THE SBS GROUP: Quarter Century of South African Success for SBS

“When I stand in front of a SBS Tanks customer, I am able to say: ‘Everything that will go up on this site is South African by origin’,” says Delayne Gray, Group CEO at The SBS Group.

Perhaps one of South Africa’s proudest advocates, Gray heads one of the country’s leading manufacturing businesses. The SBS Group – home to SBS Tanks, SBS Agri, and SBS Energy – is a local manufacturer and exporter. Solving problems for clients with South African solutions, this company has taken a 25-year journey, becoming an industry leader through localisation.

“I am a proud South African, born and bred here. As a father, husband, and citizen, it is deeply embedded in me to do everything I can to make this country work,” says Gray.

“From a business perspective, all of our activity is South African by root. We own our properties and our investor base is South African,” he adds.

A Proudly South African company, The SBS Group demonstrates the success that is possible through local procurement and local production. The company joined the Proudly South African many years ago, inspired by the organisation’s mission and belief in encouraging business success through impactful local operations.

In its 25^th year of operation in South Africa, SBS is pleased to highlight its significant accomplishments, despite going through the toughest of times, while preparing for ongoing advancement in the future.

“You see economies going haywire and you see looting” says Gray, “but Proudly South African businesses have to be the custodians of good news. We have to give hope across different tiers. Hope for some is having a job, hope for others is having an education, and hope for others is becoming a millionaire. The ethos of SBS is that we live by the code of ProudlySA.

“We are all proud to be South African and we are seeing global acceptance of our product which opens the door for us to tell the South African story. Our staff and client base buy into that vision and story.”

25 & COUNTING

Established in 1998, SBS’ early focus was around the import, sale and installation of industrial water tank solutions. A team of three entrepreneurs founded the business, growing quickly through the delivery of first-class service and a strong product range.

“We are 25 years old and we are proud of that. Two of the three founding members still remain in the business It has been a long walk to where we are today as a manufacturer but throughout our journey we have maintained our authenticity to serve South Africa. On the SBS Tanks side we build infrastructure – reservoirs and water storage solutions – and that has been really good for the country,” says Gray.

From water conservation tanks and fire protection tanks, to mining storage tanks and commercial water tanks, recent examples can be found in the KZN community of Ekukhanyeni where population growth has called for a water storage solution, or at the Bernard Isaacs Primary School in Johannesburg where a municipal pipe failure left the school and learners without water, or at the Blanket Gold Mine in Zimbabwe where the mine is the lifeblood of the community, and at many businesses across South Africa and the globe that are now protected with an SBS Tanks fire water storage solution or backup water tank.

“South Africa, and Africa, are water scarce regions and the impact of climate change is being seen globally. We need to take care of our precious resources – water being vital to our survival,” says Gray. “Our SBS Tanks solutions can be used for rainwater harvesting, storage of water from aquifers or boreholes, as backup water when municipal infrastructure fails, to store bulk water (with less evaporation due to the roof structure) and as part of a closed water circuit, reducing water wastage and recycling water from manufacturing or mining and even effluent wastewater.”

Realising the impact a thriving manufacturing sector can have on a country, The SBS Group began producing products locally from their base in KwaZulu-Natal. From here, the Proudly South African ethos was quickly adopted.

“We really believed in it,” he says. “We needed to stop importing, create local manufacturing – which in turn created jobs. Our story is one of a South African product, made and designed by South Africans, exported to the world. SBS’ water journey – under the banner of SBS Tanks – is one of a manufacturer and installer of premium water storage solutions. We sell heavily into the African continent. We have offices in Ghana, Kenya, and we have an office in Texas. That is a five-year endeavour and has done exceptionally well, meeting all of the American engineering criteria. We are happy to export to many countries – the product is modular, exportable, and able to be resold and installed by distributors, although we do have our own installation teams who travel to anywhere they are needed.

“We are better today than we were before,” he adds. “We are an exporter. Our staff contingent has grown. The products that go into making our final SBS Tanks product are sourced in South Africa. We could source all of our bolts from out-of-country, but we have elected to buy from a manufacturer in Gauteng at a much higher price, recognising the value of local procurement.”

DIVERSIFYING FOR SA 

Success with industrial water tanks opened up doors for SBS in similar sectors. There was a need for South African solutions to South African problems.

