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There’s plenty of business around in engineering and therefore engineering supplies but finding the right people for the job is getting harder all the time.
For a quick report from the engineering tools category I asked around to get feelings on the state of the market and what the major hurdles have been for the wider industry in the past year.
Over at Toolware Sales, Aaron Bell is happy to say that the market for the company’s engineering tools is definitely up this year.
He puts this down partly to “a booming economy overall” along with the much talked about move by Stanley Black & Decker/ Irwin to go exclusive with Bunnings leading some players “handing their business” readily over to Toolware Sales, he says.
Even with business looking good there are still concerns out there in the market.
I asked Aaron Bell if he had any advice for readers when looking for engineering tools in a changing market.
“Looking for alternative suppliers is an issue that all engineering merchants are going through now.
“And to those merchants I would say there’s plenty of ‘us too’ products out there, so just be aware of where the product is manufactured and make sure they’re getting product that is like for like or better from a reputable manufacturer.”
TOOLS AS AN INVESTMENT
Another player finding that business is looking good for engineering tools is Auckland Engineering Supplies, whose Sales Rep is Nicky Wyatt.
In her travels around the Auckland region, Nicky Wyatt has seen demand coming from a range of industries including construction, engineering, and even boat building which has seen another rise in interest thanks to some America’s Cup buzz.
With Aaron Bell’s warning around “me too” products still ringing in my ears, I ask Nicky Wyatt if she’s come across many customers who are prepared to take a risk with their tools
“Each customer is different. You’ve got your guys out there who are penny-pinching who will buy cheap nasty tools because they can buy five for the price of one good one then throw it away when it’s destroyed. Then you’ve got the guys who are prepared to invest and are reliant on it.”
AES’s Nicky Wyatt says that a good warranty can be a persuading factor for those “investor” customers, seeking a long-term life for their tools but that in many cases it comes down to customers asking for her recommendation.
“When they ask me I recommend the companies that I feel are looking after the industry and not just here for market share or the bottom dollar. Unfortunately, there are very large companies out there who are making this industry quite difficult,” she says.
KIDS THESE DAYS!
When I ask Nicky Wyatt what other concerns she’s been hearing around the industry, she says the biggest is around getting keen, qualified staff.
“There are a lot of people out there who have apprenticeships to offer but can’t find anyone that wants to do the job or turn up regularly.
“And I’m definitely coming across more people that want to bring in Filipinos and it’s not because it’s an easy option, it’s because they have tried the local market and they have work that needs to be done.”
Nicky Wyatt has even heard from employers desperate for apprentices that recent engineering graduates may be lacking some of the basic practical skills needed for the job.
In this respect, she suggests that perhaps the younger generation doesn’t have the same level of work ethic or respect for work experience that the older generation in the industry has.
Sutton Tools’ General Manager, Kevin Donovan, confirms that finding skilled labour for manufacturing to be a major challenge.
Does he share the idea that the younger generation has a poor attitude to work?
“I don’t buy into all this ‘millennials are lazy’ stuff. I think its BS,” he says.
“The problem we have with recruitment is that the trades and the old engineering workshops and the teaching of that at school has been in decline.
“There’s been a lack of emphasis on trade qualifications for a long time so I think students are not really being encouraged to take up engineering.”
THE JOYS OF APPRENTICESHIPS
Kevin Donovan points out that a student doing an apprenticeship for three years can then go onto an advanced trading certificate that can lead to a university degree later on.
The difference being that they have been earning a living the whole time and are sought after for their on-site skills.
“And someone coming out with a bachelor of business is probably going to be earning less than someone at the end of an apprenticeship but that emphasis has always been on ‘you’ve gotta go to uni’ whereas design, engineering and manufacturing offer some great career paths,” he says.
Kevin Donovan suggests that the lack of skills in the area may even start at home.
“The amount of stuff that gets fixed and repaired at home has probably declined as so many things are seen as disposable now.
“So those DIY skills aren’t getting passed on and that’s probably where a lot of people’s passion for fixing and creating things often came from,” he says.
