Construction Equipment Dealers Are Forced to Restructure

Contruction equipment dealers in British Columbia have been stunted by the recession and have been forced to restructure their businesses to survive in a rapidly shrinking market.

"We constantly have to readjust, refocus and change our business plans due to the impact of the economy on equipment sales," said Blair Gourlay, operations manager with SMS Equipment Inc.,a Canadian company supplies equipment, parts and service to the construction, forestry and mining industries.

The company is a dealer of heavy equipment, such as excavators, bull dozers, graders, dump trucks and back hoe loaders, that are manufactured by companies including Komatsu.

"We review our business and requirements for manpower everyday, because it is critical to the success of our business."

Gourlay said the market in the Lower Mainland is off by 65 to 70 per cent from where it was a year ago.

"We have made some adjustments, but the one thing we keep in mind while we are making these adjustments is the customer," said Ernie Friesen, Brandt Tractor division manager for coastal B.C.

"We are making sure we are giving the same level of service or better than in the past."

Brandt Tractor Ltd. supplies John Deere construction equipment across western Canada.

Friesen said that the total construction market, measured by the number of units sold, is down 60 per cent compared to last year at this time.

Both Friesen and Gourlay have used their experience with previous recessions to guide their businesses through the current one.

"The young generation has never seen anything like this before, but some of us have been through a few of these," said Gourlay.

"During the big one back in 1981, we were all a lot younger and in different positions. I was in sales and I was writing deals with 20 plus interest rates. The biggest challenge then was keeping equipment out there."

In the late 70's and early 80's, Gourlay said he never worked so hard for so little.

"I try to impress this on my employees," he said. "This is a survival mode. I have found people who are prepared to do it and some who are not."

Friesen's experience with past recessions makes him hopeful about the future.

"If you look back at all the times the economy went into the dump or off a cliff, like in 1981 or after 9/11, it usually comes back strong," he said. "It's going to come back with a vengeance."

By Sinoway Industrial (Shanghai) Co.,Ltd
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