Mexico market picks up
By Hal Lundgren05 November 2012
The opportunity was right there all along. Other business kept Global Crane Sales from reaching for it.
Now the timing’s just right.
Unable to resist bulging opportunity in Mexico, the California-based company will start selling cranes there in 2013. President Uri Toudjarov says his company has spent much of 2012 establishing partnerships in Mexico.
At press time, Toudjarov says Global Crane Sales is at least one month away from identifying those partners, although most alliances are in place. Cranes will be sold out of the partners’ Mexico locations.
Despite never having never operated or sold cranes in Mexico, Global goes forward without a blink, he says.
“We expect to sell two or three cranes every month in Mexico,” says Toudjarov, who spent 15 years with Terex in international sales.
Though the company’s product line is mainly crawler and rough terrain cranes, Global will make other cranes available. Toudjarov says his company will target the right cranes for the right jobs.
“We won’t have customers buying something expensive that they don’t need,” he assures.
Mexico’s petrochemical companies and Pemex, the national oil company, will be among prime customers. Most sales, Toudjarov anticipates, will be in heavy population areas – Mexico City and the country’s southern region.
He estimates that 80 percent of Mexico’s population is in the service area, and that most models sold will probably be the Zoomlion brand.
Toudjarov emphasized that the Global team’s broad industry experience will smooth any roughness a newcomer might expect. Rick Hunter, who recently joined the company, formerly was with Link-Belt. Ed Gibson, who manages North American sales, won’t limit the company’s Latin America expansion to Mexico. “We continue to set up partnerships throughout Latin America,” Gibson says.
Global Crane Sales, according to Gibson, stayed busy in its first year of linking with partners in Panama, Ecuador, Peru, Chile and Colombia. The company will be doing business in Venezuela but not Cuba.
Another U.S. company, Illinois-based Ervin Equipment, is no Mexico newcomer. Ervin has been a successful distributor in Mexico for 20 years. The Illinois-based company operates out of Mexico City, Monterrey, Chihuahua and across the Texas border in Laredo and El Paso.
“We’ve been dedicated to Mexico for years,” says Ervin’s John Connor. “We serve construction, mining and other industries. Our specialty sales people have given us continual growth. We expect that to continue in 2013.”
Ervin sells both new and used trailers in Mexico, although he did not offer specific numbers. Demand for dry vans, lowboys, flatbeds and tankers, he says, has been steady. Ervin’s sales of Wabash National products have been especially strong in Mexico.
Connor notes a broader trend, maintaining that Mexican industries have been “very accepting of U.S. products.”
He adds. “That acceptance has been very helpful to our company. We expect to keep doing good business there.”
Ervin and other U.S. companies enjoy a vital advantage when selling to Mexico.
“Companies there are managed very conservatively,” Connor says. “They do not like to operate with lots of debt. About 90 percent of our sales to Mexico are cash transactions. We receive a wire transfer or other form of (electronic) payment. When one of our products reaches a customer in Mexico, the customer has already paid for it. “
A spokesman for Tradelossa, an important heavy-haul company in Mexico, explains the reason for that conservative approach.
When you burn your tongue sipping hot milk, he asserts, you’ll probably never do it again.
Mexico’s economy has taken several severe, unexpected thrashings. A heavily leveraged company, already wobbling with too much debt, enters crisis mode when an economy tanks. It risks yet another tongue burning.
Business wisdom has come to Mexican companies such as Tradelossa, which continues to expand without risky borrowing.
After going through economic hard times, the leadership of Tradelossa and many other Mexican companies has grown from that turmoil. That firming experience has shaped leadership style.
If you’re growing, do as much as you can without borrowing. That caution has marked Tradelossa’s steady progress.
“If someone had left our company five years ago, he would have remembered us as a family-size business,” the spokesman says. “If that person would come back now, he would see us as an institution, a much more formal company. Five years ago, we were probably half our current size.”
During its advancement, the spokesman asserts, Tradelossa has not wavered from three founding principles: Service as a core value; maintaining internal processes; and staying financially cautious.
At Tradelossa, project acceptance has been a bit less conservative. The Monterrey-based company operates in power, oil and gas, renewables, petrochemicals, mining and manufacturing.
Success is easily validated. Tradelossa has earned two SC&RA Job of the Year awards.
Global Cranes Sales, Ervin Equipment and Tradelossa each expects steady 2013 growth for Mexico. If an unanticipated twist gets in the way, Tradelossa will be financially ready.
“Avoiding long-term debt has been one reason for our success,” the spokesman explains. “It gives us a lot of flexibility. We limit our growth to moving as fast as we wish to move.”
Watching the company’s advance from family-type business to heavy-haul institution, you’ve got to admire Tradelossa’s plan and pace.