Hardrock Mining acquires bit manufacturer, orders two friction welders and prepares for move to new building
Lou Sharrock, president of Hardrock Mining Products, had a choice. At the age of 56, he could hold on to his money and go fishing, or invest it in the business and build something he and his wife could leave to their three grandchildren.
Figuring they’d just get bored catching fish, they went on a spending spree, laying the groundwork for a massive makeover of the company. In short order, the Sudbury-based manufacturer of drill steel products acquired southern Ontario-based Vertex Mining Tools, a manufacturer of carbide bits, laid out $3 million for a new, 15,200-square-foot building, and purchased two atomic bonding machines for $1 million each.
Here’s how it all came together.
Beginning in 2006, Hardrock began selling Chinese bits as a sideline.
It made sense because “when a customer called wanting rods, it was convenient to also sell them the bits,” said Sharrock.
“By 2014, we were buying approximately $1 million a year worth of bits, striking bars and couplings from China. When you buy from China, you have to give them 30 per cent up front and wait six to eight weeks for the product to arrive. At that point, you pay them the remaining 70 per cent and put the product in stock. Then you sell it to the customer and wait for the customer to pay.”
Buying bits from overseas made less and less sense the more he thought about it.
“What my wife and I cared about was our grandchildren (currently aged five, three and one),” said Sharrock. “I know it sounds silly, but buying product from China doesn’t help my grandkids. It helps China.”
Sharrock looked around for a domestic source and found Vertex, an established supplier of bits in Concord, Ontario, whose owner was eager to retire.
Vertex manufactured everything Hardrock was buying from China, so in February, Sharrock started to talk to them and by August a deal was struck.
Sharrock is confident that Hardrock will have an edge over competing suppliers who are mostly importing bits from China and other overseas sources.
“Our competitive advantage will be our speed,” he said. “There’s no one who can catch us.”
Usually, notes Sharrock, customers wait six to eight weeks for delivery. That was even the case at Vertex, which had less than a sterling reputation for prompt turnaround. Sharrock, the polar opposite of laid back, won’t stand for that.
When one of his regular customers called looking for a R25 54 mm bits, Hardrock turned them around in four days versus the eight weeks it would take from most suppliers.
Sharrrock originally planned to keep operating the Vertex location in Concord, a suburb of Toronto, until Hardrock’s new building in Sudbury is ready in January or February, but he was paying rent in two locations and wasn’t able to provide the immediate oversight necessary to meet production schedules.
“I knew I’d have to move all the equipment a second time, but our reputation was on the line,” he said. “A customer would call and we’d promise delivery in two or three weeks. Then we’d call Concord and have to push for delivery, so we bit the bullet and moved everything up here.”
Sharrock and his 10 employees cleared Vertex’s five-month backlog in three weeks and is now quoting delivery times of two to four weeks.
“If your back’s against the wall, we’re the people you call,” said Sharrock.
The acquisition of Vertex diversifies Hardrock’s product offering, but it’s the two friction welders, or atomic bonding machines, purchased from Thompson Friction Welding in the U.K. that will catapult the company to a new level of technological prowess.
“An atomic bonder is a fancy name for a welding machine, but it doesn’t just weld. It bonds products together at the atomic level,” explained Sharrock. “We’ll have the only atomic bonders within a 300-mile radius, and there’s a good market for it.”
One is scheduled to arrive in February, the other in June. A $1 million contribution from the Northern Ontario Heritage Fund Corporation was a big help.
Hardrock will use them to manufacture male-female rods, which are used in the mining industry for additional extension. The company will also offer friction welding services to area fabricators currently outsourcing jobs to southern Ontario.
Sharrock is eager to experiment with other applications of friction welding. For example, pointing to a bin of steel shavings, a waste product from manufacturing a bit from a single cylindrical piece of steel on a CNC machine, he muses about manufacturing bits in sections and fusing them together using the atomic bonder for more efficient use of the raw steel.
Born and raised in England, Sharrock had no intention of settling in Sudbury when he arrived in 1994 to train Hardrock employees on a giant drill steel twisting machine the company had just purchased, but he fell in love with the city and decided to stay. In 2010, when former president Roger Lafrance retired, Sharrock bought his shares.
“Canada is a much better place to live than England,” he said. “Everything about Canada is better. I couldn’t get in England what I have in Canada. I wouldn’t have had the opportunity. Where in England would I be able to buy the president’s shares and take over? That doesn’t happen in England. You couldn’t build your own home in England. You couldn’t afford the land, and you certainly couldn’t afford the volume of land we have here.”
As for that that drill steel twisting machine, it’s still twisting, “but mining has totally changed because of the power of the machines,” said Sharrock. “Probably not today, probably not tomorrow, but in 20 years time, things are going to be totally different, and if we don’t act now to offer something else, we’re going to be left behind.”
