Schlam steps up to take on Pilbara

After nearly 20 years operating in the state’s South West, Schlam Engineering is making a move into the Pilbara.

The asset management and maintenance company has acquired a majority stake in Tom Price-based The Pilbara Clean Machines and sister company Unique Blasting & Coatings, and taken full ownership of Port Hedland-based RIM Engineering.

In addition, Schlam has opened a workshop at Newman and a new office and workshop at Midvale, which will supplement its traditional base at Waroona.

Managing director Ryan Schlam, whose father, Barry, founded the business as Schlam Welding in 1996, has led the expansion.

The group had only five staff as recently as 2007, but that was followed by four years of rapid expansion in the South West, working for the likes of Alcoa and Newmont.

Mr Schlam said that, since 2012, he had visited the Pilbara twice a year, meeting people on the ground and evaluating opportunities.

This included speaking to half a dozen groups about potential acquisitions.

The high cost of operating in the Pilbara initially deterred Mr Schlam from making a move, but he noticed a big change when visiting last year.

“People were leaving, there was low morale in the towns,” Mr Schlam told Business News.

“Our long-term vision is to build a sustainable business in the region, with permanent staff and apprentices.

“You can now afford to do that, the cost of living up there is a lot more affordable.”

Mr Schlam said the group’s focus was on asset management and maintenance, which was stable compared with the more volatile construction work.

It also focused on mobile plant, which he said was a distinct niche.

Mr Schlam said he had held very positive discussions with tier one miners, as well as civil engineering contractors.

One contractor had been transporting heavy equipment back to Perth between jobs for cleaning and repairs, and anticipated big savings by getting Schlam to undertake the same work in the Pilbara.

Of the three acquisitions, the biggest was The Pilbara Clean Machines, which has been run by Darren Waters for the past 10 years.

Mr Waters had been looking to sell and move on, but chose to retain some equity and continue as Schlam’s Pilbara regional manager.

“He bought into our story,” Mr Schlam said.

“Part of the strategy is to surround yourself with good people and build up your expertise.”

Mr Schlam believes the group’s three facilities across the Pilbara provide a competitive advantage.

“Being local isn’t a licence to win work, but it gives us an opportunity.”

Schlam was also looking to offer an ‘end-to-end’ service.

“Being a one-stop shop is highly advantageous,” Mr Schlam said.

Following the acquisitions, the group now employs about 130 people across the state and plans to rebrand as Schlam Group.

Mr Schlam said a big focus had been implementing systems and processes, including ISO certification, to continue improving the business.