Enterprise Africa October 2016 by CMB Media Group

THE BUSINESS MAGAZINE FOR AFRICAâ&#x20AC;&#x2122;S INDUSTRY LEADERS

AFRICA

ENTERPRISE October 2016

www.enterprise-africa.net

SCRIBANTE CONCRETE:

Scribante Cements Position As An

Industry Leader

ALSO IN THIS ISSUE:

Big Five Duty Free / Argon / Chas Everitt / Esquire Technologies

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EDITOR’S LETTER

Joe Forshaw EDITOR joe@enterprise-africa.co.za Hal Hutchison SALES MANAGER hal@enterprise-africa.co.za Sophie Bolderstone SENIOR PROJECT MANAGER sophie@enterprise-africa.co.za Sam Hendricks SENIOR PROJECT MANAGER sam@enterprise-africa.co.za Shaun Cousins PROJECT MANAGER shaun@enterprise-africa.co.za Shannon James PROJECT MANAGER shannon@enterprise-africa.co.za Peter Littleboy PROJECT MANAGER peter@enterprise-africa.co.za Daniel Scott PROJECT MANAGER daniel@enterprise-africa.co.za Dominic Margarson PROJECT MANAGER dominic@enterprise-africa.co.za Jane Larkman ACCOUNTS MANAGER finance@enterprise-africa.co.za Harvey Tarlton SENIOR DESIGNER harvey@enterprise-africa.co.za

Welcome to our latest edition…

As another month comes and goes, we talk to another set of the country’s biggest and best and we hear the same thing we’ve been hearing all year – a successful business is built on people. The way management interact with employees is changing; it’s easy to communicate in the wrong way but for those who get it right, a happy and well-motivated workforce is a fuel that can propel your business to the next level – it really does pay to be a good boss. Scribante Concrete, one of the largest privately owned ready-mix concrete suppliers in South Africa, has built a culture where employees are involved in all aspects of the business. One of SA’s leading asset managers, Argon Asset Management is investing in training so that employees are extremely welleducated. Esquire Technologies have trained people with no knowledge of the IT business, and are now working with those same people, 17 years later, on leadership succession plans. High-Tech Refractories has built a team that is 100% dedicated to customer service and is prepared to go the extra mile. One of the country’s leading estate agents, Chas Everitt, develop people to be employees for life; agents are well-respected, well-rewarded and as a result, highly motivated. All of our feature companies create an environment in which employees are educated, empowered, understood and appreciated, and in every case, this has resulted in success. Contact us if you have excellent working conditions and bright ideas relating to HR. We’re online @EnterpriseAfri1

Published by CMB Multimedia Chris Bolderstone – General Manager E. chris@cmb-multimedia.com Sackville Place, 44-48 Magdalen Street, Norwich, NR3 1JU T. +44 (0) 20 8123 7859 E. info@cmb-multimedia.com www.cmb-multimedia.com CMB Multimedia 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. Any resemblance to real persons, living or dead is purely coincidental. 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 Multimedia Ltd 2016

Joe Forshaw EDITOR

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

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06/NEWS: The Month that was... A round up of some of the latest news stories from around the country

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

8/ENTERPRISE ACQUISITION Famous Brands Takes a Bite Out of UK Market South Africa’s Famous Brands has concluded the biggest deal in its history by acquiring UK-based GBK. The deal could see the brand open up in SA bringing new competition to the quick-service and casual dining restaurant industry.

12/SCRIBANTE CONCRETE: Scribante Cements Position As An Industry Leader Following fleet upgrades, extensive talent acquisition and a commitment to quality products and service, Scribante Concrete has solidified its position as one of the largest privately owned ready-mix concrete suppliers in South Africa.

18/ARGON ASSET MANAGEMENT: Trusted, Relevant, Global Argon Asset Management is an African investment firm with global standards. By growing its product portfolio, investing heavily in people and culture development, and by remaining true to its core values, CEO Mothobi Seseli hopes that Argon will continue to be one of the most trusted and client relevant asset managers in the industry.

24/NECSA: Nuclear Build Programme Has All Eyes On Africa South Africa’s much-discussed Nuclear New Build Programme continues to make headlines every month and while officials continue to prepare for a busy time ahead, the South African Nuclear Energy Corporation is making plans to build on its expertise and create a flourishing nuclear industry.

32/SAOTA: Architecture at the Forefront

12/ 4 / October 2016 / www.enterprise-africa.net

Driven by the dynamic combination of Stefan Antoni, Philip Olmesdahl, Greg Truen, Phillippe Fouché and Mark Bullivant, SAOTA is a firm of architectural designers and technologists which pairs its innovative and dedicated approach to the execution of projects with a potent vision in its designs.

CONTENTS

68/

24/

38/BIG FIVE DUTY FREE: Definitive Duty Free Shopping Boasting a world-class array of goods, from jewellery and liquor to perfumery and cosmetics, Big Five Duty Free strives to offer the very best in discounted airport shopping, just moments from the sights and sounds of the runway.

44/PHOENIX AVIATION: Reinventing Air Travel Phoenix Aviation seeks to deliver quality, consistency and the highest level of professionalism to its broad range of clients. This stretches from its finely engineered aircraft to the superior maintenance of the fleet and training of its pilots, together with its famous no compromise approach to maintaining safety and ensuring peace of mind.

50/ADVANCED HEALTH: A Growing Health Care Footprint A dynamic and burgeoning company, Advanced Health establishes, invests in and manages day hospitals in Australia and South Africa. With a central focus on the quality of its surgical outcomes, it prides itself on offering competitive rates for patients and medical schemes alike.

54/G4S: From SA to The World The largest private security employer in Africa, and certified as one of the best, G4S is now bringing technology and ideas developed on the continent to the rest of the world.

68/ESQUIRE TECHNOLOGIES: SA’s IT and Digital Lifestyle Company Working in the Fast Lane Founders of Midrand-based Esquire Technologies, Asgar Mahomed and Mahomed Cassim, tell Enterprise Africa that the key to building a thriving tech company in a modern environment is innovation.

44/ 68/CHAS EVERITT INTERNATIONAL: The Real Estate Company That Dazzles Its Clients Berry Everitt of the Chas Everitt International property group tells Enterprise Africa that despite economic challenges, a highly competitive market and an industry culture of talent poaching, his company continues to grow and is now recognised as an international real estate business based in South Africa.

74/SOUKOP: Luxury Property with Strong Values Having first opened its doors in 2007 with six employees, Soukop Property Group has quickly expanded firstly in KwaZulu-Natal, and then later into the Western Cape and Gauteng. Long associated with many of KZN’s most prestigious property sales, Soukop currently has 13 branches nationwide, all located in prime positions, with plans for further expansion still..

78/MCCORMICK PROPERTY DEVELOPMENT Rural Retail Development Pioneers A local, family run business, McCormick Property Development has been leading its industry, while remaining committed to its values, since its establishment 33 years ago.

84/HI-TECH: Team Work And Hard Work Build Success For High-Tech “If it is hot, we can handle it” is the message from High-Tech Refractories MD, Jannie du Plessis. He talks to Enterprise Africa about how his hardworking team continue to carve out a name that is synonymous with quality.

www.enterprise-africa.net / October 2016 / 5

SOUTH AFRICA’S TOP BRANDS NAMED

South Africa’s top 10 brands are MTN, Vodacom, Sasol, Standard Bank, Woolworths, FNB, Absa, Nedbank, Investec and Mediclinic. South Africa’s top brands, which contribute not only to the country’s economy, but to the image they portray when doing business internationally, were unveiled in September. Brand South Africa and Brand Africa Finance hosted the breakfast announcement, which took place in Houghton, Johannesburg. Brand Finance calculates the values of the brands in its league tables using the ‘Royalty Relief approach’. This approach involves estimating the likely future sales that are attributable to a brand and calculating a royalty rate that would be charged for the use of the brand- which is what the owner would have to pay for the use of the brand — assuming it was not already owned.

The report releveled that the total value of the Top 50 brands increased 3% from R373 billion in 2015 to R384 billion this year. MTN remains the most valuable brand despite losing 32% of its brand value due to some of its reputational challenges. Woolworths – which stands at number five - holds the strongest brand position with an increase of 21% in brand value. Telecommunication – Telkom has seen the greatest increase in brand value following the integration of Business Connexion and improved performance on the retail side with good ratings on Value for Money and Customer Satisfaction according to the South African Customer Satisfaction Index (SAcsi). The increase in brand value sees Telkom move from 23rd position last year to 17th in 2016. Interestingly, many of the top 10 brands from 2015 have retained their positions

in 2016 except for Woolworths which has moved to fifth place, and Absa which has moved to seventh. Brands seeing a significant increase in value include Investec (27%) and WesBank (27%). Two new brands have entered the Top 50. Country Road, now owned by Woolworths – which enters at 31st place with a value of R4.64 billion and Growthpoint enters at 50 with a value of R1.47 billion. Chairman of Brand Finance Africa, Thebe Ikalafeng said the story of the Top 50 corporate brands is a good story for the South Africa Nation Brand as well as the continental story. “Many of these brands have footprints on the continent and this bodes well for perceptions about business on the continent, their ethics, governance and commitment to social upliftment.”

SHOPRITE’S BASSON GETS PAY BOOST Shoprite CEO, Whitey Basson received good news when it was announced that his yearly salary would be doubled thanks to meeting and exceeding various targets. Basson, who has been with Africa’s largest food retailer for 45 years, will now take home R100.1 million. Following some raised eyebrows

from industry onlookers, the company defended the decision saying that trading profit growth of 15% beat an internal target of 11% and the CEO hadn’t received a basic pay increase since 2013 and no one-time payments for five fiscal years. His long service was also taken into account. Basson has been at the helm of the company since

6 / October 2016 / www.enterprise-africa.net

1979 and is credited with raising it to its heights of today. Shoprite is a multi-award winning business with more than 500 outlets and 22 million customers around South Africa and on the continent. It was also recently labelled as the 12th most valuable brand in the country by Brand Finance Africa.

NEWS ROUNDUP 4,700 SKILLED NEW ARTISANS FOR SA As part of the skills needed to grow the economy, 4749 new artisans have been certificated by the National Artisan Moderation Body in the first quarter. Also, 24,324 workplace based learning opportunities were taken up. “Artisans possess specialised skills that are sought after by industry; and also have the opportunity to become entrepreneurs,” said Science and Technology Minister, Naledi Pandor. She was briefing media on the work done by the Economic Sectors, Employment and Infrastructure Development Cluster in the implementation of the Programme of Action (PoA) towards achieving the goals of the National Development Plan: Vision 2030. South Africa has been racing up to its target of training 30,000 artisans a year by 2030. The country’s requirement for artisans in the construction, engineering and other relevant sectors is seen as key in economic growth and sustaining these industries.

SA, CHINA TO COLLABORATE ON MOLOTO RAIL DEVELOPMENT CORRIDOR

The Passenger Rail Agency of South Africa (PRASA) and China Communications Construction Company Limited have signed a MoU to explore various infrastructure development initiatives. Key among them is the Moloto Rail Development Corridor, the Government said last month. The MoU was signed at the 2nd Investment Africa Investment Forum attended by President Jacob Zuma in Guangzhou, Guangdong Province, in China. The President has stopped over in Guangzhou from Hangzhou, where he participated in the G20 Summit. The construction of the Moloto Rail Development Corridor is a direct response by government to excessive traffic congestion, numerous fatal

road accidents and general economic underdevelopment in the area. The Moloto Rail Project’s main objective is to ensure that passenger rail becomes the backbone of an integrated multi-modal transport system, using proven state-of-the-art rolling stock and equipment. The project would serve as a catalyst for economic development initiatives within and around the corridor, resolving challenges of safety, efficiency, reliability, affordability and overall integration with other public transport services. “Our message is clear. Africa is open for business. Africa is open for partnerships with China. A lot of economic interaction is already taking place between China and Africa with good results,” said President Zuma.

www.enterprise-africa.net / October 2016 / 7

FEATURE

FAMOUS BRANDS TAKES A BITE OUT OF UK MARKET PRODUCTION: David Napier

South Africa’s Famous Brands has concluded the biggest deal in its history by acquiring UK-based GBK. The deal could see the brand open up in SA bringing new competition to the quick-service and casual dining restaurant industry.

In a big move for a South African restaurant business, the continents leading quickservice and casual dining restaurant franchisor, Famous Brands, announced last month that it had acquired a leading UK-based chain, Gourmet Burger Kitchen (GBK). Opened in London in 2001 by three New Zealanders, GBK serves up delicious ‘premium burgers’, all created for an upmarket segment, across 75 company-owned restaurants around the UK and a handful of other locations in Europe and the Middle East. The deal was worth a reported R2.1 billion was perfectly timed by Famous Brands and thanks to the slump in the British Pound after the UK’s decision to part ways with the EU, it has been reported that Famous Brands saved around R700 million on the price of the acquisition. Following the announcement, later in September, Famous Brands announced that it had also acquired

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a 49.9% stake in events company, By Word of Mouth. This was the fourth acquisition in the year and will see Famous Brands support the growth of the owner-managed, 200 employee, Gauteng-based company. Famous Brands already owns the fast food chain, Wimpy, in the UK and in South Africa it has a huge presence with Steers, Debonairs Pizza, Mugg & Bean, FishAways, Milky Lane, Brazilian Café and many more. The company has been targeting growth outside of SA for some time and the deal with GBK looks to be the perfect catalyst for this development. Famous Brands’ Group Strategic Advisor responsible for M&A activity, Kevin Hedderwick said in a statement: “As far back as 2007 when we acquired the Wimpy business in the UK, the Group is on record as saying that we would use our foray into the UK as a beachhead to expand our presence in the market as and when suitable opportunities presented themselves. Our investment in the

Wimpy UK business has given us invaluable learnings in terms of an understanding of and insight into the local market. “More recently we have stated our intent to pursue opportunities which will enhance our existing income stream with hard currency earned outside of Africa; the GBK acquisition achieves that goal, and simultaneously up-weights Famous Brands into a substantially higher league. “In terms of scale and scope, this is the biggest deal the Group has ever concluded, and one which will transform the future of the business. It will be as much of a game-changer for the Group as our acquisition of Wimpy SA was in 2003. Quite simply, GBK is a best in class business and brand, with growing consumer equity, supported by a phenomenal leadership team.” As GBK is merged into the Famous Brands portfolio, Hedderwick suggests that both parties can learn and improve from the deal. “The GBK team has built an outstanding infrastructure

ENTERPRISE ACQUISITION

FEATURE

//IN TERMS OF SCALE AND SCOPE, THIS IS THE BIGGEST DEAL THE GROUP HAS EVER CONCLUDED, AND ONE WHICH WILL TRANSFORM THE FUTURE OF THE BUSINESS// and their processes are world-class, so much so, that we can transfer many of the brand’s best practices back to SA.” Over the next five years, Famous Brands has set an ambitious target of doubling the number of UK stores and Hedderwick suggests that international expansion could also be on the cards with SA as one of the first countries on the list. “GBK has substantial store growth potential in the UK – with a secure, current pipeline of sites in place, supported by the brand’s excellent track record of successful new store openings. The business has also recently concluded an agreement to re-acquire the franchise rights to own and manage the five GBK restaurants in Ireland, which provides an immediate platform for growth and a significant overseas footprint. Furthermore, there is opportunity to export the brand to South Africa, which would afford Famous Brands representation in the premium burger Fast Casual dining category where we do not currently compete. “In this context, we are confident that the existing business model has the potential to double GBK’s restaurant footprint within the next five years,” he says. In 2010, GBK was purchased by the Yellowwoods Group for £30 million. The Yellowwoods Group owns the UK arm of Nandos but is itself owned by the wealthy South African Enthoven family. When the business was sold to Famous Brands, Hedderwick emphasised the strong financial performance as one of the drivers behind the acquisition. “Through continued transformation the business has

delivered sustained industry-leading like-for-like growth. GBK has an impressive historical financial track record (five consecutive years of same-store sales growth, at a level well ahead of market norm) – and delivered in the context of an economic downturn. “93% of the restaurant portfolio has either been refurbished or opened in the last five years. “For me personally, concluding this transaction is the pinnacle of a 16-year executive career during which I have overseen the value of Famous Brands increase from a market capitalisation of R185 million to one close to R15 billion. “I am confident that the addition of GBK to our portfolio positions the Group optimally to attain its audacious future growth targets,” he says. On the GBK side of the deal, CEO Alasdair Murdoch said that the deal had been exciting and had seen a shared vision come together. “We’re delighted to move onto the next phase of growth with Famous Brands. Since we started dealing directly with the team, there has been real chemistry and a sense of shared understanding and vision. “GBK has grown rapidly, and has had continuous like-for-like sales growth, but at its heart GBK is much more than that. It’s based on fantastic restaurant teams and critically, a continuous journey towards excellence in our food. We like to call it real burger obsession! “Our aims remain the same: to continue opening 10-15 restaurants a year in the UK, continually elevate our food, and

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look at other growth opportunities. We feel honoured to be the next chapter of the Famous Brands’ story and we are delighted to be part of the team.” Investment into the casual dining and quick-service restaurant sector has increased in recent times and with Famous Brands leading the charge in SA, with multimillion Rand advancements like this, it seems likely that this ambitious organisation will lead the way for the foreseeable future.

