Changes to Vale’s procurement system will result in new jobs and opportunities in Sudbury, said the executive director of the Sudbury Area Mining Supply and Service Association (SAMSSA).
Dick DeStefano, SAMSSA’s executive director, said Vale’s new regional focus on supply and service procurement will improve Sudbury’s reputation as a world-leader for the mining supply and service sector.
“This will attract a number of satellite offices,” DeStefano said, as companies will set up shop in Sudbury to be closer to the buying action. Mining supply and service companies previously had to deal with Vale’s offices in Toronto and Brazil to set up contracts with the mining giant.
But in 2012, Vale started to change its organizational structure, and shifted its gaze to regional markets. “It was about getting more autonomy in the different regions,” Kelly Strong, Vale’s vice-president of Ontario operations, said regarding the shift in focus.
In early 2014 companies in Sudbury will be able deal with Vale employees who handle procurement directly in Sudbury.
Strong said the company has created around 12 new jobs in creating the Sudbury office.
Under the previous centralized model, smaller companies did not often have face-to-face contact with Vale representatives. It was difficult for the company to build strong relationships with suppliers.
When a Vale supplier started a new contract it often resulted in a changing of the guard from Vale’s end.
With the regional model, Strong said, Vale’s employees will specialize in particular areas, such as equipment or small tools, and the suppliers will be able to place a face to a name.
Vale will be able to more easily build strong business relationships with its local suppliers.
DeStefano said more than 300 Sudbury supply and service companies are in business with Vale.
From 2009 to 2012 Vale spent $2.6 billion on supplies and services in the Nickel City.
“We really do have the best supply and services industry for mining in the world,” Strong said. He added early feedback from Sudbury’s supply and service companies, regarding the upcoming changes, has been positive.
“It’s one of the best announcements I’ve heard in a long time,” DeStefano said. “This is increasing the opportunities for us.”