“We saw opportunities in the agricultural industry and that grew a new entity, SBS Agri which is now six years old,” says Gray. “Again, we are proud to say that we underpin the farming community with technologically advanced solutions that we have designed, developed and manufactured locally including our SBS Agri hot air generator and SBS Agri Automatic Fan Control unit. We also supply and install a range of grain bin and silos, grain conditioning and handling equipment such as cleaners, conveyors and bucket elevators.”

SBS Agri expertise, translated into products that fit the need of each farming customer, allow for early harvest of up to three months, faster drying and safer and larger storage capacity. This gives farmers quicker access to markets at important times – when demand is high and supply is low, helping realise prime value for their product and a better return on their investment.

“We bring storage, conditioning and handling solutions to commercial and private farmers so that they can store safely and effectively process and store more grain. This eradicates the need to rely on imported grain for animal fodder or to buy back their harvest stored at a co-operative due to a lack of on farm storage. In the commercial milling sector, this allows for buying in bulk when prices are good and storing safely and conveniently on site. Our solution is a partner offering which allows farmers and commercial businesses to do better,” explains Gray, adding that this model is for the SA market only and is not exported at this stage.

SBS Agri solutions can be found on farms across South Africa and are helping farmers such as the Baynesfield Estate in the KwaZulu-Natal Midlands who can now harvest their animal fodder early, getting it safely off the field, dried to the perfect moisture content and stored safely at the right humidity and temperature. And the sheep farming operation in Mpumalanga where three impressive 2200-ton silos sparkle in the sun on the vast farm, fitted with grain cleaning, drying and handling equipment – all supplied and installed by SBS Agri. Along with many others such sites across South Africa, popcorn kernel and animal husbandry farmers in Paulpietersburg trust SBS Agri, and now boast over 6000 tons of additional on-farm grain storage silos.

SBS Energy is the group’s latest offering and comes at a difficult time with South Africa facing national electricity loadshedding that interrupts operations, stops the pumping of water into storage reservoirs resulting in water shortages, and disrupts businesses at an already economically challenging time.

SBS Energy brings the latest in renewable technologies to the market, delivering integrated monitoring and data solutions for clients to ensure sustainability, save costs and help to reduce the pressure off the South African electricity grid, which has the spin-off effect of Building for Better for other businesses that are not able to install solar or backup solutions.

“We now play in three critical sectors, food, water, and energy,” adds Gray. “We realised that wherever possible, we need to service South Africans – business or private. SBS Energy is a more localised offering. We are looking at solutions for mid-tier businesses, similar to ourselves, that are interrupted by power supply problems. We want to engage where we can augment energy use, save businesses on their energy input costs and provide operational security that keeps the doors open – and the milk fresh. We have grid-tied solutions that offer a great return on investment but don’t offer backup power, and other solutions that do – they just require a bit more of an investment or a longer time to return profits to the client.”

The SBS Energy platform surrounds the roll out of solar installations and has been proven at the Larsen Farming sugarcane site in KZN where a rooftop project has resulted in reduced operational costs and sustainability through loadshedding. Success was also found at the retail hardware store, Buildit Hillcrest, where the SBS Energy system caters for fluctuations in demand, delivering a 40% monthly cost saving. And at the Gentle Magic cosmetics manufacturing facility in Durban, where SBS Energy facilitated data management tools along with photovoltaic panels, integrated with a generator system to handle grid supply issues and achieve a 37% monthly cost saving.

PEOPLE FOCUSSED

The success of the past 25 years has positioned The SBS Group strongly for growth. The ascension of the business to the top of its industry has been remarkable, and shows what is possible when localisation is prioritised. But recent market conditions and an unstable economic environment have bumped the company’s notable progress.

“We have experienced growth of around 20% year-on-year,” details Gray. “Obviously 2020 and 2021 was flat. We were well-positioned for exceptional growth pre-Covid. We had prepared ourselves for a doubling over a five-year period, but that projection has been scaled back. We will become a bigger business, no doubt, but year-on-year growth projections have been challenged. Everybody here would now be happy with 10% year-on-year, while achieving our key objectives of retaining the jobs we have created.”

With around 200 people in the company, across multiple disciplines, The SBS Group supports a wide network of livelihoods. Its procurement spend underpins many other companies, and the commitment to ProudlySA principles (which calls for 50% of cost of production to be incurred in South Africa) continues to develop related businesses and communities. But there is pressure. The market is challenged, and Gray is under no illusions.

