Games.

The group accounts for around 2300 stores across South Africa, and 21,000 jobs. Each business is too small to be considered a major national retailer, and described as non-essential due to the nature of products on offer.

The main aim of the group is to negotiate fair terms with landlords while demand remains suppressed and revenue is unpredictable.

“We are most concerned about the year ahead after the lockdown,” said Jonathan Kingsley-Hall, representative for the MIR Group. “Limited movement, social distancing and constrained trading will be a reality until a vaccine is commercially available. The majority of retailers we represent generated sales in the week preceding the lockdown in March that were sharply below the same week in 2019.

“This poses an extremely high

default risk for thousands of retail shops after the lockdown is lifted, if they are to try to meet the terms of their existing lease agreements.

“The approach taken thus far by the Property Industry Group lacks tenant engagement and the foresight on the frightening reality facing the retail industry. A collective ‘out of the box’ effort to ensure our collective survival is urgently necessary to avert a disaster.”

But it is important to keep focus on the positives during tough times, and while the market may have been drastically impacted by Covid-19, the Carrol Boyes business continues to shine.

AWARD WINNING In March, the company was labelled Best Homeware and Gift Retailer in Build Magazine’s Home and Garden Awards 2020. The UK-based publication developed the awards scheme to recognise the best companies operating within the home and garden space, working to create environments in which people love to spend time.

“The award was a lovely surprise and a great achievement for the

44 / www.enterprise-africa.net

CARROL BOYES

company, and we are so very proud of Carrol. She worked hard and loved doing what she did,” said Michelé Stuurman, group marketing and PR for Carrol Boyes.

“Carrol made a tremendous contribution to the design world, both locally and internationally. What an accomplishment for South Africa, her

// I LIKE TO KNOW THAT FROM A SOUTH AFRICAN POINT OF VIEW, IT REMAINS A SOUTH AFRICAN ICON AND THAT THE SOUTH AFRICAN PUBLIC CAN BE PROUD THAT WE HAVE CREATED THIS BRAND THAT CAN BE SOLD ACROSS THE WORLD //

staff and the countless women whom she empowered over the years.

“Carrol was an inspiration to so many people through her designs and art, as well as her considerable contribution to the community. She added so much value to so many lives in so many ways. We just wish she could be here to celebrate with us. She was, and continues to be, a true South African icon, and nobody deserves this award more than Carrol. We miss her dearly, every day.”

In May, Carrol was awarded the Global Innovation (gia) accolade in the category Home and Houseware Retail 2020.

Established in 2000, the gia calls on the expertise from magazine sponsors in 13 countries with the International Homeware Award created to foster innovation and creative merchandising among home and housewares retailers.

“We are very honoured to receive the award and we see it as a recognition of Carrols’ efforts and as encouragement to not give up on what you love,” the company said.

Clearly, even a year after her passing, Carrol Boyes continues to have an impact on staff, customers and industry onlookers and her designs and business ethos live on. Growing from a single person operation experimenting with something enjoyable and muchloved, the organisation has become internationally renowned. Perhaps that is the key to business success and longevity.

The announcement of her death came with a message to employees within the business: “I have had such fun with you and you have enriched my life greatly. Please remember that we do things differently here. Never be ordinary - be extraordinary and throw in a bit of naughtiness every now and then and keep laughing. Never lose your sense of humour.”

Now, in times of challenge, this message has never been more meaningful.

WWW.CARROLBOYES.COM

www.enterprise-africa.net / 45

AUTOTRADER SA

Searches Surge During Lockdown PRODUCTION: Karl Pietersen

AutoTrader South Africa reports a boom in searches during national lockdown. The number increased dramatically on the previous year as the market hunts for solutions to the problems brought about by Covid-19.

The company also has the solution for retailers as they are forced to change during these times when the brakes are firmly fixed on spending.

46 / www.enterprise-africa.net

INDUSTRY FOCUS: AUTOMOTIVE

//

In March 2018, George Mienie – CEO at AutoTrader South Africa – told Enterprise Africa how the company had succeeded transitioning from a print publishing operation into an online, digital offering, pairing buyers with sellers efficiently and affordably. At the same time, the company’s revenue and profits had grown, and AutoTrader SA controlled a 70% market share - seen as the business for a discerning buyer with research and comparison tools, features and expert video reviews as well as great car finance and insurance deals. This was all backed up by 45,000 classified vehicle listings in 2018, a figure which now sits at over 63,000.

