AMS fills niche at mining's big end

The decision to sell the family home to fund a new business, with two children under three years of age, was one Julie Smith-Massara did not make lightly.

However, the move has paid substantial dividends for the 36-year-old and her husband, Ian Massara, with their specialist engineering design and maintenance company, Australian Mine Services, having evolved into a $20 million business since its inception in April 2003. 

Based in Bayswater, the company specialises in the fabrication, design and maintenance of heavy earthmoving equipment and fixed plant used by the mining industry.

With 95 employees and a forecast turnover of $20 million this financial year, AMS has carved a niche for itself as a specialist operator, serving a number of resource industry heavyweights, including BHP Billiton, Rio Tinto, HWE Mining and Macmahon Holdings.

The company has received several accolades in its short history. It made BRW’s Fast 100 list in October last year – ranked ninth overall and the highest of any Western Australian company – and placed equal first in the WA Business News Rising Star Awards the following month.

AMS has also received industry recognition for its technical proficiency, being the first WA company, and the fifth in Australia, to receive ISO 3834 international quality accreditation from the UK’s Welding Technology Institute, substantially widening its scope to access international markets.

The company combines the technical expertise of Mr Massara, a welding engineer previously based with contracting companies Eltin and RCR Tomlinson, with his wife’s diverse range of skills.

As AMS divisional general manager, Ms Smith-Massara oversees the financial, administrative, marketing and human resources components of the business, assisted by an external finance director and some outsourcing of creative projects to marketing agencies.

“My main focus is not necessarily on the day to day, but more the actual culture of the business and direction it’s taking strategically,” she told WA Business News.

While AMS came into being on the cusp of WA’s resources boom, Ms Smith-Massara spent four years researching the mining services industry before establishing the business, devoting two years to studying a diploma of business at Central TAFE.

“I knew that once the business opened its doors I wouldn’t be able to afford to outsource consultancy roles, so I went back to study to make sure the timing was right in the marketplace,” she said.

 The business grew rapidly following its opening, recording a profit by the end of the financial year in June 2004.

“It didn’t take long to get off the ground because from the initial concept stage..we had a really strong focus on brand awareness and corporate identity,” Ms Smith-Massara said.

She said marketing was a high priority from the beginning, with an official launch and a radio advertising campaign commencing within the first two months of operations.

“We had firmly in our minds that you had to spend it to make it, so we didn’t view it as an expense but as an investment,” Ms Smith-Massara said.

The company has also adopted a policy of promoting staff internally where possible, which Ms Smith-Massara believes has helped to insulate AMS against the current skills shortage.

AMS is currently developing a formal strategic program for its national expansion, and has been consulting with a number of companies, including Deloitte.

The initial phase of development is loosely planned for later this year, although Ms Smith-Massara said this was contingent upon a number of factors.

“It depends on whether we open a new branch and start from scratch or…acquire what is currently available on the market, which will have a bearing on timing,” she said.

Adelaide is of particular interest to AMS, following recent investment by the South Australian government to boost the state’s resources industry, while Tasmania is also a potential market.

Ms Smith-Massara said AMS needed to consider whether the economy of any new market would be able to sustain the company.

“It’s a question of whether the economy is strong enough to stand us, and more importantly, whether the market can sustain us with our current positioning,” she said.

The company also has international aspirations, and intends to pursue opportunities once its national expansion is under way.

“From day one, we’d hoped to take the business to a global stage. In that regard, the vision was always there, although how we get there is something I seek good advice on,” Ms Smith-Massara said.

She said it was important to retain the company’s brand as a quality supplier and innovation leader, which was endorsed by its recent welding accreditation, although the company’s image as a professional, family business was equally important.

“I think the biggest challenge we face moving forward is keeping our competitive advantage in terms of our culture,” Ms Smith-Massara said.

While there has been talk of diversification, particularly into nickel and gold sectors, Ms Smith-Massara said the company had not committed itself to this.

She said AMS intended to retain its focus as a specialised supplier, along with its core competencies.

“As a business, it’s important to diversify, but you never want to spread yourself too thin,” she said.

Although AMS has grown rapidly since 2003, its trajectory belies the personal challenges faced by its founders during this time.

In addition to the financial pressures of establishing the business, Ms Smith-Massara’s father, who was also an employee of AMS, was diagnosed with cancer during a crucial growth period for the company last year.

Ms Smith-Massara said that, while this was a challenging period, it helped to demonstrate the capabilities of employees and encouraged her not to micro-manage the staff.

“I hated the business at the time. If you’re employed by somebody else, in a day-to-day job, you’d throw it in or take annual leave; but the business was at a stage…where I couldn’t walk away,” she said.

“What happened was our staff came to the forefront and freed us up so we could both run the business, but also have family contact.”