ENTERPRISE ACQUISITION

SCRIBANTE CONCRETE

Scribante Cements

Position As An Industry Leader

PRODUCTION: Karl Pietersen

Following fleet upgrades, extensive talent acquisition and a commitment to quality products and service, Scribante Concrete has solidified its position as one of the largest privately owned ready-mix concrete suppliers in South Africa.

In 2015, South Africaâ&#x20AC;&#x2122;s construction industry was feeling the pressure from an ailing economy and a global commodity price crash. Investment, demand and confidence slowed and after rising to 59 index points in the fourth quarter of 2014, the FNB/BER civil construction confidence index fell to 39 points in the first quarter of 2015. Stock prices for major JSE-listed construction companies dropped between 42% and 72% in that time and even the strongest among them, WBHO, deteriorated by about 15%. In 2016, some confidence has returned to the

market, following big SONA announcements, and activity has improved but as we approach the end of the year, there are many companies that have found the economic situation, with a weak currency and potential credit downgrade, extremely challenging. But at Port Elizabeth-based Scribante Concrete, Sales Director Eric Fouche says that a culture of hard work, offering quality products and service and a nimble approach to the market has meant that the company, one of the largest privately owned ready-mix concrete suppliers in the country,

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BUSINESS PROFILE

continues to thrive. “ The environment has been a lot more challenging,” he says, “there’s fewer projects around. We have a system that we use to track jobs through all the stages and we know about them two or three years in advance. That, along with our name and the type of plants that we have, enables us to become hunter gathers instead of farmers. We don’t sit and wait for crops for grow, we go out and find new work. We’ve seen a downward economic trend through construction and civils in the Eastern Cape in the last four years and so we moved into renewable energy. When renewable energy slowed, we moved into RDP housing. As that slows, we’ve moved into Sandton. That mentality keeps us on top when business gets tough.”

To stay in touch with demand in different regions, the company has a large and diverse fleet of more than 140 trucks and commercial and mobile plant. One of the most recent and exciting additions to the portfolio is a plant in Wynberg, Gauteng. The Wynberg plant will supply the Sandton region and surrounding projects. “We had four mega mobile plants that moved around South Africa and to that we’ve added an additional four more minor mobiles to accommodate the more remote and smaller projects that are popping up around South Africa. This combined with our ever increasing ready-mix fleet increases our abilities. “Sandton has been a fast growing project based area for many years and we believe it will

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give us a steady flow of work for at least the next 10 years,” says Fouche. STRONG PRODUCTS Scribante Concrete has experience in commercial, industrial, renewable, civil, residential and agricultural projects and has worked all over the country. It’s product range includes readymix concrete, retarded mortars, plaster, self-levelling concrete, flowable concrete, colour concrete, waterproof concrete, freezer room mix, piling concrete and pump mixes. Over the years, the reputation of the company has blossomed and this has been a result of both quality products and quality service. “We focus on striving to deliver a quality product better than anyone else,” says Fouche.

SCRIBANTE CONCRETE

these complex tasks emanate from the company’s more than 350 employees who are carefully selected to fit into the special Scribante culture.

Scribante Concrete’s availability around the country, and across border, is also part of its unique service offering. “We have a commercial side to our business and a mobile side and they work hand-in-hand,” explains Fouche. “In areas where we are commercially set-up, we have static plants that supply to the commercial markets. Around that, we have many projects like renewable energy wind farms, shopping malls all over the country, or government projects and these require a mobile supply that isn’t effected by the challenges that a commercial plant might have. Our ability to set up and breakdown these plants quicker than most is also an advantage.” The skills required to perform

SOLID HISTORY One of the elements incorporated in Scribante Concrete’s vision is to ‘build a positive team and family spirit’. Following 16 years of growth, this has been achieved. The company has created a culture where all employees are selected not only because they are highly-skilled, but also because they can be adaptable and communicate well. This is a business making the jump from medium to large enterprise and along with this comes a number of new challenges. Recruitment of management-level people has

been essential in this transition. “We do try to keep our staff compliment low to be efficient and we try and keep everyone involved in all facets of the business. We always joke within the company that our receptionist becomes the bookkeeper becomes HR becomes the Manager. Everyone is always moving up and if you come into our company, it’s likely that you’re destined for greater things,” explains Fouche. “We only have a few directors in Scribante Concrete and previously we were all involved with all aspects of the business and could fill in for each other easily. “We have had the biggest growth in staff at management level in the last five years. We have bought in a great amount of

BATCHING PLANTS STEEL FABRICATION PLANT ALTERATIONS GENERAL ENGINEERING

FOR DYNAMIC CLIENTS YOU NEED INNOVATIVE SOLUTIONS PROUD SUPPLIER TO SCRIBANTE CONCRETE

www.enterprise-africa.net / October 2016 / 15

BUSINESS PROFILE

sales managers, area managers, operations managers, workshop managers and the like, that has filled the gaps that we had. The directors remain very hands on but now they have a fantastic team to support. “An example is our Safety Manager, Martin Gray who has transformed our approach to health and safety to a much more corporate style. We are completely educating the workforce in safety principles and that’s vital because of the size of the projects that we are now working on and tendering for. Now there is extensive literature and a strong educational

focus and it’s great for the safety our people.” Many companies fail when it comes to smoothly moving from a less formal set-up to one where structures and systems are more rigid but at Scribante Concrete, the Directors are keen to keep the family feel on which the business has been built. “Our mindset now and our mindset when the company was founded is different. We definitely found things challenging in the early days, but at the time we were only thinking about a small area – Port Elizabeth. As we grew into different areas, we found more and

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more opportunities and with every day that passes, we are reaching new heights. We have remained a business with a family feel and now we are looking to blend the corporate elements of business with that family feel because of the new challenges that we face. We have grown so much, and our reach is so widespread, that we need to bring corporate elements as our projects are growing and our employee base in growing. We certainly want to maintain a team culture where everyone can be heard. “Our managers are empowered and can make the decisions that

SCRIBANTE CONCRETE

they would not be able to in other companies because of red tape. We try to use a corporate structure but understand that everyone is accountable for what they do and that lets us make decisions and find solutions quicker than most,” he says. “When we recruit new people into our family, we find they are normally use to a very segmented way of thinking and operating in business, as this was the method used in their previous employment. The challenge is not with their abilities or knowledge but trying to integrate them into our way of thinking. We always

talk about our ‘company language’. You can bring on the right people but it takes them time to learn the language. People who can adapt to our teams and learn our language quicker will always be successful here.” Scribante Concrete, as part of the wider Scribante Construction Group, has the people, knowledge, skill and quality to thrive as it continues to grow. “ The Scribante family has been operating for a long time in the construction industry. Our ready-mix division has been operating for 16 years,” says Fouche. Over the next five years, if the governments

ambitious infrastructure plans come to fruition, the landscape in the construction industry will change and businesses that have positioned themselves correctly, like Scribante, will become the goto brands of choice for contractors all over Southern Africa.

SCRIBANTE CONCRETE +27 (0) 41 406 9500 concrete@scribcon.co.za www.scribanteconcrete.co.za

www.enterprise-africa.net / October 2016 / 17

ARGON ASSET MANAGEMENT

Trusted, Relevant,

Global. PRODUCTION: David Napier

Argon Asset Management is an African investment firm with global standards. By growing its product portfolio, investing heavily in people and culture development, and by remaining true to its core values, CEO Mothobi Seseli hopes that Argon will continue to be one of the most trusted, client relevant asset managers in the industry.

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BUSINESS PROFILE

The asset management business in Africa is still relatively young compared to other international markets and right now, as in any region, it presents a hugely complex web of issues; challenges and rapid changes that must be navigated successfully if investments are to be successful. Following the global financial crisis, the industry has witnessed increasing regulation, operational losses, outsourcing, advancing technology and enhanced risk management and compliance requirements. Therefore, building an asset management brand that is recognised for trust, good ethics and positive results is more important than ever. Africa represents a huge opportunity for asset managers – the continent is home to 15% of the world’s population, but just 3% of the world’s GDP and less than 1% of the world’s stock market capitalisation. But wealth continues to increase; in South Africa, the growing middle class has created many opportunities, the number of domestic investors is on the rise, financial institutions are strong, and legal and regulatory frameworks are some of the most robust in the world. The future looks bright with predictions showing that asset managers are now looking to diversify product lines and find new opportunities. Regulatory reforms in Africa are encouraging a savings culture and local investment as well as technology advancements. It is predicted that traditional asset management will grow at CAGR of 9.6% across a number of the ‘more developed’ African nations. One asset manager that has positioned itself perfectly to take advantage of the growing appetite for investments is Argon Asset Management. With offices in Cape Town and Johannesburg, Argon has grown its brand since its formation in 2005 and is now recognised as an industry leader. Founder and CEO, Mothobi Seseli has used his experience, including a Stanford and Oxford University education to create an environment where customer relevance and trust is first and foremost in every activity. This has proved successful, and

now the company is expecting further growth while continuously remaining at the industry’s cutting edge. “We are sitting upwards of R32 billion assets under management. We have nearly 50 important client mandates and we are expecting these figures to grow in the next 12 months,” explains Seseli. “It’s fantastic to realise that people recognise the name Argon and associate it with excellence. “Regulation in a space where money is involved is obviously critical. You have to protect clients’ interests and the regulators worry about how you manage someone else’s money - how are you protecting their interests, how are you making sure their end objective is realised. There cannot be rogue elements in the system and so regulation has increased over time but it has been necessary. For smaller firms such as ours, ensuring you remain compliant can be expensive and firms with much larger balance sheets are able to easily absorb these costs with minimal impact to their bottom line. Irrespective of the costs, complying with industry regulations is important to us as it builds trust. “Many people complain about the red tape and bureaucracy created by legislation but we see it differently. At Argon we always ask ourselves the question: ‘If you took your own money to an asset manager, who would you want looking after it, people who are compliant and understand all of the legislation or those who are not?’ Investors want to deal with people who are educated in this space, who are constantly developing themselves and who are dynamic. With my own money, I would be looking for someone who gives me peace of mind and compliance is a part of that,” he says. TRUST Of course, when dealing with other people’s money, trust is the number one concern and building trust with clients and partners has always been a part of the Argon story. In the last three years alone the company has collected 17 local and international awards but the same values that have guided the firm for the past decade remain in place.

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“There have been a number of changes at a company level but for me, the most important has been the personal development I have experienced over the last 11 years. When setting up a business, the entrepreneurial journey is something that you cannot be prepared for – there is no amount of education at any business school that can prepare you for the challenges that test you as an individual,” says Seseli, an economist by training who has previously also been a part of Alliance Bernstein and Alexander Forbes amongst other firms. “From the company’s point of view, we have better brand visibility in our chosen areas of focus and that is always a big challenge in the asset management space. We are dealing with other people’s money and it’s a space of trust, one of the things we had to get right is our brand. Through various initiatives such as public relations and below the line advertising, we have increased our brand equity in the market, positioning ourselves as one of the most recognisable brands in the South African financial services industry. “Clients have recognised our money management expertise, we have a longer track record of success and we have built trust. I was clear from the get-go that I didn’t want to have a single product focus; I wanted to be able to have a broad investment conversation with our clients. That meant we had to set up different capabilities including; equity, fixed income and multi-asset class. Over time we also added a global offering through our partnership with Schroders Investment Management,” he says. GROWING AND CHANGING Traditionally, Argon has been hugely successful with ‘institutional products’ but in the past few years, ‘retail products’ have been added to the mix to ensure that the portfolio is diverse. This diversification and growth will continue as Seseli looks to maintain that dynamic, energetic offering that has proven so successful. “Historically, the retail asset

ARGON ASSET MANAGEMENT

management space was run through the life offices and the banks. There exists a real opportunity for non-life or non-bank asset management players to gain bigger market significance. We are looking to take our offering into that space; we’ve already started and it’s moving really nicely.” The CEO is also keen to ensure Argon solidifies its position as a global player or ‘an African investment firm with global standards’, and this continues through an important longstanding partnership. “Offshore we are working with our exclusive institutional partner, Schroders Investment Management, the largest listed independent asset management firm on the London Stock Exchange. We’ve been in partnership with Schroders for almost five years and the idea is to provide our clients with access to a full investment offering,

including the broad investment and operating capability of one of the best global money managers. We believe that this partnership with Schroders is also testament to Argon’s strength as a brand internationally, and it speaks volumes about our capabilities and provides our clients with an excellent opportunity to access global investment products. Through our experience we have found that investors want to entrust their money with a global partner that has on the ground presence where that money is deployed. Schroders has presence in 28 countries. Being immersed in the culture and nuances of investments in specific geographies is very important, not just for return opportunities but also for risk management. Schroders offers our clients that special opportunity,” he says. Also bolstering Argon’s portfolio will be growth in Africa, where

demographics are changing and where new financial models and markets are constantly being developed. “We are interested in expanding on the continent. We are busy looking at what we can take into the market but the listed space is limited; unlisted and infrastructure are the more relevant and interesting vehicles we are considering when we consider expanding in the continent. There are many opportunities but we haven’t finalised where we will deploy our limited capital,” says Seseli. Years of growth and development have also allowed Argon to develop a degree of insulation to fluctuations in the economic climate. South Africa only narrowly avoided a downgrade to junk status recently, with many of the international credit agencies showing concern, but Argon has not been impacted in a major way. “Because of our institutional focus,

