In the current economic climate it is often said of businesses that only the strong will survive. With a company ethos that proclaims “Forging new direction and maintaining strength”, Mining and Slurry Technology (Pty) Ltd (MST) has demonstrated adaptability and courage, to deliver a remarkably successful change in strategy.
MST is a slurry pump company operating from its centralized design, manufacturing and assembly plant in Vulcania, Brakpan. The company specializes in manufacturing robust and heavy duty slurry pumps for all abrasive applications, providing solutions to the mining industry with a range of horizontal and vertical centrifugal pumps.
The company’s adaptability came from recognising that prevailing market forces required a change in focus; the courage came from implementing that new direction – which required a major investment and a cultural change, as Eddie Lizemore, Managing Director, recalls:
“I have been with the company for about two years. We started on our journey about 18 months ago when we began manufacturing pumps locally, having previously imported these from China and the Far East. We saw the need to get the local market going and acquired a foundry – since then we have grown rapidly and increased our capacity six-fold in the past year and a half.”
The investment in the foundry dramatically changed the fortunes of MST, which today manufactures the Buccaneer range of pumps, developed in-house.
“We started out in 2007 when my partner Jaco Griessel began in a small double garage just across the street from where we are today,” says Lizemore. “The company was successful but today the industry is going through several major challenges here in South Africa: everyone in this business imports pumps from China and that has several disadvantages, including the fluctuations in exchange rate, issues around quality and also the impound time which can delay delivery by eight weeks – as a consequence we were losing flexibility.
“Our customers couldn’t wait eight weeks and we decided to branch out and make our own products, meaning we now deliver on time and importantly we manage our own quality (we are currently working towards ISO 9002 accreditation).
“MST is unique in having our own foundry, there is lots of competition in the market but everyone else continues to import while we are unique in having 100 per cent manufacturing. We have been able to develop our own materials and we filed a patent on our special alloy – SH46, which is better than normal 27 per cent chrome.”
The investment in the foundry, which Lizemore says cost in excess of 10 million Rand, was only the beginning. The site covers 22,000 square metres in total – enough capacity for future expansion, while MST immediately set to work increasing and developing areas on-site to assist its growth.
“We have now increased the size of the foundry from 3,000 square metres to 5,000 square metres; we have implemented a new sand plant and increased the capacity of the machine shop. Our foundry casts 10 tons on average per day and is accompanied by a Pattern Shop, Pattern Store and Testing Laboratory and we carry stock of around 20 million Rand at present.”
In the last 18 months MST has seen its order book swell from a previous turnover of 1 million Rand each month to roughly ten times that figure. Lizemore attributes much of that growth to a strategy looking beyond South Africa’s borders:
“We have seen good growth in Namibia, thanks to our strategy of partnering with appointed distributors. It has paid off handsomely and kept our own logistics costs down and this model is helping us to expand throughout the continent.
“In South Africa much of the growth has come through supplying platinum mining companies but Namibia is rich in iron ore and uranium (as is Malawi) and we also have a big share of the coal mining business. The next area we are looking to serve is the growing sand market,” he describes.
Lizemore says that one of the big advantages of having the foundry has been the flexibility that MST can offer clients. Many of the pumps are standard sized and interchangeable, however when a customer has a special requirement the foundry and labs are able to produce to specification. The existing product range is likely to be added to, according to Lizemore, with the company looking to manufacture process equipment like samplers and cyclones by the middle of 2013.
Of course grand designs require a dedicated, highly skilled workforce and MST has swelled its numbers from 56 in early 2011 to 159 employees today, as Lizemore explains, “When we took the decision to acquire and upgrade the foundry, we recognised the need for qualified engineering people and we head-hunted the guys that we knew could help us to develop the pump industry. We have the best skills in the whole country.
“The foundry project was a learning curve for all of us and we initially embarked on a big training programme. Today we have ongoing on the job training and our training officer is helping us to work towards ISO accreditation on quality and health and safety.”
Quality is an essential component of MST’s service, but maintenance is still a pre-requisite both on-site and at customer centres, with the company providing full-time fitters at some facilities. Despite MST’s unmitigated success since its transition, Lizemore insists there remain plenty of challenges: “It is a very difficult time to be in the sector and the recent political unrest within domestic mining has not helped matters. I think that the Rand is going to struggle over the next twelve months and that will take out lots of the importers from China.”
Tellingly, Lizemore’s prediction is likely to play nicely into MST’s hands, given its reliance on its own manufacturing now. With scrap at a premium due to demand again from the Far East, having a foundry has given MST another financial edge:
“Our biggest concern has been paying world market prices for raw material and the big demand for scrap has driven prices up. We now have in place buy-back agreements with customers and we can recycle our products 100 per cent. This has certainly given us a huge advantage not only in terms of availability but also from a cost perspective – buying scrap from other sources would cost an extra 40 per cent. Of course it also means that by recycling we are helping the environment,” Lizemore states.
All things considered, it has been a meteoric 18 months for MST, yet the growth achieved has been carefully stage-managed, something Lizemore insists will continue in the future: “In terms of culture we are poised for the next phase in our growth,” he asserts. “Our growth has been limited in the past by our ability to product sufficient stock, but going forwards we have the capabilities to triple our foundry output.
“We also have scope on site to double the machine shop area and are looking to construct a pump testing performance facility in the next nine months – the challenge there is to build the proper test loop that conforms to ISO standards.
“We are very excited by the prospects coming up for the business in Central and Northern Africa and there are opportunities in Russia and Kazakhstan which will help us to significantly increase sales and double our size in the next year,” he concludes.
All of which reinforces that company ethos – and with a combined total of 150 years, the leadership team at MST is looking forward to steering that new direction.