Talking to Garmin SA, a World Leader in Satellite Navigation and GPS

Interview with Franz Struwig, Site Manager at Garmin Stellenbosch (Garmin SA)

Garmin has built a very solid reputation in both the consumer and professional navigational realm since it was founded back in 1989. What does the company now see as the key competitive and disruptive technological threats to its business?

A couple of years ago Garmin realised that the PND or the personal navigation device market is not going to sustain the business so Garmin took a diversification strategy which really meant that we are developing new technologies and new markets. Garmin has since become a leader in a lot of fitness wearables, in the cycling market, in aviation and marine. There is a lot of growth outside of the traditional personal navigation device market. There is also a lot of competition in these new markets with fitness wearables and activity trackers – serious competition. Garmin is constantly reinventing itself to stay ahead of the curve.

It wasn’t going to fall victim and be one of the things crushed by the juggernaut of the iPhone I suppose?

Yes Apple is definitely a competitor but Garmin is really good at identifying specific niches and catering for the unique needs of those niches. For instance in the running market we have really good running watches that are easy to use for runners, they have a long battery life and are really robust. They are much more suitable to a running environment than an iWatch or an Apple watch for instance. Continuing with that kind of focused product is really serving our niches well.

Apple is definitely a competitor but Garmin is really good at identifying specific niches and catering for the unique needs of those niches.

Garmin has worked hard to grow the Garmin brand in South Africa. How much further do you expect to grow the business into the rapidly growing region?

Garmin is quite aggressively moving into Africa. We have moved into West Africa and East Africa; obviously the move started in South Africa where we have a very strong brand but Garmin is really committed to getting involved in the whole continent. I am not personally involved on the marketing side of things; I am more focused on R&D, developing new products, but I do know that Garmin is keen to conquer the continent.

What is the confidence level that Garmin has in South Africa? What is the importance that it attaches to South Africa as being the key to further developing Garmin’s African business?

South Africa has very well developed infrastructure; it is really a second world country. It has first world infrastructure, good access to internet, good postal services and all of those kind of things that need to be well developed to be able to run a logistics outfit in the continent. Also if you look at air travel it is a lot easier to access the rest of Africa from South Africa. Garmin sees South Africa as the gateway to the rest of Africa. It makes a lot of sense.

Do you think that the brand is about far more than navigation now and it is being marketed as a trusted partner to an adventurous life?

Garmin really stands for quality products that are essential to people’s lives. It is no longer just a navigational company but it is a company that people can trust: there is a level of quality that you can rely on. If you want a really good running watch or a really good fish finder, which are obviously very different products but you know you can trust Garmin to provide that quality. Garmin is a leader in marine products and in aviation products.

I didn’t know such a product as a fish finder existed!

A fish finder is an essential product for the marine industry. It is basically sonar on your boat so you can identify schools of fish. Garmin is still strong in the personal navigation device market and continuously finding ways of improving that and making it more relevant to provide features that cater to the niche requirements for example enhancing safety on the road etc.

In terms of another product category which I was interested in because I think it is a new one, you recently released a range of dash cams in South Africa which are “an eye witness which never blinks”. What are your hopes for this new product? Why is South Africa a particularly good test bed for this particular product?

The dash cam is really useful in making sure that you capture incidents on the road.

Although the vast majority of the time nothing is going to happen.

Yes, I guess it depends on the legal system in your country. In a country like Germany I know that it is not admissible in a court. South Africa would be different. You could however settle outside of court typically in those kinds of countries. However in South Africa where there is a lot of road rage and people tend to drive pretty recklessly, it empowers a motorist to know at least that they have something to stand on, that they have some evidence if there is a claim arising out of an accident.

Has the uptake exceeded expectations?

I am not privy to the sales numbers but I know that there has been huge demand for it in South Africa. They have battled to satisfy the demand.

In terms of the second part of the question; why was South Africa chosen as the test market for it?

South Africa has a lot of aggressive drivers and a lot of road rage. It made sense from that point of view, but I don’t think South Africa is unique. The product has been rolled out in a few different countries. I think it is quite proven in the US.