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BUSINESS PROFILE

which is largely pension funds with a long-term investment commitment and focus, we have been able to ride out the noise,” Seseli explains. “When we are exposed to the economic downturn, it’s with respect to unemployment and its effects. It’s a big issue, upwards of 25%, and that is meaningful. When the global and regional economies slow, jobs are shed and people withdraw from institutional savings such as retirement funds. We have seen that, but it has not been significant. Does the ratings story scare us? Yes. The cost of borrowing would increase, there are strong concerns about employment creation, there are retrenchments and therefore more drawdowns out of retirement funds and institutional savings but over time these things correct.” With the SA economy not expecting to realise major growth for some time, the decision on your asset management partner becomes all the more important. During periods of uncertainty, you need a firm that is well-established, with a reputable brand and with people that know the industry intimately. “Over the 11 years that we’ve been around, we’ve built quality relationships. People understand that we are trustworthy partners and I have seen that people will switch away from firms that are less trusted to firms where they feel comforted, understood and listened to. In difficult times, you want a trusted partner and as a brand we have proven to be that partner,” says Seseli. INVESTING IN PEOPLE As we discovered last month, people and culture development is now one of the hottest topics in business management circles; how can you constantly develop your employees while always building a structure around them which allows them to blossom? It’s a difficult task, but those who get it right reap the rewards. At Argon, the career and personal development of existing and future employees are catered for but the

company is not hiring for the sake of it – each employee is an asset and everyone has to meet certain standards. “In an environment which is as dynamic as the financial markets space, where economic performance is very important, employers need to apply stringent criteria when selecting employees,” explains Seseli. “I want to be able to have a skillset that enriches our ability to be client relevant. We need to respond and stay ahead of change and ask ourselves the correct questions about how we are positioned relative to our client relevance. Client relevance is about growing wealth on behalf of your customer so if we are unable to navigate changing environments with our current skill set I would be very concerned. “With future staff, it’s important to have people coming into an environment with an appreciation for the global environment. Through our partnership with Schroders, we send our graduates to London to interact and learn about investing at a global level. In that programme, there are other young professionals from different geographies. When our graduates return to South Africa, they have been introduced to and accustomed to a global operating framework, which we believe is positive for our client relevance. I’m passionate about people development because I’m passionate about client relevance,” he says. “With our grad programme we screen candidates for three things: Firstly, academic capability, they must have above average grades; secondly, leadership potential or demonstrated leadership, they must have a way that they carry themselves with accountability; and finally selfawareness, emotional intelligence is everything and people must understand themselves relative to others, which is an important element of building effective teams. Our seven

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current graduates scored highly in all of these areas.” The graduate programme, which takes place over three years, is something that has helped Argon unearth excellent talent, even some from outside of the popular South African metropolitan areas. “We will grow our presence slowly. As we build our assets under management, we will be able to deepen our strategies as well as broadening the range of strategies that we offer and this means we will always need more people. “We pride ourselves on creating an environment where you can define how far you want to go in terms of your own development. We introduced a coaching programme six years ago to ensure people are supported in their careers and we want an environment where people will share their ideas and are recognised for those ideas – culture development is critical,” says Seseli. As the industry continues to change, thanks to Argon’s stubbornness to remain true to its values, the future looks very positive for this growing business. Fee models will be transformed, demographics will change, new breeds of asset manager will emerge, technology will continue to advance and regulations will always adapt, and where some will find these changes overpowering, Argon’s nimble and dynamic framework makes for an organisation that will thrive. “We’ve always been clear with what we want to achieve: Investment success on behalf of our clients,” Seseli concludes.

ARGON ASSET MANAGEMENT +27 21 670 6570 info@argonasset.co.za www.argonassetmanagement.co.za

ARGON ASSET MANAGEMENT

CEO MOTHOBI SESELI

NECSA

Nuclear Build Programme Has All Eyes On Africa

PRODUCTION: David Napier

South Africaâ&#x20AC;&#x2122;s much-discussed Nuclear New Build Programme continues to make headlines every month and while officials continue to prepare for a busy time ahead, the South African Nuclear Energy Corporation is making plans to build on its expertise and create a flourishing nuclear industry.

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BUSINESS PROFILE

KOEBERG NUCLEAR POWER STATION

In order to support economic growth and development, a mix of sustainable energy sources must be sought in South Africa. In his State of the Nation Address earlier this year, President Zuma said South Africa plans to introduce 9,600 MW of nuclear energy in the next decade, in addition to running the Koeberg Nuclear Power Station in the Cape Town. At a press conference for the NCOP in September, Deputy President Cyril Ramaphosa said: “In pursuing a suitable energy mix, government is determined that our investment in generation capacity should be evidence-based, sustainable and affordable. “As indicated by the

Department of Energy in December 2015, any decision to proceed further with a nuclear build programme will only take place after the Request for Proposals process has been completed and a final funding model has been developed.” Deputy Director General for Nuclear Energy at the Department of Energy, Zizamele Mbambo said: “The nuclear programme shall contribute to government’s socio-economic development and transformation agenda.” The expectation is that by 2030, the roll-out of the hugely important Nuclear New Build Programme for 9,600MW of nuclear power will be well under way so Enterprise Africa decided to talk to

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one of the most qualified men on the subject, the CEO of the South African Nuclear Energy Corporation (NECSA), Phumzile Tshelane who was in London at the World Nuclear Association Symposium. He explained that all eyes in the international nuclear industry are on South Africa. “In terms of plans to build between six and nine reactors, no one else is talking like that. We’re not just talking about reactors, were talking about nuclear fuel cycles, the nuclear manufacturing industry, training and development – we have the biggest ambitions in the world at this stage. “We are working on the nuclear build closely with the government. The site studies and

NECSA

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impact assessment report has been sent to the government – that’s an important step. The site nuclear license has been issued to the regulator to evaluate. We’ve started training hundreds of people in China, Korea, Russia and France to be able to participate in this programme so that we are ready. “In December last year, it was announced that we should reconstruct some proposals and we’re busy with that now and we are finalising consultations as it is a 100-year relationship and don’t want to rush into it with the wrong partner. We’re working strongly to align everyone with the programmes – even opposition parties. “I expect that when we begin to move forward with this development, the landscape will

the primary sources of energy, especially electricity in South Africa, there are a few that we can choose from. We cannot do hydro – we don’t have the rivers or the rain, we’re semi-arid as a country. Wind and solar are still taking flight in a small way. We have coal in abundance and more than 80% of our electricity comes from coal but we shouldn’t be putting all our eggs in one basket. “The nuclear option becomes more than natural as we mine gold in South Africa and with that we find uranium. We don’t have a single uranium mine, we only have resources that come from gold mining activities and there

change internationally. Others will see what we are doing and realise what’s possible,” he says. PREPARED FOR NUCLEAR Currently, the South African electrical energy mix is made up of multiple sources including coal, nuclear, gas, renewable, and other small contributors. As a nation that has successfully operated a full-scale nuclear power plant for around 30 years and a nuclear reactor for 50 years, improving the mix with more nuclear power seems like a logical choice. “Our demand for power far outstrips the supply,” explains Tshelane. “When we look at

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is a cost involved in separating uranium from gold. We do have deposits that we can mine but we have such resources above ground that it is not economically viable to mine, but some have started preemptively exploring which is a good idea. We have long coast lines that suit nuclear power stations and our economic hubs are landlocked so it makes sense to deploy our uranium resources around the coast and bring industry,” he says. Long-term plans have already been discussed and Tshelane is excited about the future saying: “We would certainly be interested in gaining stakes in uranium mines and in partnership with the government we are looking at various mineral rights to ensure we can beneficiate successfully. “Developing a mine is not

an overnight thing, you have to apply yourself for the long-term. Fortunately, we are the best in the world when it comes to mining.” These plans remain some way off and although Eskom has been commended recently for stabilising supply across the country (needing little, if any, load-shedding), the network as it is right now sits on the edge of a knife. When planned maintenance takes place, there’s always concern around the security of supply. In September, Unit 1 at the Koeberg power station was taken offline for a planned refuelling outage where one third of the used nuclear fuel is being replaced with new fuel. This happens every 15-18 months as part of Eskom’s overall maintenance programme for its fleet of generation units.

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28 / October 2016 / www.enterprise-africa.net

But away from power production, with the research reactor, Tshelane is confident that with the organisation’s detailed inspection and maintenance programme, NECSA’s jewel in the crown, the Safari-1 reactor will remain important for years to come. “ The Safari-1 reactor is the best operated reactor in the world right now,” he says. “We operate for more than 300 days a year and nobody else does that. The primary focus is with age management. The strategic focus is to build another reactor that can replace Safari at some point because she works very hard but she is old. The lifespan of a reactor depends on many things including the vessel. As you run it you produce neutrons which impinge on the vessel and create ageing. If you operate as we are at 100% capacity, you can estimate how long it’s going to last. However, our reactor has not always operated at 100%; it has only operated at 100% for less than 10 of its 50 years and so we think that by 2035 it will be ready to retire but with the work that we’re doing, we’re trying to push it out as far as possible.” HEALTHY FUTURE NECSA holds the vision of ‘pursuing nuclear technology excellence for sustainable social and economic development’ but with the imminent build programme allowing the organisation to take a step towards this vision, Tshelane is also keen to remain strong in other areas where South Africa currently excels that might not be so readily associated with the nuclear industry. As the world’s second biggest exporter of nuclear medicine, South Africa holds and important position in a market which is significant to millions around the world. “We are the second biggest

NECSA

www.enterprise-africa.net / October 2016 / 29

BUSINESS PROFILE

30 / October 2016 / www.enterprise-africa.net

NECSA

//THE SAFARI-1 REACTOR IS THE BEST OPERATED REACTOR IN THE WORLD RIGHT NOW// market share holder in terms of medical isotopes. It’s very important to realise that Canada has the largest share and we are ahead of all of the other major economies including the UK, USA, Russia, China, Japan, Korea and all the others - we’re very proud of that,” says Tshelane. “We have the desire and we are daring and that takes us places. “We export Melinda-99m which decays into Technetium which is injectable and can diagnose cancer. You can pair it with other organic material and it can eradicate cancer cells. That is our biggest export product. We also export Iodine-131 which is used to treat thyroid

ailments and that is our second biggest export. We sell mainly to the US and our second biggest market is Europe,” he adds. With NECSA and its subsidiaries considered by international counterpoints as an example to follow, this side of the business is something which can grow and which Tshelane is very keen developing. As the Nuclear New Build Programme progresses and more concrete decisions are confirmed and contracts allocated, NECSA will find itself in the driving seat of one of the most important projects in the history of the country and the industry. ideas will need to shared and technology will need to discussed and this will be beneficial to South Africa, the African continent, and the international nuclear industry. It’s important, it’s needed, it’s safe and it’s going to happen. Next month we will take a closer look at Tshelane and the history of NECSA and find out what prepares you for such a big step towards energy security and all of the other benefits that come with a thriving nuclear industry.

NECSA +27 12 305 4911 webmaster@necsa.co.za www.necsa.co.za

www.enterprise-africa.net / October 2016 / 31

SAOTA

Architecture at the Forefront

PRODUCTION: Timothy Reeder

Driven by the dynamic combination of Stefan Antoni, Philip Olmesdahl, Greg Truen, Phillippe FouchĂŠ and Mark Bullivant, SAOTA is a firm of architectural designers and technologists which pairs its innovative and dedicated approach to the execution of projects with a potent vision in its designs.

BUSINESS PROFILE

Thanks to its unique understanding of an everevolving industry, SAOTA continues to build on its past experiences which today leaves it well positioned to offer expert services to the corporate, institutional, commercial and residential marketplaces. Although its roots are deeply South African, SAOTA now has an international footprint and projects spanning five continents. Indeed, the vast majority of the company’s work is now based overseas, from Los Angeles, Miami and Mexico to Moscow, Shenzhen, Sydney, Dubai and Lagos, rendering SAOTA a global Architectural Design firm. Enterprise Africa spoke with Director Greg Truen, who outlined where the company finds itself today: “If we consider the whole group together,” he explains, “which

consists of architecture, interiors as well as small furniture business too, it’s around 200 - although we have possibly just surpassed this. The architectural side probably numbers 120 staff all told.” Together with in-house CGI and marketing teams, as well as a strong support staff, this allows SAOTA to bypass the ever-risky world of outsourcing in favour of applying its own creative vision to all it does, as Truen explains: “We tend to ask the client to appoint other consultants directly - we’ve always been very careful in applying our scope and our appointment in a much more streamlined way. It’s a difficult business to begin with, even without taking on board such risks which clearly are more the responsibility of the client.” It is this careful, detailed approach

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which led SAOTA to a top award at the 2016 edition of the Architizer A+ Awards, in its Popular Choice category for residential developments. OVD 919 was completed in 2014, and is nestled below Lion’s Head in Cape Town. A design which truly has to be seen to be appreciated fully, it is a family home which capitalises on the spectacular views which surround it, with the architecture drawing its strength from the concrete finish used to create monumental forms which contrast sharply with the dwelling’s copper roof. Greg Truen himself joined SAOTA in 1995, and so naturally has been party to great change within the industry. “I was only two years out of varsity at that time and so just started off as a young architect, and I think back then that we were a team of around 14.” The biggest influence in

SAOTA

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BUSINESS PROFILE

the shift in the architectural world since then? “The internet, without question,” he laughs. “We are out here on the Southern tip of Africa, miles away from anywhere else, and when I finished studying we could only participate in what was going on by reading magazines and buying books. It was a very slow flow of projects which were being completed, whereas now I have 15-20 new blogs in my email account each day and I know exactly what is happening in the world. It’s allowed us to really be involved at the heart of what is going on, and also to communicate,” he adds. To propel SAOTA to the forefront of this industry where it dwells today has not been without its trials, as Truen explains: “Among our main challenges has been the building of teams possessing the correct skill sets. We have found that it is increasingly difficult to employ more experienced people, so we have developed a model whereby we seek good, recent graduates and accept that over the next three or five years we need to grow them into being able to take charge of production and

design teams. Obviously, alongside this markets are very challenging as well, and as a result we like to work on projects that present the absolute minimal risk. “That inevitably comes with its own difficulties, but we are very lucky in the sense that we work across such a breadth of cities and countries that we tend to find that different locations enter our radar almost on a cyclical basis. Take for example somewhere like Lagos, which was at one time the biggest single city in which we operated in terms of revenue. While it has not quite vanished from our conscious it has significantly scaled back, and other cities have stepped in to pick up some of the slack.” SAOTA recently attracted a considerable amount of attention thanks to its central involvement in the prestigious Clifton Terraces development. Surrounded by Lion’s Head, Table Mountain and Clifton’s picturesque beaches, the site provides a private and serene enclave described by many as, “the perfect embodiment of the Western Cape itself.” However, SAOTA is retaining its

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characteristic scope and vision across the board. “We have a very broad basket of projects on which we’re working at present. We come from the one-off villa market and so that work still represents a fairly large chunk of what we do, but aside from that we also take on a lot of multi-residential developments, by which is meant things like apartment buildings - more and more hotel projects, for example and then we’ve also tackled a little bit on the educational side, so it’s a real mix. The residential constructions still represent 50-60% of our work, though, and that is definitely what we and our brand is best known for.” When pressed on what helps to set SAOTA apart from its many competitors, Truen is able to point to the footprint the company has developed over its operational life. “I think in South Africa we are much more internationalised than other companies. We have definitely constructed a platform which is designed to allow us to work anywhere, and an aspect of that is our commitment to engaging with local consultants wherever we may happen

SAOTA

to be working. A lot of the other South African groups use a model whereby they try to take their whole team with them and thus control the whole process, and so we work quite differently in that way. Our projects are all for local clients and with local teams, which has unlocked new networks and gives us much better insight into what is going on on the ground and what opportunities there are.” This is another aspect of SAOTA’s success that has been greatly facilitated by the technology available to it today. The company employs REVIT, the leading Building Information Modelling (BIM) software available, allowing it to develop and document a building in a threedimensional environment. Any changes are immediately co-ordinated through the entire documentation

package and it gives unprecedented control over the co-ordination of structure and services when working with consultants using the same platform. “Using REVIT has allowed us to communicate much more easily with clients and consultants because everything is in 3D, and this has proved a much more effective way to work,” Truen say. “We’ve actually had a few of our own consultant architects come through our REVIT training school too, and have striven to give some of those establishments access to our systems to provide a singular base from which to work.” Looking forward, Truen details how SAOTA will continue to build on its sturdy foundations to enable further growth in both stature and prestige in years to come. “We will

look primarily to do much more of the same as we have in the twenty years since I came on board, although with a slightly greater focus perhaps on hospitality work, which can be very lucrative. We are also starting to use virtual reality (VR), which I think will be the revolution which we are about to experience, and really integrate that into our design process. Essentially, we will seek to establish an even greater foothold in this incredibly diverse market.”

