Vapour Trail

Steam valves

Market advice and networking help from UK Trade & Investment has helped steam engineering company Spirax Sarco to expand its operations in Mexico

Steam power may seem like a thing of the past, given that we now have diesel, nuclear, solar and wind power to fuel our lives. But, almost 2000 years after its properties as an energy source were first harnessed; steam is still an essential part of many industries, including oil and gas, food and drink and manufacturing. In fact, even today, it is used at some point in the production of around 90 per cent of consumer goods.

Businesses in every industry are conscious of their energy consumption, for financial and environmental reasons. This is where Cheltenham-based Spirax Sarco comes in. The company provides products and solutions that help its clients, including Rolls Royce, Nestle, Proctor & Gamble and Coca Cola, to optimise steam usage, either by recycling the condensate or by using excess steam elsewhere. It has 4,500 employees in 39 facilities across more than 50 countries and its turnover in 2011 was £600 million.

“We make products like steam traps and valves, and also provide knowledge and analysis that can save our clients energy and money,” says Humberto Tenorio, General Manager of Spirax Sarco Mexico. “One of our services, for example, is a steam audit, where we visit a facility and suggest how the client’s process can be improved to reduce steam and condensate loss and, as a result, running costs. Our advice can save companies hundreds of thousands of pounds a year.”

Steaming ahead

Spirax Sarco is no stranger to overseas markets. The company’s first venture beyond the UK took place 60 years ago and since then it has set up a direct presence in more than 50 countries. It has been in Mexico since 1966, when it started out with a local partner. Since buying out the partner in 2010, Spirax Sarco has grown steadily in recent years in Mexico, where it has 82 employees, and the company expects similar growth in 2012 and 2013. Its main Mexican clients include petroleum and food giants Pemex and Bimbo.

The company has had a relationship with UKTI in Mexico for several years. When it opened its new facility in Mexico City in 2009, UKTI secured extra press coverage by inviting representatives of the local media to the inauguration. Since then the relationship has thrived, with UKTI inviting the company to several events, including UK Embassy climate change conferences and networking events. UKTI also invited Spirax Sarco to join its UK-Mexico committee, through which the company meets other UK companies, sharing its own experiences of doing business in Mexico.

“Mexico is an attractive market for us, because of its rapidly growing economy and strong trade links with the US and South America,” says Humberto. “Whilst we’ve been active there for many years, traditionally it has been the local food industry that knows us best. But with UKTI’s help we are expanding our reach, for example into the automotive sector. Our relationship with UKTI has helped us to integrate better with both British and Mexican companies. ”

In the pipeline

Fast Facts

Company: Spirax Sarco

Industry: Advanced engineering

Target market: Mexico

UKTI service: Networking

Website: www.spiraxsarco.com/mx

The company’s long-term aim is to double the size of its Mexican operation by 2020. Part of this development will come from exploring new sectors, like hotels. The company plans to increase its Mexico staff to 90 over the next year, and is building a new manufacturing facility in the Cienega de Flores district of Monterrey which will need a further 24 employees. The Monterrey facility will export to the US and Canada, increasing revenue from the US from US$10,000 to US$1 million by 2020. UKTI helped Spirax Sarco to choose Monterrey as the site for this facility by pointing out its thriving business community and links to both the US and Mexico.

Meanwhile, Spirax Sarco plans to continue networking to meet new clients and to deepen relationships with existing customers in the region. In October 2012 the company attended the opening of new offices of UK industrial measuring equipment maker, Renishaw, along with UKTI and Monterrey’s British Consul. This event provided another opportunity to meet and get to know British companies in Monterrey. As ever, UKTI was on hand to help.

“UKTI are really good at helping you to get to know overseas markets,” says Humberto. “Their local knowledge helped us to find the region of Cienega de Flores and to meet more companies there. You can go to networking events and talk to companies for a few minutes, and then UKTI brings you together for more focused talks. UKTI undoubtedly played a role in helping us to achieve this. Any company that wants to grow in markets beyond the UK should use UKTI.”

The UK and Mexico

Mexico is the UK’s second largest trading partner in Latin America and there has never been a better time to consider Mexico as a place to do business. Mexico regularly ranks in the top three emerging markets in which to do business, and is the fourteenth largest economy in the world.

Over the past decade, the country has seen economic growth and stable inflation. With its impressive network of Free Trade Agreements (including North America and the EU) and its strategic location in-between the US and Latin America, Mexico has the potential to act as a springboard into the region as well as being an attractive proposition in its own right.

For further information about business opportunities in Mexico, please go to www.ukti.gov.uk/mexico

Sectors: Energy, Environment & Water
Countries: Mexico and South West England
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