COMPANY PROFILE
2014
Rolfe
Pharmaceutical success from the Karoo?
company profile
Pharmaceutical success from the Karoo? Editorial: Christian Jordan Production: Hal Hutchison
Rolfe Laboratories is one of the most successful pharmaceutical manufacturers and packagers in the country but based in Middleburg in the Eastern Cape does the company struggle because of its location? Not one bit according to Chairman, Phillip Rolfe who tells IndustrySA that the people of Middleburg are at the heart of this innovative organisation. When you think of successful, longstanding, innovative business in South Africa, you tend to think immediately of Cape Town or Johannesburg. Obviously, these two cities are rife with successful business and entrepreneurship. Then you have the other major hubs; Durban, Port Elizabeth, East London, Pretoria and Bloemfontein to name a few, but in the more remote locations, especially areas like the Karoo, surely this is not a place where entrepreneurship and innovation can thrive? In general, this is correct. Not many businesses flourish in this part of the country but there are a few of examples where this is not the case; one of the most prominent being Rolfe Laboratories. With a long and eventful history, Rolfe Laboratories has been at home in the Eastern Cape for over a century. Originally founded as a small pharmacy, a kind of makeshift chemist, today the company is one of the largest manufacturers of pharmaceuticals and one of the largest
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contract packagers in the country. Founder of the business in its current form and Chairman, Phillip Rolfe tells IndustrySA more about this fascinating company’s history.
HISTORIC SUCCESS “The company is probably more than 100 years old and it started off in a chemist shop, a pharmacy in Middleburg in the Eastern Cape,” explains Rolfe. “They started off selling a skin lightening cream which was sold on a mail order basis to the Cape region of South Africa. As the company got bigger, the pharmacist needed more capital and eventually he got ten farming families in the Karoo region involved. “Each family put in money and each became a shareholder and they bought in more products. The business grew very quickly so they built a factory and the business got involved with manufacturing. During the Second World War period, the business was healthy and was selling a number of products and the organisation became a more sophisticated consumer
Rolfe Laboratories
selling company and it started selling into the larger cities – Johannesburg, Durban and Cape Town,” he says. After the War, during the 50’s and 60’s, the challenges of being so isolated became more apparent and the company began to suffer. “Because the company was domiciled in Middleburg, it didn’t keep up to date with what was happening in the wider market, they lost touch with product development. From the beginning of the ‘70s the company found itself in trouble because it hadn’t kept pace with the market. “The company found that it either needed to get people in who understood the market or alternatively sell the business. “I had spent a lot of time in New York and when I returned to South Africa, I was doing a lot of consultancy and I was asked to look at this company and give advice. There was one attraction to this company for me and that was that they owned the Playboy trademark - the bunny - but they had done nothing with it. No one had the skills or the knowledge of the market so the company, KA Laboratories as it was
known at the time, just sat with the trademark and when I came along I realised the value, bought the company and launched the Playboy range of toiletries,” says Rolfe.
PLAYBOY The launch of the Playboy range proved to be a turning point for Rolfe Laboratories and the brand became a huge success providing the platform for the company to expand further and grow to become a recognised name and important employer. “Playboy was the number one selling male deodorant brand in South Africa and it went from strength to strength and ultimately I sold the brand and then started other brands and new products,” explains Rolfe. “I then realised that there was a lot of money to be made in contract packaging. It seemed that there was a trend around the world for multi-nationals to own brands but not get involved with activities like logistics or packaging. This provided a huge opportunity.
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company profile “Today we work for big multi-nationals like Unilever, Tiger Brands, Colgate Palmolive and many of similar. “When I bought the company, there was a staff of about 20-30 people in Middleburg. Today we have 500-1000 people, depending on the season, in the factory alone,” he says.
MIDDLEBURG One of the strengths of Rolfe Laboratories is its location. Despite being around 770 km from Cape Town and around 740 km from Johannesburg, the company draws on its community for much needed skills and expertise and both Rolfe Laboratories and Middleburg benefit from the company’s continuing presence in the region. “It has been great for the town. I deliberately stayed there as many people who have worked for us have been with us for 30-40 years and sometimes whole families will work for the company. “Our head office is in Durban and we have two factories in Middleburg. We have developed our own products and we own a number of brands. Everything from sun tan preparation to mosquito repellent – you name it, we’ve got it,” boasts Rolfe. “From a humanitarian point of view, we have stayed in the Cape because we are so important to the town. We are good
for the whole region. For every one person that we employ, we feed many mouths and that has been the motivation for us to stay in Middleburg.
“I deliberately stayed there as many people who have worked for us have been with us for 3040 years and sometimes whole families will work for the company” “We are a one stop shop for multi-nationals who come into the country who don’t have local knowhow. We can do everything from sourcing materials, developing packaging, creating formulas, controlling accounting – we become their company in South Africa,” he explains.
