GenTex able to capitalize on busy oil industry
The line between adversity and opportunity can be a narrow one.
When Red Deer’s GenTex Oilfield Manufacturing Inc. found itself waiting for the pumps needed in the oilfield heating and pumping equipment it manufactures, president Garett Cupples began pondering ways to address the bottleneck. One option was to create a stand-alone company to supply those pumps.
That company recently came into existence. But Century Equipment Industries Ltd.’s customer base extends far beyond GenTex, which only accounts for about 25 to 30 per cent of its sales. Cupples, who is a partner in Century Equipment, said the new company has been able to capitalize on a need in the busy oilfield service sector.
“We’re able to keep our inventory up and deliver a good quality component with quick turnover time.”
Operating from its own premises in Belich Business Park, Century Equipment sells oilfield pumps and components that are manufactured in China. Quality has been the primary objective, said Cupples, with considerable time spent choosing and directing the Chinese companies that Century Equipment works with.
“I’ve been to China probably three or four times.”
Products have been inspected by Century Equipment officials in China and again upon their arrival in Canada. They’ve also undergone third-party testing to ensure the materials utilized are suitable for the equipment’s end use.
This commitment to quality, said Cupples, is essential when breaking into a new market.
“The quality has to be as good or better, and the delivery and price have to be better as well.”
Also important is the fact that Century Equipment pumps are being used and sold by GenTex, said Cupples.
“It’s part of our product line, so we want to make sure Century has a good reputation.”
Currently, Century Equipment only sells into Canada. But its market should expand, and its equipment will be exported as components in GenTex products, said Cupples.
Despite being separate companies, Century Equipment and GenTex are able to benefit from synergies, he said. GenTex is experienced in international business dealings, and customers who need pumps or components can now buy Century Equipment products.
Century Equipment also has oilfield heating equipment for rent, which relieves GenTex of this responsibility. And its premises are being used for repair and servicing work, which allows GenTex to focus on manufacturing.
Cupples said Century Equipment faced some early pressure to expand its product line into drilling pumps. But he wanted to concentrate on the completion and production side of the industry, where GenTex is active.
“Drilling is a completely different industry,” he explained.
“We’re not just going to get into something because we think there’s money in it. I’ve seen too many people fail at that.”