Ditching print in 2017, the company is now regarded as ‘South Africa’s most trusted motoring market place’ and it defends its title by maintaining no transactional

barriers and directly connecting buyers and sellers by displaying a physical address, telephone number, email address and website address.

Accessible through many devices, AutoTrader users visit more than five million times each month and make use of the tools available to find, or sell, their vehicle. In the past 12 months alone, 401 million searches were conducted.

However, 2020 has been the year of absolute change and constant shift. Very few operations have come through the global Covid-19 pandemic without hassle and upheaval. The motoring industry, one already in a state of flux, has certainly faced challenges.

BRAKES ON SALES Globally, new car sales were slammed in the first half of 2020.

The Verband der Automobilindustrie (VDA) — a major German automotive industry body showed massive declines in major international markets including Europe, Japan, USA, Brazil and Russia, and an expectation of total global new car sales dipping by 17% for the full year. In South Africa, the new car market is expected to contact by 20-30%. But there is some optimism across the industry, and those involved are not about the let an

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important GDP contributor die away.

“Our lack of transport infrastructure means South Africans have to drive cars. Without the public transport systems that the UK or US has, they don’t have any choice,” Mienie said in 2018.

Eric Scoble of Auric Auto BMW in Cape Town told Engineering News that some model lines will always have demand, such as the bakkie which needs replacing for agricultural work.

“In May, only 5% of passenger vehicles weren’t used, and by June most vehicles were being regularly used again,” said Michael du Preez, Executive: Product and Marketing at Tracker South Africa. “Under Level 2 restrictions, which started mid-August 2020, the average distance travelled nationally recovered to more than 90% of what used to be normal.”

AutoTrader is looking to continue to provide its services to customers without interruption until stability returns to the market.

“As we stand together in the midst of guiding our businesses into a new future, it is an exciting time to be alive. As a business, we have seen all time high records in consumer consideration, engagement and conversion to our customers,” Mienie said in the AutoTrader 2020 Car Industry Report.

AUTOTRADER SA

OPTIMISTIC OUTLOOK Mike Mabasa, CEO at National Association of Automobile Manufacturers of South Africa (NAAMSA), shared the view of George Mienie, with both stating that now is the time for innovation – particularly around e-commerce and digitising the car buying process.

“This is thanks to the fact that we’re dealing with two cold fronts: the economy and lockdown,” Mabasa said in the AutoTrader 2020 Car Industry Report.

“Companies that prosper going forward” he adds, “will be those that focus on innovation and adapting to customers’ needs. They will need to adapt to the new reality and the new ways of doing things. Those companies that move with the trends and do things differently will

stand the test of time. Prior to 2020, some companies were reluctant to go the e-commerce route. Those that did so quickly are seeing the results now.

Mienie believes it is essential for retailers to analyse the information and take advantage of change.

“It is crucial that we embrace automotive digital retailing as the new normal. The necessity for social distancing has led to a situation whereby car buyers don’t want to necessarily visit physical dealerships. Automotive digital retailing is therefore vital to the future success of any dealership.

It will also open the door for deal structuring elements and processes to be moved online.”

This change in consumer behaviour is not only evident in the

// COMPANIES THAT PROSPER GOING FORWARD WILL BE THOSE THAT FOCUS ON INNOVATION AND ADAPTING TO CUSTOMERS’ NEEDS // fact that people are now encouraged to be socially distant and therefore staying out of retail outlets, but actual searches and information requests have changed, with a new emphasis on affordability.

During lockdown, hatchbacks became the most searched for type of car, with the Volkswagen Golf the most popular search. The

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INDUSTRY FOCUS: AUTOMOTIVE

Volkswagen Polo the most searched hatchback, the Volkswagen Golf was the second in the R250,000 price range, and Volkswagen was the third most searched brand behind BMW and Mercedes-Benz. The Ford Ranger remained the number one most sold used car, with the VW Polo second, the Polo VIVO fourth, and the VW Golf in ninth.

