Building sustainable relationships key to Ver-Bolt's success

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The company is now ready to use its strong base in South Africa as a springboard into the rest of the continent, especially as many major power projects begin to take off.

The company sees its partnership with Standard Bank as crucial to this success. It recently worked with the bank to obtain the funding to secure a contract to supply the fasteners to a major wind turbine project in the Northern Cape.

Instrumental role

"If a company grows two or threefold, you need a bank to support expansion and Standard Bank has been instrumental over the last few years in backing us with some major power projects. Funding is not easy to come by and needs to be motivated correctly. I would say about 50% of that motivation would be based on how well the bank knows the individuals and company it would be working with to have faith in them," says Nienaber.

On a big contract like a wind turbine project a lack of funding would have seen the project stagnating and the opportunity being lost.

This project and projects like it are becoming increasingly important drivers of a localisation strategy across the economy - where key components on a project are developed locally rather than being imported. Ver-Bolt is encouraging more localisation across the supply chain.

This is because the local manufacturing sector has largely been excluded from many renewable projects, where bigger companies preferred tied and tested overseas suppliers. But now this situation is changing fast and bringing about more opportunities for job and real economy growth.

Local suppliers

"The first rounds of bidding had a lot of solar energy projects and the majority of goods in the industry were imported. But we are now seeing the process develop further and a lot of wind power projects are on the table, with more goods being supplied locally by companies like ourselves," says Nienaber.

"We pushed hard to localise, but the swing happened when saw the bill for localisation, when certain components were focused on and we have seen that portion increase," says Nienaber. The Preferential Procurement Policy Framework Act entitles the government to direct which products and services have to be procured locally and it has been ramping up this in 2015, with the latest designations including many power and construction components.

"It needs to be a pretty efficient system to gain the confidence of international companies in the supply chain. The capacity of the local market was just not sufficient. But we have streamlined our system over the past ten years to handle localisation in a big way - this is why these companies trust us to deliver for their projects," says Nienaber.

Expansion into Africa

While the localisation policy is already creating jobs, it will likewise provide opportunities for Ver-Bolt to benefit from the growth. While four rounds of renewable projects in SA have been a roaring success, Nienaber says the whole of West Africa and countries like Botswana, among others, are opening up for these projects now.

"As this happens what you see is a transfer of money and skills. If you start a project in a sustainable way over a number of years there is true empowering in the form of education and skills transfer - we are already seeing this with the wind projects in the Northern Cape," says Nienaber.

"The growth in our company has exceeded expectations and with the relationships and reputation we have, I believe we are very well placed to be able to piggy-back on the expansion of local and international companies into Africa by being the preferred supplier of materials to them. We have, in fact, developed our supply chain to such a degree so that we can meet that demand," concludes Nienaber.