This chief is hard-wired to run rigging business
by Rachel Boon
PRODUCT knowledge is one thing but Gaylin Holdings chief executive Desmond Teo takes it a step further by memorising the price and specifications of every single piece of equipment in his firm’s vast inventory.
Gaylin provides rigging and lifting equipment such as wire rope slings to the offshore oil and gas industry.
“Ask me about any size or diameter of the wires, length, price or the load it can take, and I can tell you what they cost now, without looking at the price list,” Mr Teo, 54, says with pride.
This is no mean feat given that Gaylin distributes over 30 brands of wire ropes, slings and related accessories in a bewildering variety of dimensions.
“I’ve been to so many countries and places such as Australia, Hong Kong, China, Vietnam, Indonesia and the Middle East. There are not many of these kind of stockists that have so much stock in their country,” he notes.
“Sometimes they have to get items from Singapore flown over by air because they don’t keep stock for certain sizes (of wires).”
Gaylin has around $110 million worth of goods on its shelves as at Sept 30 and it needs all of it to hand.
“Some makers are in Europe, America… If you want to buy from them, you have to wait for months and during that time, you’d have no items for sale,” says Mr Teo. “So we have to keep enough inventory to serve our customers, who could need it tomorrow or next week.”
This strategy allowed the firm to meet an urgent late-night sale request some years ago.
“An Australian engineer came to me in 1993 to ask for some rigging items, so I just provided whatever I had to support him.”
Some weeks later, Mr Teo got another call from the same engineer, this time at 12.30am. He needed some slings by6am.
“We made the slings, delivered it to Sembawang Shipyard at 5am. From then on, he has supported me all the way.”
Being known for that kind of efficiency has helped the firm grow. Being in Singapore in the 1970s and 80s, when the energy, petroleum refinery and ship building sectors took off, also helped.
As the shipbuilding industry began to decline, the offshore energy industry started to grow as did related sectors such as rig-building.
“Since 2000, the oil and gas industry has kept moving. Look at Keppel Fels, a Keppel Offshore & Marine unit, how many orders they have,” he points out.
The industry has grown so much that Mr Teo says at least $20 million would be required to start a firm to compete with Gaylin, which listed here last year.
Net profit rose 17 per cent to $3.7 million in the second quarter of the 2014 financial year, compared with the same period the year before, while revenue soared 38.8 per cent to $29 million. The stock listed at 35 cents on Oct 24 last year and closed at 59 cents last Friday.
The company, which employs 160 staff here, will be busy next year. It will acquire 51 per cent of the share capital in Rig Marine Holdings FZC. Rig Marine, which supplies and inspects deck equipment, operates in the United Arab Emirates, Azerbaijan and Kazakhstan.
It has also acquired 90 per cent of Korean company Phoenix Offshore, a wholesale trader and chandlers’ supplier.
Gaylin did not have specific plans to expand overseas but increasing demand from places like Malaysia and Indonesia pushed it to seeking opportunities offshore.
A new 100,000 sq ft plant in Malaysia has just been completed. Some manufacturing operations will be transferred there from Singapore.
“The clients in Malaysia want us to be there,” says Mr Teo.
He was even invited to set up a plant in the Middle East in 1996 but there were few oil firms there then. But now is the right time and the Rig Marine deal will allow Gaylin to serve customers there.
The ebbs and flows of the industry are nothing new to Mr Teo, who joined Gaylin as a delivery boy about 34 years ago. The firm was set up in 1974 by his oldest brother, Mr Teo Bee Yen.
He moved into the office to do sales three years later and found himself struggling with English, even after his brothers sent him to the British Council for lessons.
Four brothers still hold key positions, although Mr Teo Bee Yen has stepped down.
There are also several members of the next generation in the firm, Mr Teo’s two children among them. But the hands-on CEO, who is in the office before 7am every day, says no one is ready to take over the reins at this point, his two children included.
Until they can recite the inventory or invoices off the top of their heads like he does.
“Last year, I told them to check an invoice from three or four years ago for a specific item. They said, are you sure, and I told them to dig it out, and I was right,” says Mr Teo with a laugh.
“I think I need another five to 10 years to see who can take over the company.”