CIMdata PLM Industry Summary Online Archive
4 August 2004
Company News
netGuru in Exclusive BPO Contract with DOWCO Consultants Ltd.; Steel Detailing for North American Construction Projects; Plans Expansion to Europe, Middle East, Asia
netGuru, Inc. ( http://www.netguru.com ) entered into an exclusive four-year business process outsourcing (BPO) contract with Canada-based DOWCO Consultants Ltd. (DOWCO), one of the leading providers in North America of steel detailing for construction projects, under which DOWCO will outsource North American steel detailing requirements exclusively to netGuru and jointly expand to new markets in Europe, the Middle East, and Asia.
netGuru expects approximately $5.5 million of steel detailing work during the four-year contract, which is expected to begin in fiscal second-quarter ending September 30, 2004. During the first year of the contract, netGuru expects to receive approximately $500,000 in steel detailing work. Revenues are expected to reach $1 million in year two and at least $2 million annually thereafter for the remainder of the contract term. netGuru will employ and maintain in Kolkata, India, a dedicated team of engineers trained in creating steel detailing drawings.
DOWCO, an established leader in steel detailing with a 34-year track record, is also one of the largest fully automated companies in the industry. DOWCO has provided steel detailing for a number of widely recognized structures, such as the new Walt Disney Concert Hall in Los Angeles and Safeco field, the Seattle Mariners' new ballpark, and has other ongoing projects in the United States and Canada. With netGuru's additional resources overseas, DOWCO estimates it will be able to handle up to double its annual capacity of approximately $10 million.
netGuru and DOWCO will also jointly market steel detailing services to international markets, including Europe, the Middle East, and Asia. In the next two years, gross revenues from these new markets are expected to reach $5 million annually, with netGuru receiving 40% of this revenue.
Steel detailers produce drawings and erection plans for a steel fabricator based on engineering and architectural drawings produced during the "upstream" phase of the construction process. Steel detailing drawings are required for each and every component of a structure being built, including beams, bolts, and welds, as well as how the steel structure is to be assembled. The worldwide steel detailing market is estimated at approximately $1.2 billion annually.
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