Business Profiles

Kanu Equipment: Hard work pays off

After-care: it’s an essential part of many operations and disciplines, and what sets Kanu Equipment apart. In equipment rental, support and maintenance can make the difference between a steady or distressing customer experience, and yet in Africa, it was strangely absent from the industry. Unsurprisingly, filling this need shot Kanu Equipment to success: we caught up with company founder and CEO Stephen Smithyman, to catch up on Kanu’s latest developments, and what is continuing to set this company apart.

For a young company, Kanu Equipment have a hefty reputation. In essence, they sell and rent heavy equipment and related aftermarket replacement parts, but the services they offer go far beyond this. The five-year-old company quickly carved out a space for itself in the equipment rental field for Africa’s key heavy industries, including agricultural, forestry, mining, earthmoving, construction and road construction. With well-established competition to contend with, Kanu took on these market by going the extra mile for their customers, providing support and maintenance that was sorely lacking across Africa. When working in some of Africa’s more remote locations, this support can literally be operation-saving, and the loyalty this has won Kanu speaks for itself.

One of the ways it shows itself is through strong working relationships. Kanu Equipment work closely with several large equipment manufacturers: Bell and Liebherr, who focus mainly on the construction and mining industries, and Case Agriculture, providers of top of the range farming and forestry equipment. Working closely with these companies allows Kanu to not only keep top-of-the-range equipment available for its customers, but also a generous supply of the correct spare parts. This allows them to provide a maintenance support service of their own, and also to rent out spare parts to their clients, in order for them to cover themselves and prepare to deal with their own equipment emergencies.

We spoke with Stephen Smithyman, company founder and CEO, about this after-sale care: “Our stated ambition is to lower our customers’ cost of doing business. In part, that’s through the support we provide. Our slogan is ‘Experience the Support”, so we like to differentiate ourselves by being a support organization to our customers in the hard areas where they do business.”

Whether renting or buying, this ability to have access to spare parts on site can mean the difference between a minor hiccup or a costly stall to operations. This is true anywhere, but particularly in some of the remote and far-flung locations where Kanu’s African clients do business. “We’ve got a very good, special relationship with Liebherr and with Bell, and obviously we got this good relationship because we provide a good service on the ground. Previously, African customers would accept the fact that in these countries, they needed to provide their own support.” Kanu’s competitors are largely still operating by this old model, meaning that their clients must source and stockpile their own spares, or else must source specialist maintenance support in their often-remote sites of operations. “What has fundamentally changed now is that the world has become a smaller place, and customers are expecting first-world support. Companies need to adapt to that or I believe that they will die.”

The company started out in Congo, followed by expansion into West Africa, Botswana and Zimbabwe. Over an eight-month period, this was followed by a further push into Ghana, Liberia and Sierra Leone “We basically started out in the hardest countries to do business in, and then worked our way around.” The idea for the company came to Smithyman in Congo when he encountered his own difficulties in hiring equipment for a mining exploration project. “We were trying to find a bulldozer to rent. We couldn’t find one, and then when we eventually did, the rental rate was really high.”

“What inspired me to start the company was that I saw there was a real lack of support for people who are running or using machines in some of the markets. So, what inspired me was the business opportunity – I knew that if I could provide exceptional support and exceptional service to our customers, we would succeed. That’s what inspired me in the beginning. Obviously now, what inspires me is we employ over 570 members of staff across 14 countries, and those are the people who inspire me now to continue to grow this business, because they work in very difficult situations and so, I’m inspired by them and the way they work.”

