Construction and engineering services group Bicacon is investigating the viability of establishing a manufacturing division within the group to produce products for use by its maintenance division, says Bicacon Group strategy and planning head Bornapart Sibanda.
The group continues to look for acquisition opportunities and will consider acquiring a manufacturing company that it can fold into its maintenance services division, Mainbic. The objective is to leverage the technical expertise of Mainbic.
“We are already conducting feasibility studies to manufacture valves, pumps, pipes, generators, transformers, couplings, water meters, electrical boards and other equipment maintained or used by Mainbic operations, mainly in the water infrastructure and health sectors.”
Further, the group is pursuing organic growth and is aiming to grow within its established client sectors, as well as aim to enter and grow within new sectors, he says.
“The unbundling of Bicacon [into three companies in 2015] has enabled us to concentrate on the specialities and expertise of each company and, thereby, pursue a more rapid-growth strategy.”
By integrating Mainbic backwards into its supply chain, the group intends to establish control over the quality of products that it uses and improve supply chain efficiency. It leverages the technical expertise within the group, which affords it the opportunity to pursue complex and technical projects while sharing overheads.
“A manufacturing unit will also serve to bolster capacity and cost-effectiveness as we pursue growth in new sectors, such as the ports and rail sectors, as well as organic growth in our established client industries,” says Sibanda.
He adds that the group’s operations will provide its manufacturing company with baseline demand for products and it can then pursue additional production for engineering-related industries.
“Demand for our services is sustained and we expect good growth to continue over the medium term. Similarly, demand for high-level, technical skills is a constraint in engineering industries and we are pursuing in-house skills development to ensure that we can attract and retain these skilled people.”
To this end, the group has a robust internship and mentorship programme within and between its units to nurture skills development. The broad range of disciplines within its operations also enables it to facilitate broad career development for its employees, allowing it to attract and retain skilled employees.
“The goal is to use the combined capacity of the group, avoid the trap of forming operational silos, and ensure that any innovations in any of the subsidiaries are used by all the other subsidiaries. This management approach also colours the way we identify potential acquisitions: they must have a similar philosophy to Bicacon’s focus on improving the quality of life in the communities we serve. In this way, we are able to ensure control and performance of the businesses and the growth of the group,” concludes Sibanda.