SAOTA +27 21 468 4400 info@saota.com www.saota.com

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www.enterprise-africa.net / October 2016 / 37

BIG FIVE DUTY FREE

Definitive

Duty Free Shopping

PRODUCTION: Timothy Reeder

Boasting a world-class array of goods, from jewellery and liquor to toys and clothing, Big Five Duty Free strives to offer the very best in discounted airport shopping, just moments from the sights and sounds of the runway.

Big Five Duty Free is run today by the husband and wife team of Marina and Chris Harilaou, with the origins of the company dating back some 40 years to a time when the concept of duty free shopping had not registered in the South African conscience. “The formation of the company is a long story,” the pair explain, as they take us through its earliest days. “It was originally established by Marina’s father, an immigrant who came into the country from Greek origins. He started the business at grass roots level alongside a partner, at a time when duty free simply wasn’t present in South Africa. It’s fair to say that he was the pioneer of the

duty free business in South Africa, helping to construct its foundations in the country’s airports and setting the foundations for where we see it today. “He had obviously travelled” adds Chris Harilaou, “and seen that there were duty free outlets in other countries, but not in South Africa at that moment. Airports existed on a much smaller scale compared to what we see today, of course, offering maybe one international flight departure each week. He saw this gap in the market as a real opportunity and so approached our government with his proposal and long term commitment and he was given the opportunity to kick start this business in the country.”

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BUSINESS PROFILE

HISTORIC SUCCESS Subsequent governmental, political and environmental changes played significant roles in shaping the business moving forward, with its structure having been required to constantly adapt to the times over the course of its 40-year existence. “Jump forward to 1994,” continues Marina, “and South Africa becomes a democracy, which itself brings change within the country, as well as the airports themselves. The formation of ACSA, the Airports Company of South Africa, a parastatal, was influential in the direction that the business took. In 1999 they re-tendered for all the business at the airport, and one of the requirements was that the successful tenants have either a partner with an international background, or that the bidder themselves had it. This led my

father to partnering with another four companies, and led us to the concept of the ‘big five’ - we were five companies in total.” From then until the present day the company has continued to evolve and today consists of three partners, with a staff compliment numbering around 430. “We have branches in all of ACSA’s international airports,” Chris explains, “including Cape town, Durban and Johannesburg. We are also heavily focussed on social and economic development within South Africa - that is a central concern of ours and forms part of our commitment to the furthering of the country as a truly South African company ourselves. We operate solely within the borders of South Africa, with no stores outside of the country.” As an innately South African

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company, for Big Five Duty Free the social responsibility element of its operations goes far deeper than for many others. “It’s fundamental; it’s one of the pillars of the company, a foundation. We have a whole team of people focussed on our campaigns and how we carry them out - Freddy the Teddy for example runs every December and we are now in our fourth year of running it, which offers our customers the opportunity to donate the bears to various charities which we fund, and children in surrounding areas are the recipient of the bears. We also have four schools which we subsidize each month, because government subsidies are not sufficient to allow them to operate month to month, with a particular focus on younger and disabled children.”

BUSINESS PROFILE

FLYING HIGH Helping to keep Big Five Duty Free at the forefront of such a competitive and at times turbulent market is its approach of constant innovation. “We see the duty free environment as similar to a fashion brand,” explains Chris. “It’s essential to keep strong foundations to the brand, but equally important is to keep changing and providing something innovative, new and exciting for the consumer. After three or four years the business will need to be remodelled, and we are constantly in the process of upgrading our shops. Currently in our flagship store, in Johannesburg OR Tambo International Airport, we are redesigning a major section of our shop which includes the confectionary area - a big segment

of our business. Brands themselves have also changed through the years, as Big Five have had to recognise. “We have to keep up with the different markets and niche products which are evolving on a yearly basis. This also requires innovation as far as the units are concerned the design, display and sale of products, all of which we are busy implementing now in one section of our shop.” Big Five prides itself on its ability to strategically undertake such developments in stages in order to prevent any disruption to its operations. “This kind of upgrade wouldn’t take more than a few weeks to effect completely. We’ve never closed a shop down because of necessary renovations, and have always managed to run in sync with

Cell: 084 390 3841 / 084 498 4012 Landline: 011 952 2443 E-mail: martie@gbstransport.co.za

www.gbsti.co.za We render a fast and sufficient overnight courier service country wide as well as cross- border. Our prices are very competitive and our service is excellent! We are a same day/ overnight delivery company and for that reason, we are in great demand.

The Golden standard of Delivery

42 / October 2016 / www.enterprise-africa.net

keeping the shop open, however fragmented or temporary this may be. “We always look for international brands which we can bring in as add-ons,” continues Chris, as he talks us through some of the factors underpinning Big Five’s continued success. “A lot of big brands feel that South Africa’s airports are not ready yet for the expansion, while some have already felt that the time is right and invested. We can only trade with products that the market is ready for. A huge segment of the African market as a whole still comes to shop in South Africa, It is therefore imperative that we cater for our consumers specific needs. “For the moment though, in order to keep people coming back we offer value for money and are as competitive as possible, alongside a range of promotions which are in effect on a continuous basis in the shops. We do extensive marketing and place a real priority on service to our clientele - we have a lot of repeat customers, particularly on the business side, which has seen our strike rate increase in the airport itself year on year. We are showing double digit growth in an economy where passenger growth is single digit at the moment. While it’s not always easy in these economic times, we are constantly looking to offer our customers the best possible deal.” TAKING FLIGHT IN AFRICA? So focussed is Big Five Duty Free on cementing its position at the very top of the South African competition, that its immediate development plans centre around growth within the country itself rather than looking outwards. This is not without its challenges, as Marina explains: “As South Africans we are facing our own challenges, not least in the fluctuating nature

BIG FIVE DUTY FREE

of the currency at present. We are a very young country within a very young democracy, so Chris and I as leaders for the company want to stabilise Big Five in South Africa, and equally make it a truly African duty free company. “Only once we have achieved this will we look to take it even further, but we are not looking at expansion on our door step right now, and certainly not within the next two to three years. “We’ve tried to grow a business within the duty free market that’s

recognised as a brand in South Africa or sub-Saharan Africa. If you look at our client base, a big percentage is European while the Americas are also important, but the African market remains one of our biggest. We welcome our African visitors who in turn spend a lot of money with us, and we strive to look after them, and as a result they recognise the brand. They know they will receive genuine products at competitive prices, and with the highest level of customer service. That’s really been our

main focus and driving influence: to provide an A-grade shopping environment that’s as competitive as any other duty free operator worldwide.”

BIG FIVE DUTY FREE +27 11 390 2670 customercare@bigfivedutyfree.co.za

www.enterprise-africa.net / October 2016 / 43

PHOENIX AVIATION

Reinventing Air Travel

PRODUCTION: Timothy Reeder

Phoenix Aviation seeks to deliver quality, consistency and the highest level of professionalism to its broad range of clients. This stretches from its finely engineered aircraft to the superior maintenance of the fleet and training of its pilots, together with its famous no compromise approach to maintaining safety and ensuring peace of mind.

www.enterprise-africa.net / October 2016 / 45

BUSINESS PROFILE

BA private executive air charter company operating from Wilson Airport in Nairobi, Kenya, Phoenix Aviation aims to subvert the traditional notions of air travel, be that crowded terminals, long waits in security, or connection and checkin lines, in favour of a convenient and stress free approach. Its unparalleled air travel service delivers reliable and economic solutions tailored to meet a broad

range of needs and customers, free of layovers and unscheduled delays and offering customers the opportunity to travel when and where they may desire. This freedom is one of the key concepts underpinning its existence, with aircraft which are able to take off and land at more and remote airstrips than conventional scheduled airlines, taking clients closer to their destinations at a time which suits any schedule.

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Opening its doors for the first time in 1994, Phoenix originally had a dual focus on the repair and maintenance of light aircraft within East Africa, and air ambulance services. Even today, both of these operations still form a large part of its business. Phoenix Aviation currently possesses a large range of aircraft, with its diverse fleet comprising a Citation Excel C560, four Citation Bravo C550s, four

PHOENIX AVIATION

Beechcraft King Air BE200s which all boast with pressurised cabins, as well as a Beechcraft King Air BE350, two Grand Cessna Caravan 208Bs, a McDonnell Douglas MD 83 and a Eurocopter AS350 B3. These are all equipped with the latest innovations in safety and technology, to succeed in meeting the demands of its diverse clientele, while the company also has access to a number of privately owned aircraft. Such an unparalleled fleet is a significant reason behind Phoenix Chairman Bill Parkinson’s assessment of the company’s standing in the market. “I regard Phoenix as the quintessential air charter company in East Africa,” he states. “We strive to lead the way on all levels of our business, and I believe that this is defined in our approach, ability, pilots, staff and state of the art technology.” As Managing Director, Satwinder Reel has some 45 years of experience within the field of aeronautical engineering. Holding licenses from C.A.A. UK, F.A.A., K.C.A. (Kenya Civil Aviation), TZ C.A. ( Tanzania Civil Aviation) and U.C.A. (Uganda Civil Aviation), he applies this to his role of personally heading up the company’s engineering department. He is licensed on the Citation Excel C560, all Cessnas, Pipers, Beech Craft, Lycoming and continental engines, and as the only Engineer in Kenya qualified to work on the Citation Bravo, he has acquired a breadth of experience across the United Kingdom, United States, Canada and South Africa, including pre purchase inspections of aircraft for clients throughout the world. Phoenix General Manager Shaun Barretto goes on to make explicit the company’s primary concern: “Safety is the backbone of everything we do. Our attention

//PHOENIX IS THE QUINTESSENTIAL AIR CHARTER COMPANY IN EAST AFRICA // to every small detail is what sets us apart from the competition.” Chief Executive Officer Steve Parkinson builds on this further, adding: “Phoenix Aviation is one of the oldest aviation companies in Kenya with a fully developed Safety and Quality system that exceeds European standards in some cases,” leaving no doubt as to the peace of mind on offer when employing the company’s services. Of Phoenix’s permanent fleet, the Citation Bravo is one of the most popular, cost-effective and versatile private jets with the ability to land at shorter and narrower

airstrips than most other jets, whose luxurious leather interior comfortably seats four or five passengers. The King Air BE 350, meanwhile, offers a more luxurious version of the King Air 200, capable of faster speeds than but still able to land on some of Africa’s famously more challenging airstrips in both comfort and luxury. Phoenix’s Eurocopter AS350 B3 is, in contrast to a fixed wing aircraft, unique in its ability to hover and land without the need of a landing strip. Built with speed and precision in mind, flight transactions are guaranteed to be fast and fluid and, while Phoenix has been operating a state

Fuel marketed by Flamex meets

AVIATION FUEL QUALITY REQUIREMENTS FOR JOINTLY OPERATED SYSTEMS (AFQRJOS)

WILSON BUSINESS PARK I FOXTROT, 2nd FLOOR P. O. Box 1497 -00502, Karen - Nairobi Tel: +254 (020) 600 77 15 / 733 61 11 88 24 hrs.: 0703 911 000 / 774 260 706 Email: info@flamex.co.ke I Web: www.flamex.co.ke

www.enterprise-africa.net / October 2016 / 47

BUSINESS PROFILE

//OUR AIM IS TO DELIVER RELIABLE AND ECONOMIC SOLUTIONS TAILORED TO ALL AIR TRAVEL NEEDS// of the art Eurocopter helicopter since 2008, this was recently upgraded and sees them boast the newest and most modern helicopter of its type in East Africa. At its core, Phoenix Aviation is focussed on delivering quality, consistency and the highest level of professionalism to its clients. This is true of the full range of its operations, whether this be its famously finely engineered aircraft, with Phoenix the only fixed wing ISO 9001/2008 certified charter company operating in East Africa, or the superior maintenance of the fleet and the training its pilots

receive. Emblematic of this is Phoenix’s no compromise safety policy, which delineates that all of its charters fly with two pilots, while its safety certifications are second to none in the region. This allows it to take its flights through throughout Eastern and subSaharan Africa, Europe and even more exotic destinations, such as the Indian Ocean Islands. “Our aim is to deliver reliable and economic solutions that are tailored to meet all air travel needs,” the company states. “Our dedicated team is available 24 hours, seven days a week to ensure that the experience

International Trip Support & Flight Operations

Services:

• Worldwide Flight Planning • Fuel • Overﬂight & Landing Permits • Weather & NOTAM Services • Ground Handling • Crew Hotac

with Phoenix Aviation makes flying fast, comfortable, convenient and affordable.” AMREF Flying Doctors Air Ambulance Service has been in operation for 55 years and is the largest air ambulance service in sub-Saharan Africa, leading the way in medical evacuations and as such performing over 1200 each year. Its close working relationship with Phoenix Aviation dates back more than a decade ago and in partnership they have created a unique service that is used by many of the world’s leading Insurance and Assistance companies. Operating as a fully equipped Air Ambulance, the Phoenix Aviation Citation Excel and Bravo jets have the capacity to evacuate two patients at a time, which no other aircraft in Kenya is equipped to do to the same level of technology or specifications. The medical interior is complimented by AMREF Flying Doctors’ high tech sophisticated on-board medical equipment, and alongside Phoenix Aviation the pair are bringing operational and safety procedures together to ensure the best possible environment for both patient and clients.

