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BUY CHEAP, BUY TWICE: LOW COST SUPPLIER ISSUES EXTENDS FURTHER THAN PORT INFRASTRUCTURE

Guest contributor, Andy Hatton, owner of Global Anodes UK Ltd shares his story.


I have seen a fair bit of discussion raised by Trelleborg in the last few weeks about the issue of low cost suppliers and it’s a topic that really strikes a chord with me.  There are a lot of parallels I can draw between the issues that Trelleborg’s Barometer Report brought up and my experiences.

Years ago, when working for another company, we were frequently undercut on equipment by “low cost” replicas. However, when the equipment failed, ship owners or managers would still call us to put it right.

We would always go above and beyond to help a client, dispatching engineers for the cost of a flight and a hotel in the (naive) belief they would come to us for systems next time they were building new vessels.

In reality, they got so used to us running around doing our best to keep their substandard equipment running, that the next six ships in the series would be fitted out with the same cheap rubbish as before.

After about three years we had no choice but to start saying no, that we weren’t prepared to do this for nothing and if they wanted our engineers they’d have to start paying for the service.

Another drawback to our willingness to help was that in many cases the equipment we were called in to look at was of such poor design and quality it was not economically viable to attempt repair, if indeed it was repairable at all. It became a serious concern for some of our engineers, they started to feel we either looked incompetent or as if we were lying just to make a sale when all we could do was say; “Sorry… you need to rip out all the old system and replace it”.

Before this, we’d always maintained an excellent world wide service base out of profits from the spares and systems we sold. If a client called with a problem we could usually have an engineer on a plane and on his way to meet the ship within 12 hours (in one case in 45 minutes when I had to be in Turkey for a hand over that had to be concluded that day).

We’d started to lose the equipment business, and slashed our margins so much just to compete, that our service facility gradually disappeared; the profits were simply not there to maintain it.

Worst of all, we start getting calls saying things like: “We had your engineer on the other day and he didn’t know what he was doing.”  This often came as news to me, as I was in charge arranging all engineer attendances worldwide.

Further investigation revealed that the Chief Engineer or similar would ask purchasing to get him the “anodes guy”, and purchasing would either just book any Joe Bloggs who happened to live locally or go for the cheapest quote – usually resulting in unqualified people we had never even heard of going on board vessels with the Supers and Chiefs believing they were our engineers. Until it was too late.

As a final note, the worst case scenario I experienced. An “engineer” attended a vessel in Pusan; he turned out to be some guy from a domestic appliance repair shop (apparently a contact of a company we had traded with previously.) I had a very angry Superintendent screaming down the phone at me until I explained that his company had not even spoken to us about their problem or requested an engineer… never mind sent a purchase order for a service attendance. Apparently this so called “fake” engineer even had business cards with our company logo on them.

Global Anodes UK Ltd is an independent company that is owned and operated by engineers with a range of experience in marine, offshore and industrial applications.

Global Anodes offers trouble-shooting solutions to corrosion and bio-fouling problems.

 

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