Local Sourcing Stabilises Cost Factor

If you take into account mining, agriculture, the building and construction sector, food processing, general manufacturing, sand and salt mining other general large-scale production, Australia appears to have disproportionately high requirement in materials handling systems compared to other, more populated countries.

Despite our small population, most of our successful industries — particularly the ones that have significant export markets – are high scale operations turning over 24 hours a day.

Uninterrupted supply is extremely important. One of the more common factors to negatively impact bulk materials handling operations is downtime. The fear of downtime is nothing new. Downtime can cost tens of thousands of dollars per hour; such is the large scale of the operations.

But where are all these components, systems and engineered solutions coming from?

This question is now being given more media time. Various industrial groups in Australia have been looking at how we operate our bulk handling and it’s been determined the one specific area in which we can grow to help ourselves is in ensuring our bulk materials handling technology is, as much as possible, sourced domestically.

This is not to suggest that there is anything wrong with imported technology. The overriding factor is that imported technology can take a lot of time to reach us, it may not have direct technical representation for implementation, and all this can add up to lost time in production.

One local company, heavily involved in expanding the local technology supply chain for bulk materials handling here is ICA. Considering this company supplies to mines and quarries, to general production plants, automotive manufacturers and food processors, it has been able to expand successfully due to demands by such industries to have a complete local supplier of turnkey projects.

Managing director of ICA, Mr Don Erskine, says it has been the push to develop in-house as well as call in as many viable technologies from the supply chain that has consolidated the domestic growth. "It is no accident that our company has grown exponentially with the influence of the global market on Australian business," said Mr Erskine.

"Most Australian industries that use bulk materials handling equipment have found that our place in the global market is one for niche quantity supply. But in world terms, these quantities are just that little bit too small for profit for the likes of countries such as China.

"As a materials handling specialist, we saw the time was right to identify all viable technologies that can serve the bulk handling sector and equip ourselves with a capable design team that can incorporate all available technologies and turn out turnkey projects as required.

"The overriding factor is that we have been able to grow our business significantly. By identifying a technology base which probably wasn’t afforded due respect, we have been able to sell those technologies domestically, and for the first time, give Australian industries the option of sourcing complete solutions from here rather than wait on imported solutions.

"In a way the supply chain for bulk materials handling has always existed here, it is just not been properly utilised. Taking nothing away from overseas suppliers, the biggest problems faced by those importing bulk materials handling systems solutions has been time.

"Our companies just cannot afford to sit there and wait until solutions are shipped in. They cannot sit there and expect consultants to drop everything and come to their aid in a hurry. And they definitely cannot function properly if the technical support line is at a distance rather than at the plant itself."

Mr Erskine believes the direct involvement by companies such as ICA is cutting down delivery times for bulk materials handling solutions to virtually wipe away downtime. Food processing, in particular, especially where perishables are involved, have very little margin for error and immediacy is a key factor.

Mines and quarries, it has been found, are to some extent moving away from fixed handling systems and, wherever possible, implementing mobile or relocatable technology for faster productivity. And when it comes to agricultural processing, with commodities prices often fluctuating to the point where very little margins represent profit, the opportunity to have a domestic supply line for all types of handling solutions in emergencies is proving priceless.

"It is proving very beneficial to the Australian economy that local companies cannot only engineer all types of materials handling solutions, but also rely on second and third tier technology suppliers to help bring about anything that is required," said Mr Erskine. "In an ironic development, the onset of the global market has shown us that the ideal way to best serve Australia with bulk handling solutions cost effectively is to source domestically.”

"It is providing the best time frames, by far the most competitive prices, and most importantly, it links the end user directly with the company that actually supplies solutions so the technical support will always be at a premium."

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