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Established in 1995 and initially focusing on supplying the professional jet-sprint racing community, Scott Waterjet is now a recreational brand in the New Zealand and North American markets.
Last year, the company reached a crossroads when demand outstripped the capacity of its existing facility in the small South Canterbury township of Winchester.
Conversely, long-term supplier United Machinists had just invested $3 million in a two-stage expansion of its Dunedin-based manufacturing facility.
“We faced the decision of investing millions into our own manufacturing facility upgrade or outsourcing.
‘‘The Winchester location itself presented challenges. With such a small population, finding skilled staff was difficult, supply chain and freight logistics were also expensive and time-consuming”, Scott Waterjet owner and managing director Gary McManaway said.
The company worked out that about 50% of its processes — 90% of which were in Dunedin — were already outsourced.
In a local engineering collaboration, Scott Waterjet units were now made entirely from a Dunedin supply chain.
The castings were made at Giltech Precision Castings, machined along with mechanical and hydraulic components at United, and the largest parts sent directly across the road to FARRA Engineering.
Once machined, castings were sent a few doors up the road to Escudo for powder coating, before final assembly and testing at United.
Scott Waterjet operations manager Gareth Turner said United’s production capability and capacity was ‘‘far beyond’’ what the company would have been able to invest in had it set up its own facility.
There were plans for global expansion and product development in 2022, plus custom high-performance units in design. It was also establishing new distribution channels into North America and Canada.
For United, the timing was perfect. It had taken a ‘‘pretty big hit’’ with Covid-19 and, given it was onboarding the new machining facility at the same time, it had unfilled machine capacity, chief technical officer and co-owner Alex Ramsay said.
“The biggest challenge in taking a product that’s been tweaked, refined and perfected over the years through a process of craftsmanship and individual’s knowledge is to pull that information out and set production up to be highly repeatable and efficient”, Mr Ramsay said.
United was now embarking on Stage 2 of its expansion, setting up United HQ in the adjacent 1600sq m building formerly occupied by Saeco Wilson, where there was a dedicated space for Scott Waterjet.
“We actually purchased the building in late 2019, but our HQ plans were put on hold with Covid,’’United chief executive and co-owner Sarah Ramsay said.
“The Scott Waterjet deal has helped de-risk the expansion for us and is the catalyst to shift into offering full contract manufacturing services.
‘‘Strategically, it’s an excellent fit to welcome three full-time members of Scott Waterjet’s team to United, all of whom have extensive engineering experience and expertise”, she said.
Robin Nyhof, from Giltech, said there were a lot of symbiotic relationships among the engineering industry in Dunedin, while Adrian Slocombe, from FARRA Engineering, said being able to have the manufacturing solution, through the entire process, for Scott Waterjet in the city was ‘‘awesome’’.
Mr Turner said the jet-boating scene in North America was very different from New Zealand, with much bigger boats.
However, both countries were experiencing a boat-building boom, with demand for boats soaring due to people being unable to holiday.
Mr Nyhof said there had been ‘‘some silver linings’’ like that, from Covid; Giltech made components for portable hot tub Kiwitub which had also seen plenty of demand, although sourcing raw materials and freighting was ‘‘dire straits’’.
Mrs Ramsay said steel prices in particular had gone up ‘‘massively’’ in price.