That critical link

Quality brands rely on quality dealers with the necessary infrastructure to keep machines operating round-the-clock.

Quality brands rely on quality dealers with the necessary infrastructure to keep machines operating round-the-clock.

There is a very important reason for the credence we have placed on listing as many dealers for prominent original equipment manufacturers (OEM) on this platform, and why we find reporting on their activities so important.

The fact remains that it is the dealer who helps the OEM navigate the continent. In South Africa, alone, we have witnessed the fall of well-known international OEM marques simply because of their limited distribution infrastructure, or their lack of abilities to respond quick enough to the needs of the markets that they serve.

Quality brands rely on quality dealers with the necessary infrastructure to keep machines operating round-the- clock. This is definitely where most of the well-known and established players in the market have a significant competitive edge.

Take a company, such as DEM Group, as an example. A visit to our Dealer Atlas reveals the extent of its footprint on the continent, and the capabilities it has in place to support powerhouse brands, including Hitachi, John Deere, Rammer and Wirtgen.

Other sound examples of formidable dealerships on the continent include those supporting Caterpillar and Volvo Construction Equipment. Barloworld Equipment and Babcock are two names that immediately come to mind.

Not only do these dealers have the necessary infrastructure and technical skills needed to keep their principals’ machines operating, but they also have an intricate understanding of the unique environments in which they operate. These are the real barriers to entry on the continent for any newcomer to the market.

Last year’s bauma Conexpo Africa highlighted the ongoing interest in Africa as a growth area for many international OEMs. There are still a number of international behemoths who have not yet entered the sub-Saharan Africa region, and it will be interesting to see just how they intend establishing that critical link between the market and the OEM.

There is no shortage of sound case-studies of what distribution model works the best on the continent. However, I think that many will agree that this has nothing to do with a fly-in- and-fly- out approach to doing business. It is also not about merely “dumping” a cheap brand on the market. Rather, it’s all about a long-term approach to doing business on the continent.

These dominant names in Africa’s earthmoving equipment market have built up the strong infrastructure and unique capability because they need to do business on the continent. It has taken them many years to build up these massive footprints and capabilities.

Enjoy browsing Equipment Africa!

David Poggiolini
@D_Poggiolini

 

David-Poggiolini

David Poggiolini
David Poggiolini is a South African technical and business writer focusing on public and private-sector driven infrastructure development programmes in Africa. Over the past 15 years, Poggiolini has written extensively on transport, energy and water infrastructure. He also keeps a very keen eye on resource extraction industries on the continent, including mining, oil and gas, as well as forestry.
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