In a recent address to the Cape Chamber of Commerce and Industry, Minister Trevor Manuel, while talking about the hardships of doing business in the South African environment, recalled how in 1995 as the then Minister of Trade and Industry he had given an export award to a Cape Town company that manufactured ovens for bakeries. “Does this firm even still exist?” he asked. “Which others have shut down? It would seem that competitive pressures from China would have caused a wide range of companies, including long-standing intergenerational firms to move from manufacturing to finance or IT, sometimes because of creative destruction or because a new generation does not understand the processes.” Well Mr. Manuel, I have good news. Not only does Macadams Baking Systems still exist, but the accolades continue to pour in. Macadams, manufacturers of ovens and all related products for the baking industry, has been around for more than 100 years and is a South African good news story of note. Having developed into a major force in the international baking industry, its key strength has been its ability to evolve and reposition itself in an everchanging global market. “The company was initially an agent and importer of equipment, but when sanctions were implemented against South Africa a radical change had to be made and that led to the purchase of a manufacturing plant,” Shane McMeeking, CEO of Macadams International, told FTW. “But if you have a factory, you need volume – and subsequently exports grew.” And not only to the traditional markets serviced by South Africa. Anywhere and everywhere is a possibility for Macadams which more than 20 years ago foresaw the potential in Africa. “We are strategically placed to service the African market,” says Graham Noonan, the financial director. “It has been a major focus for growth in the company for at least 15 years. We have exported to 36 of the 54 countries on the continent of which about 18 are active and ongoing exports.” Noonan says the initial focus on Africa was primarily because the value of the sale was higher and they found synergies for their sales by providing complete solutions to customers. “Our business in Africa is slightly different from the other markets that we export to. In Europe or Asia we have no control over our products once they are sold, but in Africa we create business opportunities, we work very closely with entrepreneurs and we have long-standing relationships that develop.” It is not an easy market by any means, says Mike Hodgson, the company’s projects director. “We had to develop the means to be able to supply specific solutions to different countries. There is no one size fits all approach. We were selling ovens in the Congo when they were still at war and we learnt some very valuable lessons that have led us to build a very strong brand reputation across Africa.” Today, he says, the African market is a lot more stable and predictable but it remains risky at times. “One of the greatest challenges in Africa is that its economies are so small that making predictions is very difficult. You could have a fantastic year exporting to a country and then the very next not make one single sale,” says Hodgson. Their African recipe is based on building good partnerships at ground level in the countries to which they export. “It is all about trust,” says Hodgson. “You have to be able to provide longterm service to this market – some sort of scenario where you can give technical backup. Training is essential in the African context.” Their 17500-sqm manufacturing facility in Cape Town is serviced by sea and road. “Airfreight is just too expensive into Africa so we prefer to ship out of Cape Town harbour and do the final stretch of delivery by road. Our service providers are chosen to suit the ethos of our company – reliability, dedication, open communication, transparency are what we look for in the people we work with,” says Noonan. The company’s African strategy continues to evolve, says McMeeking. “We have this year made some significant progress into markets like Sudan and Rwanda. Our strategy for Africa is however not set in stone. It changes and evolves as does the market and we adapt to conditions on the ground. At the same time our export team works hard at knowing the market. We visit the countries we export to several times a year, work on our relationships and continuously strive to add value for our customers.” INSERT & CAPTION 1 Africa’s economies are so small that making predictions is very difficult. You could have a fantastic year exporting to a country and then the very next not make one single sale. – Mike Hodgson INSERT & CAPTION 2 We have exported to 36 of the 54 countries on the continent of which about 18 are active and ongoing exports. – Graham Noonan CAPTION 1 The premises of Macadams Baking Systems in Blackheath Cape Town – strategically positioned for efficient distribution into Africa and close to Cape Town harbour for international shipments. CAPTION 2 The Macadams manufacturing plant – impressive systems to ensure a smooth operation.
