Whether they are setting up local manufacturing or providing maintenance services, Saudi companies interested in long-term financial success know that trading is no longer the engine for growth that it once was.

Bader S. Al-Reziza, head, Oil & Gas Equipment Division, Al-Reziza Trading and Contracting Company (ARTCCO) described how strategies are being implemented at ARTCCO which will bring fundamental changes to its Oil and Gas Division. ARTCCO was founded in 1974 and has weathered the Saudi economy’s highs and lows over the years. Al-Reziza remarked that last year was “a little bit flat in terms of business,” but now the oil and gas sector is improving and the market is bouncing back.

“We see very good tenders, especially for the drilling activities going on,” Al-Reziza said. “It looks promising.”

With profits returning, ARTCCO’s management believes that this is the best time to move rapidly on its plans to focus on bringing high-end specialty materials and equipment to Saudi market.

“We are now in discussion with companies that can supply us with high specifications to fill niche requirements in the market,” Al-Reziza said. “We are interested in unique materials and products. This is the way to stay alive and thriving now. With standard equipment and materials there is too much competition. There are too many suppliers in the market. The price keeps dropping and the margins are thinner. To thrive, companies must have differentiators. We are also looking at local manufacturing. We are talking with a number of partners. This is a client requirement. Clients give preference to the local manufacturers, so this is another differentiator. Moving forward we plan to trade in more niche areas, while we ramp up the manufacturing.”

ARTCCO is also moving into value added services. Using their years of experience in specialist materials as a foundation, they became the Local Service Center of GEA Air Flow Services (AFS) SAS. Through their AFS center, ARTCCO offers services in thermal engineering that relate to air cooler heat exchanger (ACHE) and air-cooled condenser (ACC) applications.

“Our teams go out to do condition assessment surveys at client sites. We take measurements, do simulations and studies, and make recommendations. We’ll even be doing the maintenance after the equipment is in place. So it’s more than providing materials and equipment,” Al-Reziza commented. “The conventional trading business is very uncertain. A supplier is with you for two, three, ten or twenty years. Then one day the firm is acquired. That company merges with another company and suddenly you no longer represent them. That has happened to us on occasion. So it’s better to go with a joint venture and have a local facility and offer local services. This is the best way to ensure we’ll be engaging in long term relationships and our company will have a bright future.”