Proud Suppliers to Phoenix Aviation Tel: +44(0)1323 811 093 Fax: +44(0)8542 800 159 E-mail: ops@flight-assist.com www.flight-assist.com ARINC: HDQFA8X AFTN: KLGWFJEO

48 / October 2016 / www.enterprise-africa.net

PHOENIX AVIATION +254 (20) 4945 540 | 541 flightops@phoenixaviation.co.ke www.phoenixaviation.co.ke

PHOENIX AVIATION

www.enterprise-africa.net / October 2016 / 49

ADVANCED HEALTH

A Growing

Health Care Footprint PRODUCTION: Timothy Reeder

A dynamic and burgeoning company, Advanced Health establishes, invests in and manages day hospitals in Australia and South Africa. With a central focus on the quality of its surgical outcomes, it prides itself on offering competitive rates for patients and medical schemes alike.

Advanced Health strives to be the industry leader in the provision of day surgery services through its net-work of day hospitals, inspiring confidence by focusing on the delivery of high-quality, cost-effective healthcare. Its day hospitals have come to embody modern healthcare facilities which are placed to carry out the very best short-procedure surgical services, while its marketleading sterile environment means that diagnostic procedures can be expertly performed on a same-day basis. Recent advancements in surgical and anesthetic technologies mean that in excess of 60% of all surgical in-terventions can be performed in day hospitals, without entailing an overnight stay. These facilities are

modern and compact, with both the correct equipment and staff to carry out these same-day procedures efficiently and at prices which can suit a variety of clientele. Advanced Health’s day hospitals are developed in partnership with leading medical practitioners who ensure that medical quality and technology objectives are met, while Advanced adds value through central services such as information technology and account-ing which focus on overall management, staff and bringing increased efficiencies. Advanced Health was able to report some significant success for the most recent year end in June 2016, coming with the publishing of its latest results at the end of August this year. Amongst the

most notable of the past year’s operations was the company’s having successfully achieved its expansion targets of owning seven new day hospitals in South Africa, in itself a landmark accomplishment. That it was accompanied by Advanced Health’s commissioning of Australia’s largest day hospital specialising in ophthalmic and ENT sur-gery makes it all the more momentous. All of this brings the company’s total current holding to nine opera-tional day hospitals in South Africa, bolstered by its trio in Australia. Of probably comparable importance to the company was a stunning revenue increase, of 34% compared to the previous year. This brought the total to some R241,1

www.enterprise-africa.net / October 2016 / 51

BUSINESS PROFILE

million, while the number of patients coming through its doors also rose, this time by 26%. The resounding good news was tempered slightly by the costs of development and settling-in associated with the new developments, which combined to see the company in fact post a loss of R15,7 million, against its 2015 profit of R22,2 million. However, this is of course to be expected in all such cases, particularly when the development in question is of this magnitude, and therefore when the 18 and 36 months for the development and settling-in respectively are up, Ad-vanced Health will look forward to seeing the realisation of the envisaged financial advantages in full. Amongst its compliment of nine facilities are the two Advanced Day Hospitals located in Roodepoort and Mpumalanga, as well as the

Groenkloof Day Hospital in Pretoria. Alongside these day hospitals Advanced Health also runs Surgical Centres; Durbanville and Panorama are both found in Cape Town, while Advanced Worcester Surgical Centre, Advanced Knysna Surgical Centre and Advanced Vergelegen Surgical Centre are spread across the different provinces. Bringing the total to the planned nine is Advanced Soweto Eye Hospi-tal. CEO Carl Grillenberger spoke of Advanced Health’s achieving its ambitious goal: “The target to have nine day hospitals in South Africa operational was achieved four months ahead of schedule, and our tenth is scheduled for opening in eMalahleni in October 2016,” he surmised neatly. Presmed Australia is one of the leading healthcare companies in Australia that specializes in establishment and management of

ophthalmology day hospitals. There was much to celebrate for this, the Australian sec-tion of the Advanced Health business, as Grillenberger went on to detail. “The opening of the Chatswood Private Hospital (CPH) in January 2016 represents a milestone in the growth of our Australian arm, PresMed Australia (PMA). It consists of six theatres with a femtosecond cataract laser procedure room and four private-warded overnight beds. A strategic decision was taken to merge the recently acquired Sydney ENT Day Surgery Centre with Ophthalmic Surgery Centre (OSC) and move it into CPH. The new facility will require a settling-in period, but the other PMA facilities of Central Coast Day Hospital and Epping Surgery Centre continue to perform to expectations.” The hospital industry is one

Medical Property Developers Benchmark Property Developments is a specialist medical property development and development management company. The directors, Hennie Bezuidenhoudt, Pieter Knoesen and Ivan Makkink have extensive experience and have been active participants in medical property development and investment since 1993. As a South African property developer/investor we aim to expand the business through partnerships, tailored made solutions for clients/tenants and co-investment with selected national and international property companies/owners. Our goal is to grow Benchmark Property Development’s ability to take on bigger projects locally and abroad through partnerships with property partners that can oﬀer land, private equity, experience, selected opportunities and expertise in other markets. Our core medical assets include: • Lifestyle Management Park, Gauteng Province. • Free State Medical Centre, Free State Province. • Pietermaritzburg Healthcare Centre, KwaZulu Natal Province. • Worcester Healthcare Centre, Western Cape Province. • Vergelegen Healthcare Centre, Western Cape Province. • Knysna Healthcare Centre, Western Cape Province. ALL THE PROFESSIONALS | ALL THE FACILITIES | ALTOGETHER

52 / October 2016 / www.enterprise-africa.net

ADVANCED HEALTH

which is constantly undergoing great change, which has meant that Advanced Health has itself had to maintain a philosophy which keeps it in line with the changes which are taking place. The move for example towards compact and customdesigned short-procedure facilities are being accelerated almost daily by newly available technology, the latest of which is key-hole surgery, which again complements modern anaesthesiological techniques. The Competition Commission inquiry in South Africa, meanwhile, into the cost of private hospitalisation is accelerating the move to treat short-stay surgeries in free-standing day hospitals. This has meant that, following an initiative by Discovery Health to provide sur-geons with an incentive to use day hospitals more, medical schemes are now actively

promoting the ad-vantages day hospitals offer, in terms both of cost and patient comfort, whose benefits Advanced Health is reaping. The success that the Advanced Health business model has brought centres around strong dayhospital teams and partnerships, together with participating medical practitioners which come together to ensure that medical and quality objectives are met. Underpinning these teams is an expert central team which works to ensure effective management, staffing and shared services such as information technology, mar-keting and administration. Its properties are developed and owned by property developers, while tenure is secured through a long-term lease agreement with Advanced Health. All of this combines to ensure

that Advanced Health is on track to achieve its next primary objective of man-aging 20 day hospitals in South Africa and six in Australia by 2020. Grillenberger goes on to conclude that, “management continues to evaluate additional day-hospital investment opportunities in South Africa and Australia. At this stage we shall open two new day hospitals in South Africa before the end of the 2017 cal-endar year and we have strengthened staff at central level to enable us to continue meeting growth and quality objectives and to realise long-term succession targets.”

ADVANCED HEALTH +27 (0)12 346 5020 www.advancedhealth.co.za

Medical Property Developers Following 23 years of experience and positioning in the medical developments market segment, Benchmark Property Developments (BPD), is today a leading small/medium-sized medical specialist facilities developer and operator. • • • • •

Medical property developers of choice with focus and experience Understand specialised demands and requirements Hospital development, redevelopments, turn key solutions and property facility management Medical consulting rooms, specialised medical services, pathology, radiology, renal dialysis, day hospitals, sub-acute hospitals Seeking new development opportunities

www.benchmarkproperties.co.za hennieb@benchmark-group.co.za Tel: +27126635200

www.enterprise-africa.net / October 2016 / 53

G4S

From SA to

The World PRODUCTION: Manelesi Dumasi

The largest private security employer in Africa, and certified as one of the best, G4S is now bringing technology and ideas developed on the continent to the rest of the world.

www.enterprise-africa.net / October 2016 / 55

BUSINESS PROFILE

Perhaps one of the world’s most recognised brands, not just in the security business but across the board, G4S is the leading security services provider in the world, with operations in more than 100 countries across six continents. Its business models, technologies, ideas, solutions and service offerings have been replicated by companies looking to follow in the footsteps of this industry leader which started life modestly in 1901, entering South Africa in 1957. Following a number of high-profile successes in Africa in the last 12 months, G4S is buoyant and looking to continue on the growth path which has seen it develop to employ more than 119,000 people, servicing more than 75,000 customers across 29 of the 54 African countries. G4S Regional President, Africa, Mel Brooks (formerly CEO of G4S India and South Asia) tells Enterprise Africa

that the African continent presents huge opportunities for growth. The large-scale security challenges that are already present on the continent coupled with the ongoing influx of international organisations setting up here makes for a challenging but exciting environment. “Africa is an exciting and important regional market for G4S,” he says. “Even though there are many challenges to doing business in Africa, the continent still remains an attractive market to tap into and presents enormous growth opportunities. A combination of proven approaches, services and technologies are essential to address the multifacetted security challenges Africa faces, and to instil continuous business growth.” Brooks, a leader with experience in a number of senior line and functional roles in the defence and technology industry, is keen to modernise the business and integrate technology as an

56 / October 2016 / www.enterprise-africa.net

aid where possible. “I believe that the future of the security industry will be heavily influenced by technology and that there is huge potential for technology in the African market. Although our prime regional focus will continue to be our core services of manned guarding, cash security and facilities management, the intention is also to bring new energy and innovation to our electronic security sector and its consultancy role services in Africa,” he says. In 2015, Africa was the world’s fastest-growing region for foreign direct investment. In 2014, the global greenfield FDI market grew by just 1% but Africa enjoyed a 65% increase in capital investment on the previous year, to an estimated $87 billion with the number of FDI projects in the continent growing by 6%. All of this investment means that global companies are clambering for a share in Africa, which has been described

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Learn more at www.mixtelematics.co.za

BUSINESS PROFILE

by McKinsey&Company as ‘the last major region on Earth that remains largely unexplored’ and a region which will have ‘a prolonged phase of rapid growth’. G4S is experienced in Africa, probably as experienced with PanAfrican operations as they come, and Brooks is confident that the company can help to “hand-hold” as global business move onto the continent. “We have a number of global clients already in Africa or who are showing interest to do business on the continent, where the security aspect is significant. My promise to them is that we can be wherever they are and wish to be. “We have several customers that require our services and expertise on a Pan-African level. G4S prides itself in understanding ‘the bigger picture’. We have a diverse variety of services, ranging from Cash Solutions, Manned Security and Courier Services to Security Systems, Risk Services and even Justice Services, to meet our customers’ requirements and have a broad geographic footprint to meet demand for security in Africa and globally. “We use our global expertise and knowledge derived from providing security solutions in diverse regulatory environments in over 100 countries around the world, combined with local knowledge to provide our customers in with elite and tailormade security solutions in Africa. “If we continue on our quest of providing our customers with tailormade, innovative and integrated security solutions, I believe that our business in the Africa region will reach new frontiers and continue to grow,” he says. INNOVATION Globally, G4S has developed innovative products and services

for the exact requirements of customers who operate in challenging situations. In Africa it’s no different. Recent innovations include the Bank Cash Accepting Device for Capitec, the mobile banking solution or ‘Bank-in-a-Box’ offering rural banking services, and an e-commerce solution for OLX in Kenya. The partnership with Capitec Bank involves technology that is being used in a bank for the first time. “I am extremely happy with the development process of this product, especially when we look at the way that we have worked with our customer to assure that the product meets their needs, improves their security and increases overall efficiency,” says Brooks. “Similar in function to G4S Deposita Cash Accepting devices already in use by retail customers, it is the first time this technology has been developed specifically for the banking sector in Africa. “Each time a customer enters a branch to pay cash into their account, they hand it to the bank teller, who deposits the money in the device situated behind their counter, which counts it, detects any fraudulent notes, provides the teller with an amount to credit the customer’s account and then acts as a secure safe for the cash until it is collected. By automating the process of depositing cash, it increases the speed of deposit transactions, minimizes overheads and also reduces the cash-in-transit and processing costs by ensuring the cash is processed closer to the source,” he explains. “Deposita allows a retailer to do exactly what we’re doing with Capitec and that is to improve the efficiency of its cash cycle. Cash is taken from a cash office or till and is deposited into the machine. That machine gives real time acceptance

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and puts that cash into the retailers bank account immediately – real time recognition of cash, which is great for them as they can earn interest and they have cash flow instead of it being tied up in transit or in vaults. “We have more than 4500 retail Deposita units across Africa and we are now talking to all of the major banks and financial institutions about how we can assist them with cash automation and bank branch automation. Our aspiration is to follow our customers to wherever they need to be and that relies on the maturity of the banking environment and the local environment. In South Africa, banking is moving towards an increasingly sophisticated service support branch where machines take care of almost every transaction,” Brooks adds. The pilot project was so successful that G4S will now be installing a further 120 units of the Bank Cash Accepting Devices in Capitec Branches all over the country. “Across the group, we have a huge cash solutions line and we have technology centres in the US, Europe and South Africa. South Africa is and has been the front line for our hardware development, particularly around the Deposita business which we bought many years ago. We’ve merged technology developed in SA with the capability and competence from our US colleagues and now we have local technical expertise and global innovation so that we can provide a compelling solution. “What Capitec Bank appreciates most, is the fact that G4S has formed a long-term sustainable partnership with them. We have listened to our customer’s challenges and worked alongside them, to develop a tailor-made solution that meets their needs,”

G4S

says Brooks. The success of this innovation has resulted in international interest but G4S is focussed on continuing to tailor the service so that it constantly meets the changing needs of the customer. “We are now moving towards taking this technology overseas and utilising it across the group. Customers in Asia, Europe and North America have all had a keen eye on this trial. “With Capitec Bank, we have done exceptional work to innovatively integrate G4S technology with that of our customer. However, the buck does not stop here. Even now, after the roll-out process has been approved, we continue to work with Capitec Bank to continuously improve our solution offered and to further

advance the integration process,” Brooks notes. BANK-IN-A-BOX G4S’s Bank-in-a-Box concept was launched in December 2015 and the premise of this uniquely African product is bringing secure banking to workers in isolated, rural communities. Approximately the size of a standard shipping container and costing between $150,000 and $300,000 based on specification, this solution is being heralded around the world. “I am very proud to say that the actual unit was designed by G4S Africa,” says Brooks. “The concept is unique to the G4S Africa Region and utilises some of G4S’s main service offerings, including remote cash solutions, secure solutions, CCTV monitoring and response, first line maintenance, facility management

and technology. “In short, our Mobile Banking Solution (MBS) is a portable, fully equipped, plug and play, secured ATM unit that can be tailored to the customer’s needs – or as we would like to call it, our ‘Bank-in-a-Box’ solution. The idea is that our customer’s employees would be able to securely withdraw wages and be assisted in performing basic banking functions, as First Time Bankers (FTB’s) in remote locations. “The Bank-in-a-Box solutions is not seen as a replacement for a traditional bank branch, but rather a secured semi-permanent cash processing facility, that will save our customers and their employees, time and money,” he adds. The invention can expand to three times its transportable size and will come equipped with a Technology

www.enterprise-africa.net / October 2016 / 59

BUSINESS PROFILE

Data Centre, eight CCTV cameras, industrial air conditioning, industrial diesel generator, underfloor UPS, G4S Deposita, two G4S ATMs (internal and external) and can also include solar panels and staff toilets if required. Like the Bank Cash Accepting Device, the Bank-in-a-Box has attracted attention from international companies, operating in the UK and Scandinavia, and G4S is hoping to offer the service in many markets as soon as possible. “We’re even looking at border control. At a number of the borders around Africa, you have to use cash or transactions for Visa payments and so a small bank branch for people to draw or deposit money is perfect and it allows the banks to test services in remote areas,” explains Brooks. INTEGRATED SOLUTIONS In Kenya, G4S has partnered with online classifieds company, OLX,

