Jari Randell, sales director for Vexve, explains why this Finnish company is looking to the Gulf for new business
What does Vexve do for the utilities industry?
We have two different brands. One produces valves and the other water measurement systems. Our business area for valves is district cooling and district heating, and our water measurement systems allow companies to measure their consumption.
Both are growing businesses in Europe. We also see the Gulf area as having fantastic potential for district cooling.
What attracted a Finnish firm to look to the Gulf?
What we are trying to sell to the Gulf area is practically the same thing we are doing here [in Finland] for district heating. The technology is the same and we can simply transfer it. This is a new area for us and the biggest challenge is not the product, but the need to change the attitude of companies and people in the Middle East. We need to demonstrate that we can offer different, and better, products in comparison to the ones companies are using right now.
What we are now looking for is a company that is powerful enough to influence a change by starting to try the products we are using here; in other words, a recognised industry leader.
What makes Vexve’s products stand out from the local competition?
We use the same products in district heating technology that are used in district cooling in the Gulf. But over the last 30 years we have developed these products, improving them along the way. Now we have developed our own valves, which can be used in district cooling, instead of existing products, which in my opinion are derived mainly from the oil and gas sector.
So your valves are more designed for the municipal-scale district cooling market?
Yes. The challenges that local companies witness in district cooling, such as corrosion, are the same as for heating.
How do you distribute your product?
We believe that you must find local people to do business in any region, so we don’t have our own offices, but instead use distributors. Our distributor in the Gulf is Al Tayer Engineering. We signed the distribution agreement with Al Tayer for valves and water meters last year.
How is Vexve handling the downturn?
It depends on the product. If we’re talking about products for district cooling and heating, for big lines our business is growing. The smaller valves that connect main supply to a building are dependent on the construction industry. But, as always, when there are economic problems, governments support the building of infrastructure, so our main business area is growing.
In which international markets do you operate?
Europe, Russia, China and, of course, the Gulf region.
What lessons has your business learned elsewhere that it can bring to the GCC?
The product itself has developed so that the main idea is to make the lines tight. This means only using welded connections for every component. Secondly, we endeavour to make the product as light as possible.
We use the same materials for valves as in the pipes, so the welding process is simple and it’s cost efficient because you don’t need flanges. In addition, we don’t need chambers, as we can direct bury the valves, which are insulated to avoid outside corrosion.
What are your hopes for the business in the Middle East region?
When we enter a new business area, it generally takes a minimum of about two years before we can start to sell at significant levels, but we see district cooling as being a really big part of our turnover in the future.