Portfolio Consolidation to Extend ReachMon, 10/22/2018 - 13:20
The fact that mines are often located in remote areas is challenging, especially toward the northwestern part of the country in traditional mining states such as Sonora and Chihuahua. Héctor Torres, Director of heavy machinery distributor Sitsa, saw the need to set up its new branch in Hermosillo with this in mind, and two of its technicians provide services directly to the Cananea mine. “As we are newer to the market and despite all the years of acquired expertise that backs us up, the territory is a challenge in itself,” he says. “So, we have very clearly identified that this is a pressing issue and we have people living in key logistics points.”
Sitsa is part of a group with 45 years of experience in the market but as a company it started in 2007. It has experienced the cyclicality of the mining industry, through both the high points and the lows. Torres says he would advise foreign firms entering Mexico to look for strong business partners in the country and build a solid supply chain. “As for the definition of a good business partner, I think this encompasses many different factors like the market role, trajectory and years of experience, among others,” he says.
He believes that the heavy machinery industry is lagging in transitioning into more sustainable machinery. However, an effort is being made to develop more efficient engines, which translates into higher power using less fuel, thus decreasing operational costs and the environmental impact. “As for the mining processes, I find that companies are increasingly taking more care of sustainable operations given the risk of punitive economic measures,” he says. “If mine operations are carried out with a strategic planning, I am convinced that the environment can be completely restored after the mine closes.”
Entering its 11th year in Mexico’s mining industry, Sitsa is opening its eighth branch in Hermosillo, which it expects will be fully operational by the end of the year. It will specifically be targeted to the mining sector, like the company’s offices in Durango. “We visualize a standardized block composed by our operations in Chihuahua, Durango and Hermosillo,” he says. Sitsa’s market is segmented into three sections: big mining groups, independent mining companies and mining contractors. About 50 percent of its portfolio is focused the latter, 20 percent on the second and 30 percent on the former, according to Torres.
The company’s current priority is to consolidate its portfolio. To do so, it is establishing strategic partnerships. One company with which it is working closely is Paus Machinery.