Globalization and outsourcing has now become the way of life within the world economy, it is commonly accepted if you do not outsource, it increases inefficiencies and follows with lower profit margins. However, a new player in the coatings and construction industry is defying industry norms with a vertically integrated manufacturing and service offering. Omega Industries is the founder of the “Supply & Apply” concept, where a firm formulates and custom manufactures paints and applies the products through its own application teams.
Ashvat (Ash) Shetty an MBA graduate from the Macquarie Graduate School of Management (MGSM) founded Omega Industries less than seven years ago. He credits his management style and unconventional methods through his father’s mentorship at an early age. Shetty was born in Muscat, Oman and at the age of six, migrated with his family to Sydney, Australia.
In 2000, his father, Kan Shetty after constant bullying from a line manager, resigned from his position as an accountant. The following day, Kan purchased a small paint manufacturing business he found for sale in the local newspaper. Majority of Ash Shetty’s early childhood memories came from helping with tasks around the small manufacturing unit such as sweeping floors, labelling cans and accompanying his father on paint deliveries to local customers.
By the age of 20, after accumulating years of exposure in the paint industry, Ash Shetty decided to branch out on his own and start a paint contracting business. He purchased paint materials at cost prices directly from his father’s business and sought out contracting opportunities using a simple website, flyers and his most successful method; canvassing local businesses to paint their offices. Very quickly Shetty realized the lucrative margins and unique offerings a painting company with its own manufacturing plant could offer. In 2012, Shetty and his father merged their respective businesses Omega Painting and Omega Paints into Omega Industries.
A Small Family Business Morphs into a Multinational Powerhouse
Omega Industries rapidly grew after its merger in combination with Shetty’s leadership and strategic direction. He focused his efforts on specific market sectors rather than appeal to the masses. Firstly, Omega were determined to become market leaders for niche products and increase buying power with suppliers in the coming years. Secondly, through selective acquisition, they absorbed poorly performing organizations including, Apco Coatings, who were running in major financial losses for over 15 consecutive years in Australia from the global paint conglomerate, Asian Paints Corporation. Within three months, Omega’s hands on management style were able to overturn Apco Coatings into a profitable business whilst securing several major government contracts for the supply of Road Marking paints.
Shetty propped the Omega Industries brand across Australia and other attractive foreign economies. Omega Industries today supplies paints and/or services across Australia, Vietnam, Fiji, Malaysia, New Zealand, USA and are in early stages for their new venture in the UAE.
In 2017, Omega Industries were able to add to its manufacturing property portfolio with the acquisition of a $11M manufacturing plant from Axalta Coatings in Australia. Their key focus in the takeover is to enhance R&D programs and further develop their unique capability to customize products for major coatings projects.
How Omega Avoided the Consequences of Unsustainable Growth
The most common issue firms face with doubling annual growth similar to Omega face, is falling into an unsustainable rate of expansion, where eventually either they plateau or rapidly decline at the same rate. However, Shetty has managed growing pains in Omega’s exponential growth through effective people management, he says “Our people have always been the catalyst to Omega’s success, my father nor I did anything special. We just look for people with the right attitude whereas everyone else focus on industry experience or qualifications, you can train anyone but you can’t train passion.”
Today, Omega Industries employs over 230 employees and contractors across several cities globally with an annual turnover of over $45M. However, Shetty has now set his sights to reach an annual $200M turnover before publicly listing Omega Industries on the stock exchange.
The Puzzle for Entrepreneurs to Unlock
Shetty efficiently created a vertically integrated model for his small family business and turned it into a multinational firm with over 14 brands whilst diversifying into multiple new industries including metal recycling, screen printing inks, scaffolding, consulting and acquiring valuable commercial properties valued over $30M with expectations to double by 2020.
When we asked Ash Shetty for any advice he could give entrepreneurs and business owners with plans to create change in their industry, he responded “Write a list of everything your top three competitors are doing the same, then write a list of how you can offer twice as much for half the price, your attitude will solve the puzzle.”