Vital stats
- Player: Andre De Beer
- Company: Global Leisure Group
- Visit:www.globalleisuregroup.com
In 2005, the De Beer Family acquired Megamaster in South Africa. At the time of purchase, Megamaster was a regional supplier of grills and fireplaces in the Northern Part of South Africa.
Andre De Beer was originally appointed as the Group Finance Director, but his leadership skills and passion for marketing and sales soon saw him promoted to Managing Director and eventually CEO, at the young age of 28.The company experienced growth in excess of 500% under Andre’s leadership as CEO (which was approximately 25 times more than the expected GDP growth).
During this time, the business grew from a virtually unknown grilling brand in South Africa, to the clear market leaders on the continent, with the majority market share market share in the wood, charcoal and gas grill sector. Given the number of international competitors in this space, including Weber and Cadac, this is an impressive accomplishment.
International growth
Andre also spearheaded the company’s international alliances and partnerships, opening markets and sales in Europe, the United States of America and Australia.
He also negotiated manufacturing, distribution and licensing partnerships with large international brands like Nexgrill and KitchenAid (owned by Whirlpool Coporation), eventually leading to the establishment of Global Leisure Group Limited in Hong Kong, which is a formal partnership between Nexgrill Industries and the Mega Group, founded between Andre and Sherman Lin, CEO of Nexgrill, the third largest grilling business in the world.
Since the establishment of Global Leisure Group, Andre has also unlocked the Walmart US and Canada business.
Today, Global Leisure Group, with Andre as CEO, owns Mega Group Holdings (the South African subsidiary), Global Leisure Group BV (European subsidiary) and together supplies Megamaster, Nexgrill, KitchenAid and private label grilling products to the USA, Canada, South- and Latin America, Australia, Germany, France, Spain, the UK, Scandinavia and Africa.
Despite the global reach with Global Leisure Group’s head office based in Hong Kong, Megamaster’s head office and factory is based in Pretoria, South Africa, and along with the five regional offices provides work to over 140 employees.
These are Andre’s lessons in scale.
Q. What fundamentally separates a scalable business from a business that can’t be scaled?
The opportunity for major growth and regional/international expansion needs to exist or there needs to be a clear path to actively create it.
For global scalability, the majority of the product offering and future development cannot be country or market specific. So, even though brands can be tailored to different regions, markets and countries, your core product offering needs to be universal.
The improved business model needs to be able to utilize the established platform and current business model in the expansion process. In other words, a new supply chain cannot be created for each new opportunity as this defeats the purpose of scale.
Q. In your own business, what fundamentals needed to be in place before you could scale?
There were a number of key areas that needed to be in place. First, my brother Magiel and I needed to establish a core leadership team who had the practical experience of what scaling requires. A team of leaders who can grow the business, without increasing the inputs at the same rate, is of utmost importance.
For this core leadership team to have the necessary effect on expansion progress, you also essentially need a flattened hierarchy, enabling more effective executive decision making.
Manufacturing capabilities, and scalability was also critical. With the establishment of Global Leisure Group in Hong Kong, this helped André to have in-depth consultations and negotiations with local governing organisations such as SARS (South African Revenue Service) and the FSB (Financial Surveillance Board), to get business structure approval on benefitting offshore and local manufacturing. This flexibility is the ultimate key to being able to serve and supply international markets successfully.
The agility of the business and team to respond to internal and external factors affecting risk and reward is important. Being agile does not mean compromising on values or business principles; it means combining a balanced, flexible and adaptable approach, whilst staying true to the business’ values and focused on its vision.
Clarity and alignment with regards to our values, modus opperandi and ultimately our purpose, is also a major factor of our success.
It wasn’t and isn’t always easy, but we tried to instill and hold on to the fundamentals that we started out with as a small family business, as it formed a solid foundation for us to build on.
Finally, Trademark and Patent Registration, in countries and areas where you are planning to invest and grow in, is an important risk management aspect.
Q. What was the biggest challenge you faced while scaling your business?
The market was saturated and relatively small and unsophisticated in South Africa. We had to work with retailers and apply multiple marketing strategies and tactics to create greater demand for larger product ranges. We basically had to mature the ‘South African Braai Culture’, so that our target market would accept more diversity and explore more product offerings. Our success in the wood and gas grilling sector is a good example of this.
The biggest challenge for scaling is ensuring all business resources and functions are in sync and aligned to support the expansion and growth strategy.
Scale is most effective when all departments move in the same direction, but more importantly, at exactly the same pace. And to get the pacing right, forward movement that suits all departments involved is one of the biggest challenges to manage.
During the first phase of expansion, our sales and marketing capability was more advanced than the operational and financial functions in our business. As soon as we noticed the disconnect, great emphasis was placed on ensuring that all business functions are in position to support the business strategy and vision.
Q. What was the biggest lesson you learnt, and how has it impacted your business model, or how the business is run operationally?
The ability to make timeous decisions are more important than constantly trying to make the perfect decision. You are appointed in a role or position within a company because the shareholders, board of directors and managers trust your instincts and decision-making.
Once you reach a point where you are facing two or three options, you’ve most probably vetted out all ‘bad decisions’. Most of the time, any of the decisions you make from there will have a positive outcome on the business.
When an organization and its leadership are in a period of scaling the business, decisions will need to be made and direction given at the same pace as the momentum of the expansion process. The reluctance to make these decisions in good time will halt progress and greatly affect the results.
Q. How important is the mindset of the CEO in relation to a business’s ability to scale? What did you personally need to develop in order to have the ability to achieve scale in your organization?
When an organization expands into new categories and global regions, the reliance on a trustworthy and capable management and leadership team is the key element to success.
I have been a hands-on manager and a leader my entire life, but had to develop trust in my team’s ability to deliver greater results than I’d be able to on my own.
My responsibility and role are to ensure that we fill the right leadership roles, attract the right managers and partner with the right stakeholders that fit our business culture. And I need to make sure that they are empowered, and at the same time held accountable for their decisions. It’s important for me to facilitate my team adopting the vision and live the values of our business group.