Move over specialist interior decorators. Off-the-shelf home décor and do-it-yourself home renovation seem to have shed their cheap and nasty images now that a number of big retail brands such as Mr Price, the Foschini group, Edgars and Massmart are competing in this space.
Add a variety of decor television programmes to the mix and you have a situation that is similar to that in the culinary world – people are no longer admiring the cordon bleu chef or interior decorator from afar but instead rolling up their sleeves and getting involved.
And speaking of kitchens – this seems to be one of the key areas where more and more South Africans are making changes and where businesses are seeing opportunities.
A recent online survey commissioned by Tile Africa revealed that South Africans consider the kitchen to be the most important room in the home when it comes to renovating. Tile Africa reports that 62 percent of survey respondents said that the kitchen was not only the most important but also the room they’d consider renovating in a new home if it didn’t meet their needs. 40 percent of participants in the survey also said that they’d renovate their kitchens first before any other room in the house.
Estate agents, too, are big on kitchen upgrades. Its seems that kitchen appeal is as important as kerb appeal when it comes to achieving a good price and they recommend that a home owner gives an aged kitchen a makeover to swing a sale.
International research company, Euromonitor, also indicates that South Africans are spending increasingly on their kitchens. During 2013, the most money was spent on food, a survey on local retail trends revealed. Next on the shopping lists of the rising middle-class in South Africa was DIY products found in home improvement and gardening stores.
UCAN, a Durban company that offers a range of fitted kitchen cupboards via concession stores within 27 Game stores countrywide, is also recording consistent growth on the back of South Africans’ increasing dedication to their cooking spaces.
UCAN managing director, Andrew Milne says that South Africans have not been big on do-it-yourself kitchen renovations until now. If you wanted to redo your kitchen, you called in a specialist to provide a high end bespoke solution at an equally high price.
The end result was that this was confined to the upper end of the market. Even now, in South Africa the lifespan of a kitchen is 20 years plus. Linoleum and vinyl are alive and well. In Europe, the average kitchen is just seven to eight years old.
He concedes that, up until recently, it has probably been more affordable and easier to replace a kitchen overseas. You could choose from a range of stylish and quality kitchens at retail level and install them in-house or employ fitters.
Milne says his company is following a similar model and believes that, although South Africans have not been big on DIY in the past, they are increasingly adopting a similar value add approach. Tough economic times see people wanting more for their hard earned money and this is a way of doing just that without compromising on quality.
Ironically, UCAN was actually born out of the demand for custom made kitchens. In 1995, the Home Concept Group was created to provide bespoke kitchens. Even now, its service offering caters to this end of the market and includes measuring, design, manufacturing and installation.
Sister brand UCAN was launched exclusively in Game stores in 2008, offering the same products but excluding the onsite measuring and design service. Instead, customers make up their own kitchens in store with the help of computer design software.
It is this software that is making the change-over easier and even more exciting. It allows a consumer to view his or her potentially revamped kitchen in 3D long before loading the flat packed products into their trolleys. The sales pitch reads: “Simply bring in your measurements (use our easy 2 step measure up guide) and our friendly staff in-store will build your 3D kitchen model while you wait. Add in your chosen door colour, worktop and profile style. You can even make changes and adjustments right there on the spot. Our kitchen Styler will give you peace of mind that you have the DIY kitchen of your dreams.”
Such has been the success of their approach that UCAN is now the biggest supplier of kitchens at retail level nationally. Their first outlet was in the Game store in what is now the Pinecrest Centre in central Pinetown. Throughout, the brand has been bolstered by both the credibility of its Massmart owed host and it’s positioning within well situated stores in high traffic malls.
Since inception, Milne says that UCAN has grown its range significantly to suit a diverse South African market both in terms of finishes and colours and actual products.
By supplying nationally, UCAN not only has more extensive infrastructure but achieves sufficient volumes to lower its cost base, enabling the company to pass on savings.
Quantifying these savings is more complex. Actual costs are variable and depend on individual choices. However, like for like, the average consumer could save up to 50 percent.
The board used to manufacture their cupboards is all sourced locally, whilst the hardware, fittings and accessories are imported from the likes of India, China and Brazil. However, this is structured so that no intermediaries or agents are used. Buying direct means further cost savings can be passed on to customers, says Milne.
90 percent of UCAN products are manufactured at the company’s 2 500 sq/m state-of-the-art factory. This includes cutting, machining, edging, finishing and assembly facilities.
Although highly automated, the workforce – which has grown around 10 percent each year – now numbers 75. UCAN has also created at least 100 jobs on the retail side since start up.
