Current Issue 52
Vertical integration of key services has allowed Davis & Shirtliff to focus on enhancing its staff performance, expanding its product range and extending market reach to new regions of Africa
Winning Business Strategy Boosts Indigenous Expertise
Kenya-based Davis & Shirtliff is East Africa’s largest water industry player focusing on pumps, water treatment, swimming pools, renewable energy and power products. The Company has grown rapidly over the past decade and is now looking to capitalise on the recent high rate of economic growth in Africa through a comprehensive business strategy involving an extended product range, new branches over a wider geographic spread and a centrally-managed distribution model.
Having spoken to the company previously in 2014 and 2013, it appears the same factors have led the Company to achieve continued growth this year. As a leading name synonymous for quality in East Africa for close to 70 years, Davis & Shirtliff leverages on its reputation in the region in order to widen its activities and target new markets. Last financial year, the Company achieved an impressive revenue figure of US$70 million.
Moreover, rolling out a number of initiatives has allowed the Company to vertically integrate a number of its services, in particular its in-house manufacturing and logistics capabilities. “Through our Dayliff brand, we now make our own control panels for example, which complements the already substantial range of products we have from working with approximately 40 key international suppliers from Europe, Middle East and Asia,” comments Alec Davis, Davis & Shirtliff‘s Chief Executive Officer (CEO).
Davis & Shirtliff has greatly benefitted from the buoyant market conditions in East Africa’s manufacturing industry, investing in significant amounts of stock to ensure the Company is able to fulfil orders promptly. “The dynamic market conditions have been welcomed, which have necessitated the purchase of additional warehouses offsite in Kenya in order to meet demand and keep high stock levels,” the CEO adds.
Alongside this, the Company has increased its customer reach with the opening of four new branches across the East Africa region, taking the total number up to 40. Davis & Shirtliff now has a presence in Kenya, Tanzania, Uganda, Rwanda, Zambia, South Sudan and Ethiopia through an associate company. This wide market presence particularly services the demand for its volume line of products including water treatment for domestic applications, small solar systems and pool equipment as well as a wide range of domestic pumps. When more specialised equipment is required, supply is referred back to head office, where stock is distributed. “Our model is that we centrally purchase stock to be distributed across our network of branches while carefully monitoring demand for each product to ensure branches are appropriately stocked.
“Maintaining high stock levels is key to operating successfully in our market. As such, we have invested more than US$10 million across our various markets in Africa,” explains Davis.
In order to serve these markets and increase product volumes, Davis & Shirtliff has deployed a footprint strategy which optimises warehouse and branch facilities to better serve the customer across multiple business segments. The growing regional markets have also encouraged Davis & Shirtliff to identify potential new countries and the Company is now looking at further growth in Central Africa. “We are a very well-known brand as well as leaders in our field and plan to apply our successful business model to new regions in the future,” he further adds.
Through the development of the Dayliff brand, Davis is injecting the element of independence into the business as he further details: “Having our own brand plays a very important role in our long-term strategy. Not only does this give us more flexibility, but it will also allow us to work on a wider range of projects and keep a high level of control over the final product.”
In line with this, Davis & Shirtliff will continue educating its staff in the latest technologies and industry innovations. “Given that the technology of our various product segments is developing at such a rapid pace, we need to make sure we have strong indigenous expertise by developing our own internal capacities to keep up with market developments.”
Internally, centralised support functions including finance, supply and IT has greatly improved communication and control, resulting in benefits to operational efficiency and financial performance.
Given the increasing importance of the renewable energy sector in Africa, Davis & Shirtliff has developed a significant business in solar pumping, particularly among county governments and NGOs such as World Vision, the Red Cross and Oxfam. “Due to the recent substantial reduction in the cost of solar modules and technology advances, demand has considerably grown and solar pumping is now becoming a popular option for water supply in remote areas,” says Davis.
Davis was also keen to highlight the Company’s other key ongoing projects: “Through our partnership with global water and process solutions company, Dow, we have been able to introduce reverse osmosis and ultra filtration (UF) technologies in our markets which are both excellent solutions for treatment of particular water conditions. Plants are designed and assembled in-house which provides benefits of reduced cost, quicker deliveries and improved serviceability. We are also working on our own solution for remote pump monitoring and control, which will be a great innovation, especially in remote areas.”
Additionally, Davis & Shirtliff is currently forming ties with diesel engine-maker, Kohler, to power its pumps and also supply to the market. “Kohler is world-leading in both technology and quality and with the recent demise of another well-established manufacturer, it is expected that these engines are destined to become market-leaders,” says Davis.
Training is a key focus for Davis & Shirtliff and an active training centre, located at the Kenyan headquarters, holds regular courses for both staff and customers. The Company is also proud to be 100 percent indigenous in all its markets, with current staff levels standing in the region of 550. “This has been achieved through our progressive staffing and employee empowerment policies, resulting in a committed and competent workforce that is trained to the highest standard.
We are a results-based organisation, so it is vital that we focus on staff performance, which is a key area of our success,” emphasises Davis.
Given that East Africa has the potential to become one of Africa’s leading economic powers, Davis & Shirtliff’s open and transparent attitude to business is sure to continue to support future growth beyond East Africa. “Long-term partnerships, a strong company culture and a sustained focus on our strategic expansion plan are the three main factors that differentiate us from the competition and reinforce Davis & Shirtliff’s leading position,” Davis proudly concludes.