“According to the 2020 AutoTrader Car Industry Report, the average selling price of the Golf over the past year was R288,049 while the average selling price of the Hilux was R327,807. The dominance of the Golf during lockdown could indicate that

// AUTOMOTIVE DIGITAL RETAILING IS THEREFORE VITAL TO THE FUTURE SUCCESS OF ANY DEALERSHIP //

50 / www.enterprise-africa.net

motorists were under financial pressure and wanted to minimise their spending on a car,” suggests Mienie.

Across the period under review, more than 177 million Consumer Advert Views occurred through AutoTrader, representing a 59% increase on the previous year.

DRIVING FORWARD With lockdown easing across South Africa, and the government pushing hard for the total reopening of important sectors, the hope for all in the automotive industry is that confidence returns to the market so stability and sustainability can be installed. Of course, there still remains the issue of the devasted South African economy, but facing a single challenge is easier than battling hard on two fronts.

AutoTrader is continuing to bring buyers and cars together but also bring information to the market to help those buyers make informed decisions, and help sellers to market their vehicles in the right way.

In April, the Jaguar I-Pace EV400 AWD was labelled as the 2020 AutoTrader South African Car of the Year. The all-electric Jaguar also received the World Car of the Year, World Car Design of the Year and World Green Car awards for 2019, making it the first car in history to win three World Car titles.

For some time, South African motor manufacturers and industry professionals have been unsure of the potential for electric cars – mainly due to the expensive roll out required for charging networks alongside the country’s already fragile electricity network. However, with the I-Pace hailed as the Car of the Year by AutoTrader, perhaps the time to consider larger roll out of electric vehicles is now. Mienie says that hybrid vehicles were something of a bridge between traditional combustion engines and electric vehicles when presenting the AutoCentral podcast in October.

“We have to go all electric. It’s the way of the future. Hybrids have had their day and maybe they will have

AUTOTRADER SA

// WE HAVE TO GO ALL ELECTRIC. IT’S THE WAY OF THE FUTURE // their day in the future again but we will see.�

In Europe during lockdown, while sales of new electric vehicles fell, the decline was not as dramatic as combustion engine cars. Many in the sector are taking this as proof of a switching trend as consumer look for more environmentally friendly ways to drive that do not differ drastically from what has become

recognisable over the past century.

The next 12 months will be a very interesting time for the automotive sector in South Africa. in the build up to the 2021 AutoTrader Car Industry Report there will be much change as those that are able scramble to take market share by going digital. But even for those who are struggling and looking for assistance making

that move, AutoTrader can assist.

Its platform is the largest in the country and offers an easy and fast tool that connects buyers and seller seamlessly. In these uncertain times, this type of offering is more valuable than ever.

WWW.AUTOTRADER.CO.ZA

www.enterprise-africa.net / 51

AFRICAN UNDERGROUND MINING SERVICES

Resilient AUMS Remains Contractor of Choice in Africa PRODUCTION: Karl Pietersen

Combine much more difficult to extract resources with a global pandemic that cripples business and you do not have a nice environment for a successful mining operation. But AUMS, the African operating arm of Barminco and Perenti, continues to buck the trend, delivering results through utilisation of world-class best practice. www.enterprise-africa.net / 53

INDUSTRY FOCUS: MINING

//

As mining, both surface and underground, continues to become more uneconomical, all over the world, those in the industry are looking for experienced partners who can utilise technology effectively. Now more than ever it is vital to apply efficiencies to ensure returns are viable.

In August 2020, the price of gold hit a record high – more than $2000 per ounce – but those in the industry are concerned this could be ‘peak gold’ – where miners extract the maximum amount possible in a year. If we have reached peak gold, the future would see declining production each year as new deposits become rare and existing mines become very difficult to operate.

According to Mining Technology, 2020 realised a 1% reduction in gold production in Burkina Faso and Mali, a 3% decline in the DRC, a 2% fall in Ghana, and a 5% drop in South Africa.

The gold example is typical of many other resources. Mining the

Roxgold Yaramoko

54 / www.enterprise-africa.net

minerals required in many of our everyday products and processes is important, but doing so in a safe, sustainable and profitable way is becoming challenging.

