Afrox has partnered with Ulula Energy to take gas safety, affordability and convenience into the Western Cape’s informal domestic and residential markets. The partnership will see Ulula Energy, a Level 1 BBBEE contributor and independent black South African woman-owned and managed LPG distributor, supplying Afrox Safety Gas and Handigas cylinders to the low income housing and residential sectors as well as light industries in the province.
Gerhard van Wyk, National Business Manager LPG, says that the agreement forms part of Afrox’s strategy to branch out from its core business of supplying gas to large industrial commercial enterprises, while aligning with the company’s Enterprise Supplier Development (ESD) objectives that seek to engage with previously disadvantaged enterprises and suppliers in an effort to combat unemployment and contribute to the economic development of the country.
Comprising shareholders, trustees and technical experts with strong backgrounds and years of experience in the domestic gas market, Afrox identified Ulula Energy as a suitable ESD partner in 2017.
“Ulula Energy has access to knowledge, experience and business contacts in the informal domestic gas market, and for that reason Afrox made the decision to appoint the company as the preferred LPG distributor of Afrox cylinders to the informal residential, domestic and light commercial industries in the Western Cape,” says van Wyk.
Owner of Ulula Energy, Rizelle Sampson, says that the company’s primary objective is to develop a portfolio of high-growth energy companies centred on providing consumers with a diversified energy mix that is competitive and innovative. As Afrox’s LPG distributor of choice, Ulula Energy aims to reintroduce Afrox Safety Gas and Handigas cylinders to the Western Cape domestic market. The emphasis of its offering will be on safety, convenience, affordability and technology.
Van Wyk says that Afrox had identified a wide scope for growth in the informal and domestic gas market in South Africa as low income households begin to move away from the use of paraffin for cooking and turn to safer gas alternatives.
“Gas is becoming more and more competitive as a standalone energy alternative or in a hybrid system with electricity,” says van Wyk.
Afrox’s lighter and more portable 5 kg Safety Gas cylinders were specifically chosen for the low-cost housing market where residents often have to carry cylinders from gas depots to their homes. In addition, the rental cylinders will be maintained by Afrox to ensure they are fully compliant with safety standards while, as distributors, Ulula Energy will fulfil specific domestic market needs such as after-hours and weekend delivery.
Van Wyk adds that once established in the Western Cape, similar low-cost business models will be rolled out in other areas of the country. Large numbers of Afrox safety gas cylinders have already been delivered to the Western Cape, with a further investment being made in KwaZulu-Natal, and numbers increasing as demand requires.
Moving into the low-cost domestic market also aligns with Afrox’s corporate social initiatives as the opportunity now exists to establish gas re-sellers in these areas, thus promoting job creation in the informal sector.
In its pursuit of economic reform and development in South Africa, Afrox has already partnered with a number of black-owned and black woman-owned suppliers and realigned its procurement strategy to identify suitable 51% black-owned and 30% black woman-owned suppliers.
Afrox’s LPG, which includes Safety Gas and Handigas, is supplied in smaller cylinders for lower volumes and cost, and has numerous domestic applications including heating and cooking, making it versatile and useful in all major sectors of the South African economy.