Van Dam – director of ABP and Marius Mostert -
owner of M2 Consulting Engineers at the signing of the
TASS licensing agreement between the two companies
ABP are licensing the TASS slab system to consulting
engineers and the following “Motivation”
outlines the benefits to potential licensees
TO BECOME A TASS LICENSEE
Concrete ‘rib and block’ and pre-stressed
floor slab systems have become common place in the construction
of multi storey buildings in Southern Africa.
Whilst they offer many advantages over insitu floor
slab systems there is now a new generation floor slab
system which is an advance on the traditional ‘rib
and block’ –TASS Thermal Acoustic Slab System
TASS leads the way in design innovation and fitness
The development of TASS started in 2002 when MRH Consulting
Engineers saw that their earnings were being impinged
by the concrete rib and block supply industry offering
the market a design and supply service. The fees of
consulting engineers were thus being eroded but overall
responsibility for the structural integrity and safety
of buildings remained.
MRH then researched systems being used elsewhere in
the world with the intention of finding a solution that
could be taken directly to market.
Key research criteria were:
- ease, simplicity and quickness of installation.
- ability to be installed considering the constraints
and labour capability in the South African market.
- cost competitiveness with rival systems.
- structural integrity.
- unique selling features that would differentiate the
system from its competitors.
After much experimentation two key material
changes were decided upon:
- replacement of the concrete rib with a priority cold
rolled, steel rib.
- replacement of the ash/concrete block with a permanent,
fire retardant expanded polystyrene void former.
approach was refined and working with ABP Multistyrene
(Pty) Ltd, the largest producer of expanded polystyrene
mouldings in South Africa, through several generations
of product, a patented moulded expanded polystyrene
block has been developed.
the same time advances have been made with the lipped
has been installed in a wide cross section of construction
projects over the past two years, its competitiveness
proven and has now reached a point of refinement where
it can be taken to market more comprehensively.
is marketed by ABP Building Products (PTY) Ltd who have
decided that the most effective way to take the product
to market is to license it to civil/structural engineering
will ensure proper control of the product in design
and use and open up a new revenue stream for the appointed
BECOME A TASS LICENSEE?
Civil engineers are restricted in their activities primarily
to design and consulting services.
A TASS license enables diversification without any compromise
to professional integrity.
diversification is into a domain where the engineer
has a captive market and is responsible for the suspended
slab design anyway.
designed the sourcing of the materials to meet the design
criteria and the revenue stream that results passes
to a third party.
being a TASS licensee the product supply responsibility
and revenue remains with the consulting engineer.
A product trading opportunity is thus transferred to
of lost design revenue.
With the advent of traditional pre-cast ‘rib and
block’ slab suppliers offering a full service
from design, to manufacture, to supply, engineers have
had their fees for this element of design squeezed or
often however continue to carry the full engineering
responsibility for the building.
Where owners/builders use concrete ‘rib and block’
suppliers to provide the slab engineering at extremely
low rates and therefore eliminate the need for a separate
engineer, this type of work can revert to the consulting
reversing this trend to consultant engineer design and
supply not only is the lost revenue stream regained
but the component supply revenue is transferred to the
The supply of the TASS components, which are patented
and unique, restricted to TASS licensees only and cannot
be copied by ‘me too’ suppliers opens up
an additional revenue source for the consultant.
amount of revenue generated will be restricted only
by the number of square metres of suspended floor slab
designed and specified by the consultant.
is also likely that periodically a licensee, because
they are called on to supply a TASS slab, will be appointed
as the structural engineer for the entire project.
will also be created to supply / trade in structural
steel outside of what is required for the floor slab
if the contractor sees that this will assist in the
management of the project and its competitiveness.
capital investment and manufacturing risk.
The components of the TASS system are sourced from pre
approved third party manufacturers who have the capacity
and supply expertise to be the licensee’s supplier.
TASS licensees will deal with two suppliers only: one
supplying the expanded polystyrene and ancillary components
and the other the steel elements.
suppliers will be responsible for manufacture, processing
orders to specification and delivery to site.
Licensees will have direct contact with the system suppliers.
