Product Price and Project Cost

Is it worth paying a higher product price for something now when it is a known, or paying for an unknown project cost later?

LA Services works with clients across a number of industries, historically we have serviced the oil and gas sector, a sector with a focus on quality assurance and compliance and rightly so. The processing assets this industry uses, and manufactured by LA Services, are engineered for high risk critical environments typically containing high temperatures, pressures and corrosive or volatile fluids so quality assurance and manufacturing integrity is paramount.

Over time LA Services has witnessed occasions where asset buyers steered away from price certainty by purchasing a ‘cheaper’ product. However, this short-term product price saving can become eroded as repairs or modifications on newly installed equipment requires rectification of non-compliant workmanship. Overall project costs can also escalate when the customer needs to increase their presence in the project management or inspection processes, (to oversee that the work is being done correctly) potentially adding significantly to the original product price.

Our point is there are sometimes costs associated with the risk management of highly engineered purchases that are less likely to be present when purchasing from an experienced local supplier like LA Services.

When large corporates invest with local SMEs it provides opportunity for lasting relationships that reduce business to business costs by building mature supply chains that understand where value resides, which can bring significant project savings over time.

Investing in Australian SME manufacturing companies it also provides opportunity to build a skilled workforce adapt and capable for future maintenance, repairs and upgrades, ensuring a ‘sovereign’ capability underpins the assets and systems Australia has in place and requires to maintain its standard of living and security.

 

Investing in and working with forward thinking Australian businesses now will save time and money for everyone in the future.

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