I had the chance to sit down with Leonard Moore, Sales Director with OMB Valves, about the valve business and how they chose to grow their way out of a recession through new product development and acquisition.
Please excuse any typos in this hasty transcript.
Matt Register: Hey guys, welcome back to Texas Business Radio. We’re down here at the George R. Brown Convention Center in Houston, Texas. At Valve World America’s Expo and Conference 2017. We’re learning about valves today. Valves are a big part of the Texas economy, big business in Texas. And we got the experts in here to tell you all about it. I’m your host Matt Register. Jay Curry had to step out for a little bit. He’s going to join us here in a minute. But we have some great guests that are going to tell you all about the valve business. Some very interesting things that we’re finding here to show you. You have guys that are here in Texas, that are operating within the oil field industry here in Texas. But you also have some foreign companies that have set up shop here in Texas as well. Providing Texas jobs, providing service to the Texas economy. We’re going to talk to those guys here in just a second. So we’ve got a whole lot to talk about, we’re pretty excited. Go ahead and get your calls in 844-814-8144, is a 24 hour call in line. 24 hours, that means call now, call later. Really doesn’t matter to us. We’re going to get the experts in here to get those questions answered. So let’s jump right into it. Leonard Moore is sales director in the United States for OMB. Leonard welcome to the show, sir.
Leonard Moore: Thank you. Glad to be here.
Matt Register: So tell us a little bit about OMB. What do you do? Who do you do it too?
Leonard Moore: Well, we’re an Italian based company started in 1973. We’re in our forty fourth year, that’s getting pretty good. Next year will be 45, fives and zeros are always great.
Matt Register: That’s right.
Leonard Moore: We entered into the U.S. market through independent reps and distributors back in 1976. Predominantly selling project related business. We came in a direct capacity in 2011 and today we operate a facility in Stafford, Texas. Where we assemble, test, modify, upgrade and automate all of our valves. We’re a manufacturer of predominantly forged product; gate, globe, check, ball and triple offset valves.
Matt Register: Nope. A whole bunch of different kind of valves. Now in Italy is your main production facility. They do a whole lot of things there in Italy. What was the decision for them to open up in the United States.
Leonard Moore: Well, predominantly, I think that when you start out in business, you’re going to look to own things in your backyard.
Matt Register: Sure.
Leonard Moore: But as you get, you know, a greater market share you have to grow. In today’s business, you know, you have to evolve. And we had business in, in North and South America but it was mainly project related. We also had some contracts. We’ve been a contract supplier for MRO products and gate, globe, check for Exxon for over 20 years. We have a quality certification for a number of other companies and that facilitated the need for us to have a more local and direct presence in, in the United States.
Matt Register: Well, you know, we’re obviously very big fans of the Texas market. Right? You guys obviously are as well. You do a significant amount of work in the energy and oilfield industries…
Leonard Moore: Correct.
Matt Register: Here in Texas. So, Texas was the logical place for you guys to put your presence. Tell me a little bit about some of the things you’re doing for the oilfield and energy industry here.
Leonard Moore: Well, you know, we, originally we were making a forged steel product and, and when we first entered into the business, you know, the, the standard product was not something that, you know, the industry was looking to support a foreign based company.
Matt Register: Sure.
Leonard Moore: So, ultimately we had to look to innovation, look to the nonstandard products. Products that others didn’t want to do or didn’t have the capability to do. We made our world, here, out of those products for the first 15 or 20 years. And now that we have that base of made to order products, we’ve actually embarked upon made for stock and bringing some of our more commodity products over. At the same time, we recognize that the economy hasn’t been what everyone would like for it to be. And rather than sit around and think about, you know, what life used to look like a couple of years ago. We decided to put our heads down and innovate our way out of the, out of the problem. And so we’ve been developing new products to go into the energy sector.
Matt Register: Well that’s, that’s interesting, because I mean everybody, you know, that listen to this show and everybody that’s been in Texas for the last couple of years knows that, you know, energy has been, I think bloodbath is the economic term for it. Right? I mean, it’s, it’s not been great. Right? And, and companies can sit around and fight for the, for the, for the scraps, fight for the work that is there. Right? Or they can do something about it.
Leonard Moore: Correct.
Matt Register: And we were talking during the break. I want to talk a little bit more about how you guys have chosen to weather that downturn. Because, you know, I find it pretty remarkable that you guys didn’t just accept that this is the new normal. We’re going to have a lower level of work. Right? You decided to go out and find problems that people had. Find new products, to be able to do it. Talk me, walk me through a little bit, your R&D process. Right? How do you identify, you know, the need that somebody has and get to the point that you have a product, a viable product ready to give them.
Leonard Moore: Really it’s quite simple. We listen, we talk to our customers, our end users and they say “these are the problems that we’re having”. These, you know, “if you guys could do this, then we think we could do more business with your organization.
Matt Register: Sure.
Leonard Moore: Or they say “these are things that have always plagued us and we really wish there’d be a better, you know, there were a better way to do things”. And we sit down and talk to customers and say “what is it that you’re experiencing with the current product that you have. What do you like about it? You know, what do you not like about it?”. If you had a clean sheet of paper and you were starting over, what are the key elements that you want to make sure existed in a product? And weather that means to expand current capability or to develop a new product organically from scratch. Then we’re certainly set up to do so, based on our, our R&D group.
Matt Register: No, absolutely and guys, that’s the way to do it. You can either accept that, you know, life is the way it is with the, with a lower level of work or you can go do something about it. And this is exactly how you do that. We talk on this show all the time and talk to CEOs and business owners about, take advantage of the downturn and build a business you want to be, right in the next downturn.
Leonard Moore: Absolutely.
Matt Register: Right. And one of the ways to do that is through acquisition as well. And I know we were talking during the break. There’s a whole lot to like about having acquisitions around this time. Right?
Leonard Moore: Correct. Correct. I think there’s certainly opportunity. There’s definitely opportunity in a chaotic environment. And, you know, at any given time we may have three or four acquisitions that we are looking at. They, we look for opportunities to bring in people and product. So, in some instances, the product, we feel, is maybe not the perfect fit, day one, but then we can innovate, innovate and add additional products to bring it in, to make it more of a mainstream item for, for our offering.
Matt Register: Well, hey, no doubt. And this is, like I said, this is exactly the way to weather a downturn. Quite remarkable. Leonard Moore is the sales director for the United States, for OMB valves. What is the easiest way for somebody to get in touch, should they want to learn more.
Leonard Moore: Well, they can certainly go to our website, OMBvalves.com.
Matt Register: OMBvalves.com. OMBvalves.com. Guys, as always there’s no reason to take notes. We’re going to have links to everybody we’re talking to right there at Texasbusinessradio.com. Leonard, thank you very much for joining us.
Leonard Moore: No problem at all. Thank you for having me.
Matt Register: Yeah, absolutely. We got to pay a couple bills. We’re going to be back with a whole lot more, here, at the George R. Brown Convention Center at Valve World America’s Expo and Conference 2017. Don’t go anywhere.
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In addition to hosting "Texas Business Radio," Matt is an investment banker and serial entrepreneur from Montgomery, Texas. He is the owner of RREA Media and Register Real Estate Advisors and a Managing Director and Principal at Corporate Finance Associates. He has a BS from the United States Military Academy at West Point and an MBA from Rice University in Houston. You can read more about Matt HERE.