A tale of two industries

The manufacturing sector is in crisis. How manufacturers respond to this scenario is largely determined by the business’ size, budget and priorities. Two industry insiders unpack the current state of play.

04 July 2023

Mohammed Gause, Tiger Brands

When I ask Johan du Toit, strategic sales executive for SYSPRO Africa, if the situation across the local manufacturing sector is bad, he pauses. Trying to find the right words to describe the challenges our manufacturers face, he explains that the sector as a whole is under tremendous pressure, due to electricity and water supply issues and a sharp rise in the costs of borrowing capital. “The sector is shrinking by about 7% per year as more and more people offshore and look for alternate ways to get goods manufactured.”

That being said, he points out that there are two “types” of businesses in the industry. “The larger manufacturers obviously respond to market pressures quite differently to the smaller and medium-sized businesses, simply because they have more capital to play with. So when you talk about industry innovation, the top 1% or 1.5% have the means and appetite to build entirely new factories that are fully robotic, fully automated and tech-enabled, but the rest do not,” he says.

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