INDUSTRY MATTERS
53
To locally manufacture
or not is the question
Unemployment within the borders of South Africa is 27% for Q1 2018, according to Stats SA.
By Andy Camphausen
Some believe this figure is actually higher at almost
37%. In fact, 120 000 jobs across the manufacturing
sector have been lost since the start of 2018.
South Africa’s unemployment rate is high for both youth
and adults; however, the unemployment rate among
young people aged 18–34 was 38.2%, implying that
more than one in every three young people in the labour
force did not have a job in the first quarter of 2018.
Compounded to this are increasing political pressures
and agendas that do not assist people to attain jobs or
create job opportunities in this country.
Would it not be utopian if we all followed the principle
of purchasing and/or procuring locally produced goods
and services? If South Africa has the capability and
the capacity to locally manufacture a product or offer a
service, why buy it from overseas?
Why is it that the likes of massive corporations like
Mercedes, Volkswagen, and Renault invest in South
Africa in building manufacturing plants to build cars
for the export market? They use our expertise. Are we
not good enough? Of course we are and that is why
they invest. With the same thinking as above, local
manufacturing has attained a reputation of being more
expensive than its overseas counterparts.
But why is that? If there was capacity in factories using
the economies of scale formula, do you not think that
local manufacturers would be able to compete on the
world stage, obviously comparing product like for like?
The short answer — of course we can, but there is this
false sense of security that if something breaks, I can just
replace it as it is cheaper than buying something locally.
Is it really cheaper?
FOR EXAMPLE
You kit out a bathroom with primarily locally
manufactured fittings. As the product is locally
manufactured, there is peace of mind from an installation
point of view as the service backing is local, too, should
something go wrong, or if you just need some advice on
how to install a particular product. It is just a phone call
away and most often, the service is exemplary.
www.plumbingafrica.co.za
Obviously, there are things in a bathroom that cannot
be procured from a local manufacturer, like porcelain
tiles. Now you install lovely, locally manufactured
brassware/sanitaryware products and tile with imported
porcelain tiles that can cost over R500 per square metre.
Eventually, everything is installed and you get paid for
the work done and in your opinion, it looks beautiful and
much pride is emitted when getting paid from the owner.
On the other hand, you kit out the same bathroom with
exclusively imported fittings from overseas. There is no
peace of mind as you do not actually know where the
fittings have been manufactured.
Yes, it is cheaper and you save some good money on
the installation. But there is no one you can phone if
you have a problem or need advice. You then get paid
and the same amount of pride is emitted when getting
paid as it also looks good and the owner is very happy
with the workmanship and the lovely imported fittings.
You leave, but a few weeks later, you get a phone call
from the owner, complaining that there is water coming
out of the porcelain tiles that you painstakingly laid at
R500 per square meter.
This is a plumber or installer’s dread.
Now you have to go back and fix what is wrong, using up
the money saved on the cheaper fittings and more often
than not, all profit is diminished by a simple principle
decision. You phone the store from where you bought the
fittings and learn that they cannot assist you. You now
have to remove the tiles at your expense and time (where
you could have been doing another paying job), some tiles
break, and you only have 10% in backup. You find that the
brassware in the wall is leaking. You now have to use your
hard-earned profit to sort out a problem that, if you had
bought locally manufactured product, would most probably
not have happened due to the available after-sales service
from the local manufacturer.
Andy Camphausen
Andrew (Andy) Camphausen
has been in the building/
plumbing industry for over
20 years. During his six
years in the Free State, he
was nominated and served
as vice-chair of IOPSA
Free State. During his 12
years with the company
he has been Regional
Manager and recently
holds a National Technical
position at LIXIL Africa.
Andy is very passionate
about our country and
believes it’s our responsibility
to ensure that the next
generation of plumbers is
adequately trained. He takes
pride in working for a local
manufacturer and believes
that customer centricity is the
key to success.
The point is, we can complain, shout, scream, and blame the world about our woes and
why there is no employment, but if we were asking the plumbing stores whether the
product is manufactured in South Africa, it would force these suppliers to procure locally to
satisfy the demand of you the plumber or installer and that would put capacity back into the
factories, which in turn would reduce the price of goods substantially to compete with the
likes of the overseas counterparts. Whatever you decide, we need to feed our population,
and this will never transpire without, among others, the local manufacturing sector. PA
September 2018 Volume 24 I Number 7