Nelspruit-based Electro Systems has managed to pursue an ambitious growth and expansion phase that has seen the business grow its footprint, capabilities and client base.
Specialising in the manufacture and installation of power automation systems, a key moment in its growth was its new sheet metal factory in Meadowdale, Ekurhuleni. Here it has set up a facility to manufacture mild steel and stainless steel enclosures.
Company director Martyn van Beek explains that this factory gives Electro Systems’ customers “a complete solution”, while helping the manufacturer to meet customer deadlines.
Previously, the company had sourced enclosures from a third party and often had to wait in line for products to be delivered. “But now we have full control over our production and delivery.”
A leap of faith
This result is very promising for the future of the business, but would have come at great cost and risk if Van Beek had not secured funding from MCEP.
“I applied for MCEP funds in 2012 because putting up a factory like this one requires a huge capital investment. If I had taken [the capital] out of my own funds it would have put a strain on my business in Nelspruit,” he explains.
The funds are a loan, he points out, which he will have to pay back over five years. “They gave us a year’s grace, which is great to get you going.”
This enabled Eletro Systems to rent factory premises in Meadowdale and equip it with sheet metal bending and punching machines, as well as other enclosure manufacturing equipment.
A welcome boost
Even though the going hasn’t been rosy, Van Beek is “very happy” with the progress the company made. Breaking even was not immediately on the horizon, given the capital outlay, as well as unforeseen costs like staff training.
But he is full of praise for the IDC and the dti. “MCEP is a great instrument. The incentives they give us are attractive and I would definitely recommend to anyone that would want to go into business,” he said.
The new machinery and the new opportunities it presents includes creating 35 new jobs at the new factory.
A growing client list
Electro Systems’ clients can be found in South Africa, neighbouring countries and up north along the east coast of Africa. They include waste water and mining companies, sugar groups, and pulp and paper industries in Swaziland, Mozambique, Malawi, and Tanzania.
Even though the region is full of opportunity, it’s equally competitive, Van Beek says.
“You have to go with the quality of the product, the right price, and it has to be available on the shelves. I think if you have a product that’s always available on the shelf you will always have a buyer.”
