Strive to survive5 December 1999
The debate over the future of the industry rumbles on. How do smaller companies respond to increasing consolidation? Paul Weldon-Johnston is UK managing director of GH Crane & Hoist. Here is his view
I totally agree with the comments made by Andrew Pimblett in his article ‘Alliance of independents – the alternative to consolidation’ in HOIST issue 6. Here at GH we have employed a partnership programme since 1996 and this has increased our export sales by 30% in that time. However, that is only part of the secret to competing with the majors.
GH, a division of the Spanish company Industrias Electromecanicas GH, began in very humble surroundings in 1956, totally cut off from mainland Europe due to the political situation of Spain at that time. We had to build firm foundations in our natural markets of Spain, France and Portugal. In the late 1980s Spain finally entered the world stage.
By this time companies such as Demag and Kone had colonised the world markets. GH as ‘new-kid-on the-block’ was finding it difficult to attract partners and we certainly did not have the financial clout to grow by acquisition or to set-up manufacturing facilities in other markets.
It was during the early 1990s that we decided our best course of action was to totally overhaul our products and manufacturing processes and we produced our first range of standard EOT cranes and hoists. This was a major move away from our natural business of specially designed crane equipment.
Producing a standard product range to very high specifications and tailoring our production to handle volume, we could meet the demands of our potential customers and offer them realistic prices and delivery times.
We launched our package hoist, crane kit and crane components in 1996 and we specifically targeted potential partners who had been working with one of the majors and had become unsettled due to their suppliers setting up in competition on their doorsteps. Not surprisingly, there were many of these independent crane builders looking for a way back into the market.
By offering our partner companies a competitively priced, reliable, high quality range of products, we were also giving them the means to compete against the majors and secure a future in their indigenous markets.
So what is the other part of the secret in competing with the major crane manufacturers? In a word – loyalty.
Like Street Crane, GH is a family run company. We are not part of a huge multi-national organisation and we can ensure our partners that we won’t be setting up rival service organisations or manufacturing facilities in their back yards. We do not have to meet the demands of faceless shareholders. Of course we have to turn a profit, but never at the expense of our partners, without whom GH would still be working in its three local markets instead of more than 40 worldwide.
The announcement of our strategic alliance with OMi Crane Systems in the USA (see Round up, this issue) sees the completion of three years of hard work by our sales organisation. GH now has representation in all the major global markets, including Australia, USA, Canada, South America, Africa, the Middle East and Southeast Asia.
The next few years will see a period of consolidation and a concentration on providing top quality service to our partners and their customers. GH has encouraged the use of modern media technologies to assist us in this quest. The use of the internet and e-mail has allowed us to offer a unique service to all of our partners.
The newly completed GH web page (www.ghsa.com) will allow all of our partners 24 hours-a-day, 365 days-a-year access to our main manufacturing facility based in Beasain, Spain. They will be able to communicate directly with us via an intranet link and also make use of our new GH Quotation Programme.
The GH Quotation Programme contains a full database of all GH standard component parts, covering our package hoists, end carriages, wheel heads, bogies, crane kits, EOT cranes and even open barrel crab units. Our partners will be able to select the GH product for their application and then download a full set of technical information, including dimensional drawings and EOT crane general arrangements.
Next year we will be adding the facility for automatic order entry and order expediting, giving unprecedented access to our factories and enhancing our relationships with our worldwide partners.
Larger crane manufacturers will continue to swallow up smaller independents, creating huge nationwide service organisations, spending vast sums of money in the process. But I believe that there will always be a place for companies such as GH, one of the few remaining independent and family-run companies in the crane manufacturing sector. And it is still growing rapidly.