The traditional mining powerhouse nations of the world – South Africa, Russia, Australia, Canada, China, Uzbekistan etc – have become home to the biggest and most powerful mining businesses, and they have helped to develop mining practices that are as efficient as possible. But many are looking to new areas to unearth some of the world’s last decent reserves. West Africa is high on the list with rich stocks of gold, rutile, bauxite, uranium and more.

Even during the Covid-19 global pandemic (the driver of high gold prices), West Africa has seen little slowdown. Borders remained open between most nations with essential supplies moving between Ghana, Mauritania, Mali, Sierra Leone and Senegal. Mines have been forced to

take extra precautions such as keeping out unnecessary personnel and making use of new safety measures and PPE, but production has continued.

African Underground Mining Services (AUMS), the leader in the region when it comes to mechanised underground hard rock mining, has benefitted from renewed global attention in the area.

A JV between Australia’s Barminco and Ausdrill - both Perenti Group companies - AUMS has been operating in Africa for more than 15 years. The skills from both companies are utilised to ensure global standards and leave a lasting legacy on the communities in which it operates.

“To date AUMS and AMS has trained over 20,000 operators in Africa,” the company says.

With offices in Ghana, Mali, Burkina Faso and Tanzania, AUMS is well-positioned across the continent and has developed many positive relationships with international mining houses operating in Africa.

AFRICAN UNDERGROUND MINING SERVICES

YARAMOKO In 2018, AUMS picked up a $160 million from Roxgold – a leading Canadian gold miner – to complete rollover and extension services at the Yaramoko operation, as well as to start works for the Bagassi South mining contract in Burkina Faso.

Located 200km south-west of Ouagadougou in Burkina Faso, the Yaramoko gold mine project began in May 2016. In 2018, expansion and underground mining in Zone 55 began, creating 300 jobs, with AUMS providing development and production activities, diamond drilling and associated services. At the time, AUMS Chief Operating Officer Blair Sessions said: “We are delighted to have secured this work and look forward to extending our important, highly valued relationship with Roxgold on their flagship project.”

Bagassi South is located just 1.8 km south of Zone 55 and therefore shares facilities and management.

AUMS will have assisted Roxgold

// WE LOOK FORWARD TO CONTINUING TO CREATE ENDURING VALUE AND CERTAINTY FOR OUR CLIENT, EMPLOYEES, SHAREHOLDERS AND THE PEOPLE OF YARAMOKO AND BURKINA FASO ALIKE // in producing approximately 480,000 oz of gold from Yaramoko – more than the anticipated feasibility study production levels. Currently, expansion plans are in the pipeline with the hope of adding at least a decade to the mine.

In September, AUMS received a contract extension from Roxgold to assist further with mine expansion.

The $146 million contract will last from December 2021 to December 2023 and, on top of the existing work, will see AUMS on site at Yaramoko for eight years.

“The high-grade Yaramoko complex is an important project for Roxgold, Barminco and the people

of the Yaramoko community. We are very pleased to extend our contract with Roxgold to December 2023 and look forward to continuing to create enduring value and certainty for our client, employees, shareholders and the people of Yaramoko and Burkina Faso alike,” said Barminco’s Chief Executive Officer, Paul Muller.

Perenti Managing Director and Chief Executive Officer, Mark Norwell, added that Barminco and AUMS, combined, is a global leader in hard rock underground mining, with this contract extension reinforcing its sector leading position.

Continues on page 52

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INDUSTRY FOCUS: MINING

// UNDERGROUND DELIVERED STANDOUT FINANCIAL AND OPERATIONAL PERFORMANCE THROUGH THE BARMINCO AND AUMS BUSINESSES ACROSS BOTH AUSTRALIA AND AFRICA //

Continued from page 49 “Bagassi South has also had a positive impact on the company’s cost structure on a per ton basis, with an average operating cost of US$150/t processed, which is a 16% reduction compared to Q3, 2018 driven by increased throughput and strong cost control at Yaramoko,” said Roxgold CEO John Dorward, talking to Mining Review Africa about the success of the project to date.

The Houndé greenstone belt region that the Yaramoko complex calls home is volcanic and volcaniclastic rock to the west and the Diébougou granitoid domain composed predominantly of granitic rock with minor volcanic rock to the

58 / www.enterprise-africa.net

east, divided by the north-northeasttrending Boni shear zone. Because of this, a trusted, proven and reliable partner was essential. AUMS was quickly able to move the project along, helping in the relatively short five-year period from discovery to production at Zone 55.

