Customisation at the centre of CASE Construction Equipment’s African rental trust
From left to right: Nico Louw, MD of Renico Group; Leon Schelvis, CSE Sales; Louis Nel, workshop manager at Renico Group; Jonathan Clark, Product Support South Africa at CNH Industrial; Andrea Rapali, CNH Industrial; Corne Coetzer, CSE National Sales and Mark Webster, CSE branch manager, in front of Renico’s CSE TLBs.
CASE Construction Equipment remains one of the most preferred brands for rental companies in Africa, and Franco Invernizzi, senior director for Africa and Middle East at CASE, explains that customisation plays a crucial role in meeting this market segment’s needs.
Invernizzi believes that when economic conditions in the earthmoving equipment business environment are this tough, quality of the product alone may not be enough, but customisation plays a crucial role in meeting the fleet operators’ needs.
“Mostly in tough economic conditions, people ought to opt for rental than investing in their own equipment. For us rental companies are traditionally a big target market, and ought to thrive when markets are this down,” he says.
He explains to Equipment Africa what CASE has done right over the years is its focus on catering for the different tiers within the rental market from fleet owners of two machines through to those who operate as many as 2 000 units. “For example, in South Africa, together with our dealer CSE Equipment, we have segmented the rental market because the needs of a big plant hire company are very different from the needs of an owner of two machines. Additionally, the needs of companies renting equipment to mining clients are different from those of a company that hires its equipment to general construction. So, segmentation of markets is very important in today’s operating environment,” says Invernizzi.
However, he reasons that after understanding the needs of the different customers, an original equipment manufacturer, together with its dealer, must be in a position to be able to customise the product as per customers’ requirements.
To further support this, he quotes a recent report by McKinsey & Company, which states that the most important driver of construction equipment in the past was production costs, but today the most important thing is customisation, which is the ability to satisfy customer needs. “The value proposition is the most important consideration for the customer right now, all the way from quality, price, financing through to service and maintenance,” reasons Invernizzi.
“Customisation means understanding what the customer needs are. Secondly it’s about being able to change your offering as per those customer requirements. We cannot do that alone as an OEM, and likewise the dealer cannot be in a position to do that on its own,” he adds. “We work together with the dealer to achieve that feat. For that reason, our partnerships with our dealers have become very strong, compared with the way we used to work with them, say three to four years ago. I remember we would not so often discuss in detail about the customer with the dealers. Now it’s something we do every week and the buzzword is customisation.”
Franco Invernizzi, senior director for Africa and Middle East at CASE, says rental companies are traditionally a big target market for the OEM.
A CASE of trust
One rental company that has, over the years, stuck to its CASE brand is South Africa’s Renico Plant Hire, part of the Renico Group. The Renico Group comprises various companies in the fields of construction, property investment, quarrying and crushing, civil engineering and earthworks, in addition to plant hire. Having started off as a real estate agency in 1992, the company has gone from strength to strength, investing in different sectors and dedicated companies such as Renico Plant Hire.
Nico Louw, founder and managing director of Renico Group, started Renico Plant Hire with an old backhoe loader in 1998. Since then, the company has established itself as one of the leading plant hire companies in the north-west area of Johannesburg and its rental fleet has remarkably grown to today’s count of over 200 earthmoving machines and tipper trucks.
The fleet includes a total of 38 CASE tractor loader backhoes (TLBs), 14 excavators in the 21 to 29-tonne (t) class size, four recently acquired motor graders and several skid steer loaders. All these units were supplied by South African CASE distributor, CSE. The units are deployed on various job sites throughout South Africa and Namibia and they have played a crucial role in the development of large-scale civil engineering projects, including shopping centres, office developments, highway upgrades, mining and various other projects.
Renico Plant Hire has established itself as one of the leading plant hire companies in Johannesburg and its rental fleet has 200 earthmoving machines and tipper trucks.
“Reliability is a key factor in our business,” says Louw. “Our results depend on the equipment performance and having minimum downtime is essential. Since its foundation, our company has been relying on the proven reliability and performance of CASE equipment.”
“Ease of use is a very important factor for our customers,” says Louis Nel, responsible for Operations, Technical & Procurement at Renico Plant Hire. “We are committed to provide them with turnkey equipment solutions that perfectly fit their needs and applications.”
Nel also believes that technical support and parts availability are very critical. “CSE is always available when we need them and they resolve any issues at speed,” says Louw. “What’s more, when we need to renew or expand our fleet, we get excellent advice from them on the model that will fit best with our needs.”
CSE, which is part of South African based investment holding and management company Invicta Holding, has an extensive network of branches and dealers which cover the major centres of South Africa and some bordering countries. “We are committed to offer the best equipment that better fits our customers’ applications, with consistent benefits in terms of performance and minimum downtime,” says Brenton Kemp, managing director of CSE. “Our company is also well positioned to support our customer base with extensive sales, technical and aftermarket services.”
One of the reasons why Renico opts for CASE is the remarkable aftermarket service the company gets from the dealer CSE.
“In South Africa, there is a high demand of equipment from the compact line but there are also specific industries and sectors in which the market is dominated by products from the heavy line, such as excavators and motor graders, as the ones we have provided to Renico, but also other machinery like wheel loaders that are part of the full CASE offering,” reasons Kemp.
The African market as a whole represents more or less 1 500 units per year for CASE, according to Invernizzi. “In good years we used to achieve in the region of 2 000 machines. We believe there is still potential for us to be bigger than that. The challenge today is that Africa is a market with the biggest number of used machines. When I say used I don’t mean five to seven-year old machines. In Africa you can get a 20-year old excavator or even a 25-year old grader still working on site,” says Invernizzi.
Invernizzi adds that in a market where mining, the major source of income for many African economies, is in dire straits and investments into infrastructure have also significantly dried out, while banks have also been reluctant to finance construction equipment, CASE is pushing ranges that bring quick returns for the owner of equipment, especially in South Africa. “The best bargain remains the backhoe loader. CASE has always been renowned for its backhoe, which also comes at a very good price, especially when contractors are cash strapped due to constrained order books,” he says.
“With our backhoe, especially the CASE 570 model, you get a return on investment very fast, and for that reason it remains a trusted tool in the market. People can afford it. Besides our 570 backhoe loader, we are also seeing increased interest in the skid steer, especially our CASE SR175 model,” adds Invernizzi.
Equipment Africa says: At a time when contractors are cash strapped, as Invernizzi reasons, CASE has gone a step further to help its customers. It is offering an in-house financing programme through its dealers with a better interest rate than most of the banks. The second pillar of its winning strategy is the service package. This is part of the effort to not only sell a machine but to give the customer a total solution. The customer is only left to think about how to run his business not how to maintain and repair machines.