Supply chain: Manufacturers

Ceramic Industries

Nature of business

Manufacturer of tiles (South Africa and Australia) and bathroomware (South Africa).

Strategic positioning	Target market
Preferred supplier of tiles and bathroomware. One out of every two tiles, baths and toilets purchased in South Africa is manufactured by Ceramic.	Retailers and wholesalers of fashionable and affordable tiles and bathroomware in South Africa, Australia and selected export markets.

• Leader in design and fashion, creating desirable products.
• Low-cost manufacturing ensures products are affordable.
• Local supply ensures an understanding of customer requirements and a short, reliable supply chain. This supports our 'always in stock' policy, with consistent volume supply of fashionable well-priced product.
• Complementary products for bathroom and complete home tiling solutions.
• Ceramic's factories rank among the most energy efficient in the world.
• Ceramic's low-carbon footprint EcoTec tile range is recognised as a leader in the manufacture of ecologically sensitive products.

South Africa: Samca Wall (monoporosa wall tiles); Samca+ (hardbody rectified floor tiles); Pegasus (ceramic floor tiles); Vitro (extruded fully vitrified tiles) and Gryphon (glazed porcelain tiles).
Australia: Centaurus (glazed porcelain tiles).

	South Africa		Australia
KPIs	Trends 2022	Trends 2021	Trends 2022	Trends 2021
Sales
Production volumes
Average selling price
Margins
Net profit
Closing inventory

2021/22 priorities	Scorecard
Drive productivity and cost improvements.
Commission Samca+, our cutting-edge technology floor tile factory.
Continue to invest in training and new technology to ensure our products are differentiated by quality and fashion.
Enhance demand planning to improve on-time in-full delivery rates.
Continue to enforce Covid-19 health and safety protocols for employees and customers.

2021/22 major achievements

2022/23 priorities and prospects

We commissioned Samca+ and are ramping up production to full plant capacity, while ensuring we continue to build the requisite skills and experience. Commissioned upgrades in the Pegasus factory to increase volumes. Improved the calibre of teams through appointing and training process artisans. Improved our in-house tile design capacity to reduce glaze costs. Strengthened our relationships with local retailers and continued the roll out of EcoTec products in all formats at Samca+, Gryphon and Vitro. Maintained market share in the local competitive environment by supplying quality, fashionable import substitutes. Maintained a competitive market share in Australia, despite gas price shocks.

Achieve Samca+ full capacity and launch the 800 mm x 800 mm format. Improve productivity and unit cost competitiveness. Upgrade Vitro's third production line. Commission 2,2 MW of solar power to reduce electricity consumption from suppliers using fossil fuels for generation. Continue to invest in training, new technology and equipment to ensure our products are differentiated by quality and fashion and our factories remain relevant to changing market dynamics. Increase the polished product capacity at Gryphon and expand the range. Leverage efficient manufacturing processes to grow margins and increase market share in the context of subdued demand.

Ceramic Industries

Betta Sanitaryware (Betta) and Betta Baths.

KPIs	Trends 2022	Trends 2021
Sales
Production volumes
Average selling price
Margins
Net profit
Closing inventory

2021/22 priorities	Scorecard
Continue to improve self-directed work teams and advance staff through training and development.
Improve production yields.
Expand capacity at Betta through investment in further casting capacity.
Complete construction of the sanitaryware warehouse building. Erection of storage racking started.
Increase BettaBath's capacity to manufacture freestanding baths through additional plant space. This will be implemented once the new warehouse has been fully commissioned in January 2023.

2021/22 major achievements

2022/23 priorities and prospects

Retained market share in the sanitaryware sector. Improved the distribution model and enhanced customer service by reducing lead times. Improved process capability which increased production output of certain ranges. Developed and approved new products for production in FY2023 at Betta.

Improve volumes sold through improved range and distribution. Systematic development and upgrade of equipment and process parameters to improve throughput yields. Stabilise and improve process capability through best practice implementation and continuous improvement. Erect racking and commission automation system in the new Betta warehouse. Increase capacity to manufacture freestanding baths through additional plant space and a specialised paint section. Gain market share through import replacement products and increased production of fashionable in-demand products. Improve margins through cost leadership, and focus on efficiencies, yields and product mix. Betta is now the only significant local producer of ceramic sanitaryware, which will afford opportunities to grow market share.

Ezee Tile

Nature of business

Manufacturer of cement-based adhesives, grouts, water-based paints and related products. Comprises 10 manufacturing facilities in Johannesburg, Durban, Gqeberha, Cape Town, Bloemfontein, Mokopane, Windhoek, Mombasa, Lusaka and Harare.

Strategic positioning	Target market
Africa's preferred tiling solutions.	Primarily the Group's retail networks, Italtile Retail, CTM and TopT, as well as select open market customers including speciality tile retailers and big-box hardware stores.
KPIs	Trends 2022	Trends 2021
Sales
Average selling price
Margins
Net profit
Stock turn
Closing inventory

• A national footprint of manufacturing plants which underpins Ezee Tile's 'always in stock' policy with consistent supply of products.
• Strong strategic partnerships with key raw material suppliers who provide access to the latest technologies to improve quality while reducing costs.
• Largest producer provides economies of scale.

2021/22 priorities	Scorecard
Commission the new tile adhesive plant in Brakpan, Gauteng.	In progress
Invest in our manufacturing operations to improve operational efficiencies.
Expand the product offering in the paint segment and investigate opportunities to broaden the customer base.
Enhance the material requirements planning system to improve on-time in-full delivery.
Build on the stable base of our four operations in the rest of Africa and target higher market share.	In progress
Continue to enforce Covid-19 health and safety protocols for employees and customers.

2021/22 major achievements

2022/23 priorities and prospects

Increased market share of tile adhesives despite tough trading conditions. Expanded share of construction chemicals market as the business forged closer relationships with large construction firms and Italtile Retail's Projects division.

Commission new Brakpan factory to realise the inherent operational efficiencies and cost benefits. Purchase new sand quarry to ensure long-term security of supply to Gauteng operations. Enhance forecasting models to ensure optimal stock levels and improve service to clients. Reduce inventories and implement vendor-managed supply into vertical integrated customers. Integration into the Group's TMS. Improve performance of the Zambian and Kenyan factories. Grow market share in paint. Accelerate the upskilling of staff to align with the Group's high-performance culture. Continue to build market share in the specifications market. Adverse trading conditions are likely to result in attrition of marginal operators, which could provide opportunities to increase market share.