Thursday, May 18, 2006

Buying in South Africa

UK selfbuilders have long been making the journey across the Channel to buy cheap fittings from Leroy Merlin. You can buy a complete close-coupled toilet with seat for less than €50, a price which you easily spend on just the seat in the UK. It may not be the best quality but at that price does it really matter. It’s a toilet, after all. France is particularly good for sanitaryware and tiles but oddly there are some items, like plastic plumbing fittings, which are generally cheaper in the UK so this cross border arbitrage in building materials isn’t all one way.

But what about sourcing building materials from further afield? Recently, I spent an afternoon with Lol Berman, who is just completing a new house outside Cambridge. It’s an unusual build in many ways, but one of the remarkable aspects of it is that he purchased many of the materials used on the build from South Africa. South Africa may seem a long way away to go and buy a kitchen but it’s got a lot going for it. They speak English, we have much in common culturally (which is code for saying that you are no more likely to be ripped off there than you are here) and many of the goods on sale there are instantly recognisable to, and therefore usable by, Brits. But perhaps the biggest plus in all this is the exchange rate of 11 rand to the pound. This really throws up some bargains.

Lol Berman managed to fill a 40ft container with a pay load of 27 tonnes, which was shipped from Cape Town to Mildenhall in Suffolk in under a month for a cost of £5,000 and around 2% import duty. The purchases are exempt from South African taxes. This is what he filled it with:

• Around 8m3 of hardwood kitchen units from Joos Joinery, Cape Town, at a cost of £3,000. Saving probably £5,000.
• 10 linear metres of granite worktop, cut, prepared and ready for placing. Cost £700. Saving around £1,800. Contact The World Marble and Granite
• 200m2 of floor slates at £6/m2 and 200m2 of quarry and ceramic tiles for around £4/m2 from Tiletoria. Saving around £4,000.
• 32 Meranti windows, unglazed, and all the internal and external doors and skirting in hardwood. Saving at least £10,000. Contact Cape Dutch Joinery.
• Wood burning stove and aluminium flue, plus a steel feature indoor barbeque. Cost £1,000, saving – hard to know as the equivalent isn’t readily available in the UK..

In all, Lol probably saved around £25,000 on his material costs by buying from South Africa. It’s not quite as clear-cut as this because the windows were all custom-made to meet his specifications, which was to create a house with something of the look and feel of the Dutch-influenced South African styles. And £25,000 must be put into context: it’s a large house, with a 400m2 floor area including the basement, and it probably only represents 7 or 8% of his overall build budget. For those with more modest aspirations, the shipping costs may reduce the overall attractiveness of the deals on offer. You can get smaller containers, which cost a little less but they also come with height restrictions, which could reduce your options. I would calculate that the break-even point on this exercise would probably be around £15,000 (UK values). The more you import above this figure, the bigger your savings will be.

In order to track down his materials, Lol never went more than 40km from Cape Town to do his shopping: indeed two of his suppliers and the shipper are actually located on Paarden Island, just metres from the dock. The shipping was expertly handled by Ken Holdsworth of Kenco Clearing & Forwarding: the various suppliers delivered their orders to his bonded warehouse and he packed it all into the container. When it arrived in the UK, it was delivered to a site in Suffolk, about 25 miles from Lol’s site, where they were able to leave it in store until such time as they needed the materials on site.

Of course, it does rather help matters that Lol Berman is originally from South Africa and still has family living there but there was nothing he did that couldn’t be easily undertaken by anyone else. “A plane ticket to Cape Town is around £500, that’s about the cost of a window” he told me, “Once there I did what I do here. I didn’t shop around that much, it was just such good value I didn’t need to.”

If you want to let your fingers do the exploring before you set off on a buying adventure like this, the South African Google puts you straight into the heart of the local economy and pulls up numerous suppliers, though a surprising number of the smaller ones don’t appear to have websites. There is also a useful listings site called www.ananzi.co.za. Payment terms are usually a deposit on placing the order and the balance to be paid when the goods are delivered to the bonded warehouse. The UK customs place VAT on imported goods but a selfbuilder is able to reclaim this in the normal manner if they are undertaking a zero-rated project. There are also import duties placed on the goods but these are pretty small, typically 2% or less.

If, like Lol, you have identified large amounts of timber joinery, kitchen units and floor coverings, then it could well be worth your while to explore this option. You need to be know exactly what you require beforehand and, in the case of windows, you need to be aware how the UK specifications vary from the South African ones. If the worst comes to the worst, you get a week’s holiday in South Africa, which can’t be all bad news.

South African shipping contact
Ken Holdsworth
Kenco Clearing & Forwarding
64 Marine Drive
Paarden Eiland
7405 Cape Town
South Africa
Tel +27 21 5117147
Fax +27 21 5117110