The ground may be shaking for the manufacturing and flooring industry, but change is afoot for 2020
The past few years have painted a pretty bleak picture for the Manufacturing and Flooring sector. The recent announcement by one of SA’s longest running flooring companies to completely phase out its soft flooring business as part of a major restructure and down-sizing of the business has reaffirmed the glib reality for the industry. However, according to one of the manufacturing and flooring sectors’ leaders, despite the ground feeling somewhat shaky for many businesses, opportunity and growth is afoot. Nouwens Carpets, Oscar Grobler shares his view of what the state of play in the manufacturing and flooring sector currently is and how he believes the grass can still be greener on the other side.
Nouwens Carpets has been a major player in the manufacturing and flooring industry for the past 57 years, and although we have seen our fair share of ups and downs – the past few years have proven to be some of the toughest. Adding to the woes of a global recession, our country’s electricity supply crisis coupled with the instability of our political set up has certainly not helped matters. Even closer to home where our factory is based in the Harrismith region, companies have felt the brunt of corruption with our municipality failing to deliver basic electricity and water supply, which as a business community – called the Harrismith Business Forum – we have had to rally and find an alternative solution to keep the lights on. Fortunately, a landmark deal was made on this front in October 2019, but overall it feels as though we have constantly been on the back foot in terms of creating efficiencies for our plant and with the economy being in the doldrums – staffing has also been impacted with retrenchments being commonplace within manufacturing and business in general.
Sadly, even our efforts to try and consolidate manufacturing operations with one of our “colleagues” to streamline both our manufacturing processes and expertise wasn’t enough to save them from a company restructure that has seen their entire soft flooring manufacturing division be disbanded. Their recent withdrawal from our intended arrangement echoes the reality and knock-on effect of the soft flooring market’s almost recession in 2018. Over the past two years a growing militancy of the unions and labour force challenges have also impacted many businesses, including ourselves, who have been forced to face the reality that the market has declined to such an extent that businesses are downsizing and as a result simply can’t afford to keep the same number of people in jobs. Although 2019 has not shown much improvement, a change in strategy and being open to explore the opportunities that present themselves is how I believe companies in our sector will survive and even flourish in 2020 and beyond.
What I believe will give us our edge is innovation and quality. Particularly when it comes to our industry. That’s where trust comes from. From its humble beginnings in 1962 and through the highs and lows of the economy over the years, the Nouwens brand is still recognized by the consumer as a brand of quality. Innovative advances and investment in new technology have set Nouwens apart and it is these elements that will support us into the future as we exploit new opportunities which present themselves in the textile floor covering market both locally and abroad.
If you’re not up to standard with what the rest of the world is doing and listening to what your competitors are doing – then you’ll be left behind. Innovation carries all fronts – it carries new product, it carries innovation in approach, it carries innovation in design, it carries innovation in how you treat your customer base. You have to be ahead of the curve and not behind it. That’s the difference.
The enormous consumer demand for artificial grass and growth of this product within the flooring sector over the past two years is a perfect example of how success can be achieved when innovation and opportunity collide. In fact, our introduction of an artificial landscape range almost three years ago into our portfolio is what has saved us. We saw a massive decrease in sales turnover because of the soft flooring market going into a recession in 2018, which improved slightly in 2019, but it’s been the significant increase in our grass year on year that has helped us weather the storm of this poor economic climate. In 2018 we saw an increase of over 20 – 30% in our artificial grass production and in 2019 we are up by 50%.
Artificial turf is definitely an expansion area for Nouwens Carpets and additional machines have been converted over the past two years to keep up with this growth. I believe that in the soft flooring industry over the next 5 years, artificial grass is going to be the mover. There are four million football and rugby fields around the world and globally only 10% of these have been converted into artificial turf. And that’s just for sports – never mind the other landscaping opportunities for business and home purposes that with recent droughts has made artificial turf far more appealing to natural grass from an upkeep and maintenance perspective. Colour changes to turfs due to TV screening preferences – blue on white being the preferred option now – will also factor in.
There have also been signs of an infusion in the soft flooring industry with some new ideas coming to the surface, that are starting to carry favour. In time that will pick up. In a nutshell though, a fresh approach to doing business is what is needed during these challenging times. Opportunity and innovation are key to bringing about positive change and growth in 2020 and beyond. Fortunately, Nouwens Carpets is ideally positioned, and our revised business strategy demonstrates how we can create efficient and profitable operations to keep us relevant and not just in business – but to maintain our status as leaders in the manufacturing and soft flooring industry in South Africa.
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