Oil sands 101 – top tips for success

Many Ontario companies are growing their business by partnering with operators in Alberta’s energy sector. What’s the secret of their success? While there is no single solution, below we summarize some of the key pointers for building east-west partnerships.

Long-term partnerships versus short term supply deals

Many oil sands projects operate on 10 and 20-year horizons and buyers are looking for long-term commitment to the oil sands market. Successful Ontario companies have demonstrated this commitment through regular and ongoing visits to Alberta, while building trust through successful fulfillment of initial orders. Attending a single meeting or trade show is unlikely in itself to secure new business.

Know and understand the energy sector

Energy sector buyers want to see that potential business partners have done their homework. Be sure to fully understand the needs of the companies you seek to do business with – their operations, procurement processes, product requirements and applicable codes and standards.

Competition and pricing

Investigate what your competitors are offering to oil sands buyers and develop ways to add extra value. Be aware that competition comes from not just within Canada, but also from around the world. Ensure that quotes are competitive with market price. Off-base pricing will rapidly undermine credibility with oil sands buyers.

Identify a niche

Energy sector procurement is typified by large scale, low volume, high mix requirements. Buyers are looking for business partners that can add value beyond core manufacturing capabilities – for instance, via technology and automation applications, environmental products and turnkey solutions. The energy sector also offers tremendous after-market opportunities. Promote the specialized strengths that set your company apart from its competitors.

Have a logistics strategy in place

Buyers will want the reassurance of a well-developed logistics strategy, perhaps working with a specific transport company. Know exactly what type of lead times you can meet.

Build a strong brand supported by an effective portfolio of marketing tools

A strong brand is more than a tagline or logo; it stands for the added value your company delivers. Your compelling brand should be effectively and consistently communicated via a portfolio of marketing tools including business cards, brochures, product photos, company profile, testimonials, price list, buyer kit and website.

Take advantage of the support and resources available

The Ontario government has teamed up with Canadian Manufacturers & Exporters (CME) to provide companies with free-of-charge consultation services supporting oil sands supply chain development. For more information, call CME’s dedicated, toll free oil sands hotline at
1-877-241-3649 or e-mail Ron Subramanian, Director, Business Development, Alberta Division, ron.subramanian@cme-mec.ca or Stephen Rach, Director, Oil Sands Partnerships, Ontario Division, stephen.rach@cme-mec.ca.