Going with the grain
Grain lies at the heart of the many offerings made by agricultural services provider Overberg Agri. Julia Smith discovers that the company has a special way of adding value to a staple commodity.
Overberg Agri, with its head office in Caledon in the Overberg, is literally rooted in the agricultural heritage of the area. Based in one of South AfricaÔÇÖs most significant grain growing corridors, grain is the lifeblood of the company and lies at the core of its many diverse activities.
The companyÔÇÖs reach extends from seed to storage and sale. The agricultural division includes two seed processing factories, where approximately 10,000 tonnes of seed is cleaned and distributed every year. At the other end of the spectrum, when the harvest is collected, Overberg Agri plays a key role as a facilitator in the marketing process.
Between these two aspects of the companyÔÇÖs work, there are many intermediate stages. The product division has evolved to supporting clients at every step in the cultivation, storage and handling of grain. Overberg Agri is, for example, the leading provider of storage for malting barley in South Africa, with a total storage capacity of 300,000 tonnes at a network of depots across the region taking in Bredasdorp, Klipdale, Protem, Napier, Rietpoel, Krige and Caledon itself.
Years of experience have enabled the company to become a source of expert advice on the technical aspects of efficient grain production. Overberg Agri manages a fully functioning farming unit at Caledon, which is also used as a research farm. There are various research projects in progress at any given time, but one of the most highly prioritised in recent years has been the experimental planting programme, which aims to maximise yields. 
With over 400 employees and operations that cover everything from fertiliser and tractor sales through to storage and insurance, the agricultural arm of Overberg Agri is a complex business that raises complex management challenges. There are currently more than 800 clients in total and each has a unique relationship with the company and a unique set of needs and requirements.
CEO Rian Pheiffer has been in a leadership role for the past fifteen yearsÔÇöhe was the driving force behind the creation of Overberg Agri five years ago when the company was formed through a three-way merger with two other cooperatives. It is his job to steer a course that will provide customers with the service they want, while delivering to shareholders the returns they require. He believes that Overberg AgriÔÇÖs ability to understand its clients and customise services accordingly is one of the principal reasons why it has enjoyed so much success.
A big leap forward has recently been made through a major investment in IT and the installation of QlikView business intelligence software across all operations. ÔÇ£This has made the entire decision making process much faster and more accurate, because we can see and analyse every detail of a clientÔÇÖs relationship with us within a couple of clicks,ÔÇØ said IT manager Johan Mouton.
ÔÇ£We can now answer queries in hours that would have taken us days before. Not only that, the quality of the underlying data is improving all the time because QlikView exposes inaccuracies and inconsistencies very quickly.ÔÇØ
The system has delivered many benefits, but the biggest lies in the improvements it has made possible in delivering superior customer serviceÔÇöthat is to say, a service which is better and quicker than competitors can provide. ÔÇ£Our clients need to know what we have in stock, what they bought from us, for how much and when. It used to take many calls and complex spreadsheets. Now they can get that information with just one phone call,ÔÇØ he added.
The company has even written a special QlikView model for its outreach representatives that can be accessed in real time on their laptops. ÔÇ£Because the stockholding and prices sometimes vary from branch to branch, the reps are now able to view the stock availability as well as the prices at each branch with the click of a button. This allows the reps to provide a better service to our clients, because the information they require is immediately available,ÔÇØ he said.┬á┬á┬á
At a strategic level, the availability of instant information on stock turnover, stock on hand, available silo capacity, profitability analysis and market share means much better informed decision making along with early identification of problems and opportunities.
Unlike ordinary commercial entities which are concerned purely with shareholder returns, Overberg Agri was originally a cooperative. This structure was dismantled as part of the far-reaching programme of economic and agricultural reform that has taken place in South Africa over the past two decades. However, OverbergÔÇÖs cooperative past has left a vital legacy. It means that 80 per cent of the companyÔÇÖs shareholders are also clients. This causes an interesting dynamic as the long-term sustainability of clientsÔÇÖ farms and their growth and prosperity is a vital interest. This must be balanced with a conventional corporate obligation to create wealth for shareholders. Wealth generation is achieved principally via the more recent industrial division which has strict, purely commercial objectives and includes a highly profitable lime mining operation and a pet food company.
Pheiffer has shown that sustainability and the creation of wealth can be compatible objectives; now he is on the lookout for new opportunities and ways to expand the business. Although 90 per cent of the company's business is grain related, Pheiffer has never been afraid to take risks and likes to be known for thinking ÔÇÿbeyond the boxÔÇÖ. However, he does not want to be drawn over specific plans for future development at this stage. ÔÇ£We have some very exciting developments in progress which we hope to make public over the next few months. IÔÇÖm sorry I canÔÇÖt say any more than that at the present time,ÔÇØ he stated.
