Top of the agenda is Melco’s acquisition of Conveyor Pulley Manufacturers (CPM Engineering), the company started by Doug and Othmar 24 years ago. “CPM is a well-known, established, quality brand so it forms an ideal brand synergy with Melco,” says Danie.
CPM has traditionally manufactured pulleys while Melco is renowned for its conveyor steel rollers, idler frames, impact systems including impact rollers, supreme HDPE rollers and Rulmeca motorised pulleys, so customers can choose from a much larger package of offerings.
Michael says that these days, clients are looking for one vendor to service multiple commodities. The range will be underpinned by investing in new equipment at CPM which will move from its current premises in Sebenza to a larger 3 800 sq. metre (underroof) property in Elandsfontein, thus doubling their capacity.
Although business is flat right now, figures in 2017 have improved on 2016. Says Othmar, “Every business is feeling the effects of a lack of new projects and new investments in South Africa but the replacement business is good.”
Danie describes the current uncertain environment and political issues as a hurdle to doing business. “Policy indecision is an obstacle. However there are opportunities in Africa”
Fortunately, as an international player of many years standing, Melco has recently completed projects in Brazil and Canada.
The Brazil project was a pipe conveyor comprising 44 000 rollers, all manufactured in Germiston. Impressively, the order was completed in just six weeks. This is one of the reasons why Melco South Africa is an internationally respected roller manufacturer. “With a large capacity of 40 000 rollers per week, and top quality products, after Italy, we are one of the biggest roller manufacturers in the world,” says Danie.
The Canadian project required 25 000 frames to be completed, also specially-treated to deal with the extreme low temperatures.
Although both these international projects required slight modifications, much of the conveyor equipment is standard. Carel says this enables expansion without incurring additional costs for new equipment. The opposite is true of the pulley environment, where every item is built specifically for each job, Doug tells us.
“Our big advantage is both Melco’s and CPM’s longstanding reputation in the local and international arenas. Quality is about upholding top-notch standards, continually investing in technology and equipment, training people well and most important, repeatability.”
Smaller players can compete on costs, but Doug says it’s very disappointing when a contract is awarded to a poor quality manufacturer. “Unfortunately you have cases where they would rather buy three pulleys a year, than one pulley that lasts a lifetime.
“Having said that, there is a definite change in buying patterns as some customers are slowly realising that it is more cost effective in the long run to buy a quality product. Look closely at the lifecycle costs, and you’ll see that premium brands are always the obvious choice.”
Now that the CPM acquisition is complete and these two brand leaders have joined forces, both teams are looking forward to learning from each other and growing together. “With more stability and synergy at an operational level, customers are assured of a quality supplier – that is always a good thing,” Danie concludes.
Melco Conveyor Equipment, Tel: (011) 255-1600