expectations for sme’s working on major rail projects

© 2011 BRADKEN®

LL

ARA Rail Suppliers Forum July 2013

Expectations for SME’s working on major

rail projects. Prepared by: Glenn Clifford

© 2011 BRADKEN®

Agenda

• Overview of Bradken and the Rail Division

• Expectations of SME’s working on major rail

projects, with respect to:

• Supplier Assessment

• Performance Measures

• Opportunities and Benefits

• Questions?

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Bradken Overview

• Bradken is a leading manufacturer and supplier of

differentiated consumable and capital products.

• Servicing the mining and construction, rail and transit,

energy and general industrial markets.

• Manufacture fully machined cast iron and steel

products from a mass of 0.5kg to over 25 tonnes.

• Over 6,000 staff globally

• Truly global footprint with 59 manufacturing, sales and

service facilities worldwide

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Bradken Overview

• Sales Revenue of over AUD$1.4B

• Structured into five discrete Divisions and seven

Businesses focused on meeting the specific needs of

the resources industry.

• Divisions – Engineered Products, CMS, Mining

Products, Mineral Processing, and Rail

• Head quartered at the New Global Corporate Centre

in Newcastle, Australia

• Bradken is listed on the ASX

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Bradken Global footprint

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Bradken Global Corporate Centre (GCC)

• Bradken’s new State of

the Art Corporate

Headquarters and

Technology Centre in

Newcastle, Australia

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Rail Division Overview

• Major markets - coal, iron ore, magnetite, grain, bulk and

intermodal, for the resources sector

• Rail division design, manufacture, commission and supply

freight rail products, including wagons, draw gear, bogies,

and spares parts.

• Expanded product and service offerings to the resources

based rolling stock owners, including locomotives,

maintenance and equipment leasing arrangements

• Other new products truck trays and buckets

• In house engineering and product development, to support

all customer requirements

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• Manufacture of 1700 + wagons in FY13 with circa 1800

wagons forecast for FY14

• Manufacturing consolidated for capital projects into Xuzhou,

China, with overflow capacity and other services in

Australia.

• Rail 21% of the Total Sales Revenue of AUD$1.4B in FY12

• Greater level of competition from the emerging markets,

China

• Goods and services are sourced globally to support the Rail

division needs

• Future globalisation of the Rail division

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Intermodal Iron Ore Wagons Spare parts

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Bradken Xuzhou Manufacturing, China

• Stage 1: 6,600

square meter,

including two

bays , mainly

for sub-parts

assembly

• Stage 2: total 13000 square meter, including three bays, Rail

• Stage 3 & 4: total 55,000 + 18,000 square meters, foundry &

CMS store

• Stage 5: total 8,000 square metres, fabrication of buckets,

truck trays and fixed plant (not built)

© 2011 BRADKEN®

Expectations of SME’s working on major

rail projects

Supplier Assessment

• Does the supplier have a suitable product or service to

meet our needs, for major rail projects

• Intellectual property protection in place between parties

• Suitable systems, processes & accreditations for:

• Quality management

• OHS&E

• Suitable capacity and capability to support us, both now

and in the future

• Consideration of Company footprint – global or local

© 2011 BRADKEN®


rail projects

Supplier Assessment

• Level of innovation and differentiation to support customer

needs

• Supply chain establishment as an input into

manufacturing in Xuzhou, China, and also for warranty

and support services in Australia.

• Evidence of lean and waste reduction

• Best market rates for goods or services available

• Ability to fix pricing for duration of project, to aid project

forecasting & currency ‘FX’ management

• Financial stability to support Bradken

© 2011 BRADKEN®


rail projects

Supplier Assessment

• Company has a suitable structure and resourcing plan

• Supplier approval process complete – internal / customer

• Ability to support Warranty and Service needs of our

customers

• Approved commercial offer between parties and Purchase

Order in place, prior to proceeding with the supply of goods

and services

• The supplier will demonstrate a commitment to and culture

of continuous improvement

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rail projects

Performance measures

• Meeting Lead times into production

• Delivery on time in full – DIFOT

• ALL Contract deliverables met

• Quality and safety systems audits and reporting

• Project reporting on time, where required

• Reject performance and reporting

• Response time to support design, production or to

resolve warranty and in service problems

• Meeting ALL terms and conditions of contract

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rail projects

Opportunity Benefits

To achieve approved

supplier status

Ability to supply goods and services

into Bradken’s Rail Division, for

major projects.

Potential entry into new

market sectors

Future business growth and

financial stability

Agreed general terms &

conditions

Reduce lengthy negotiations prior

to contract award

Supply of innovative

products or services

To improve capital cost, reliability,

efficiency and safety of Bradken

products or services

© 2011 BRADKEN®

Expectation of SME’s

Opportunity and Benefits


Improved logistics

management

Reduced cost and lead times, &

improved reliability of the end to end

supply chain

Supplier Continuous

Improvement Initiatives

Access to programs like ‘SCIP’ can

help improve business performance

Improved quality and

safety systems

Quality cost reduction for rework,

scrap & warranty claims. Better

delivery performance & reporting

More visible safety compliance &

reporting

© 2011 BRADKEN®

Expectation of SME’s

Opportunity and Benefits


To Improve Relationship

Management Systems

CRM / SRM

Improved communications,

potential for cross company teams

working together, ability to improve

long term planning & reduced

customer complaints

Potential access to other

parts of Bradken

business, via corporate

group supply (including

SLA’s)

Could enable SME’s to generate

higher sales revenue based on

greater volumes, improve planning

& maximize the value for both

parties