Smithyman’s praise of his employees has been well-earned. The Kanu name is inspired by an old African tale Kanthu N’khama, a story about a small but brave and resourceful bird that flies into a dark and forbidding forest, where it overcomes challenges and great danger to emerge from the other side larger and infinitely wiser. Kanthu N’khama means ‘hard work pays off’ This is not just a mantra followed by head office – it exists in the company from their operational decisions and expansion plans right down to the daily choices of their employees. Their dedication has pushed them to heroic acts: whilst expanding its operations, Kanu moved into several areas that were in the throes of dealing with the Ebola virus crisis. Instead of leaving their customers unsupported, they stayed firm. Truly going above and beyond the call of duty, Kanu proved that it values its customers as people, and that its promise to provide support would hold true however desperate the conditions. “We showed our customers that we were prepared to support our them even in the middle of a crisis. Many of our staff put their lives at risk to provide that support.”

Despite stormy waters, Kanu’s dedication to their customers has led to success in every market they move into. “Some markets are very new for us, whilst other markets in places like Botswana had more established customers. We’ve been very successful in Botswana, Ghana and Liberia, all for different reasons.” As well as spreading their on-the-ground support throughout Africa, the company also has a physical presence in Europe, allowing them to reach the decision makers of larger industrial groups whose African branches are on their client list: “We’ve got a marketing arm in Switzerland, and we reach quite a few customers out of our Switzerland office. Those customers who want to buy in spares themselves, or work in other areas where we aren’t currently present. Companies have lots of decision makers based in Europe, so our marketing arm in Switzerland visits these decision-makers.”

This face-to-face contact is important, and Kanu are constantly branching out to increase this physical presence even further. As they often do at ambitious rates, Kanu are once again looking to expand, taking their physical support to existing markets in previously un-entered countries. “In Tanzania, we’ll be very successful – we have a very strong customer base and support base there. Kenya is also a very exciting market for us, because there are a lot of machines sold in Kenya every year, so we’re hoping to gain market shares there.”

However, their biggest expansion plan is currently Namibia. “We are the only Liebherr Mine dealer in Namibia. We’ve got five customers currently operating Liebherr Mining machines there. We believe there’s a lot of strong growth potential for mining in Namibia, especially now as the prices have picked up a bit. Those customers have not been supported as well as they should be in terms of stock and service. What we are going to bring to these customers is a level of sophistication around our IT system, around the support we can give them, and around the spares that we will put there on the ground to support those customers. We believe it will be a win-win for us, those customers and the market. Everybody’s really excited for the launch.”

Of course, not even Kanu can expand indefinitely – or at least, not without investor support. “Next year will be a consolidation. The year after, we will look at expanding further, but only if we get the support we need. Largely we would look at going further into Africa – it is where we are mostly based, and where our customers want us to be. Over the next few years, we aim to be in 18 different countries, and then we’ll look at listing the business on the stock exchange. We want to double revenue every year – that’s our plan.”

It’s an ambitious plan, but given the loyalty they enjoy from their markets and suppliers, it’s a goal that is well within their grasp. True to their mantra, however, their own growth isn’t the only one that interests Kanu. Project Hummingbird, taking its name from Kanu’s Kanthu N’khama inspired logo, is a proposed initiative that will allow Kanu Equipment to empower and establish a network of entrepreneurs that will serve as independent spare parts suppliers for their products. “Project Hummingbird has been set up to finance local entrepreneurs. We will buy a container and give them training and IT support, allowing them to open up their own spare parts business in their area. We’ll give all the technical backing, spare parts and spare parts knowledge, and they will operate like a distribution centre for us. Through Project Hummingbird, we believe we could create about 1000 entrepreneurs throughout the continent.”

“Training is a very important part of our service offering. It’s arguably one of the biggest parts of our business. Making sure that local staff are trained well means we have an opportunity to grow.” This project would not only contribute to Kanu’s operations and the number of customers their support services can reach, but would also create jobs and serve as a boost to local economies. They are running feasibility studies on the proposition, and are hoping to receive government backing to supplement their own contributions. If successful, the project will be a fantastic boon to Kanu, but it will also be a lifechanging one to the entrepreneurs empowered by the programme. Once again, this innovative company will not only achieve success for itself, but will ease and enable the industries and business around it, truly allowing Africa to ‘experience the support’ once more.