Since teaming up with the Department of Trade Industry and Competition (dtic), Massmart, the second-largest distributor of consumer goods in South Africa, has increased its local supplier base as well as the number of made-in-SA products it offers.
The collaboration reviewed the group’s top imported products and determined which had the potential to be manufactured more competitively by local manufacturers.
The process involved retaining industrial engineers to review 600 products and selecting those with the highest potential for local manufacture based on local manufacturing capability, opportunity to achieve target pricing, and local availability of raw materials.
Massmart, which owns brands such as Makro and Game, localised the supply of cookware products for Makro’s private brand, Primaries. This means that previously imported pots and pans are now manufactured locally by Africa Cookware.
“In this case the dtic played an important role by assisting Massmart to engage a local aluminium supplier to supply previously imported base materials for these items,” the company said in a statement.
Massmart has also localised a variety of previously imported products, including baby cots, flat pack office furniture, pool accessories and instant noodles.
One of its “most successful” projects has been the localisation of multi-density fibreboard (MDF) toilet seats, which involved investing in capital equipment such as hydraulic presses, raw material milling machines and paint lines for local manufacturer Active Factory.
Other localised products include nails, wheelbarrows, gym equipment weight disks, brackets for boxing bags, heating gel and clothing accessories.
“Locally manufactured products present significant supply chain benefits by reducing supply lead times so that stock arrives in our stores faster and more reliably which translates directly into improved sales,” says Von Stander, Massmart sourcing optimisation executive.
“Localisation means more investment in local manufacturers which creates opportunities for growth for those companies,” he added.
Stander says the group is currently exploring opportunities in the housewares, garden tool and office furniture merchandise categories to manufacture locally in the near future.
Palesa Mofokeng is a Moneyweb intern.