Premium pays superior dividends

Over its 17-year existence, Road Milling and Sweeping has carved itself a niche rental business to become the largest privately-owned operator of milling machines in South Africa. With a clear understanding that the success of a business of this nature largely depends on machine uptime, the company has vested its trust in premium Wirtgen milling machines over the years, a decision that is continually paying dividends, writes Munesu Shoko.

From humble beginnings back in 1999 with a single Wirtgen 1000C milling machine, Road Milling and Sweeping (RMS) today owns a strong 21-unit fleet of milling machines, making it the single biggest privately-owned operator of such specialised gear in South Africa. Founded by Cecil Aling and a business partner at the time, today the family-owned business is being steered by two of Cecil and Glynn Aling’s three daughters, Leigh Cameron and Lesley Kafka, who share their father’s passion for anything mechanical, but with a premium taste, of course. Over the years, RMS has supported the Wirtgen brand for its milling equipment needs purely driven by the understanding that though premium calls for premium capital outlay, the returns, in the long run, are massive.

Road Milling’s core business is the rental of milling machines for rehabilitation of asphalt and concrete roads. The company operates on a national basis and has recently successfully completed cross-border contracts. “We work all over South Africa in terms of the milling work we do. In the past year, we have done quite a lot of cross border work,” says Lesley Kafka, general manager of RMS. “We still have ongoing work in Lesotho that will pick up in 2017. We have also worked in Namibia, Botswana, Swaziland and Malawi.”

Kafka foresees increased cross-border work moving forward as most of the South African civil contractors spread their wings into the rest of Africa for greener pastures. This is considering that most of the cross-border contracts RMS has are with local South African companies doing work outside the country. According to Kafka, 98% of the company’s cross-border work is through the South African contracting fraternity working elsewhere in Africa.

Sticking to core business

Over the years, RMS has stuck to its core niche business of renting out milling machines, but with a few other value adds such as lowbed trucking services, road sweeping, tippers and water carts. The company now owns its own three lowbed trucks used mostly for transporting its rented milling machines to sites, but these can be outsourced to any other customers in need of lowbed trucking. However, Kafka says sticking to the milling business only is a difficult decision from a strategic point of view. “We ask ourselves whether we need to stick to our niche or diversify the business,” says Kafka.

“Diversification has got its own pros and cons. Sometimes you become too thinly spread. Ours is a capital intensive business, so to diversify you need to invest huge amounts of capital into equipment. Diversifying is also a bit challenging in the sense that all of our people are focused on milling; our operators know how to mill and are not versed with any other work,” reasons Kafka.

But, Leigh Cameron, financial manager at RMS, believes that if ever the decision to expand the product portfolio is made, the immediate possible and closest option would be recyclers. She believes that recycling is aligned to what the company does and will allow it to continue dealing with the very same customer base. RMS reports increased demand for its milling machines in the past 12-18 months.

“We believe we had a fantastic year in 2016 in terms of being able to keep our machines on hire,” says Kafka. Demand is mostly driven by smaller civil engineering contractors. This is in direct contrast to some five years ago where the company would mostly deal with the bigger civil contractors.

Understandably so, this trend is because of the way civil projects are being packaged in South Africa at this stage. Projects are being packaged into smaller lots to allow smaller and upcoming contractors to have a share of the government infrastructure spend. Most of these smaller contractors lack the financial muscle to invest in their own specialised gear such as milling machines, hence the increased demand for RMS’s services.

Success drivers

For a rental business of this nature, machine uptime is a key success driver. For that reason, RMS, from its inception, has always purchased Wirtgen milling machines only. All its 21 milling machines are Wirtgen machines. Kafka explains the reasons behind the loyalty to the brand.

“We started out with a Wirtgen and created a strong bond at the time,” she says, adding that the relationship has been further strengthened over the years.

RMS has also built a strong technical competence on Wirtgen machines with its own mechanical workshop equipped with strong technical capability to service these machines in-house. Led by Errol Edwards, workshop manager at RMS, the technical knowhow on Wirtgen machines goes beyond service and maintenance to include complete rebuilds of the machines in-house.

Another reason for sticking to Wirtgen is the fact that these German-made milling machines have a good reputation among RMS’s customer base. “Wirtgen machines are popular products among our customers, in terms of their quality of work and productivity,” says Kafka.

The quality of the build and durability is another key driver for sticking it out with this range of machines. This is reinforced by the fact that the first Wirtgen 1000C which kicked off the business back in 1999 is still in operation today, and works beyond expectations.

Meanwhile, a good product is as good as its service, and aftermarket support from Wirtgen South Africa has kept this relationship intact over the years. Waylon Kukard, Wirtgen sales manager, who has become more than just a business partner, is always at hand to respond to RMS’s needs, be it technical queries, parts issues or even advice, especially at a time when the company is grappling with the idea of diversifying its product range. “We have become friends along the way. We work closely together on RMS’s plans for the future,” says Kukard.

Cecil Aling founded RMS back in 1999.
RMS recently purchased a new Wirtgen W200 milling machine. Standing in front of the new acquisition are: (left to right) Brian Manganyi, operator manager at RMS; Errol Edwards, workshop manager; Lesley Kafka, general manager at RMS; Leigh Cameron, financial manager; and Waylon Kukard; sales manager at Wirtgen South Africa.

Strong maintenance regime

Prior to the purchase of its new machine in July 2016, the previous machine RMS bought was back in 2013. According to Cameron, that speaks volumes about the quality of the build of the machines, but more importantly the strict service and maintenance regime. “Due to our strong focus on maintenance, even our first machine is still running perfectly beyond our customers’ expectations,” she says. The longevity of this gear is also buoyed by the fact that these machines are rented out with an operator. Every operator sticks to their own machine, which, over the years, becomes their daily office.

“Our operators are very territorial about their machines and they look after them,” says Kafka.

A strict service and maintenance regime is followed, according to Edwards. Services, including oils, hubs, gear boxes and engine oil, are done at every 250-hour intervals. These intervals are maintained even when machines are out on sites.

These services are undertaken on sites 95% of the time. Major services, such as drums and hydraulics, are done once a year, especially during the December downtime period when most machines return to the workshop.

Wirtgen undertakes services for all machines under warranty. All services are then done in-house when machines are off warranty. Continuous training of the 25 operators is also a key focus for the company, says Brian Manganyi, operations manager at RMS. It is this thorough training regime that has seen Manganyi himself rising through the ranks over the years when he started as a security guard, before he became a foreman, a supervisor and currently the operations manager.

Looking ahead, Kafka and Cameron are convinced that the business will continue on a good course in 2017. “Our vision is to continually strive for excellence to further build our reputation. We always go an extra mile for our customers, delivering more than they expect.” This goes beyond the equipment to the people, constantly focusing on the people who make it happen on the ground. “Being a smaller, family-owned business, allows you to have that desire to always go out of your way for customer service.”

Source Capital Equipment, Jan 2017