The licensee/consultant will have additional flexibility
in determining design fees by manipulating the overall
design fee including slab design with the margin that
will be achieved from the component sales i.e. if an
alternative slab system is price competitive against
TASS, the consultant can reduce the slab cost to be
competitive whilst still retaining the consultancy fee
and making a reduced but acceptable margin on the TASS
ABP Building Products (ABP) PTY Ltd the TASS licensor
will provide the following support package to facilitate
the integration of the license arrangement:
- design protocols.
- estimating, material quantity calculation, pricing
and quotation methodology, project management and ordering
protocols and invoicing procedures.
- website and generic promotional support.
- general administrative procedures.
- trouble shooting and problem solving guidelines.
- supplier access through factory visits, links to responsible
contact personnel and all contact details.
ABP will provide pricing models which licensees will
use for their pricing.
This modeling has been based on pricing practices adopted
by the original TASS licensee, MRH Consulting Engineers.
on TASS EPS blocks and steel components - cold rolled
steel rib, rebar and mesh.
This ‘trading’ margin can vary between R50/m2
to R100/m2 dependant on the size, complexity and competitiveness
of the job.
licensees should review the square meterage of multi
storey floor slab designed in the prior year and multiply
this by R50/m2 to gain a conservative view of potential
gross margin available.
and drafting fees.
This can vary from a low competitive rate for the slab
where the overall situation is highly competitive to
‘normal’ where the licensee is the appointed
structural engineer and the overall design fee includes
all design elements.
Importantly the design fee, at whatever level, stays
with the licensee. This could add between R5 –R35/m2
to the margin achieved from the TASS system sale.
above earnings need to be offset against additional
costs that will accrue from operating the license. These
will include the upfront license fee, sales royalty
and administrative costs.
simple income statement based on a licensee specifying
20,000m2 of TASS slab p.a. is laid out below (using
conservative margin and fee structure):
TASS trading margin @ R50/m2 R 1,000,000
Additional engineering fees @ R10/m2 R 200,000
Total income R 1,200,000
License fee R 75,000
Annual royalty (4% of Margin) R 40,000
Administrative assistant R 60,000
Additional admin. costs R 10,000
Total expenditure R 185,000
income: R 1,015,000
this will need to be deducted the cost of labour and
time to draw, design and service the project.
2: Based on the same throughout the upfront
license fee can be deducted with all other numbers remaining
from the revenue stream is any additional fee revenue
which could result in the licensee being appointed as
the overall project structural engineer due to the capacity
to supply TASS and minor revenue which will accrue from
selling system auxiliaries such as EPS plaster and light
boxes and also the potential for additional steel sales
for items such as beams etc.
If the licensee wants to expand the earnings potential
of TASS they can link to or create slab installation
teams where they can participate in the installation
Based on a very low investment risk (upfront license
fee) the potential return as a TASS licensee is significant.
The financial model is based on the actual earnings
of a small consulting engineering firm, MRH Consulting
Engineers, but taking a more conservative view of margins
and fee structures.
van Dam 0114502139
General construction projects with ABPPolyblock.
Installers of the TASS multi story slab system.
John Kirkpatrick 0824124898
Auckland Park, Johannesburg
Marius Mostert 0114821420
General building contractor with operations in Gauteng,
Tswane and Limpopo
Fanus Grove 082551603
TASS licensee and installer
Robbie Reid 0126623039
LD OOSTHUIZEN KONSRUKIE BK
GAUTENG (Pty) Ltd
140 Cantonments Road,
Lyttelton Manor, 0157
P.O. Box 12142,Centurion, 0046
Fax: 012 664 7709,
Tel: 012 664 6490
Avalanche Street Westdene 2092
+27 11 726 6997
+27 11 428 9417
+27 83 501 2189
Fax: 018 963 3775
Tel: 015 963 3773
25 Hampshire Downs
Contact: Derek Henderson 0767549225
Petrus Mulaudzi 0834199404
Emmanuel Munyai 0762298097
Email: firstname.lastname@example.org or email@example.com
SLABS (Pty) Ltd
Tel: (011) 7946940
Insulated Building Systems
PO Box 40321