The company has begun a journey of pursuing reinvention.
In 2019 Macsteel Service Centres SA (Pty) Ltd (MSCSA) embarked on a consolidation and reinvention programme set on becoming a centralised distribution-type business. The focus would be on how the company would move steel to customers as effectively and efficiently as possible.
The new strategy and thinking resulted from Macsteel re-evaluating its business owing to a steady decline in steel consumption over the previous five years, with 2019 being a new low and the start of 2020 faring just as poorly – a situation that was exacerbated by the lockdown because of COVID-19.
In various interviews Macsteel CEO Mike Benfield said: “Our strategy is to continue pushing the accelerator pedal to get to the level where we are distributing our steel from fewer distribution centres nationally and not viewing our branch network as a key component of that network.”
This strategy has been boosted with the opening of Macsteel City, a state-of-the-art facility that is located at 233 Barbara Rd, Elandsfontein, Gauteng. Officially opened at the end of October 2021 Macsteel City, the approximately 250 000m² site, is intended to house most of Macsteel’s Gauteng customer facing staff and their support functions, as well as the manufacturing and beneficiating operations.
“This site offered MSCSA the opportunity to rationalise and consolidate its sales, operational, procurement and distribution centres. We have moved staff as well as a number of manufacturing and distribution services to Elandsfontein. Macsteel Tube & Pipe, as well as Macsteel Roofing and Macsteel Pipes, Fittings & Flanges to this facility so that they are now under one roof,” explained Benfield.
“Numerous properties have been closed and all services have been consolidated at Macsteel Trading Germiston South and Macsteel City Elandsfontein,” continued Benfield.
“We are now able to deploy better economies of scale in that there are many different operations within the various units that are now shared, thus eliminating excess and duplication. Centralising departments such as procurement, inventory and sales have created positive synergies that we were not expecting.”
“A key element of the strategy is to have more customer-centric approach to servicing customers while remaining relevant, agile, and focused on providing the best solution and service to customers. Macsteel City is designed to benefit Macsteel customers by offering much larger inventory, speed of deliveries, and efficiencies. We know how important it is for our customers to have ease of access and options, so by consolidating our Gauteng customer facing staff and their support function, we ensure a far better and integrated customer experience.”
Macsteel City warehouses are equipped with the latest technology allowing the business to digitise key operations, so all inventory moving in and out of the warehouse will now be barcoded and can be tracked anywhere in the country. “Digitisation has been a key focus for Macsteel as it enables us to have information at our fingertips as well as develop operational scenarios to make informed decisions. It has been one of the significant areas where the business has focused their efforts to evolve the business, streamline operational efficiency and ensure long-term relevance, agility, and sustainability,” says Cowan.
“Macsteel City allows us an opportunity to improve our offering completely with our prime focus being the customer. There are plans to ensure all lighting used is changed to LED as well as future strategies to install solar panels which will significantly reduce our electricity costs freeing up capital to invest in core areas of our business that will drive customer benefits and growth.”
“We are excited about Macsteel City and understand that change is necessary, especially if we want to align with and meet the needs of our customers. We need to remain adaptable to ensure a sustainable competitive edge,” concludes Cowan.
Macsteel’s new business transformation model drives consolidation and centralisation of functions within its business. This led Macsteel to consider the option of independent ownership of certain Macsteel branches. The concept of Macsteel Express was conceived and the first Macsteel Express franchise opened in Welkom, Free State in February 2021.
Whilst Macsteel Express is a new franchise-partnering concept, the transition to an Express store will be seamless, says MSCSA. The store will continue to hold the widest range of steel and value-added products and remain focused on partnering with customers to offer and provide solutions.
What makes Macsteel Express exceptional? It’s continued customer centric and solutions-oriented approach to all customer engagements says the company. It is open six days a week with in-store expertise and promises to deliver steel and steel-related hardware designed to meet the highest standards for all commercial and residential construction needs.
A key feature of the Macsteel Express franchises will be the accessibility to the general public and small businesses. The long process normally associated with pre-order, account credibility, execution of the order through despatch and delivery, all time-consuming components, will be cut to a minimum when dealing with a Macsteel Express, depending on size of order.
For further details contact Macsteel Service Centres SA on TEL: 011 871 0000 or visit www.macsteel.co.za