To increase production and efficiencies, grow volumes, improve on wastage and provide product of consistent quality, UCAN invested R8,5 million in sophisticated equipment from Italy in 2013. This enables UCAN to cut batches of board as opposed to one shape at a time with an extremely high level of accuracy.
Since the upgrade, he admits that productivity has doubled, accuracy is as good as 100 percent and there has been a 30 percent improvement in wastage. “The crux is that the more volumes that you can push through, the more savings you can pass on to your customers. Quality is key. Because everything is flat packed, when the customer gets it, it has to be 100 percent.”
But just because UCAN’s cupboards are flat packed doesn’t necessarily mean they have to be fitted by the screwdriver wielding household handyman. In fact, whether it is because of time constraints of just plain old laziness, Milne says that the South African aversion to DIY still stands.
They’ve managed to fill the gap in a typically South African way – by recommending fitters.
Initially, says Milne, they were reluctant to do this but were put under pressure to do so by Game. Customers, too, weren’t prepared to bring in any old fitter. They eventually capitulated. “We realised that you can ruin a good product with poor installation. It’s also not just about having the skills, you need the appropriate tools.”
The system that is in place provides customers with peace of mind and preserves the UCAN brand’s credibility. “We take the risk element out of getting your own fitter. We work with our fitters and have got to know them well over the years. When taking on a new service provider, we inspect their previous work and do follow ups,” Milne explains.
This has also inadvertently acted as an incubator for developing small businesses.
An example is Sydwell Mayisela, UCAN’s top fitter. His company is as good as exclusively contracted to fitting UCAN kitchens and he installs an average of two to three a week, ramping up to 15 a month during busy periods.
He signs for the plan that has been finalised in store based on the customer’s measurements and then collects the selected units from UCAN’s New Germany factory.
The beauty of having accredited fitters with whom sound relationships have been built is good service, according to Steve McCabe, regional executive. “Often measurements can be inaccurate but a good fitter can sort that out without the customer even knowing,” he smiles.
At present, KwaZulu-Natal leads the way when it comes to calling in fitters to install kitchens. Between 65 and 70 percent of customers don’t go the DIY route as opposed to lower figures elsewhere, says Milne.
Apart from consolidating its national footprint and growing its local turnover, UCAN has longer term plans to supply into the rest of Africa. This will plug an important gap in a market where there are very few reliable suppliers and fitment operations. Already, the company has sold kitchens to customers visiting South African outlets from Zambia, Mozambique, Swaziland, the DRC and even the Seychelles.
In South Africa, there are still many growth opportunities for UCAN. Although times are tight and the company’s market has not grown, they have consistently taken market share from other suppliers.
But, stresses Milne, they are not focusing on the negative economic factors over which they have no control. Instead, their people and their products are priorities. “That way, we have identified smarter ways of doing business and experienced strong growth against the odds.”
This year, UCAN is looking to grow its store-within-a-store count by 12. Of these, three will be in the Western Cape with the balance in Gauteng and Limpopo.
Last year, the company added just one store to its 26 store count. But it will make some sacrifices from now onwards. To accommodate the increased food offering by the mass discount chain, concession stores are now smaller. “What we’ve done is that, instead of taking a valley (a whole shop isle), we have taken just one side of the isle and created a whole new trading format,” he says.
Milne adds that there is also on-going investment in other aspects of their business. A complete software upgrade that will result in seamless integration from the customer interface to the factory goes live in July.
UCAN has also just bought new premises in Jetpark, Johannesburg. This 500 sq/m warehouse and logistics operation will underpin growth in that region and improve operational efficiencies. “In the past, we held stock in Durban but we have run out of space and it made sense to ship containers directly from Durban to Johannesburg. We will be focussing increasingly on logistics as the business grows,” says Milne.
In November last year, UCAN recorded its best ever month. He says the festive season is definitely the strongest trading period with October, November and January tending to be the busiest. Sales in December tend to dip as families ready themselves for Christmas and the building industry shuts down.
New products that both meet local tastes and track the latest international trends are introduced constantly. UCAN has also diversified into built in cupboards for bedrooms and vanities for bathrooms.
Now, says Milne, they are looking to repurposing existing successful sellers. For example, a few tweaks have transformed a standard space saver unit into a shoe rack. With the addition of a centre shelf, the same unit can now accommodate two rattan baskets, providing a more rustic look.
They are also seeing the benefit of investments in marketing and social media promotions in the form of increased brand loyalty. “You’ve got to give customers a reason to buy into your brand. You have to refresh your product and be creative. We’re seeing more and more customers coming back.”