AUMS is also active in Siou, Burkina Faso for Semafo; Kenyasi, Ghana for Newmont; Geita, Tanzania for Anglogold Ashanti; and Obuasi, Ghana for Anglogold Ashanti.

With the unwelcome news that peak gold could be upon us, Perenti will be keen for its divisions in Africa to continue supporting clients as best possible so that new strategies and new opportunities can be sought.

PANDEMIC SUCCESS Mark Norwell said in February that the company had achieved reasonably successful half year results, positioning it for further growth throughout the year.

“Perenti’s underground mining business, across Australia and Africa, performed exceptionally well, with earnings growing by more than one-third over the prior corresponding period as we successfully integrated Barminco into the Perenti group,” he said.

After the impact of the Covid-19 pandemic became more obvious, Norwell was quick to reassure the market that Perenti and its subsidiaries, including AUMS, was operating safely.

AFRICAN UNDERGROUND MINING SERVICES

“We are focused on protecting the wellbeing of our people and working closely with key stakeholders so that we can continue to operate safely and effectively during this unprecedented period.

“We are doing all that we can to minimise any disruption and we will continue to focus on capital management as part of our 2025 Group strategy to ensure Perenti is well positioned to deliver through all economic cycles,” he said.

In August, Norwell delivered the company’s 2020 annual results and labelled the figured ‘exceptional’, considering the circumstances.

The major highlights include delivery of record revenue – exceeding $2 billion for the first time – record

EBITDA, a significantly strengthened liquidity position, and the company now enters FY21 with more than $5 billion work in hand and almost $11 billion in contract rollovers and targeted tender opportunities.

“To report record revenue and earnings, end the year in a stronger financial position than 12 months ago, and maintain a substantial order book is impressive, but to do so in the midst of the operational and economic challenges presented by Covid-19 is exceptional.

“Underground delivered standout financial and operational performance through the Barminco and AUMS businesses across both Australia and Africa.

“We also secured almost $1 billion in contact extensions and new work across our Surface and Underground

ISGs in FY20 and successfully commenced operations in attractive mining jurisdictions of Botswana and Canada,” detailed Norwell.

For those in the AUMS business, its customers, and stakeholders around Africa, this news is much welcomed.

The mining industry is now far from its heyday and constant investment is required to delivery worthwhile returns.

Fortunately, AUMS promises to ‘create enduring value and certainty in Africa’ – something which is much needed and why the company is now recognised as the contractor of choice in Africa.

WWW.BARMINCO.COM.AU

www.enterprise-africa.net / 59

Sureswipe Managing Director - Paul Kent

SURESWIPE

Safe Cashless Virtual Vouchers to

help Revive Retailers PRODUCTION: David Napier

Many independent retailers and businesses desperate for quick cash generation have been given a lifeline by Sureswipe. The country’s largest distributor of card acceptance devices is delivering innovation and hope when businesses need it most. “It is not too late to support a local business,” says Managing Director Paul Kent. www.enterprise-africa.net / 61

INDUSTRY FOCUS: FINANCE

//

Operating in retail, one of the industries hardest hit by lockdown and the Covid-19 pandemic, Sureswipe – South Africa’s largest independent card payment acceptance company – has proven itself innovative as it looks to support its clients and retain its position while the flow of money in the economy has changed.

Featured in Enterprise Africa in April 2019, Sureswipe was growing at pace. The company had already secured more than 8500 customers with 10,000 devices in the market. Managing Director, Paul Kent was keen on growing market share and helping the economy to transition to a safer, more efficient card transacting society.

But with the closure of many stores due to lockdown and the dreary

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economic climate that has plagued the country for some time, Sureswipe’s growth ambition has been slowed and the business has been forced to look at how it can best serve its customers during these tough times.

VIRTUAL VOUCHERS “When we went into a full lockdown, only some essential businesses were up and running and the bulk of our customers and the bulk of retailers had no ability to earn income,” Kent tells Enterprise Africa.