Amongst the law enforcement community?

No in the public for public use. In places like Russia it is law that everybody has a dash cam.

And they make TV programs out of it as well!

Yes! I don’t think that will be the case in South Africa! We are not as litigious as the US, for us it will probably be more for insurance claims.

It might result in a reduction of your premium?

I’m not sure if that would be the case, but in the case of a claim it should help you to get clarity on who was responsible.

You recently acquired the assets of the iKubu, the little hippo, which is a start-up that designs computer vision and radar systems for the cycling market.  What will this technology bring to the overall Garmin portfolio?

Garmin is already a leader in bicycle products, we have the Edge series of bicycle computers which is really a market leader and we are growing our footprint in the bicycle market by really focusing on safety features. We feel that cyclists should be safer; there are far too many tragic accidents happening on the road. We brought out the Varia range of products in 2015 which is a headset, a set of tail lights, a remote control and a bike radar. What this really does is that it enhances the awareness of the cyclist of what is going on around them. It also makes them more visible to motorists and really enhances the overall safety of the cyclist. That is what we are trying to do with this. It is a completely new and novel kind of product. We want to deepen our position and really help cyclists take back the road.

In terms of the acquisition, did you absorb the employees and the technical talent? If so, will they remain?

Garmin bought both the IP and the people, so the assets of iKubu. The plan is to keep the technical team in Stellenbosch and grow the team over here.

Will you give the iKubu team the resources to not only market their existing product but also to include the underlying short-range radar technology into other products?

The quite exciting thing about this acquisition is that we see a lot of novel uses for micro radar so a lot of new applications in the commercial space or in the consumer product space. Garmin is really spearheading consumer radar at this stage. With already quite a few radar products in the Garmin range we see a lot of space for innovation. With any acquisition, you are looking for synergy. In the past, iKubu had to deal with a lot of hassle around marketing, sales, distribution etc. and all of that is now taken care of and they can really focus on innovating and really improving this radar technology and changing it up so that it can be used for lots of different markets. We are very excited about the prospects.

It sounds like a great acquisition. What is your view of the overall software competency in the Western Cape or even the engineering technical competency?

During our iKubu days, we did a crowdfunding campaign in the US and spent quite a lot of time in Boston and New York. We got to know a lot of engineers there. I was quite surprised really that they rate our engineers very highly. Being a part of Garmin, it has become very clear to me that the level of engineering in Stellenbosch is incredibly high; we have a very good university with an excellent electronic engineering department and they have very deep skills in radar, RF, antenna design and those skills go all the way up to high level software. It is a very nice mix of skills. In terms of absolute numbers of engineers it probably is not that high but the quality of the engineers I would rate very highly. Also, the engineers are quite flexible in terms of their specialisation. Engineers tend to have a wide range of skills ranging from algorithm development to software to electronic circuit design, whereas I find that in the US people are a lot more specialised with what they do.

Are intellectual property issues such as patents and copyrights a particular challenge in South Africa?

I don’t think so. People like to make an issue out of it, citing our IP regulations that require the Reserve Bank to approve moving IP around but that is the same all over the world. There is no country where you can just move IP around without making sure it is fair value. That is all that the Reserve Bank is doing. Initially we thought it would be an issue but in our acquisition it was clear that the Reserve Bank wants companies to succeed and there was no issue in moving our IP offshore.

What is your take on the Western Cape’s potential in innovative technologies?

The Western Cape has really been governed very well so we see great opportunity here to attract the best talent in South Africa which has indeed been happening. There has been a “semigration” of people from Johannesburg, Pretoria and Durban to the Western Cape and specifically to Stellenbosch and Cape Town. A lot of engineers and software people have moved to the Western Cape. This has brought a great energy to the region. People are very entrepreneurial, they are excited to push the boundaries and create new things. I think a lot of successes, acquisitions and successful companies have created good role models and good momentum for the region. It is really on the cusp of great things. The ecosystem here has all the ingredients to really push the boundaries on technology. The biggest challenge we face is just accessing global markets and getting across the Atlantic Ocean and to the US. The companies that are able to do that can achieve great things.

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