June 2016

Asking the right questions

Cost savings in flex lay are there for the taking - but are you finding them? MDL commercial director Mike Gaskin believes an open dialog - and an open mind - help make the most of the market's competitive offering.

There are so many operators developing new and existing fields around the world, that it’s no surprise the number of supply chain companies equals, or even exceeds that. The competition in our field of flex-lay equipment has been on a sharp rise in recent years.

Of course, what that meant when the oil price dropped and the industry began falling deeper into the current downturn, was that this competition became even more fierce. As the operators’ Capex was cut down dramatically, the supply chain had to begin to work harder than ever to secure a project.

In this context MDL’s strength lays in the fact that efficiency and cost-savings have been engraved into our equipment’s design since our beginnings. Our existing rental offering, as well as proven Capex technology, were already available to benefit the industry when the oil price came tumbling down.

Proven track record and case studies come to show that our offering can save clients significant amounts of cash on every project - which, you’d think, would be every operator’s ideal scenario.

The problem is, all too often we are not given the chance to present this offering, before we are already turned down - because, in the end, all that seems to matter is the price.

It’s an ongoing argument, one which MDL has covered previously in our blogs, and which remains one of our biggest struggles: the different industry attitudes to price and value. While the drive for innovative cost reduction is well in force, the way of reaching that goal is still very traditional, namely: by seeking the lowest possible price, rather than seeking added value.

The example of this is the ITT: based on a standard supplier form, emailed to us and to other companies like us, asking countless questions about the company’s policies, its track record, and the spec of the equipment, to see how far it matches the RFQ.

In majority of situations, by this stage the client had already made their mind up on what equipment they want, and are on the search for the best price out there.

The RFQ form is not interested in how different equipment from various suppliers can affect the efficiency of the operation or length of the project, and how these in turn affect the overall cost of the campaign.

But MDL is.

Our equipment is focused on reducing the idle vessel time in port and at sea, when neither the vessel nor the equipment are doing any work: either because they’re being mobilised, in transit or serviced.

The saving is huge: the cash equivalent of the mission being reduced by days - rather than the few dollars saved in the formal tender (that difference between truly innovative technology and a cheaper, box-standard version).

But just like the RFQ does not reflect all these savings, neither does it listen to the operator to understand their actual needs - nor can it propose a different, more cost-effective solution for their problem.

That’s why we are here to ask all the right questions, to find the best solution for our clients’ needs.

We’re keen to come and see you in person, to put our knowledge and expertise into your hands - no forms required.

Mike Gaskin, commercial director

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