//WE HAVE A NUMBER OF GLOBAL CLIENTS ALREADY IN AFRICA OR WHO ARE SHOWING INTEREST TO DO BUSINESS ON THE CONTINENT, WHERE THE SECURITY ASPECT IS SIGNIFICANT. MY PROMISE TO THEM IS THAT WE CAN BE WHEREVER THEY ARE AND WISH TO BE// to develop a system which utilises G4S’s extensive network to allow online shoppers to collect their purchases safely and securely. The simple system sees sellers taking their goods to any one of 141 G4S sites in Kenya, from where the packages will be securely transported to a convenient collection site for the buyer where security questions and ID confirmation ensure the package reaches the correct person. The

//THE CONCEPT IS UNIQUE TO THE G4S AFRICA REGION AND UTILISES SOME OF G4S’S MAIN SERVICE OFFERINGS, INCLUDING REMOTE CASH SOLUTIONS, SECURE SOLUTIONS, CCTV MONITORING AND RESPONSE, FIRST LINE MAINTENANCE, FACILITY MANAGEMENT AND TECHNOLOGY//

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package will arrive within 12 hours of it being deposited by the seller. “Our success in Kenya achieved with our e-commerce customers, is largely attributed to our wellestablished Transport and Logistics Business network in the country,” says Brooks. “G4S controls over 58% of the courier market in Kenya

G4S

and we have been operational in this sector for the last 45 years. We therefore already had the infrastructure in place, to roll-out a project of this magnitude. “The retail market is rapidly changing and more-and-more of our customers are reverting to selling their products online. “Only time will tell, but I am confident that we will be able to expand this service line, in an innovative and capable way, to meet our customer’s needs. Malawi, Ghana and Morocco (Morocco forms part of the G4S Europe Region) might be some of the key countries to watch when it comes to providing similar services in future,” he adds. Of course, these projects

are just a few of the innovative solutions that G4S provides for customers all over the continent – today the company is so much more than just security guards. Every month, demands and environments change and needs from an efficiency and security perspective need to be reviewed. Thanks to its scale and history, G4S is perfectly positioned to meet the ever-changing needs of its modern customers and this is largely down to its people, after all, innovation is driven by people. In the next edition of Enterprise Africa, we hear more from Mel Brooks and G4S about the challenges of managing such a large workforce, the excitement of being named a Top Employer and

the strategies that G4S is building to help advance the level of skill across the security industry. “We are always keen to find innovative ways to improve security, efficiencies and overall customer service - this forms part of our broader technology strategy in Africa,” says Brooks.

+27 (0)10 001 4500 crm@africa.g4s.com www.g4s.com

ESQUIRE TECHNOLOGIES

SA’s IT and Digital

Lifestyle Company Working in the Fast Lane

PRODUCTION: Manelesi Dumasi

Founders of Midrand-based Esquire Technologies, Asgar Mahomed and Mahomed Cassim, tell Enterprise Africa that the key to building a thriving tech company in a modern environment is innovation.

The South African IT sector is a strong contributor to the economy and one of the most sophisticated IT markets on the African continent. When it comes to mobile software, fraud prevention, revenue management, pre-payment and E-banking services, South African companies are some of the world’s foremost; many reports suggest that the country’s IT industry contributes more than R10 billion to the economy each year. With meaningful growth expected to return to the economy by 2020, as South Africa moves towards becoming a service driven society, the IT sector is a space that will

undoubtedly grow. As companies advance, as new businesses are created, as personal demand for IT equipment develops and as the fast pace at which technology outgrows itself increases, the industry is likely to experience further booms in the years to come. This is great news for one of the country’s leading IT and technology distributors, Esquire Technologies. Founded 17 years ago, this black empowered wholly-South African IT distributor has been innovating and creating milestones for itself since day one. “The company was started in 1999 and as a country, we were only a few years into

our new democracy,”CEO Mahomed Cassim tells Enterprise Africa.“The new government black empowerment laws helped to grow the business, we positioned ourselves as one of the leaders in the black empowerment space in terms of the distribution of IT and consumer lifestyle products. “We saw an opportunity in the market where there was no black empowerment distributor and we entered into the market as an already-approved partner. “One of the bigger challenges was that we were entering into a market that had companies who had long established

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BUSINESS PROFILE

ASGAR MAHOMED MAHOMED CASSIM

themselves for 20 years or longer and so we decided to become a champion for the SMEs. There were many small and medium retailers that were emerging and we decided to put our focus on those customers. “17 years later, we still haven’t changed our focus, we’re still a champion for SMEs and we still negotiate the best deals. One of the important parts of our philosophy is that we don’t look at how we sell; how we buy is the most important thing. If we buy at the right price, we can pass the savings on to the SMEs and that is our fundamental offering to the market place,”he says. HISTORY OF SUCCESS Over the years, as the SA IT sector has developed, and as the global IT offering has grown, Esquire has benefitted from better products, increased demand and easier access to markets. The company has picked up a host of awards from both local and international bodies and this has been down, in no small part, to the experience of the management team and the staff base. “Prior to starting Esquire, we had taken a company from building PC’s on a dining room table and lifted it to the stock exchange so we’ve been in the IT industry for more than 28 years. We’ve built strong international relationships over many years - I used to travel,

almost every month, to meet with suppliers. When we sold that company, we went back and said‘now we’re going into the SME market’ and started to build further bonds,”explains Managing Director, Asgar Mahomed. Cassim continues:“In the very beginning, I was working on sales and finding SMEs to partner with and Asgar was focussed on buying and negotiated with suppliers. We grew organically to where we are today with around 160 people across all regions including Midrand, Durban, Cape Town and Port Elizabeth. “In our first year of business, we did close to R3 million sales. The following year we did over R40 million so there certainly was a significant jump.” Today, Esquire Technologies is the go-to supplier for PC components, digital lifestyle and consumer electronics, gaming, accessories and peripherals, networking, security and surveillance, and many other tech-related goods and services and, due to the breadth of the portfolio of product ranges carried, it’s a constant evolution and as demand changes, so does the offering of Esquire. “When we started in 1999, we were focussed on IT products like networking, PCs and notebooks but over the last two years we’ve seen a convergence between IT and mobility. Everything is connected whether

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it’s your phone, home entertainment, SMART televisions and everything that has a USB port. We changed from being an IT-centric company to being an IT and digital lifestyle company,”explains Cassim. A CHANGING BASKET Right now, there is a huge shift happening in the technology world – one of the biggest of our time. We had the development of the internet, faster processors, instant communication but today constant connectivity and common connectivity have begun to change the ways in which we communicate once again, unlocking almost endless possibilities for business. Sometimes called‘the internet of things’, this development is already impacting on entire industries. Esquire has had to change with the times but at the same time help to bring clients up to speed with new technology offerings. “We had to help with our clients change in mindset because we had a lot who were very focussed on PCs so we had to educate them and explain that there’s more to this and explain that mobility products are becoming very important,”says Cassim. “We’ve seen phenomenal growth in connected products. Today, your PC can connect to your SMART TV, your phone, your tablet; there’s been a huge convergence

ESQUIRE TECHNOLOGIES

between IT and consumer lifestyle products. Even in business if you go to a modern boardroom, you’ll likely find a projector that is wirelessly interacting with multiple devices. We recently worked with a school where one of our resellers provided projectors and tablets so that the teacher can interact with everyone in a quick and efficient manner. Things are no longer one dimensional; you don’t just sit and read from a board. People are interacting, editing data, working with technology; it’s exciting times.” In order to create an environment where customers are happy to work closely with Esquire, firstly a recognised brand had to be established. Over the years the brand has become strong in the SA market and recognition was bolstered in 2010 when Esquire sealed a deal with FIFA for the manufacture and sale of IT goods related to the World Cup which took place in South Africa in the same year. “We are constantly brainstorming to

try and find new innovations for the market. When FIFA was here in 2010, we approached them and asked them about working together from an IT perspective. We came up with ideas for IT products such as CD wallets, mouse pads and other IT items and FIFA were amazed as it was the very first time someone had approached them in this manner,”details Cassim.“We launched those products and we had phenomenal success. We supplied them to Korea, Japan, USA, Canada; we had countries calling us demanding these products in time for the 2010 World Cup and it was a massive success.” THE INNOVATIVE VRN Another turning point for the company came in 2011 when Esquire launched its Virtual Reseller Network (VRN). Essentially, the network gives resellers access to the entire Esquire stockholding and allows the company to market products to a much wider customer base.

“With technology going the way it is now, with everything going online and e-commerce being a buzz word, we realised we needed to sit down and think how we could get involved,”explains Cassim.“We were looking at growing an online franchise but eventually we came up with the Virtual Reseller Network (VRN). We sat with a team of developers and built a platform. We have our website where our dealers can interact with our products but we replicated that on a resellers website. So, if we have 1,000 notebooks in stock, that is replicated on the reseller website; they can sell the product, collect the invoice and the order comes directly to our warehouse and is dispatched to the customer without any hassle for the reseller. Our VRN is a hugely important facet of our business and we won an award in Monte Carlo for innovation.” At the 2014 EMEA Channel Academy Awards, Esquire was given the EMEA Channel Academy Multichannel Initiative of the Year

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BUSINESS PROFILE

Award and, after eight years and R10 million investment, this was a high-point for the company. Frederic Simard, Director and Co-Founder at DISTREE Events, said:“We would like to congratulate Esquire Technologies in South Africa on winning the 2014 Multichannel Initiative of the Year award. The quality of entries was very high. The success of VRN demonstrates the importance of distributor innovation in EMEA channels – especially in emerging markets.” “We currently have around 550 online resellers on our network. On a daily basis we get people calling us and trying to get involved, we project that by 2018/19, we will have over 2,000,online clients”says Cassim. THE ECONOMIC HURDLE With South Africa’s economy currently growing at minimal rates, growth for many companies has been restricted and instead of investments and new projects, the focus has been consolidation. This is not the case for Esquire and Cassim says that each year continues to be an improvement on the last. “I meet people from all industries and everyone is bearish about business, about the country and about the economy, fortunately we have seen strong and steady growth in our business. We’ve grown month-on-month and year-on-year in recent years. We’re always innovating, always bringing out new ideas and products and in an economy like this you have to be focused and positive. When things are bad, you need to step up your game in terms of innovation.” As an importer, the company has been effected by price fluctuations due to the instability in the currency but even with that, thanks to strong demand for products, Esquire has managed to remain on a growth path. “From a price point, we have seen challenges,”Cassim says.“At some point we’re paying 40% more than we were on certain products but with technology, you need these products irrespective of fluctuations in price. Realistically, you’re not going to wait eight or nine months for a relatively small price change.” Over its 17 years, through political change and economic uncertainty, Esquire is a business that has grown not only in South Africa but further afield, in other parts of

Southern Africa as well. “We have tuned it to a fine art and we service Namibia from Cape Town, Mozambique from Durban and Zimbabwe, Malawi and Botswana from Johannesburg. We’re also active in Zambia and Swaziland. Even though we have a number of resellers in Southern Africa, we will not be moving into these areas but we do move a lot of product into these regions,”says Cassim. “Perhaps one of the greatest challenges is ensuring clients get their stock at the time and date promised and in that vein, we all depend on outsourced courier companies to pick up and deliver the goods concerned. “The Esquire group has invested in an infrastructure of staff, logistics and vehicles now wholly owned by Esquire called Courier Direct,”explains Mahomed. “Courier Direct is a self-sufficient entity that offers several options in terms of local and national deliveries within 24-48-hours. They have a fleet of vehicles for Gauteng deliveries and have agreements with other carries for national deliveries. This in turn, assists clients in bringing the overall costs down on deliveries by cutting out the third-party courier and ultimately saves the reseller money, yet another great innovation from Esquire. “Courier Direct assists our clients by ensuring their clients get delivery at a very competitive rate saving both time and money,” he says. TECH PEOPLE With around 160 people making up the Esquire team, development and recruitment is a matter that both Cassim and Mahomed take very seriously. Having some employees that have been with the company since the very beginning, the creation of an environment where all can thrive is something that the CEO and MD are very keen on. “There is definitely a skills gap on the IT side but we have extremely highskilled people here in terms of IT, web development and technical engineers. We have programmes in place where we train our people and keep them. From the very beginning, we have enjoyed taking people who know nothing about IT and training them up and giving them the opportunity

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to better themselves,” says Cassim. “We are always working on succession planning. What we do is identify key members of staff and work with them; they will sit in on all of the important decisions in the company and be a part of the future planning for the company. If we are not here tomorrow, the company will run as normal regardless. When we first got involved with the company, we said we wanted to make it into a machine,” says Mahomed. This internal focus is one which has had astounding external effects and sees the company ahead of, or on par with, some of the world’s leading IT distributors as Mahomed explains: “I meet a lot with overseas suppliers and companies similar to Esquire and we are ahead of most of them. Looking at the products and technology we bring into South Africa, looking at the way we innovate, looking at our staff, we are almost always ahead of most of our international peers. When we launched the VRN and won our award, we had people from all over the world asking us about how we did it and whether we would sell it. I think internationally, even in developed nations, there are companies that wish they could operate like we do.” The commitment that Esquire Technologies has to innovation is equalled only by its commitment to offer quality service to its customers. This is what has taken the company from a small computer supplier to a national wholesaler with international partnerships, and this is what will take it to the next level again. With growth coming every month, and with new initiatives coming online all the time, this is a business that is undeniably stuck in the fast lane and, thanks to the drive of is people, it’s not looking to slow down any time soon.

ESQUIRE TECHNOLOGIES 012 657 8500 info@esquire.co.za www.esquire.co.za

ESQUIRE TECHNOLOGIES

CHAS EVERITT INTERNATIONAL PROPERTY GROUP

The Real Estate Company that

Dazzles its Clients PRODUCTION: Karl Pietersen

Berry Everitt of the Chas Everitt International Property Group tells Enterprise Africa that despite economic challenges, threat from competition and a culture of talent poaching, his company continues to grow and is now recognised as a South Africa-based international real estate business.

