The move came with significant investment, as ESCO bought manufacturing sites, opened several supply and service sites near critical mining clusters and acquired an established truck body line.
The revamped business model did not come without risk, as many wondered how the “new” ESCO would operate.
The Jellinbah Group, an Australia-based mine operator, provided an answer in June 2012 when it purchased five ESCO truck bodies to match with a fleet of trucks it was buying for its Jellinbah Coal Mine in Queensland’s Bowen Basin. This was
the second batch of truck bodies Jellinbah ordered but the first to be manufactured by ESCO.
“The Jellinbah deal demonstrated to the market that ESCO has the capabilities to support large capital products,” ESCO’s regional product manager for truck bodies in Australia Paul Heaphy said.
Those capabilities were further demonstrated later that year, when ESCO flexed its manufacturing muscle and delivered a truck body to another customer and produced the first ProFill dragline bucket made in Australia. Both projects were completed at ESCO’s Mackay facility. {{image2-A:R-w:350}}
“We have come a long way,” said ESCO Australia’s managing director Steve Lennard when asked to sum up the group’s proven performance and geographic footprint, which now extends to south east Asia, with offices in Jakarta, Indonesia, Manila, the Philippines and Balikpapan on the island of Borneo.
ESCO’s achievements in recent years have helped the company solidify its reputation in the Australasian market.
One customer was so impressed with the performance of ESCO’s truck bodies that it recommended other manufacturers use them as first fitment, Lennard said. The customer has also used ESCO as its warranty and repair provider.
GROWTH AND EXPANSION
ESCO’s rapid expansion in Australasia mirrors the company’s overall growth in the past decade.
The company went from a single office in Milton, Brisbane, and 15 employees in 2010 to 10 locations, including a foundry, and more than 300 employees by the end of 2012.
The manufacturing facilities provide capabilities, while supply and service locations were strategically placed to service Australia’s mining clusters. The locations give customers access to products and ESCO’s repair and fabrication capabilities.
The foray into Indonesia followed, with a few initial challenges as ground engaging tools were shipped to customers via Brisbane, Perth or the United States.
Import licences were acquired in 2012, allowing the Indonesian offices to handle product sales. That stability has given ESCO the opportunity to develop deeper relationships with customers.
“Clearing the import hurdle was critical in proving to our customers that we can serve them with a fully functioning operation,” Lennard said.
Since securing the import licence, 60 per cent of ESCO’s business comes from partnerships, which gives both sides a comfortable level of operational certainty, Lennard says.
Licensing has also allowed ESCO to focus on the continued shift of its technical experts from supply and service outlets onto mine sites in the region, and converting customers to ESCO’s ground engaging tools.
“It’s an education process to demonstrate that ESCO isn’t just about product or just about services,” Lennard said. “We are committed to providing an entire suite of solutions.”
Source: ESCO Australia