South Africa-based Filcon Filters has set an ambitious target of 25 percent annual growth over the next three years. Directors Vernon Clarke, Tony Henfrey and George Canning talk about running a knowledge-based business.
Manufacturing, water and waste water, oil and gas, food and beverage, petro-chemical, paint—no matter what business you are in, continuity is essential. Downtime and quality issues cost money. So it’s small wonder that many companies prefer to stick with the brands and suppliers they know and trust. One company supplying top quality proprietary products, but also encouraging customers to break the cycle of inhibition when a custom-built product would be more effective, is Filcon Filters.
Launched in 2000 by owners Tony Henfrey and Vernon Clarke, Filcon initially began trading as an importer and supplier of proprietary filtration products with a distribution licence for Hayward Filtration, now part of Eaton Filtration. From its base in Cape Town, the company quickly expanded and diversified, and today stocks a wide variety of products that include self-cleaning, back washing and centrifugal filters, market, basket and flushing strainers, filter cartridges and bags as well as filter media in the form of materials such as activated carbon. “We are still diversifying,” said sales director Vernon Clarke. “We’re always looking for new types of equipment and technology, and if a new product fits with us we will investigate it.” Vernon drives sales and Tony positions the Filcon brand through press releases and search engine optimisation.
Filcon’s aim is to become South Africa’s leading filtration specialist. Over the past 12 years considerable progress has been made towards that goal. “Today, we provide not just products,” explained financial director Tony Henfrey, “but we also answer any questions our customers have on filtration, and we will even design filtration systems to solve specific application problems.”
Through a combination of in-house technical expertise, reliability and integrity, the company has built a solid reputation for excellence. “Service levels are particularly important to us,” Clarke continued. “If we are able to service the customer to the level that meets with their satisfaction, price is not always the key. People will purchase from us because we have the stock levels, and we deliver on time.”
As part of its strategy for growth, the company opened a second office in Johannesburg two years ago, close to South Africa’s industrial heartland. One of the key roles of the new technical centre is to diversify into a new gap in the market. “With the rand weakening against most currencies and imports therefore becoming far more expensive,” Henfrey said, “we realised that manufacturing our own range of products would give us an edge.”
The manufacturing arm of Filcon is managed and run by design engineering director George Canning who brings some 30 years’ experience to the business. The economics of manufacturing custom products in South Africa are, he believes, very persuasive. “Because of the size of the market here and the sheer range of filters that are available on the global market, it’s impractical to hold stocks of them all. So if a customer requires a filter that is in any way non-standard, the freight costs of importing a one-off product are simply prohibitive,” he said.
“In the past, plant engineers have had to modify their plant in order to accommodate a filter from the standard range. The service we’re offering means they don’t have to do that. We will design non-standard filters from scratch to their specification. We then outsource the manufacture to one of three trusted fabricators here in Johannesburg.”
With Filcon’s reputation for technical excellence, the service has proved very popular. It saves on freight costs, reduces the downtime, cost and risk associated with adapting production equipment. All Filcon filters are manufactured to ISO 9001:2008 quality standards, and the company retains control of the entire process by providing not only the detailed technical designs but also the raw materials and components.
Since launching the new service, Canning has continuously been refining the design and manufacturing process to increase efficiency and reduce lead time, therefore making custom manufacture even more attractive. For example, where there are components and materials common to several products, the company always holds significant quantities in stock.
Custom manufacturing has been very successful, and the unit has made a name for itself with some of its products. Among the more significant is the Dirt Gobbla, a centrifugal filter that is currently unique in South Africa. “We’re also known for our centrifugal strainer, our automatic purging strainer and back washing strainer,” Canning said. “And we’ve developed a popular line of locally manufactured in-line basket strainers.”
As Filcon is a knowledge-based enterprise, ensuring business continuity has become a high priority. “This is something we’re very conscious of, and have been planning for,” Clarke said. There are currently two young graduates employed under Canning at the Johannesburg office, and one under Clarke at Cape Town. All three are undergoing a mixture of formal training and continuous in-house coaching where they are learning skills and gaining experience of the industry, absorbing knowledge almost through a process of osmosis.
“One is a young African lady who has a BSc in geology with a chemistry background which should be an aid in water treatment. It’s her first job out of graduation,” Henfrey explained. “She is showing tremendous potential and is probably one of the first black women to venture into the filtration industry, so we’re nurturing her.” Alongside this, the company has been working to improve its BEE (broad-based black economic empowerment) score, and has recently raised this to level 2, an achievement that delivers added benefits for the customer.
With these achievements under its belt, Filcon has set a challenging target for growth. “We have set ourselves a target of increasing sales by 25 percent per annum from 2012 through to 2015, and we are on target to achieve that this year,” Henfrey continued. “Our next priority is to open an office in Durban as we believe there is a big market in South Africa that we have not yet tapped. But we are also looking into Africa as a whole.” The company has already begun to make inroads into the wider African market through third party suppliers.
“At this stage, we see mining as a real growth area, and we’re also looking at the oil and gas industry, particularly in Namibia, Mozambique and Tanzania. And of course with South Africa being the 20th most water deprived country in the world there is tremendous potential for recycling and reusing water.” With so many new opportunities in a rapidly expanding industry base, the target seems well within range.
Written by Gay Sutton, research by Marcus Lewis