As the biggest purchase that most of us will ever make, buying a home is a hugely important part of our lives and to make the process as stress-free and easy as possible, it pays to partner with a real estate company that has experience, credibility and international reach. While South Africa’s real estate industry is a crowded space with many competitors vying for market share, a few names stand out from the crowd thanks to years of excellence and one of them is Chas Everitt International. You’ll recognise the red, navy and white branding because the company is active in all of South Africa’s provinces and it is also growing its global presence with international partners. Founded in 1980 by Charles (Chas) and Tilla Everitt, the organisation has come a long way and is now regarded as one of the most prominent real estate businesses in Southern Africa,

but starting a company in South Africa during the 1980s was no easy feat and the family had to navigate many challenges, as CEO and second generation leader Berry Everitt explains: “My dad was the estate agent, home loans were obtained through a building society and I used to work there at the weekends. There was no computerisation back then, so we would look at the books, manually calculate transactions and stamp books, and it would be that book that established the balance for the next day. “We would get listings by canvassing door-to-door and on the telephone and when it came to selling, there was no internet, it was all newspaper adverts and word of mouth. We had strong family values and we worked very hard and that ethos has been maintained in the company over the years, allowing us to grow. “From a seed we grew a tree and we

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now have many birds making their nest in this tree. There were growing pains; the country had sanctions, no foreign investment, a market only as big as the white population and complicated property laws. The market was small and we had to look at the landscape and keep making adjustments so that we could carry on doing what we do, which is creating good experiences for our customers - landlords, tenants, sellers and buyers – so that we build relationships, trust and respect. Our aim is to pass on the same trust that we have ourselves between our family to our customers and colleagues.” The company’s first office was opened in Randburg, Gauteng and since then, the portfolio of services and products it offers has grown substantially, and it has earned many local and international accolades. “In addition, as technology has evolved, we’ve been quick to capitalise

BUSINESS PROFILE

CHARLES, TILLA AND BERRY EVERITT

on communication advances to help us build even stronger relationships with our customers,” says Berry, “and that has earned us a reputation as SA’s most technologically advanced real estate company. “We make the most of smartphone technology and the various apps available to benefit our customers and have become so available to them that we are their friends and their first port of call when they are considering a property transaction. “We have also learnt the value of being able to adapt and adjust quickly in response to market changes and challenges, while maintaining our focus on the things that we can control like relationships, efficiencies and business models. “For example, we’re busy right now upgrading our systems to a lightframed, multidimensional, integrated system that links to our CRM and digital offering.

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CHAS EVERITT INTERNATIONAL PROPERTY GROUP

“At the same time, we know that understanding the Millennial market is important; over the next 40 years, 6080% of our business will come from that market. Understanding communication techniques and the mediums we should be using is vital and all of my executives are working on this.” PROPERTY PEOPLE There are a number of elements that combine to make a great estate agent, including the ability to keep promises, an honest approach to business, endto-end knowledge of the sale process, willingness to put customers’ needs first, continuity of communication, and a flexible approach. At Chas Everitt, the group’s more than 1300 people are carefully selected and developed internally so that their value is realised and this ultimately translates to customer delight. “One secret that remains true is that success is dependent on hiring the right people. It’s very important to us to have people in our group that buy into our culture and believe in our values,” says Berry. “Real estate in SA is a cut-throat environment and there are companies that have a culture of not developing their own people. We don’t lose our people. We know that if we provide development opportunities internally, they will stay forever because we create an environment that is unmatched. That is the reason people join us and that is why they stay. If someone does leave, we don’t question them, we question ourselves. We spend a lot of time understanding people’s needs and we make sure they know the value they add to the group. “We’ve put together the right sort of environments and interactions. We take our top people overseas every year at our cost so that I can network with the top agents, we have recognition programmes in each of the regions in every quarter, our management team is in touch with everyone to keep them in touch with the industry. This is less

complicated when you have the correct business and communications systems in place so we spend a lot of time making sure that we do, and that we provide top-notch training.” AGENTS FOR CHANGE One of the major trends in the real estate industry just now, both locally and globally, is the rise of the ‘online agent’. Typically, a seller will pay around 5% commission to an agent (excluding VAT) but online agents, with minimal overheads, are promoting lower fees. Berry believes that in some cases these businesses might be a threat to traditional agencies but in others they might open up avenues for expansion. “Everything depends on the market you’re in and the type of business you’re running,” he says. “If it’s a commission cutting models

then it can be quite dangerous, particularly if you don’t understand your own costs. We see different models pitching in our markets but that’s good for us as it keeps us sharp and there’s no reason why we can’t get involved with the successful offerings. As a group, we don’t have fixed fee structures; we negotiate each fee with each client depending on what we deliver.” The residential property market accounts for around 86% of the total R5.2 trillion SA market and as the sector grows, Chas Everitt will be looking to grow and solidify its market share. “Our business has gone from strength to strength and we continue to grow,” says Berry, “but we have a target to be in the top three in terms of market share and the most popular estate agents in every suburb in the country.

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BUSINESS PROFILE

“And we don’t just want satisfied customers; we want them to be dazzled. My team and I engage directly with any with customer who is unhappy with any aspect of their transaction. We like to offer the personal touch and go beyond expectations.” THE ECONOMIC PRICE Often, in times of economic uncertainty, house prices can quickly tumble and activity can dry up. With the South African economy only just avoiding a downgrade by international credit agencies earlier in the year, confidence is not strong and investment levels are not what they have been in the past. But despite the gloomy outlook, Chas Everitt continues to perform well and the group got off to a flying start in 2016 with record-breaking sales registrations in the opening months. “There’s not one trend across the entire country. Demand remains strong in the country’s metros and CBDs thanks to ongoing urbanisation, and the Western Cape in particular has seen positive performance. In the mining towns, because of the commodity price crash, transactions have been slower. There also hasn’t been a great deal of investment from developers except in Sandton where the demand for new apartments continues to grow,” says Berry. He says the state of the economy is based on perception, “and we haven’t seen money flowing in the way that it should so confidence does remain low. However, we are a country of very diverse and interesting people who are very resilient so I am confident there will be a turnaround. “From a property perspective, things have been fairly solid and we still have British, American, Swiss, German and many other internationals coming into South Africa and spending huge amounts on property. Many of these properties

are now unfortunately out of the reach of South Africans but this does show that people still want to invest here.” ALWAYS BUILDING In 2015, the Chas Everitt group was invited to become a member of the prestigious Leading Real Estate Companies of the World© (LeadingRE) group, which is home to more than 550 of the world’s market-leading independent residential brokerages and has more than 128,000 associates who produce over one million transactions valued at $351 billion annually. This is a major step forward in the plans that Chas Everitt International has to expand both locally and globally. “For us to grow our own brand around the world would take a huge amount of capital and probably many decades so what we are doing is working together with the best affiliates in the world, made up of the members of the LeadingRE luxury arm, which is the most sophisticated marketing system for high net-worth individuals, and we are using our power and local knowledge of the SA market to service customers from anywhere in the world,” says Berry. “I’ve been appointed to the board of LeadingRE and we’ll be meeting this month in Amsterdam to share ideas about different markets, methodologies and technologies. It’s a professional organisation of superb quality individuals that run companies and I really enjoy the interaction.” In March, Chas Everitt was named as “The Most Innovative Brokerage in the World” at the LeadingRE conference in Miami. The company was also nominated in other categories and, to Berry’s delight, walked away with awards for Luxury Portfolio Marketing (excellence in luxury real estate

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marketing), Website Quality Certification and Printed Marketing Materials. Expansion in the luxury market is a target for Chas Everitt International, and with a wealth of luxury homes available in South Africa, and more currently being developed, this is a sector that could provide the company with exciting revenue streams. However, says Berry, the core business will not be ignored: “Our focus remains on pre-owned residential properties although the new projects we are involved with will be great investments.” Going forward, the Everitt family has a strong and sound plan for the business. What started as a small family concern more than 30 years ago, is now a major player in the industry and Berry is always thinking about the next step. “My daughter is in the business and she has started at grassroots level, reporting to her regional manager but this is a big business and we need the right skills at the helm. It’s not about creating positions for family, it’s about creating positions for the right people so that we can ultimately achieve our goals which are growing our market share in the general market and capturing share in the luxury market. We are busy developing a plan for the future and that’s ongoing.”

CHAS EVERITT INTERNATIONAL PROPERTY GROUP 011 801 2500 beverleys@everitt.co.za www.chaseveritt.co.za

CHAS EVERITT INTERNATIONAL ARGON ASSET PROPERTY MANAGEMENT GROUP

BERRY EVERITT

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SOUKOP PROPERTY GROUP

Luxury Property

with Strong Values PRODUCTION: Timothy Reeder

Having first opened its doors in 2007 with six employees, Soukop Property Group has quickly expanded firstly in KwaZulu-Natal, and then later into the Western Cape and Gauteng. Long associated with many of KZNâ&#x20AC;&#x2122;s most prestigious property sales, Soukop currently has 13 branches nationwide, all located in prime positions, with plans for further expansion still.

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BUSINESS PROFILE

While Soukop Property Group has been trading since 2008 from its offices at what is now known as Soukop House, the company name is one which has been associated with property excellence for nearly 40 years in KwaZulu-Natal. “My husband and I began in the industry in 1978 as a small entity, and then just kept growing,” CEO and founder Dina Soukop tells Enterprise Africa. Born into the property world, it was her builder and developer father Valentino Bozza who passed on to her the love and knowledge of the field, alongside the integrity and hard work which have helped shaped the company to the present day. Trading in a niche market and with a host of established connections, Soukop today is synonymous with family values, lasting relationships and honour. Dina Soukop began her career working as a conveyancer, before moving into sales in 1978, and takes us through some more of the early days of the company: “We became a franchisee of Pam Golding in 1998, so for 20 years we practised on our own on a small scale, without too much expansion.

We remained franchisees for nearly ten years until we decided, in 2007, that we really would like to operate on our own again, which is what allowed us to expand to the degree that we have to date.” It is a development that remains unfettered: “We have offices throughout South Africa, and we’ve just opened up another in Mauritius,” details Dina. “Now we are seriously considering a presence in Berlin within the next couple of years, and we really want to expand into the continent.” Perhaps chief among the developments currently on the company’s radar is the Oceans development in Umhlanga, Durban. “We know the developer of this lot personally, and he’s actually taking on this one himself, with his own inhouse estate agents. He has however, in addition, chosen a couple of other estate agents to assist with the selling, and the properties are 90% sold out at this stage.” A combination of residential and commercial sites, the spectacular R3.1 billion project is the largest privatesector investment in development in KZN history and the brainchild of

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entrepreneurs Vivian Reddy and Rob Alexander, of Edison and Ducatus Property Groups respectively. The mixed-use development is a first in terms of design in South Africa and incorporates two residential towers consisting of 460 apartments which all boast sea views, as well as other such luxuries as a world class 33,000 m2 shopping mall and a 200room five-star hotel. “It’s going to totally transform how Umhlanga Village is at present, the entire skyline will change,” adds Dina. “Previously, Umhlanga consisted of just 40 houses positioned on the beach with a single small shopping centre, but since the opening of Gateway, the major shopping centre of Southern Africa, a lot of people have started to move to the North of Umhlanga and it’s continuing to expand towards Loreto. We are heavily involved the whole of that area.” Developer Reddy shares the sentiment of Oceans’ transformative power: “This is a monster project. It changes the face of Umhlanga – we are literally converting a village into a metropolis.” Even in the midst of an uncertain economic landscape, South Africa’s property market remains an extremely attractive option for investors. Property analyst Shaun Rademeyer is CEO of mortgage originator Betterlife, and states that, “despite a number of bleak predictions for both the economy and the residential property market for the year ahead, savvy investors can look to capitalise on the very real opportunities that current market conditions present. Despite the falling rand, South Africa continues to remains an attractive and affordable property destination for overseas buyers‚ and we are likely to see more activity in this sector.” This is particularly true of Cape Town, whose coastline and mountains act as a major constraint on the city’s ability to expand. Dr Andrew Golding, Chief Executive of the Pam Golding

SOUKOP PROPERTY GROUP

Property group, believes that South Africa’s housing market appears to be staging a recovery, one which, “in part reflects the continued rapid urbanisation of the South African population, which is underpinning demand for housing in the major metro areas.” Soukop’s present performance lends weight to such statements, as Dina explains: “If you compare it to overseas, to somewhere like Monte Carlo, then we’re still pretty cheap. But against South African prices on the whole it is way above the norm. For a 30 m2 apartment, for example, you can look at paying anything between R4.5 and 5 million upwards. The same apartment in Umhlanga might only cost half or a third of that. We even have properties on the V&A Waterfront for R300 million.” Reserved for a senior female

executive who has demonstrated exceptional performance within the property sector, the 13th Annual Standard Bank’s Top Woman in Business and Government Awards saw Dina receive a Certificate of Excellence, and she spoke of her pride that: “At 60, I started a brand new business venture, and nine years later we can boast 13 branches and franchises and 350 staff members with expansion still very much on the horizon.” Throughout this remarkable growth, Soukop has retained the air of a family enterprise which is at the very core of its operations. “I think I have just about the whole family working here, even my grandchildren,” jokes Dina. “There will be a transition over to the younger generation and therefore a continuation of the Soukop name, which I fully believe will simply go

from strength to strength.” Recruiting the right personnel is a central priority for the company goes hand in hand with such intentions, and Dina closes by clarifying exactly how determined the company is to employ the right personnel. “It is perhaps the biggest challenge facing us at this time, as it becomes increasingly difficult to enter the profession,” she declares, “but the upshot is that we have good, qualified and productive people coming to work within the field.”

SOUKOP PROPERTY GROUP +27 (0) 31 312 0312 morningside@soukop.co.za www.soukop.co.za

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MCCORMICK PROPERTY DEVELOPMENT

Rural Retail

Development Continues for MPD PRODUCTION: Manelesi Dumasi

Starting a business in South Africa in the 1980s presented a whole host of challenges but when your business idea is to build and open retail outlets in rural areas things become more difficult than ever. Jason McCormick of McCormick Property Development recalls the trials of starting up under hugely difficult conditions.

BUSINESS PROFILE

Last month we looked into the business of Pretoriabased McCormick Property Development, one of Africa’s leading businesses in the development of commercial retail space in rural regions. This month we look closer at the history of the business and the challenges that were faced starting a company in South Africa in the 1980s. Managing Director and second generation family leader, Jason McCormick told us that the company has land-banked prime spots for future developments, it is performing well in the challenging economic climate, it has great relationships with clients, partners and communities, and it has some major projects set for commencement or completion before the end of the year.

