We speak to Guy Wilson, Managing Director Trade and Project Divisions at Sanipex Group, to find out why South Africa and the Indian Ocean Islands represent a critical opportunity for the company’s future growth strategy.
Why is Sanipex Group expanding into South Africa?
Having a presence in South Africa is strategically important in that it gives us access to the broader African and Indian Ocean Islands markets. Johannesburg and Cape Town are Southern Africa’s leading design hubs and being physically present opens up tremendous growth opportunities in both the retail and project sectors. A large proportion of the key hospitality and luxury residential developments in Africa and the Indian Ocean islands are designed by leading South African architects and interior designers. Launching on the ground in South Africa makes our products easily accessible to the design community whilst also offering fast delivery from stock.
What is the main challenge for the Sanipex Group in expanding into this market?
For us, distribution has always been the greatest challenge. Central stockholding with a network of regional retail outlets is essential to successful market entry.
Whilst establishing a presence in South Africa has been part of the Sanipex Group plan for some time, finding the right partner was a key factor in making this step. In Destinkt Bathroom Solutions, a manufacturer and master distributor of premium bathware into Africa, we have a like minded partner that allows us to really service the full scope of opportunity that the region represents.
Why is Destinkt the right partner for Sanipex Group?
Destinkt stands out as a young, energetic company with a whole new approach to the distribution of bathroom solutions. By virtue of their existing manufacturing business they have an incredible reach with a very strong distribution network to just about every bathroom showroom in the country.
Even more important is the fact that our two companies share a lot of the same values, such as the delivery of high-quality design-led products to discerning customers, a commitment to excellent service and building long-standing relationships with both our clients and suppliers. In addition, we have worked with Destinkt for almost a decade as a supplier, so a strong relationship is already in place.
Destinkt stands out as a young, energetic company with a whole new approach to the distribution of bathroom solutions.
Managing Director Trade & Projects MEA
What can you tell us about the new showrooms in South Africa?
Bagnodesign will have a presence in premium independent retail outlets in the Gauteng area beginning with Afrikano Tile & Décor and Bella Bathrooms & Tiles as well as Cape Plumbing & Bathroom Supplies in Port Elizabeth and Victorian Bathrooms in Cape Town. In addition Destinkt have two A&D showrooms, one in Cape Town and one at their head office in Centurion. The Aquazone range will initially be available through Plumbit with additional outlets to follow in due course.
The newest showroom is a space which greets clients in a dramatic, biophilic styling. The Design Centre features an idealistic selection of products with a focus to favoured finishes from Bagnodesign. Brushed Copper M-Line brassware and Truro basins contrast and compliment dramatic slate walls; Malabar and Princess Nouveau service a classic styling with Revolution bath and basins; whilst Zanzibar reigns against the Harlem American Oak finish which perfectly coordinate to the feature wall.
Why is the project sector particularly important for Sanipex Group?
From when we first became established in Dubai in 1995, collaborating with leading developers on key projects has been an important part of Sanipex Group’s business model. Since those early days, we have collaborated on high-profile developments all over the world, spanning the hotel, residential, commercial, retail, institutional, healthcare and education sectors.
We also have the benefit of great regional market experience. Projects we have collaborated on in Africa include the Speke Resort in Munyonyo, Uganda, Hemingways Luxury Residences in Watumu, Kenya, the Bon Hotel in Abuja, Nigeria and, most recently, the Kruger Shalati in South Africa which is scheduled to open in late 2020. We have also worked on a number high-end projects in the Indian Ocean Islands, such as the Kudadoo Private Island and the One & Only Reethi Rah, both in the Maldives, alongside projects in Mauritius such as Le Caudan Arts Centre in Port Louis, the Ki Residences Pereybere and Serenity Courtyard Villas in Grand Baie.
The broad and varied African project sector represents a perfect fit with the Sanipex Group’s expertise and experience.
What is the potential for development projects in the region?
Earlier this year, W Hospitality Group’s influential annual report outlined a growth of 51 per cent in the total hotel room pipeline over the past five years, led by Egypt, Nigeria, Morocco and Ethiopia, which has been driven by major global hotel brands including the Marriott, Hilton, Accor and Radisson.
Alongside resort and business hotels, boutique hotel and game lodge developments have shown an increase as ultra-luxury brands start to move into the market, one such example being Six Senses’ planned launch of a chain of Kasbahs across Africa. Development is also planned in the Southern Indian Ocean, as illustrated by Radisson’s announced intention to double its Indian Ocean portfolio by 2022 with a focus on East Africa, Mauritius, the Seychelles and Madagascar.
However, the impact of COVID-19 has undoubtedly slowed down the anticipated surge in development of hotels in Africa. The W Hospitality Group recently revised their growth predictions sharply downwards, stating that they expect the actualisation rate to be no more than 40 per cent due to the negative impact that the pandemic has had on the tourism sector worldwide.
Clearly the opportunity has narrowed with the tourism slowdown having a knock-on effect on the development pipeline but we still need to take a long-term view. While the predicted growth will not be realised to the same volume and within the timeframes previously anticipated, we can expect developers to resume their plans as borders reopen and the travel industry starts to revive. Right now, it’s a case of being patient and waiting for the market to recover.
What does Sanipex Group bring to the market?
Having exhibited in the Hotel Show Africa in Johannesburg in 2019, and collaborated with a number of influential designers from South Africa on projects in Africa and the Gulf region for the past decade, we know that designers and their clients in the region have limited access the latest design-led products and inspirational displays necessary to create on trend cutting-edge bathroom designs.
One of the key factors at the root of the issue is that the fact that most bathroom suppliers in Southern Africa predominantly cater to the mass market with a focus on function over design, resulting in a fairly conservative, mid-range offering that prioritises price over quality and innovation.
While this fits the needs of the majority of budget-conscious consumers looking to upgrade their homes, there is a clear gap in the market for A&D professionals. This is where we step into the breach with our aspirational, design-led collections, coupled with high-quality craftsmanship and service excellence.
What else differentiates Bagnodesign and Aquazone in this market?
We are looking to exploit our speed to market and our ability to fulfil orders quickly, which is a major point of differentiation between Destinkt and existing retailers in South Africa.
We have two key supply chain advantages. The first is that we will be carrying stock on the ground to enable immediate fulfilment, which is not always the case in the region. The second is that our global logistics hub is located in Jebel Ali, Dubai, which facilitates a delivery lead time of as little as three weeks.
What’s next for the Sanipex Group in terms of expanding into other markets?
We have been looking closely at East Africa, in particular the emerging markets of Ethiopia, Uganda, Ruwanda, Burundi and Kenya, with a view to establishing a brand presence there. Currently, we regularly supply product through third parties for specific projects and are keen to develop partnerships in these markets to expand our reach and maximise all available opportunities. We continue to actively seek out partnerships in these territories and to that end have recently employed an experienced business development manager to specifically focus on these exciting markets for the next phase of our African expansion.