After the Boom
Here is a good example of a company with foresight, able to see the likely end of the boom in Australia’s minerals and resources sector…
MizCo is a diversified Western Australian owned and operated company involved in the Industrial, Oil & Gas and commercial sectors, and saw the need for changes to be made since the onset of the GFC to mitigate and assist in connection with the high cost of Australian manufacturing and labour. First came the product offer: the addition and merging of HVAC mechanical, electrical and instrumentation skill sets to bring to market a better offering, emphasising high quality engineering all in the one brand along with a specialist product line to meet client needs. MizCo sought new clients and business areas but took great care not to neglect its existing long-term clients.
MizCo’s commercial arm is a specialist systems integrator based around HVAC systems, the core business of the company being anything electrical. “We don’t do lights and power points. Our speciality has always been electrical work associated with mechanical services,” explains Greg Mizza, CEO of the company. “That encompassed the electrical services that made the air conditioning work, for hospitals, shopping centres, offices and further afield in the minerals sector. We provided on site E&I support; nowadays, the terms of reference are broader, branching into the control systems sector.”
In the early 1990s, a company approached Greg and his team and asked them to take on all its specialist HVAC, Oil & Gas, electrical and instrumentation work. “We effectively became their E&I division,” when they wanted to spread their wings and take on overseas projects. MizCo became proficient in finding solutions both at home and abroad.
But the other company floundered during the GFC and Greg saw an opportunity. MizCo was quite exposed so he approached a business colleague, James Watson, with whom he founded the MizCo Industrial Oil & Gas Division. “We are a ’boutique systems integrator’,” he explains. “Give us a concept and we will take it through to feed, to engineering, procurement, manufacture, installation, commissioning and handover. We are going to market to provide clients, whoever they are, with a turnkey solution.”
James adds that the solution can be applied equally well for existing sites or new builds – but primarily, MizCo likes to focus on existing brownfield sites. “That is our skill set. Typically we focus on smaller new builds and anything in the renovation sphere,” he says. This sector requires a particular set of skills because it can be a very dangerous business and there are many operational imperatives – how to remove and reinstall major equipment without disruption to the rest of the site. MizCo’s workforce is composed of skilled individuals who really know how to get their hands dirty. “They can look at a problem and tell the client just what will be needed for a successful outcome.”
James says the company has ongoing projects in places as far-flung as Kazakhstan, West Africa (offshore) and Russia, while it also has works in Europe, PNG and Singapore. But the team tries to concentrate on the time zones closest to Perth – which covers some exciting territories. “We are focussed on servicing Australia and into Asia. Perth’s time zone is estimated to be the most populous, with around 24 per cent of the world’s population – or 1.7 billion – as well as being a possible candidate for a future ‘ASEAN common time’. It works well for clients that we can easily have face to face meetings and telephone calls without having constant overnight delays in discussions or emails.”
There is no secret formula for making it big in these overseas markets, he says; just go out there and do it. “The key to business development is sales and forward planning.” Anything his team does today is likely to take 12 to 18 months to come to fruition, so “meeting clients face to face is equally vital.”
For Greg, it is a disappointment that virtually everything nowadays is driven by price. “That’s the commercial reality of construction in Perth WA.” MizCo, he says, has a very good name and “everyone loves what we do; we give them what they want. But when it comes to a bid analysis, because we often don’t work for the end client, they want the lowest price because they are scrambling to get across the line.” Because of the company’s experience, MizCo is often used as a benchmark; tenderers come back and ask Greg to do the job cheaper but his blunt response is always, “if we wanted to do the job at a lower price we would have quoted a lower price.” In the commercial arena, “if they don’t want to pay the right money for it, we cannot deliver it.”
But in the offshore market, it seems clients take more account of previous experience and the other factors that differentiate a top operator from the herd. “There is usually a lot of pre-qualifying and you have to show a lot of case studies, financial qualifications and prove you are what you say you are.” James says feedback consistently shows that MizCo’s bid documentation is the best and most detailed and accurate in the business. “People don’t mind paying for quality documentation because it usually saves them money in the end.”
In terms of ‘going international’, Greg reminds us that the nearest port to Perth is Singapore. The WA mentality is always likely to be more outgoing, looking for new markets, than over in the east. Between them, Greg and James present a balanced mix (they say) of youth and experience that breeds confidence in overseas customers when they visit – and this business of building relationships is vital. Too many companies fail to do enough listening to their clients, says James. “It’s talk, talk, talk. But we listen to our clients and ask them, ‘What do you want’? We are here to solve whatever their problem is, not ‘sell’ them something.” It is important to meet – and be able to converse with – not just the people with the money but also the operational staff on the client side, and be able to talk the talk with both sectors.
Of course, MizCo remains careful to not bite off more than it can chew. Recently it was asked to look at a project in Siberia, but James turned it down because the logistics and the overall scale of the job would have unbalanced the company.
Branding is not something to which many companies in this industrial space pay great attention, but MizCo has applied thought to how it is perceived. No, it has not tried to be a Nike or Apple, but there is value in “having a clear direction on who we are and what we bring to market. This may sound obvious but we spent considerable time reviewing and agreeing on our target market, clients and strategy,” James explains.
People tend to have greater loyalty to strong brands in the consumer sector, and this carries over into business, Greg adds. He cites airlines and hotel chains – people stay with brands they know and whose values they understand. “My philosophy is that we build a brand then get loyal clients coming back. So in turn we need to maintain our brand at a high level.” A conscious effort was made when James joined to develop a properly coordinated image across everything the company does – from the signatures on emails to shirts with the same logos, to the carefully prepared corporate video presentation that enables new clients to get to know the company before that first meeting, to the way the company presents its tenders. “It’s all about emphasising and reinforcing right from the start that what we do is quality.” In this sense, MizCo is speaking the language of its clients, who themselves do precisely the same.
MizCo is well set for the ‘post-boom’ future. “We have put much stress on ensuring all scopes are taken for a reason and not just because there is an opportunity,” says James. “This selection rationale for tendered project works includes strategy, geographic region, applicable codes and standards, scope of work, adequacies of staff and facilities, time commitments and competing demands. This approach has enabled us to grow while maintaining our focus, being to deliver high quality engineering and product. We have recently been awarded a multi-million dollar contract to provide HVAC integrated systems to a project in the North Sea, with a client that we believe is the right move to establish other potential long term opportunities within our region.” So watch this space.