Bundled Repair Solutions For Well Service Customers

Can you talk about your role at Holt Cat?

Adam Haby: In the oil & gas business, we live with the highest highs and lowest lows. When the market is good, we don’t get much sleep. It really is a 24/7 business. Our largest groups of customers are in well service and gas compression. We’re always looking at new ways of doing things and trying to improve. It’s a very exciting business, being on the front lines with the companies that keep the lights on.

What do bundled repair solutions – specifically foundational kits – offer well service customers?

AH: Coupled with the MLP575 program, these bundled repair solutions offer customers significant savings, quality and reliability. This product offers Caterpillar an avenue to simplify and streamline the process for customers to make their work easier.

As we’re going through our quoting process, bundled repair kits save on manual entry, allowing us to find the kit that gives the customer greater reliability. Consistency and time savings are critical in our business. It’s important that we can identify innovations to help our customers save time on the job.

Could you talk about a recent business win that was supported with Caterpillar's well service bundled repair solutions?

AH: We’ve been relying on these kits for many years. We leveraged them recently to acquire some work with both Halliburton and TJ Services. The well service bundled repair solutions give us a strong, cost-effective option. Ensuring that the overall cost of lifetime ownership is comparable to our competition.

The bundled repair kits offer real value, especially right now with the looming Tier 4 regulations. At the end of 2017, Tier 2 phases out. Customers are exploring all their options for replacement engines now because they are basically starting over with a new model. Total new ownership cost means something today. It is critical they know what Caterpillar offers before they make that decision. It’s important that a customer realizes with Caterpillar they’ll pay less over the lifetime life cycle.

What do the bundled repair solutions offer your customers? Why is it important to have a proactive solution in case something goes down?

AH: The majority of our customers don’t do the overhauls themselves. Instead, overhauls are being completed using our shops. Our kits make their lives a lot easier because they encompass everything they need, versus having to create an extremely long parts list. All of our parts fall under just a few numbers.

With our bundled repair solutions, customers know they are getting OEM-quality parts, which offer higher value.

What types of situations do the bundled repair solution kits help your customers avoid?

AH: The bundled repair kits help customers avoid the failures that they’ll experience with competing parts that are inferior. It has helped Caterpillar pick up some loyal customers in the gas compression business. When you have a bundled kit, you don’t have to piece together a large number of individual parts. That can lead to more downtime, which is frustrating to customers. There’s certainly less user error when our kits are involved.

What do reman engines offer customers?

AH: Our reman engines are a foundational kit for all of our 3512 engines. We use them on every 3512 that comes through our shops now. Reman engines help with consistency and cost savings. It’s a nearly brand-new product.

Why is reman such a good value for customers?

AH: Reman helps us become more competitive in overhauls by growing parts and labor business. Keeping the price within a threshold that the customer can see the value of is certainly important.

What are today’s well service customers looking for as far as maintenance and overhaul support?

AH: Up until about 2-3 years ago, well service customers were handled by regional managers. Previously, it was based on need, not price. Basically, they’d contact us when they were in a bind. It’s moved to more of a supply-chain-purchasing overhaul model. It’s definitely a shift in how we do business. Today’s customer is trying to get the most value out of the components they’ve purchased. Reman fills the gap between new and used.

Where is the well service industry in your region heading in the coming years?

AH: Based on the manufacturing dates of these engines, there is a large group due for overhauls in the next year. Some companies are significantly overdue. Our business is twice the volume over this time last year. Many of our customers are ramping up now for 2018.

Are there competing solutions similar to what Caterpillar offers? If so, what makes the Cat solution superior?

AH: The competition cannot offer the one-stop shop for each piece and component that Caterpillar delivers. And of course, the Caterpillar warranty is extremely valuable. Many customers view Cat products as a premium product. They are willing to invest with Cat products, as they can easily justify the value of these OE parts. Some of the competing companies don’t have the warranties and dealer network that Caterpillar has across the world. Customers are taking these machines all over the world and want to know they’re going to receive a consistent experience whether they’re in Argentina, Saudi Arabia, or elsewhere. While some competitors are more regional in scope, Caterpillar is truly a global offering.

Jay Rene, oil & gas aftermarket solutions representative, Caterpillar – When it comes to what goes into the foundational kits, Adam is instrumental in helping our team determine which parts need to be included. We stock many of these parts here in Waco, Texas so customers are able to receive these quickly with minimal downtime. With the foundational kits, there are very few wasted parts. They are a really great value for customers.