However, it wasn’t always so sweet for the company and in its fledgling years in the 80s, when South Africa was a very different place, Jason’s father, John, had to work extremely hard to launch the business and gain traction in what was a very challenging market place. There was little investment into property development in rural areas, there was not much money in these regions and there were the obvious political hurdles that stood in the way of real advancement. “My father started from nothing,” explains Jason. “He had R297 in the bank and from that he grew the business and today we are 33 years old and currently developing our 59th, 60th and 61st developments. In the beginning it was just my father with my mother

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acting as his secretary, they had a home office and a lot of stress with children and financial pressure from building a business with nothing behind them.” In the beginning, John McCormick saw a gap in the market that no one else did. Thanks to his experience working in some of the country’s more rural areas, he had no doubt that there was potential but he first had to work around the broken system of the time. “My father had been working as a development manager for one of the furniture companies and had been travelling to all the really small towns around South Africa looking for areas to put up furniture stores. In particular, he’d been investigating the possibility of putting up furniture stores in the homelands – rural areas completely devoid of services,” says Jason. “People in these areas were spending a huge amount of their disposable income on public transport to get to the main urban areas to do their grocery shopping so my father ending up leaving his job and founding his own company, McCormick Property Development, which was the first company in South Africa to focus on providing retail services in black areas at the height of apartheid. “My father was Stanford educated, highly liberal and highly opposed to apartheid, and he saw this opportunity in an altruistic way. He was an English speaker and because the government was largely Afrikaans speaking, it was difficult to make inroads politically so he wanted to make a difference economically by bringing services to rural areas and trying to make some money at the same time. “Sometimes, people were travelling more than 100 km for basic goods and services and he was the first person to develop shopping centres in these rural areas.”

MCCORMICK PROPERTY DEVELOPMENT

The ‘homelands’ or ‘Bantustans’ established by the SA government during Apartheid were areas where the majority of the black population were moved to in order to restrict the living space in urban areas for whites only. In total, ten homelands were created in South Africa: Transkei, Bophuthatswana, Ciskei, Venda, Gazankulu, KaNgwane, KwaNdebele, KwaZulu, Lebowa, and QwaQwa. “It was really difficult in the early days. He was a white man in black areas and some people had a negative attitude towards him, and the political regime were against him as he was seen as being helpful to the black community,” says Jason. After a lot of research and much persuading of financial institutions, McCormick Property Development began operating in 1983 and the focus was on upliftment of the entire community. “As the first man to develop shopping centres in these areas, many of the models that he invented were eventually adopted by government, in terms of the structuring of deals, with local communities,” Jason says. “The focus on community involvement has always been a cornerstone of the business and we’ve always had local shareholders and community trusts that enable the community to earn dividends which they use for communitybased projects like crèches, clinics, libraries, schools and it enabled the community to benefit positively from the development.” Some of today’s BBBEE policies were shaped by the work of McCormick Property Development and when John offered a share scheme at the Giyani Plaza in ’85, the idea was welcomed and helped endear the company to the local community. “A lot of those models were morphed into what became the

black economic empowerment framework that South Africa currently operates,” says Jason. The Broad Based Black Economic Empowerment Act of 2003 directly addresses the need to include rural communities in the country’s growth strategy, stating: “No economy can grow by excluding any part of its people, and an economy that is not growing cannot integrate all of its citizens in a meaningful way. The government’s approach is to situate black economic empowerment within the context of a broader national empowerment strategy… focused on historically disadvantaged people, and particularly black people, women, youth, the disabled,

and rural communities.” But in the beginning, before BBBEE, the company failed to gain widespread support as Jason recalls: “People would say ‘there’s no money in these areas, are you crazy?’ My father couldn’t convince anyone and one of the turning points in the life of the business was when he persuaded the first bank to move into these areas. Back in the early days, there was no ATMs, no electronic banking, especially in these rural areas. You had a building society book and you had to physically go into a branch to draw money and then you used cash. The big change happened in Jane Furse when he managed to get Standard Bank to open a branch by

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giving them a 250 m2 space, fully fitted out, for R1 per year. They were the first bank to physically move into these areas and that meant that people did not have to go all the way to Polokwane to get money – they could get money there and spend money there.” The development at Jane Furse was one of the originals for the company and stills holds sentimental value. “It was very risky but it paid off. It was 11,500 m2 and at the time that was about the biggest centre you could put in these areas but today we’re developing malls in excess of 50,000 m2 in similar areas and that shows how SA has righted itself from something that was completely unnatural to something where people have access to capital and are able to sustain the shopping centres of the size that we are currently developing,” says Jason. Today, John McCormick is involved to a lesser extent and the second generation handle the dayto-day, always hungry for growth and expansion into new markets. “It remains a family business. Myself and my brother run the company with my father as Executive Chairman and his two brothers will consult from time to time on various projects. “The main driver of our revenue is the ownership of our shopping malls and management of the malls helps keep MPD paying the bills. Asset management is number one in everything we do. We’re looking to grow rentals, improve tenant mixes, improve footfall and improve turnover, and that’s how you drive value,” says Jason. Of course, as well as building fantastic relationships with the communities in which it operates, McCormick Property Development has also built long-standing

associations with preferred partners and this ongoing interaction makes for delivery of excellent service. “For us, as a development company, we have a tried and tested group of companies that we engage with and some of them have done 30-40 malls with us so we know that we will get quality service from them and they know they will have a pipeline of projects with us is they continue to deliver good service,” Jason says. At the end of 2015, all of the work that has been done propelling McCormick Property Development to the top of the industry was recognised at the Africa and Arabia International Property Awards Summit, held at the JW Marriott Marquis Hotel in Dubai. The company was awarded a 5-star award in the retail development category for the Mall de Moçambique Development in Matola. These awards are the largest, most prestigious, and most widely recognised in the industry, attracting entrants from all over the world. Earlier in the year, McCormick Property Development also collected an award as the Most Socially Responsible Developer in the 2015 World Finance Real Estate Awards. “We are incredibly proud of these achievements,” explains Jason. “Our journey into Africa has been a long time in the making and we have a strong pipeline of developments that can only grow from strength to strength. The Mall de Moçambique will be our first true Regional Mall in Africa (outside South Africa) and as such we aim create a state of the art retail facility to cater to the shopping needs of the people of Matola and surrounds, whilst setting the benchmark for further developments in Mozambique and the rest of Africa.” According to South Africa’s rural development and land reform

department, the country still has much to do when it comes to developing rural areas. “Progress in urban areas stands in stark contrast to the often extreme levels of poverty many South Africans in rural areas still endure. Social deprivation and underdevelopment continues to haunt too many rural areas,” the department states. But with McCormick looking to address this situation head on, change could be closer than it seems. As companies operating in the urban areas begin to realise that growth potential is limited, focus will undoubtedly turn to rural regions and this is where McCormick Property Development is a leader and more than ready to help.

MCCORMICK PROPERTY DEVELOPMENT 012 - 654 - 6330 @McCormickProp www.mccormick-property.com

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HIGH-TECH REFRACTORIES

Team Work And Hard Work

Build Success For High-Tech PRODUCTION: Manelesi Dumasi

“If it is hot, we can handle it” is the message from High-Tech Refractories MD, Jannie du Plessis. He talks to Enterprise Africa about how his hardworking team continue to carve out a name that is synonymous with quality.

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BUSINESS PROFILE

As the challenges in South Africaâ&#x20AC;&#x2122;s mining, minerals and metals sectors rolls on, the small and medium enterprises that supply into these important industries are working harder than ever to innovate and modernise in an effort to remain competitive, and in some cases stay afloat. Thanks to the global commodity price crash, lacking international demand and widespread workforce unrest, mining, minerals and metals have faced serious challenges. According to the World Steel Association, South African steel production fell 9.9% in August to an estimated 446,000 tons compared to the previous year, after an 11% drop in July. According to PwC, the countryâ&#x20AC;&#x2122;s mining industry

recorded an aggregated net loss of R46bn in 2015. In the same year, the construction sector saw its big players lose between 42% and 72% of their stock price. But, as we hear regularly, the well-managed businesses, those that have managed to focus on what has made them successful, remaining nimble and able to react to changes in the market, have managed to come through the difficulties without being severely impacted. Take High-Tech Refractories for example. The Vereenigingbased company manufactures and distributes refractory products to customers in a diverse range of industries, but primarily metal, mineral and power. Over the last

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few years, while things have been tough, the culture of hard work and delivery of quality has seen the company build a platform that will see it grow internationally in the future. Managing Director, Jannie du Plessis tells Enterprise Africa that this small but efficient business owes its success to its people. â&#x20AC;&#x153;We work with the iron and steel, copper, aluminium, foundry, cement and power generation industries. It has been a difficult time and that has meant that we have had to sharpen our pencils dramatically to make sure there is no waste material in the factory. We have strict quality control processes so that we know the raw materials that are supposed to go into the

HIGH-TECH REFRACTORIES

products do end up in the products. We now have almost zero wastage and we have streamlined to save money wherever we can. “Our employees understood that times were difficult and they pulled together. When new orders come in, everyone is happy and we all share in the success.” Because the company has built and nurtured lasting relationships, some going back three decades, it has managed to continue forging new opportunities. “We are developing materials for use in the platinum and aluminium industries,” says du Plessis. “We are busy with trials around these products. We would like to focus on exports into Africa and internationally and that is our next biggest target. We have quality raw materials available here in South Africa and we believe that we can export cost-effectively. “We are looking at international partners to form alliances with. We can manufacture products on their behalf in South Africa so that they can be sold overseas. The reputation that has been built over 30 years in South Africa is a big asset for us and we believe we can continue to add value to that by building international relationships.” HOT TOPIC Culture building within a business has long been a challenge for management but it seems to be the common factor that is spread across all of the successful organisations – as the old saying goes: ‘happy people equals happy product equals happy customer’. There are many strategies that people try when attempting to create a culture, but often the most successful is to simply set-up the business with a flat structure so that management can impress values onto the rest of the business. That is what has happened at High-Tech and as a

result, hard work and dedication is instilled through all employees. “High-Tech was founded in 1984 by a small group of people,” says du Plessis. “I started working for High-tech 15 years ago and then I bought the company. It was a real challenge but we have a fantastic team of people here. We still have some of the people that have been here since the beginning and the relationships are very good. It’s an encouraging atmosphere to work in and I think that’s why people work here for so long and why we have such a low staff turnover rate. “Our relationships with customers is exactly the same. We build these relationships over years and years, and a lot of the companies that we started doing business with 30 years ago are still our customers today. We don’t lose

customers because of the service that we provide and because of the quality of the product. “We have an amazing group of people. They will work harder than anyone else. Whether it’s the weekend or the evening or whenever, they will stay and work to resolve problems. No one is concerned about working overtime; we’ve had experiences where a customer was desperate for a product at the weekend and the team came in on a Saturday morning and worked all the way through until 11pm to get that product ready. We go the extra mile for customers, that’s what makes us popular and what builds long-term relationships.” Thanks to this hardworking attitude and a commitment to quality, High-Tech is recognised by

SPECIALIST CONTRACT CRUSHING

VTC started out towards the end of 2010 on the premises of Vereeniging Refractories. Initially a small Jaw Crusher with a triple deck screen was erected to crush Manganese Ore for a client. This has since expanded to diﬀerent plants crushing a wide variety of materials for a diverse customer base. We also have a range of Grog products used and unused, graded for the Refractory Industry. Currently we process spent & unused refractories, Manganese Ore, Calcined Anthracite, Synthetic Graphite Electrodes and Anode Butts, Ultra Low Carbon Ferro Manganese, Ferro Titanium, Chamotte, Dead Burnt Magnesite etc. Size ranges are from 200# to 150mm but absolutely all sizes are catered for. Finished product is packed as required but anything from 5kg to 1 ton in paper and woven polypropylene bags, new or used. Quality is assured from years of experience and controls as well as equipment such as driers, screening, under roof storage etc.

VAAL TOLL

CRUSHING

Please contact Kevin (083 388 5909) or crushing@ mweb.co.za to discuss processing your products.

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BUSINESS PROFILE

the industry as a partner of choice. “One of the things that we are extremely proud of is that we don’t lose customers. When a customer becomes a High-Tech customer, they are a customer for life. Even in these difficult times, customers stick with High-Tech because they know about our consistency and our quality. “We do a lot of business with ArcelorMittal and to keep that business, with the competition we face, is very difficult. The fact that we have kept that business for such a long time is testament to our team. What stands out for us is that customers continue to return to us and often that business increases,” says du Plessis. PROVEN RESULTS Helping to improve the operations of its clients is one of the successes that has come from teamwork and hard work, and it is another driver behind customer loyalty. “We work mainly with acid monolithics and we handle our big and small customers exactly the same. As a small company, it is easy for us to adhere to the needs of the customer. There’s no long waiting periods; when our customers order, we can sometimes supply products immediately. Regularly, our technical advisors will visit the customers and assist with any problems; there’s a small communication chain and that means we move quickly. “One of our new customers were replacing their ladles monthly. Since we started working with them, they are

now replacing their lines yearly. One of our customers had a ladle that they could use 280 times before it needed replacing. When we started working with them that increased to more than 1000 uses,” says du Plessis. Fortunately, maintenance in HighTech’s chosen industries is something which will not stop. The ongoing upkeep of facilities is imperative and this means a steady flow of work will continue; the challenge will be positioning the brand ahead of competitors, of which there are many. “Our product range has changed and improved. Each customer has specific requirements and we work to closely to meet them. We have set a standard and said that we want to run at least three trials so that we can ensure the correct material and make improvements. In our lab, for every three tonnes that we produce, we test the grading, setting times and flow so that we know the material is consistent,” explains du Plessis. “There are some big international companies but as a small/medium sized refractory company, the only way we know how to compete is by providing better services, better products and better cost-life,” he concludes.

HIGH-TECH REFRACTORIES

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+27 16365 6112 jpd@refrac.co.za

HIGH-TECH REFRACTORIES

EXHIBITION CALENDAR

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

//TABLE OF ALL EVENTS: BUILD EXPO CAIRO 2016 Cairo International Convention & Exhibition Centre Oct 11 – 13 MOZAMBUILD 2016 Centro Internacional de Conferencias Joaquim Chissano Oct 27 – 29 EAST AFRIPACK 2016 Kenyatta International Conference Center Oct 12 – 14 THE DIGITAL EDUCATION SHOW AFRICA 2016 Sandton Convention Centre Oct 18 – 19

SPORTS & EVENTS TOURISM EXCHANGE 2016 OCT 24 | PRETORIA The 5th annual Sports & Events Tourism Exchange (SETE), is a dynamic business to business platform that is aimed at positioning South Africa as a sports & events tourism destination and encourages collaboration between the sports, events & tourism industries who will showcase their product offerings to the attending International Hosted Buyers and SA corporates, specializing in these sectors, who are interested in bringing business to South Africa. EAST AFRIPACK 2016 OCT 12 | NAIROBI This event showcases products like packing and packaging technology,

liquid filling & bottling technology, processing technology, package production & printing for plastics & paper, materials & consumer packaging, label track & traceability, material handling & logistics, systems and components for automation, services etc. in the Packaging Materials industry. THE DIGITAL EDUCATION SHOW AFRICA 2016 OCT 18 | JOHANNESBURG The Digital Education Show Africa, the leading exhibition & idea exchange for all educators, who are hungry for innovative solutions in how to normalise the digital learning process in classrooms. Innovative learning technologies and strategies.

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SPORTS & EVENTS TOURISM EXCHANGE 2016 Protea Hotel Fire & Ice! Menlyn Oct 24 – 27 SAAW - SOUTH AFRICAN AUTOMOTIVE NATIONAL WEEK 2016 Gallagher Convention Centre Oct 11 - 13 PROJEKTA 2016 Feira Internacional de Angola Oct 22 - 25