Although Kevin Donovan is concerned about the skills coming through, he can say that business has been good for Sutton in the last year.
Maintenance and repair work has been the best earner with industrial and industrial distributions customers doing well and generating close to double-digit growth for Sutton Tools.
As most of Sutton Tools’ products are focused around the reshaping or rethreading of metal components for construction, commercial construction projects have been generating the most flow through work for the company.
Domestic metal manufacturing, however, has been on a well-documented decline for years however and Donovan expressed some concern for his northern distributors with the recent shutdown of the Whangarei refinery.
SMARTER NOT BIGGER
Despite much of the Western world’s metal manufacturing moving to Asia in recent years, thankfully this area is still generating export demand for the specialised tools that Sutton Tools offers with export demand for the company’s drilling products “growing quite nicely” through Australia and Southeast Asia.
With New Zealand unable to compete with overseas manufacturers on volumes and labour costs, the development and design of manufacturing technologies seems to be a smarter direction for businesses like Sutton Tools.
This move has been part of a companywide diversification of its business to generate better returns.
“We’re now building better machines often with other New Zealand designers to improve our own productivity for our consumable products while also being an exporter that manufactures that technology as well. So we’re always looking at different ways to make sure the company remains profitable.”
PMI says NZ manufacturing took a dip in May
The latest BusinessNZ-Bank of New Zealand Performance of Manufacturing Index (PMI) reports that manufacturing slumped this May.
BNZ Senior Economist, Craig Ebert, notes that this latest PMI “harnessed it more in line with its average over the Jan-Mar quarter”.
“As such, May’s PMI cemented the idea of a moderating rate of expansion in the manufacturing sector, compared to calendar 2017. Then again, above average is above average, which is encouraging.”
While Craig Ebert feels that the May PMI was positive he felt it was linked to an abrupt stalling in May’s Employment Index.
However, he is quick to point out that he still expects there to be a moderate increase in manufacturing output for the first quarter (June 21).
“This implies that manufacturing has survived a number of slings and arrows that might have otherwise meant a clear drop in its overall activity in the March quarter.
“These slings and arrows include a slip in building work, depressed dairy and meat processing, a correction in forestry harvesting, even timing issues for some major manufacturers of industrial products.”
Norton’s Quantum Leap
Norton is now offering a new range of industrial quality Expert Quantum brushes.
This multi-thread range is made with high-grade 316-grade stainless steel and is manufactured in EEC to the highest safety standards. Comes in reusable PET packaging with hang sell & box combination.
Norton also has a new range of general brushes for cleaning.
This range suits domestic agricultural and industrial industries and has been developed using selected fill materials like natural or synthetic fibre for indoor or outdoor use.
Superior performance with stainless
Sutton Tools’ Inox jobber drills (D180SM3) are an industrial quality drilling solution specially designed for superior performance in stainless steel.
Tailored to overcome the difficult-to-machine material properties of stainless steel, Inox drill bits have a fast spiral, short flute and unique stepped core design providing a smooth and effortless cutting action.
For added wear resistance, these drill bits feature the latest generation Futura Nano PVD coated tip.
Inox drill bits have been independently tested to achieve 70% more tool life in stainless steel compared to standard drill bits.
The 25 Piece Metric Inox Drill Set includes sizes 1.0-13.0 mm x 0.5 mm rises and is stored in a tough ABS plastic case.
A global forecast on the market for machine tools
A recent report released by Credence Research shows that the global machine tools market may grow to US$120 billion by 2026.
A key factor in this growth is the continuing rise of industrial manufacturing and processing globally. The Asia Pacific region is the main source with strong sectors in China, South Korea, Japan, India and Southeast Asia generating more than 50% of the market.
In terms of the type of tools seeing demand, metal cutting tools make up more than 60% of the market value. The most promising market segments are the automotive, consumer goods and machine parts manufacturing areas.
The report concludes that the machine tools market is fragmented and competitive with numerous international and regional players.
New product development, particularly in automation, is seen as the most commonly adopted method by the larger players to gain market share along with aggressive distribution strategies.