COLEUS PACKAGING
FEATURE
the crown COLEUS WEARS
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cross the world obsessive fans collect them, urban kids play street games with them, and in Southern Africa the dominant player turns out over six billion a year: metal crowns - all that lies between a bottle of a beverage and a thirsty drinker. Johannesburg-based Coleus Packaging is the sole manufacturer of bottle crowns in South Africa and the biggest name and supplier in ten countries in the sub-Sahara region. Its market share within South Africa is over 90 percent, rising to 100 percent in Botswana, Lesotho and Swaziland. And Coleus is on the move. 2
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With a 30 percent take in the rest of the region, Coleus is poised to seize market share from competitors, says Commercial Director Phillip Sathekge. “In particular we want to drive forward in those areas where we currently do not exist, and where imports make up a huge proportion of the market place. Take Angola as an example - a vast market and one that should be massive for Coleus. With no local supplier it must import from us, Europe or Latin America. So here is just one opportunity for us to gain market share.� The origins of the bottle cap go back to 1890 and William Painter. Painter was an American, founder of a Fortune 500 company and a prolific inventor, holding 80 patents including a safety ejection seat for passenger trains and a machine for detecting counterfeit currency.
Coleus Packaging FEATURE
Coleus Packaging is a peak performer – sole manufacturer of beverages bottle metal crowns in South Africa and the leading niche name in the southern half of the continent. And as Commercial Director Phillip Sathekge tells South Africa Magazine, Coleus strategy is to extend its market and geographical dominance. By Colin Chinery
Patents more appropriate to our theme included a bottle opener, and a one-time bottle cap. Painter named it a crown after the ‘trade mark’ miniature diamond crown created for Queen Victoria. By the start of the First World War nearly all soft drink and beer bottles wore crown caps, and a century later Phillip Sathekge says demand across Africa is booming. “In South Africa the market is almost flat, slightly below current GDP growth. But elsewhere in Africa the growth is significant. In Angola the economy is growing in double digits and the Zimbabwean economy is now being turned around and is already showing double digit growth as well. “In other African countries outside South Africa there’s huge growth potential, although in
our case the easier markets to penetrate would be in the zero duties Southern African Development Community (SADC) nations. Without comparable trade agreements with South Africa, import duties could present us with challenges beyond southern Africa.” Coleus produces a variety of metal crowns, tin plate and tin free steel; promotional, twist and pry off. Steel coil is cut into flat sheets, each coated on both sides to prevent rust and ensuring lining adhesion and printing quality. The coated sheets are then decorated with a design using a high speed UV litho printer, varnished to a bright finish, protecting the crown from www.southafricamag.com
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Coleus Packaging FEATURE
scuffing and pressed into crown shells. The crowns are then lined and packaged, 10,000 per box, palletised and stretch-wrapped. Promotional crown tops - where a random unique prize draw number and organisers contact details are printed on the inside of a sealed crown – are a rising trend and market opportunity. “We pride ourselves on the quality of our products. Unlike competitors who are also manufacturing cans and so on, we concentrate solely on metal crowns and we have not shifted from this remit.” Coleus began operations nine years ago and was a wholly owned subsidiary of South African Breweries until 2006 when Nokusa Packaging, a black owned company, acquired a 40 percent stake. The nature of the product – and ease of transportation – makes for strong competition, both from local African companies and
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global manufacturers in Europe, Asia, and the Americas. And currently there is another issue – the exchange rate. “The key concern at the moment is the erratic behaviour of the strengthening Rand, and prediction of future movements is enormously difficult,” says Sathekge. Ranged against these challenges is the Coleus brand and three key components: innovation, expertise, and quality. Quality control through to end product is an established feature of Coleus. “To enhance this we have now invested in a full laboratory for incoming inspections, with raw materials from suppliers inspected for quality before acceptance into the process. “We are constantly looking at innovation and coming up with new ideas relating to our offering. In terms of both the manufacturing of crowns and their usage we have massive expertise on both sides, with specialists from the brewing industry working alongside us. The focus here is on how a product or innovation would work for the customer as well as shaping the technical service we can provide.
Rheem SA (Pty) Ltd In 2001 OD Investments (Pty) Ltd, a black-owned investment consortium acquired a stake in Rheem SA (Pty) Ltd. Today Rheem SA (Pty) Ltd is arguably South Africa’s largest 100% black owned manufacturer and marketer of industrial packaging. The company was established in 1967 and is today synonymous with the South African industrial packaging industry and steel/ tinplate cut to length services. Rheem has a staff compliment of 540 employees with 5 operating plants located in Durban, Alrode, Vanderbijlpark, Cape Town, Jet Park and a distributing agency in Port Elizabeth. The output from these plants supplies the South African market and many other neighbouring countries. We pride ourselves in building strong business partnerships with our customers who are market leaders within their own industries. The more than 10 years of working closely with Coleus Packaging (Pty) Ltd in meeting their tinplate cut to length needs is a testimony to that strong business partnership. Rheem SA (Pty) Ltd is SABS ISO9001 Certified. Our unique selling points are customised service, superior quality and customer service. For further details for your industrial packaging needs, please refer to our website on www.rheem.co.za.
“This is where our strength lies; expertise, product quality, innovative strategies, continuous product development, and the special relationship with our customers regardless of size. Our smallest customer takes some 900,000 crowns a month and the biggest 400 million a month. We like to react to customer orders and enquiries within 48 hours, and if we have to dispatch a specialist to a customer’s plant, then within seven days. “On top of normal after sales service, we deliver on time in full. We say that whatever you order, you will receive it on a given day and in full. We’ve made huge strides in being able to achieve 99.9 percent, but that 0.1 percent shortfall is still not good enough and we are striving to the point where we have 100 percent service delivery.” Innovations currently under assessment include an increase in container box capacity from 10,000 crowns up to 380,000 – a major gain for customers – and extending shelf life through enhanced oxygen scavenger lining.
Down gauging is another. At the moment crowns are made with a 0.22 millimetre steel gauge, and Coleus is running customer trials with crowns down-gauged to 0.21 and 0.20. “Crowns would become slightly thinner without compromising functionality. The aim is to make material savings that can be passed on to the customer,” says Sathekge. “Because of our comprehensive expertise we are able to offer more than is available from those competitors who, while focussing on crowns, do not have the specialised knowledge of what happens on the customer side. We undertake to go to the customer, perform technical audits on their equipment, and give them advice in terms of potential problems, operational enhancements, and opportunities. “This is just one of the services Coleus Packaging provides that gives us competitive advantage, customer satisfaction and appeal, and our pre-eminent position in the southern Africa market.”END www.southafricamag.com
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