“We looked at ways of how we could help retailers and help our customers and many ideas came across the desk. One was morphed from an idea where customers could donate to their favourite store, but in a time where people weren’t earning, we

// IT WAS REALLY AN AMAZING JOB TO MAKE SURE WE GET THROUGH AND SUPPORT OUR CUSTOMERS // thought donations could be a bit of an ask. We thought that if people could buy a voucher online and then go and redeem that when the economy opens was a better idea. It was about giving consumers the ability to support their favourite local businesses but by doing more than just a donation. It provides much-needed cashflow to our customers and retailers out there.

SURESWIPE

“A few businesses had this up and running and we looked at how we could do it differently and how we could do it so there is not a rush on the stores when they reopened. We wanted to use the current payment rails to make it secure and safe, and that added a couple of weeks to the deliver time. We use the card rail so the voucher is redeemed through the card machine, making it very safe.

Some of the vouchers out there right now are still paper based and we want to make sure we are providing cashflow in a safe a secure way.”

The system was introduced as a lifeline for retailers during lockdown.

SMEs could very quickly and easily sign up to the service and start selling vouchers immediately. For Sureswipe, the impact of the lockdown measures became apparent very quickly with a number of small retailers facing business closure early on in the process. Small retailers and SMEs represent a major part of the SA economy and are the backbone of job creation – without them the economic picture would worsen even further rapidly. This is why Sureswipe knew something had to be done.

“We had a soft launch in June and around 60 vouchers were sold which we thought was good considering we had no marketing at the time. Many businesses remain closed and many are looking at ways they can buy stock etc so it is not too late to support a local business,” says Kent.

“We have more than 200 retailers signed up already. We expect that to grow and we expect we can attract

// WE HAVE TO PLAN FOR ALL DIFFERENT SCENARIOS OR WE WILL NOT BE ABLE TO REACT QUICK ENOUGH //

at least 1000 retailers. We don’t have a fixed target but we have built the technology on our gift card platform.

On one side, this is going to be the future platform where we can sell gift cards online so that they can be redeemed instore. This will give us an omnichannel gift card capability. On the other side, we are looking at using the same back-end platform to distribute vouchers to the disadvantaged members of society who have no ability to earn cash and pay for food. We have secured a pilot and a lot of aid donors have cash available but have no way of distributing. We have been selected as one of the few tech providers where we can send out SMS vouchers which can be redeemed at stores that use our products and services. It has a lot of flexibility and provides a cheap mechanism for aid organisations and donors to provide funds to those in real need.”

The systems were not the work of Sureswipe alone. Part of a bigger group following the acquisition by a consortium led by Crossfin and Apis, Sureswipe called on partner companies to help deliver the innovation necessary.

“It was all developed within our group Adumo, which has Sureswipe, Innervation, Ikhokha and Humble Software. Humble and Ikhokha did the

platform, the back-end was developed

by Innervation, the launch was under the Sureswipe brand as that had the most buy-in with independent retailers,” details Kent.

GROWING BUSINESS? In 2019, just before the transaction that took Sureswipe into its new group, the business was booming. Card acceptance devices were becoming popular and Sureswipe was leading the way with distribution across all of South Africa. The company had become popular among independent retailers because of its superior customer service ability and its speed to deliver technology to its customer’s doors.

The plan then was to continue to grow but the global pandemic combined with a weak local economy has made things slightly more difficult than originally expected.

“It’s been tougher than we thought because of two things,” begins Kent. “From a sales point of view we continue to grow, from an economic climate perspective, the situation in South Africa was poor – even before Covid-19 – and we saw more businesses closing doors and therefore cancelling services. Right now, we are close to 11,000 devices through 9000 customers. Around 25% were trading as essential services in April and that went up to around 65%

www.enterprise-africa.net / 63

INDUSTRY FOCUS: FINANCE

in May. We are hopefully optimistic that most businesses will reopen but we are realistic that not all of those 11,000 devices will start to be used straight away.

“We are fortunate and we have shareholders on the board that are in Europe and we got ahead of the curve by looking at other markets. Like most businesses, priority number one was to make sure our people are safe. Even before the lockdown we were testing and building connectivity so that people could work from home.

“From a business point of view, we looked at what we need to do to survive and then thrive during this difficult time. Unfortunately, with only 25% of our customers operating, our revenues were significantly down.

