Local companies need to offer competitive rates to be considered as potential suppliers of goods and services for the major mining players doing work in Northern B.C., according to a report commissioned by the city's economic development agency.
The Initiatives Prince George report also stated that more research is needed to give area entrepreneurs the best shot at winning contracts and fostering business relationships.
The report's author, John DeGrace, picked the brains of four of those big corporations before sitting down with 13 local service companies. His results were public in Prince George Enterprise and the Mineral Industry In Northern British Columbia - A Preliminary Survey.
"There were certainly consistent themes," said DeGrace, who is currently the senior project geologist for Plateau Minerals Corp., and the former chief provincial geologist for the P.G. region. "Everybody, almost, on the service side felt their most consistent problem was establishing good contacts with the industrial side. This is not surprising. I spent time on their websites looking for ways to contact those procurement people. The really big guys like Thompson Creek Metals do make that information plain, but the smaller ones do not."
The big companies also saw obstacles between their collection of business needs and the offerings of local firms.
"All of the major companies I talked to said they would exercise a preference for local firms as long as they were competitive," said DeGrace. "The big companies all have active supply lists from past dealings, they know who can already meet their needs even if they are based in Alberta or Ontario or somewhere else. The majors aren't going to necessarily come looking for you, so you have to make yourself known to get in on that business in local activities."
The good news, said DeGrace, is there is a willingness on both sides to do local business. If a Prince George plumber can do the job more cheaply than an imported plumber, and equal the quality, the local plumber would most likely get the job.
The major companies suggested to Prince George businesses that they link together and act as block service providers, in some cases, and for some areas of business it would help to open a branch office in the Dawson Creek area for the industrial activities going on there in coal and petroleum.
Small companies were often willing to show a lot of good faith to the majors, DeGrace said. Often the results were lucrative for the local service provider.
"I heard many times from companies in Prince George that even smaller ones were willing to invest to meet the needs of their clients," he said. "These smaller firms were happy to invest their own capital in better facilities or to staff up, if it meant giving the major clients better results. One company that runs a warehousing operation cut a deal with Mt. Milligan Mine to store drill core at minus-15 for long-term storage. The company in question had to build a 2,000 square foot cooler to accommodate that, but they went for it and it really worked out for both sides of that deal."
The investment is often good for more reasons than just mining contracts. DeGrace noted that many of the service companies were involved in a number of sectors using the same equipment or the same workforce.
DeGrace said a simple first step for a business to take would be to get listed in the Initiatives Prince George industrial procurement directory, which is also streamed into the regional database maintained by Northern Development Initiatives Trust. After that, being unafraid to pick up the phone and call for information was also a wise move, he said, based on the discussions he had during his research.
To read his full report, contact IPG.
To join a dedicated discussion on the topic, IPG is offering a Regional Market Expansion Forum on May 30 at the Ramada Hotel. Procurement strategy is the only agenda item. The keynote speaker is marketing and brand consultant Jim Bottomley. Two panels will also take the stage, one on procurement practices and opportunities (panel includes representatives from BC Hydro, CN Rail, FortisBC, Imperial Metals Corp., and Pinnacle Renewable Energy) and one on international export (panelists include China's deputy consul-general, USA's deputy consul-general, and a BC government export development official).
To attend the forum, contact IPG business development manager Dave Jephcott or visit the registration website at http://regionalmarketexpansion.eventbrite.ca.
