INCORPORATING COLD CHAIN
FEATURE others . It is however great that with this growth , LSE has also increased its ability to ‘ showcase ’ systems in practice , as its greatest ambassadors are the customers using their systems .
Albrecht explains that Gonvarri consists of around 204 different brands , and although many are unrelated to LSE ’ s core business of storage systems they nonetheless contribute through having one of the largest specialised tube plants in the world , which LSE and its customers benefit from . Of these , around 20 are racking brands . The company has become a dominant force in its sector through a process of rapid mergers and acquisitions ( M & A ) of those brands . Under this extended agreement between GMH and LSE , exclusive rights have been secured to supply the various brands into Sub-Saharan Africa for the first time . Albrecht says that GMH ’ s cutting edge products , passion for innovation ( particularly in the area of automation ) and drive for sustainability have proven to be a perfect match with LSE ’ s own values and goals .
“ We want to do good work with good people , and so our partnership with GMH is the perfect match . GMH is a powerhouse across the globe , and we are proud to partner with them to supply storage systems in our region .”
He notes that GMH “ has a clear plan ”, one that eliminates ‘ mom and pop ’ clients with most of the work now being large clients requiring big orders and repeat business – which explains LSE ’ s rapid growth . Strategically , LSE only sells to those customers with continuous growth and attempts not to fight for the once-off projects .
The Gonvarri Group transforms around 5.2 million tonnes of steel into products , such as a vast range of racking and shelving systems each year which , in the context of South Africa , is almost ten times the entire volume of all local annual steel products made . On top of the sheer size of the company comes the R & D , innovation and engineering which volume facilitates . Albrecht says LSE has the largest engineering resource pool in the sector and is “ very proud of its ability to be the only company that can provide an engineered solution ”. LSE is the only steel storage system in South Africa that is manufactured according to EN ( European Norm ) 15512 ( DIN EN15512:2020 ), enabling clients to easily install the product with confidence .
Albrecht attributes the rapid growth of LSE and that of GMH to the fact that previously each country would typically have a dominant brand – but no single one had an international footprint . The M & A process for the first time created a global network with local brands such as CKarsten gradually being rebranded where possible . GMH was then formed as a holding company five years ago , to house all these brands . For strategic reasons , some remaining the same brand where they were the most dominant in their individual country , such as Dexion Europe in UK and South Europe , Constructor in North Europe and the Scandinavian countries .
“ We were able to form this alliance with Gonvarri Material Handling , as of all the companies in South Africa , LSE ’ s experience in consulting engineering in the Storage Equipment Sector , we were able to recognise the synergies between us . We didn ’ t want to simply sell the racking as a product , but to have exclusivity and the facility to advise on the designs with clients and for customers . These are complex products and projects and not suited to clients buying direct – it needs strong local representation . Our agreement entailed setting up local subcontractors around the country . LSE ’ s strategy is to work with partners and with the best associated engineering companies in Africa and Europe , to ensure the approach it adopted can be delivered on .”
1 . The Gonvarri Group transforms around 5.2 million tonnes of steel into products , such as a vast range of racking and shelving systems each year .
2 . “ We didn ’ t want to simply sell the racking as a product , but to have exclusivity and the facility to advise on the designs with clients and for customers .”
He notes that any other model would be counterproductive for clients and customers . A small local representation by overseas brands would typically entail flying out a technician to manage installation and maintenance – with all the delays , inconvenience and huge costs that entails . Or the clients and customers themselves will then have to find local contractors to install and maintain the equipment .
“ Both these scenarios we commonly see when European brands are sold locally and in Africa . In addition , who attends to the sale , design and execution of the project ? And on a more current note , who will maintain it for it to last a lifetime ? The small saving on buying direct ends up costing a lot more in lost productivity and all the risks associated to the interface and the implementation of the projects . That ’ s why the bulk of imported equipment and even vehicles in South Africa are sold through local distributors in the main centres , as in South Africa you need an approach and support for South Africans ,” explains Albrecht . CLA
At the moment , the Cape Town and Sub-Saharan
cross border African market is larger than
Gauteng , as the former is the centre of the Cold Chain Sector , as well as being a harbour city .
COLD LINK AFRICA • May 2023 www . coldlinkafrica . co . za 21