We went to the company and said we needed to make tough choices.

Every single person came back and said they would take a cut in salary versus a restructure to get liquidity in the company. It was really an amazing job to make sure we get through and support our customers.”

64 / www.enterprise-africa.net

// IT’S ABOUT CREATING OPPORTUNITIES AND BEING INNOVATIVE DURING THIS PERIOD // One of the cornerstones of the Sureswipe offering was being able to get card machines into the hands of retailers fast, and being able to service, repair or replace them when they need attention. Lockdown interrupted this service and with a move to complete home working where possible, the March-April period was certainly unusual at Sureswipe.

“We have a large team and the number of customers needing our services has reduced. That meant that the service level increased. In our call centre, we had a 97-99% closure rate.

I went back to the guys and said ‘what is this 3%’ and it turned out that some people were not waiting to have their call answered so we called them back to ensure we have 100% answer rate and closure. We have people working from home, our technicians are on the road and repairing and replacing where necessary. The biggest impact

has been on our sales team and sales channels. Either people are not open or certainly not looking at paying for new services.

“We don’t know what the future will hold but we did see a big uptick in June. We didn’t want to make a kneejerk reaction based on the activity of one month; we wanted things to stabilise and get back to what everyone is phrasing the ‘new normal’ before we made decisions on what is unknown,” says Kent.

Fortunately, Sureswipe has not been forced to stop trading at any point and remains classified as an ‘essential service provider’. Safely supporting customers either digitally, telephonically or face to face has been undertaken with care.

One of the major hurdles to overcome has been justifying ongoing cost to customers during periods of closure. Contracts between Sureswipe

SURESWIPE

and its clients are important, and Kent is clear that the company demonstrates total transparency.

Sureswipe even offered major discounts in April to assist customers as much as possible.

“The bulk of our fees are related to transactions so if no money is moving there is no fee,” he says. “The rest of the cost is based on fixed costs such as the rental of the actual devices. We have worked in help such as a 50% fixed fee discount during the month of April. We have been very open and transparent about fees and conditions. We deal with each contract on a case by case basis and we encourage our customers to come to us to talk about fees and payment terms.”

OPENING UP On August 15, President Ramaphosa announced that the peak of the Covid-19 outbreak had passed and moved the country to a ‘Level 2’ lockdown. This meant the majority of retailers could reopen but with restrictions such as the need for the

pubic to wear face coverings. He stated that the country remained in a State of Disaster until 15 September and constant vigilance remains necessary. For businesses, reopening of the economy is much welcomed news but has been met with caution.

“We are planning for all scenarios, including increasing death and infection rates and moves back into stricter lockdown, and we are hoping that they never materialise,” admits Kent.

“We have to plan for all different scenarios or we will not be able to react quick enough. We look at the worst-case, middle road and bestcase scenario, and these change every couple of weeks. We certainly cannot just sit and wait. We are putting forecasts together and we are planning around these. We will only act when data and information is available. We want to buy time so that we don’t have to make rash decisions.”

With all companies, not just Sureswipe customers, the ability to accept previously purchased vouchers,

while also selling vouchers for the future is a confidence booster. The knowledge that cash can continue to flow even if further closures are necessary gives hope to even the smallest of retailers.

“Typically, a project like the virtual vouchers would take months to put together but we did it in six weeks.

It’s about creating opportunities and being innovative during this period,” says Kent.

While the environment is tough, Sureswipe looks set to ride out the storm and help its clients to thrive in the future. Innovation, positivity and an unrelenting desire to deliver quality customer service, no matter the circumstances are helping this bright tech business to blossom after a period that has no comparison.

WWW.SURESWIPE.CO.ZA

www.enterprise-africa.net / 65

ABOUT FINANCIAL SOFTWARE AND SYSTEMS PVT AND FSS TECHNOLOGIES SA (PTY) LTD

Financial Software and Systems (FSS) is a leader in payments technology and transaction processing, offering a diversified portfolio of software products as well as hosted payment and software services built over 29 years of comprehensive experience across the payments spectrum.

FSS, through its innovative products and services, caters to the wholesale and retail payments initiatives of leading banks, financial institutions, processors, merchants, governments and regulatory bodies.