‘A COMMITMENT TO MYSELF’ Since Rolfe bought the company in the late 70’s/early 80’s, one philosophy has always remained and that is to continue to create employment, no matter how far technology comes and
JOHANNESBURG (+2711) 856 4500 l CAPE TOWN (+2721) 551 5353 l DURBAN (+2731) 202 0794 SAVANNAH FINE CHEMICALS (PTY) LTD
Proud to be associated with Rolfe Laboratories PAGE 4 APR 14
Structural Applications
how easy and cheap automation can be. “In the beginning” Rolfe says, “I made a commitment to myself to employ as many people as possible. The more people we employ, the more people we feed and that philosophy hasn’t changed. “We could wave a wand now and become even more sophisticated but that is now where we want to be. “Because of the changing nature of our business, we have become a lot more sophisticated. We have more sophisticated technology, sophisticated machinery but we have remained competitive. “We used to manufacture 50,000 roll-ons per month but today we are capable of manufacturing two million per month. We have become one of the major contract manufacturers in the country. Everything has increased and with that increase comes improvements in everything but we still try to keep as much as possible manual,” he explains. And by keeping as much of the work manual, the company can keep control over quality and, perhaps most importantly, continue to contribute to the economic development of the region. “You get some incredibly bright guys who come out of the Karoo and then go off to top universities around the country and come back with great skills, very employable. When these
people return from university, there aren’t many companies in Middleburg that can offer them careers like we can,” explains Rolfe. “We train all the time. In our business you have to train, it’s compulsory. It’s an on-going thing; we are always trying to raise the level of competency.”
“I made a commitment to myself to employ as many people as possible. The more people we employ, the more people we feed and that philosophy hasn’t changed” Training at Rolfe Laboratories is generally successful and Rolfe states that there are significant opportunities for unskilled workers to learn important skills and work their way up the ladder and eventually hold senior positions within the company – another positive of the business operating where it does. “There is no doubt about it. It’s happening all the time; there are numerous examples of this in our factories in Middleburg,” he says.
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company profile
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Rolfe Laboratories A FAMILY FUTURE? As well as benefitting the region, Rolfe Laboratories presence in the Karoo has provided Rolfe and his family with much to be proud of. But with many years of success behind him, Rolfe admits that it is his ambition for his children and his children’s children to take control of the business when he eventually retires. “I am now the Chairman and my son, Bradford, is the Managing Director. “There is no doubt about it, that is my vision. When I’m not here, whether that remains the vision for my son, I’m not sure. We also have the desire for my younger son, who isn’t currently involved, to come on-board with us. “We are regularly receiving offers to be bought out but we don’t want to sell. We are happy with what we do; we are comfortable with our success.”
EXPANSION So how does a company that has seen so much success from a relatively isolated location go about expanding? Rolfe says that the South African market still has a lot to offer and Africa and other international markets have good growth potential. “Everything in the first instance is made for the local market and then it goes up into Africa” he says. “We have already tried little forays into places like the USA, Dubai, India and we continue to supply there but not on a large scale because we are engrossed with what we are doing here and in Africa and Africa is becoming big. Countries like Nigeria and Kenya are growing rapidly and are becoming big markets.” But when realising expansion across the border, Rolfe says you have to understand your market place. “We are looking at what we do and what we understand as the South African market is so different. South Africa has had a huge impact on what is happening in Africa. There are a lot of our chains opening in Africa so we do understand Africa but India and the like have very different cultures. “Africa would make sense first but I wouldn’t rule out going elsewhere. I have spent a lot of time in the UK and the USA and I think when you go into a territory like that you draw on the local people; that‘s where you gather your knowledge and expertise. You have to listen; you can’t just force your ideas on people who have been around for a lot longer than you.” So expansion plans are likely to continue developing as the African continent continues to post strong growth figures.
SUCCESS THROUGH ADVERSITY One event that had the potential to slow Rolfe Laboratories momentum occurred back in October 2013. An explosion caused damage to one of the factories in Middleburg with widely reported detrimental effects on the community and on the business. At the time Brad Rolfe said: “The community has provided
phenomenal support,” again highlighting the company’s brilliant relationship with the region. Since the explosion, business has returned to full operation and much progress has been made with the damaged part of the building as Rolfe explains: “We are fully operational. We had so much space in that factory so we are doing a full re-design. The portion of the factory where we had the problem is being demolished. The front part of the building, mainly the office area, was affected but behind that was unscathed. We were back up and running within a month. Because of the need for speed, we bought in builders from Port Elizabeth.” This event, although tragic, was proof that with drive and determination, business can continue to thrive even during times of adversity. Through its relationship with its employees and the wider community, Rolfe Laboratories has managed to remain one of the country’s industry leaders and with no plans to vacate Middleburg anytime soon, it looks as though there will be much to look forward to for the company in the future.
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“We are regularly receiving offers to be bought out but we don’t want to sell” MAY 14 PAGE 7
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