While prominent in America, where it was founded in 1835 and remains based, and other parts of the northern hemisphere, McLanahan’s presence in continents to the south has not been nearly as strong. The company made a move to remedy this in July 2003 by choosing to establish a wholly-owned subsidiary in Australia, instead of persevering with a distribution arrangement through an agent, an approach that had brought a number of crusher sales in the past but no success with the sizer range.
The subsidiary began with a solely domestic focus, however, in July this year McLanahan handed it control of Asia as well, presumably because of its proximity and the ease with which it could monitor market movements in the region.
One of the first decisions made by the Australian management in its expanded role was to appoint as agent for China John Finlay Engineering, a Brisbane-based company with 15 years’ experience doing business in the country and strong coal industry connections. According to Jon Bentley, McLanahan’s Australian chief executive, the results were almost immediate. “Pretty much from the day of the appointment we saw a huge increase in the number of enquiries, resulting in the first order which came through within two months,” he said.
Worth in excess of $US1 million, Bentley believed the order for four DDC-Sizers and accompanying spare parts from Shenhua Group, one of China’s largest coal producers, would have a significant positive impact on McLanahan’s future fortunes in the Asia Pacific region. As the first sizing machines sold by the company into the region, they would provide an important point of reference, missing until now, for other prospective customers. Also, in winning the contract by open tender, it had overcome a challenge to gain recognition alongside more established rivals.
“One of our battles here in Australia as an American-owned company is we’re viewed as the new kid on the block,” Bentley said. “We’re getting the sales up there, but not as quickly as we would like because our competitors have some 20-25 years jump on us selling this equipment. It certainly helps being able to say we’re here, we now control China out of the Australian office and we’ve just sold a suite of equipment into that country.
“We’ve had no success against the established suppliers of sizers in Australia as potential clients haven’t been able to kick the tyres so to speak, to see a piece of McLanahan equipment operating. So this order is significant because the machines are being built here and clients will get a chance to view them going through a dry run or shop testing. We’re hoping they’ll be impressed with what they see.”
Bentley said Shenhua selected McLanahan on the basis of its long history supplying the American coal mining industry and its willingness to comply with a very demanding delivery timetable. The company agreed to have the four machines – three DDC-Sizer 24 x 96 units and one DDC-Sizer 20 x 48 unit – ready for shipping to the Bulianta coal mine in inner Mongolia within 12 weeks, six weeks faster than the typical manufacture time for an order of that size.
Critical to McLanahan’s ability to meet this fast-tracked schedule was an agreement entered into with Roche Mining JR, the process engineering division of Downer EDI company, Roche Mining, last year. Under its terms, McLanahan effectively has access to Roche Mining JR’s fabrication facilities in Kalgoorlie, Western Australia, as well as two other Downer facilities in Geelong, Victoria and Gladstone, Queensland. “To make the commitment on the 12 weeks before we took the order we had to make sure that a Roche facility had the capacity, which Gladstone did,” Bentley said.
With the manufacturing process now in full swing, he was confident that the order would go out on time. “The Downer facility in Gladstone is actually ahead of schedule at this point in time,” he said. “We have booked and paid the deposit for the ship which leaves for China on October 23 from the Port of Brisbane. That’s our deadline.
“It’s a tribute to the combined efforts of McLanahan’s engineering departments in the US and here, and the procurement departments in the US and here. It’s been a very good team effort.”
Bentley believed the Shenhua contract would instil the Australian market with some confidence in the company’s abilities and, along with the efforts to make its presence more noticeably felt, lead to the first order for McLanahan sizers from a local customer.
“We’ve done the ground work and flown the flag to the point where we are happy that we are being given an opportunity on every tender that comes up in the Australian black coal industry,” he said. “We’re certainly confident of getting our first couple of orders for sizers in the very near future. The feedback we’re getting has been very positive.”
Australia’s Mining Monthly