“Growth is great,” he says. “You can do good things when money is coming in and things are buoyant. But the past two years have been extremely difficult, not only because of financial challenges but because of people. People are hurting. The last two years has been people focused, and that has chewed up profit while restricting product. Operating a business out of KZN has not been easy. We had looting, we had flooding, both of which have not only impacted in the physical form, but manifested in the psychological form. People’s confidence and prioritisation has changed. We are working to fix people before we focus on products and markets – it is tough.”

In just a few years, SBS has grown from just 30 people to where it is now. But employee base expansion will likely be paused in the short-term as the company consolidates after a tumultuous period, driven by Covid-19, flooding and looting.

“A business can very quickly become fat and happy in the nice times. For every problem, you can find a person. When you are forced into being creative, you have to become lean and mean. You do things more efficiently and you act with the mindset of a start-up. You strip out complexity and simplify certain things. You realise that you must sift through the ‘nice-to-haves’ and define the ‘need-to-haves’.

“Businesses will be driven to employ higher quality people as opposed to a larger number of people. There is a journey change. Working remotely, self-motivated, self-managed – it drives you to find higher calibre people,” suggests Gray.

BUILDING FOR BETTER

SBS products are manufactured to the highest international standards – ISO 9001:2015 and ISO 45001:2018 – and provide end users with long term quality and reliability. This has resulted in national recognition with the company winning the Durban Chamber of Commerce Exporter of the Year Award on multiple occasions. Delayne Gray is happy.

“We have positioned our brand well, and that is now well-recognised across industry,” he says, warning that the South African market must recognise the need for global appeal if it is to remain globally competitive. “South African business must ready itself for global operations through the adoption of technology and addressing working principles. For example, we export to the USA and we have a time difference which we must address if we want to attract customers. The journey of South African business is one which must accelerate and must quickly get up to speed or risk being left behind,” he says.

At SBS, this is started internally. A culture of partnering with purpose to build for better is deeply embedded across the entire employee base. Gray is passionate about the wider development of South Africa and is keen to do all SBS can do to drive this. He founded the Build for Better initiative to share positivity and bring hope in local communities.

“It’s a platform where we, as a business, want to publicise good stories. We want people to realise that you can do good things but you don’t have to be Nelson Mandela, you can continue to good things that achieve good results, and that is a great thing.

“There is a lot of bad news but you have to keep telling the positive story otherwise you’re part of the problem. It’s not easy, but it has served us well for 25 years of business,” he says.

Community breeds collaboration and growth; it helps keep you accountable, and allows you a space to bounce ideas when times are tough. According to the Edelman Trust Barometer, 80% of consumers agree that a business must play a role in addressing societal issues. By investing in initiatives such as ProudlySA and Build for Better, SBS is embedding itself as a dedicated South African upliftment vehicle as well as a successful and profitable business – the two are related.

“A very important factor for us is community,” says Gray. “We can’t play a part through the whole country and fix every problem, but where we are positioned – Johannesburg, Cape Town, Durban – we have made it our business to be a citizen and not just a business. Where we are able to offer help and get involved in a community, we do so. We do it above the line, not so we can get credits. That is a distinct difference and something we need to get other South African companies to realise. Don’t do these things just to tick a box and get a certificate. Do it because it’s what you want to do, because you believe its worthy and right. We all live off the land and people of this country and you have to give back.”

Understanding and delivering on these principles, even when faced with increasing competition and changing workforce dynamics, is why SBS is an industry leader. Exceptional customer service combined with extraordinary corporate citizenship, has allowed the company to maintain rather than decline, and Gray is confident about the future, again looking to take a new path in the pursuit of growth.

“As a business, we are always focused on expanding our range of products, within the same field, but with a large range to appeal to more. Because we are an engineered solution at the higher-end, we have excluded a lot of the lower end clients, such as private or residential. Typically, we work with industry and commerce but as a business one of our current explorations is around a more affordable offering that is available for all consumers – both in the water storage and energy space. We have always been a B2B operator but we are now exploring the B2C channel,” he says.

And who would bet against this innovative, creative, and responsible business achieving its goals. 25 years of doing good whilst doing good business has positioned The SBS Group well while the wider economy has taken a knock.

By putting people and community above profit, and by investing in a real way in South Africa, The SBS Group is activating the potential that so many talk about but never engage. It is solving the complex needs of clients, and it is uplifting the communities in which it operates. Exhibiting a story of success that others could replicate, this is certainly a business to follow when searching for growth inspiration in South Africa.