Port Macquarie SME wins US Army tender worth $285 million

A Port Macquarie-based marine engineering company has been awarded a contract worth up to $US259 million ($A285m) to supply the United States Army with up to 374 specialised boats.

Birdon faced strong competition in winning the tender, beating global competitor General Dynamics in what was a four year process.

Group general manager of Birdon, Ian Ramsay, told SmartCompany he hopes the deal will take the business to another level.

“This opportunity is a game changer for us over time… it will give us the critical mass and platform to establish a global presence,” he says.

“We’re a very viable company, we’re an SME, but we do punch well above our weight and we’re recognised particularly in the defence space.”

Ramsay says the contract with the US Army is a good reference point for Birdon in the global market and he hopes the business will take on a bigger presence around the globe.

“We want to have controlled growth, but we need to put the right steps in place. It won’t happen overnight, but we plan to have a presence on every continent,” he says.

Birdon was first awarded the contract in November last year, but it has spent the last few months fighting a protest which challenged its eligibility, but this protest was dismissed earlier this month.

The company will be making bridge erection boats, which are primarily used to provide propulsion and manoeuvring thrust to support temporary floating bridges, often used when existing bridges have been damaged in conflict.

It’s a good news story both for small business and the manufacturing sector, which has been the subject of largely negative press recently with the collapse of the Australian car manufacturing industry.

Ramsay says it’s disappointing the manufacturing sector isn’t better supported in Australia.

“In Australia it’s very difficult. You’re up against vessel imports and it’s a significant issue as Australian manufacturing needs more support,” he says.

“There is a real issue that the Australian Defence Force has procured vessels from Asia which could have been built in Australia. In the long term the total lump cost of ownership would have been less if they were built here and it would have created more jobs locally.”

The manufacturing of the boats will occur in the US, as required by the US government, and Birdon will be setting up facilities in Denver.

The Australian arm of the business will support delivery of the contract and its local Port Macquarie base will be expanded.

A key component which allowed Birdon to win the contract was its marine propulsion system, which the company purchased when it acquired the Arkansas-based company NAMJet in 2011.

Ramsay says the key to their success was innovation.

“For small businesses, you need an innovative product to start with. One of the issues you have when you’re responding to a tender is it often comes down to a price driven exercise,” he says.

“Our boat design was superior to its competition… The innovation which went into it allowed us to win, even though we weren’t the cheapest on price.”

Ramsay says small businesses should also consider partnering with other companies and combing skills to win more contracts.