Menu
Search

A Successful Foundation Ontario’s Amaco Fuels Growth by Specializing

amaco2
eff MacDonald was 21 years old when his father, James, founded Amaco CEI. At that time, Jeff was already in the early stages of a career in civil engineering and consulting; there was no pressure for him to participate in his father’s business. But today, 35 years later, the younger MacDonald serves as CEO and owner.

A few years into his consulting pursuits, he found he wasn’t connecting to his career as much as he’d hoped. The realities of consulting and engineering were pushing him to seek something else, and when he mentioned this to his father, he was invited to try sales at Amaco.
“There was no long-term thought or anything, but that was back in 1987 and I’ve stuck with it,” he laughs. “We were able to have some fun together, I learned a lot from him, and I got to spend quality time with my father that my other family members did not—but, of course, being a family member there are more things expected of you.”

It’s difficult now to pinpoint the moment that Amaco became his career home—but MacDonald is happy here, and clear on his role in providing specialty equipment for the industry and quality jobs for his associates.

He notes that as the company has evolved, they’ve located their strengths and moved strategically to capitalize on them. With about 20 employees, they’re not going to compete directly with the biggest equipment distributors, so they find other ways to keep the business growing.

“Many large earthmoving distributors have a line of front-end loaders and bulldozers. We don’t have any of those. Rather than being someone’s tenth choice on a list of potential partners, we want to be in someone’s top three,” MacDonald explains. “There might be a limited potential, but if we understand that market and have a good manufacturing partner, then our business will succeed.” 

That approach has borne fruit for over two decades. More recently, Amaco is working through a cultural shift in how the sales team thinks of its role. The goal is to acquire customers and develop relationships, rather than just to close sales. In a smaller geographical market, with a more specialized line of equipment, loyal client relationships are crucial; Amaco has been successful in generating and capitalizing on them.

MacDonald recalls how the role of the local equipment distributor has changed, thanks largely to the internet. 

“The idea of a distributor, years ago, was to be a local supplier of parts and knowledge because there was no other source,” he recalls. “This is certainly a change that’s put pressure on margins in all aspects of the business, not just for the distributors but for manufacturers as well.”

This has two distinct ramifications for the dealer.First, the local dealer is no longer the primary source of sales-driving information. Internet reviews and discussions do a great deal of that work, so the dealer has to distinguish itself with specific and trustworthy expertise.

Second, with spec sheets and repair guides available online, the dealer is no longer the sole source of service information. Again, the challenge is to develop a trust-based relationship with the customer that creates opportunities to provide additional value. 

One of Amaco’s strategic responses is to expand service labor.“In our industry, finding mechanics is difficult—but it’s just as difficult for our customers. That’s probably a growth area for us to look at,” says MacDonald. “Traditionally, distributors were very reactive: if the phone rang, we jumped into action,” he adds. “But we have to become more proactive. Is there an opportunity for us to build our revenue and build a closer relationship to our customers?”

To keep discovering and creating those opportunities, Amaco is looking to improve internal processes. Effective training and retention will be key to growth in the service area; that growth will support expansion across facilities, personnel and, potentially, acquisitions. For MacDonald, who sits at the head of a small private ownership group, growth is the metric as well as the goal.

“One of the things my dad used to say is, ‘Nothing can happen without the successful foundation of the business,’” he recalls. “It is the engine that provides for not only me, but my employees and their families—and that’s at the top of my mind.”

Related Articles