An often overlooked difficulty in starting up a business is the resistance from established players to newcomers in an industry. Hulisani Mudau’s struggle to find a foothold for his business, Innovative Processing Solutions (IPS), in the world of dairy and beverage industry, is a good illustration of how the best start-up plans can be thwarted by fierce incumbents or existing competitors. But it is also a story of how determination and grit can win the day.
It took Hulisani no less than four years of hardship to break through. Today the Johannesburg-based IPS is itself an established distributer and servicer provider for food-processing, brewing and pharmaceutical industry in Southern Africa.
When Hulisani decided to start his own business some nine years ago, he was a field service engineer in his early thirties with a bright future in the large industrial multi-national he worked for. His prospects as an entrepreneur in the same industry was equally bright. “I saw an abundance of small food-processing factories neglected by the industry,” says Hulisani, who devised a thorough plan for starting his own agency that would supply spares, service processing equipment and projects to the smaller players by providing round-the-clock service.
Key to his plan was to gain the recognition of the original equipment manufacturers, without which it becomes exceedingly difficult to convince clients within the industry, to allow you to work on their equipment. When the industrial machinery giant Alfa Laval indicated that they would back him, Hulisani resigned and started IPS. He did not foresee the level of resistance from the established mechanical engineering outfits, including his ex-employer, who managed to convince Alfa Laval to withhold their accreditation of IPS.
Hulisani was forced to re-strategize by networking hard among the other, smaller machine brands and to win over small factories one-by-one. It was some of the hardest years of his life as he juggled cash to keep creditors and SARS at bay. As a small player, most of their work was done on site, but often clients expected IPS to fix a machine in its own “workshop”, which for a while was the balcony of their small office or his home yard.
Hulisani tapped deep into his entrepreneurial reserves to pull IPS through. He was born in Soweto and grew up in rural Limpopo surrounded by true entrepreneurs. His mother, grandmother and other family members were constantly making and trading in order to make ends meet and send the next generation to school. One day, he got into trouble with his mother for spending his school taxi money. Her solution was to send him to school with sweets to sell so that he could earn his own taxi money. The plan brought out the entrepreneur in him and soon he was selling produce on behalf of some of his teachers and running a photography business on the side.
After school he studied aircraft mechanics and got sidetracked by his first job into the food-processing industry, where he excelled. For four years after starting IPS, Hulisani never gave up knocking on the door of Alfa Laval. At last, the corporate giant told him that if he managed to reach the agreed target in sales for the business on their machines over six months, they would consider accrediting IPS as an authorised service partner. Within a month IPS managed to double the sales target, and at last Hulisani broke through in the industry, allowing him to buy his own workshop.
Since then, Hulisani bought a second property with financing from Business Partners Limited when he urgently needed more space to house his fast-growing team of thirty employees. It was in the Covid-19 years when the banks’ risk appetite completely dried up. The estate agent suggested Business Partners Ltd, who evaluated not only the value of the building, but also took into account Hulisani’s achievement as an entrepreneur.
IPS’s growth is far from over, says Hulisani, who is now focusing on the local assembly of critical machine components instead of having to wait for months for parts to arrive from Europe. In this way IPS is fast becoming a driver of the industry that it once struggled to enter.
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