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 Local manufacturer points the way to world-class opportunities

 

 Anyone in doubt about South Africa’s potential for economic growth and world-class business opportunities needs to look no further than what Martin Gassner has managed to achieve with two small plastic-injection-moulding companies in Cape Town.

No loadshedding, financial crisis, skills crisis nor any of South Africa’s other economic travails seem to have curtailed the constant growth of Classic Closures, Gassner’s packaging company aimed at the local market, and Classic Medical Moulding, his medical equipment export company.

Asked in which of the two he sees the most potential for future growth, he says without hesitation: “Both”.

One illustration of Martin’s growth since he started at the turn of the century, is the increase of factory floor space occupied by his 100 workers, several robots and injection-moulding machines in his factory in Epping, Cape Town. “We have gone from 800 square metres to 1500 to 3 000, and now we’re sitting at 4000 already square metres”.

Martin followed in the footsteps of his father Ernst, who moved from Austria to Cape Town in the late 60s to take up a job as plastics engineer. Martin was born and raised in Cape Town, but studied plastics engineering in Austria just after school. Returning to Cape Town, he did a short stint as a production manager in a car-parts factory before he started working right at the bottom as an apprentice in the tool-making workshop of his father’s small factory.

The move was aimed at his long-term vision of running his own business one day. His father, says Martin, was a pioneer in the plastics industry and he wanted to learn as much as he could from him.

Furthermore, the tool workshop is the heart and soul of an injection-moulding company. “Without good moulds, you can’t make quality products,” says Martin, who believes that an intimate knowledge of tool making is crucial for any plastics entrepreneur.

There was a third reason why Martin turned his back on a simple managerial route to his career. He has always been, and still is, a tinkerer who loves experimenting, building and innovating. It is a trait that that lies at the core of his success.

While still working in his father’s business, Martin started experimenting with plastic corks for the wine industry after an acquaintance pointed to the huge demand. Around the year 2000 the wine industry was moving away from natural cork and had not yet accepted screw-top wine bottles. Increasing quantities of plastic corks were being imported.

The challenge in making plastic corks was how to get the plastic spongy using a food-safe blowing agent, the plastic-industry equivalent of baking powder. The methods used by overseas manufacturers were proprietary, and Martin set about inventing his own recipe. Eventually he settled on a combination of three types of blowing agent.

His father, who focused his business on the electronics industry, preferred to steer clear of packaging, and Martin started manufacturing plastic corks in his own company which he called Classic Closures. By the time his father sold his business to retire, Martin was running his own fully-fledged packaging company.

His second break also came from his willingness to tackle technically difficult challenges.

At the time, Classic Closures had been making some plastic tubing for a local medical company. Their sister firm in Europe needed a product that would be difficult to make. They recommended Martin as a keen problem solver, and Classic Medical Mouldings was born.

From the beginning, Martin was able to finance his expansion through a combination of his own money and bank loans, but injection-moulding machines are expensive and the banks require lots of collateral to secure their finance. Soon, Martin ran out of assets to offer as collateral to satisfy the banks, and he turned to Business Partners Limited (BUSINESS/PARTNERS), which lends on the track record of the entrepreneur and the potential of the business rather than the strength of the balance sheet.

His first BUSINESS/PARTNERS loan was to fund the machinery needed for a contract with a prominent cosmetics firm. Several others followed, helping Classic Closures to move into the dairy industry and in-mould labelling, where the product label is part of the plastic container rather than a separate item stuck on afterwards.

The move into making dairy containers required audits from Woolworths, and Classic Closures soon became the only injection-moulding company in South Africa to achieve blue status on their second Audit – the highest score in the auditing process.

Martin says he has not found the lack of skills in the South African workforce problematic, a common gripe among entrepreneurs in technical industries. He prefers to hire new employees based on their attitudes rather than on the strength of their CVs, even if it means having to train them up.

Rather, he finds the lack of public transport the most difficult aspect of the business environment. Staff members struggle to reach the factory in Epping, which is a negative factor in setting up a third shift which would see his business operating around the clock.

The potential for growth is huge, and Martin finds himself grappling with expansion issues – whether to buy his own premises one day, how to diversify his product range even further. But whenever he can, he spends some time where he loves it best – on the factory floor, solving problems.

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