Engineering and fabrication company Oro Projects is struggling to make headway in the engineering and fabrication industry, owing to a lack of support from government departments and financial support institutions, which have been vocal about their willingness to assist black-owned industrail companies.
Oro Projects is 100% black-owned and handles projects in the construction and manufacturing sectors, with plants in Benoni and Pietermaritzburg, as well as a branch in Polokwane.
Company MD Mutshutshu Nxumalo emphasises that new black-owned industrial manufacturing companies, by the nature of the industry, have to focus on specific areas and cater for niche clients. This makes it difficult to gain a foothold in the shrinking market while having to compete with larger and more established companies.
For this reason, he says Oro Projects decided to do business under the banner of the Department of Trade and Industry’s Black Industrialists Programme. “We noticed a huge gap in industrial manufacturing . . . a key driver of the economy.”
However, he describes the programme to provide assistance as merely “paying lip service” without actually taking any concrete action to spur investment and ensure black-owned industrial companies can compete and survive in such a tough industry and struggling financial market.
“When people like us come on board, we put our energy into our businesses and, therefore, government should be even more supportive as a result of our investment into the private sector.
“I wish [government institutions] could open their eyes a bit and see that supportive interventions are lacking. We need support similar to that of the [South African] industrial revolution of the 1960s.”
Nxumalo adds that, when sanctions were imposed on South Africa during apartheid, it was forced to develop its own manufacturing capability, which provided a significant opportunity to manufacture key products locally.
He adds that using this established capability can enable South Africa to reindustrialise and promote more local manufacturing capacity.
Nxumalo says, as happened in the 1960s, this will require partnerships with development agencies, such as the Industrial Development Corporation and the National Empowerment Fund, because the banks are also trying to assist with loans, but are not geared to cater for large “capitalising companies” like Oro Projects.
“A company like ours – 100% black-owned – is a shining example to others that want to start up,” says Nxumalo, adding that companies such as Oro Projects offer hope. “If they see us failing without the support we are supposed to get, then it will demoralise others [intending] to start companies.”
In terms of its current order book, Oro Projects is undertaking work in the public and private sectors. This will benefit the company, he says, as it has resulted in the company achieving a seven- point Construction Industry Development Board grading, which is used by government (national, provincial, municipal and State-owned enterprises) to decide if a company’s tender can be considered for a particular construction works contract.
Nxumalo says the industrial manufacturing sector holds significant potential to propel the country out of financial difficulty: “[This economy is] in a quagmire. . . we should be focusing more on manufacturing, which will turn things around.”
The manufacturing industry employs many people, through which many skills are transferred, he adds.
To enhance its manufacturing capability, Oro Projects is partnering with construction and engineering company WBHO on an enterprise development programme, which Nxumalo believes will broaden the opportunities presented to Oro Projects.
“WBHO is assisting us in obtaining ISO 9001 accreditation, and in training and skilling some of our personnel,” he concludes.