Its end-to-end payments suite powers retail delivery channels such as ATM, POS, Internet, Mobile and Financial Inclusion as well as critical back-end functions such as cards management, reconciliation, settlement, merchant management and device monitoring.

Headquartered in Chennai, India, the company services 100+ customers across the globe, which include leading public and private sector banks in India and some of the large Banks, FI’s, Processors and Prepaid Card issuers across North America, UK/Europe, ME/Africa and APAC. FSS has a team of over 2500 experts serving these clients.

FSS Technologies SA (Pty) Ltd is a wholly owned subsidiary of Financial Software and Systems (Pvt)

WHAT FSS DOES FOR THE SOUTH AFRICAN POST OFFICE Choosing the right technology partner for managing grant disbursements was extremely strategic and a matter of national importance given the impact of the social grants program on millions of South Africans.

In addition to technology-related competence, SAPO needed to be assured of the vendor’s viability in terms of financial stability, quality of support, alliances and partnerships and management performance.

SAPO selected FSS ahead of several national and international vendors because FSS fulfilled its criteria on all fronts. FSS submitted a proposal that reflected its experience as a large-scale payment processor and a seasoned partner committed to long-term success of the project throughout the contracting process.

The choice of FSS as a technology partner was determined by: • • • • •

Three decades of leadership in the payment’s domain, assuring long-term project sustainability.

Demonstrable and extensive experience in implementing similar large-scale greenfield as well as replacement projects in a time-bound manner.

Its status as a Globally respected organization -- Issuance of over 750 Million cards globally across 25+ large banks.

Local presence in South Africa with on-the-ground experienced payments personnel for support and project delivery.

Rich system functionality and superior architectural design.

The FSS Integrated Grant Payment System (IGPS) is a complete solution that addresses all aspects of the grant account lifecycle from application processing, account management and card issuance through renewal or account closure. The system supports customer registration with KYC and FICA documentation, integrates with biometric systems for verification, maintains beneficiary account information, manages the lifecycle of the beneficiary account as well as administration and reporting.

For further information on the SAPO IGPS Project or on FSS Technologies SA (Pty) Ltd please feel free to reach out to:

serving clients on the African Continent from its offices in Rosebank, Johannesburg.

The Africa team is headed by The Regional General Manager: Africa, Rishi Pillay who together with his dedicated team of seasoned Payments and Banking services specialists, have decades of experience in these sectors.

In addition to the South African Regional Office, the Africa team comprises representation and offices in East Africa (Nairobi) Central Africa (Brazzaville) and West Africa (Douala) FSS services a number of major Banking clientele across the continent and is growing exponentially due to these relationships as well as a number of significant strategic Acquisitions and Alliances which have recently been concluded.

A prime example of FSS matching its Products, Services and Expertise to a stated Requirement, is the South African Post Office - Integrated Grants Payments System or IGPS Project.

After a rigorous and thorough Tender process, the dynamic and progressive team at the South Africa Post Office identified FSS as the ideal Vendor to partner with for this project of National importance.

THE DELIVERY AND IMPACT FSS implementation expertise gained from large-scale projects for Central regulators and Tier One banks helped SAPO successfully rollout the service within a record setting five weeks. As per its requirements and agreements, SAPO commenced the issuance of the new SASSA card on 1st April 2018. without any disruption. This has helped significantly in rebuilding beneficiary trust and faith in the service. To date, SAPO and SASSA have enrolled more than 8 million beneficiaries on the new system.

SIGNIFICANT COST REDUCTIONS The Integrated Grant Payment System combining the Card Management and the Lightweight CBS modules helped SAPO offload traffic from the Core Banking System. This resulted in significant savings monthly, enabling the agency to spend its budget allocation more effectively in the future, making a meaningful difference in the lives of beneficiaries

OPTIMIZED DEVELOPMENTAL OUTCOMES FSS via its long-term partnership is successfully helping SAPO improve the efficiency of the Grants program. The successful launch of the service has helped the government to reestablish trust in the program. More importantly it is enabling the underbanked to move up the financial ladder and reduce usage of cash.

Rishi Pillay - Regional General Manager: Africa | www.fsstech.com + 27 62 021 0151 | + 27 87 809 4331 | rishipillay@fsstech.com