Jason Industrial stands out in hose market with Ammega | Rubber News

SAN DIEGO—During its nearly six years in business, Ammega Group has done a good job of identifying and defining the belting portion of its business.

The company that formed out of the merger of Ammeraal Beltech and Megadyne in 2018 sports nearly a dozen brands that manufacture and sell belting in its conveying and power transmission solutions groups.

But when it comes to industrial and hydraulic hose, the Jason Industrial brand stands alone. And the company now is looking to make sure the Jason Industrial name is seen as a preferred brand for fluid power and conveyance solutions.

As a legacy company in the U.S., Jason Industrial had been a collective group to support the distribution businesses on both the power transmission and fluid power businesses, according to Kyoyul Oh, vice president and general manager, power transmission and fluid power products at Ammega.

But after Jason and Megadyne officially joined forces in 2007, the belting products over time migrated to the Megadyne brand, and hoses went forward under the Jason name. Now, the firm is looking to make sure there is a distinctive difference between these two brands.

"In terms of the Jason side of the business, we need to align what we are speaking about," Oh said. "What are the highlights we can provide on who we are and how we are distinctively operating and participating in the industry in the United States."

Ammega in North America has a manufacturing footprint in the U.S. for belting, including facilities in Charlotte, N.C., and Buford, Ga., that make Megadyne products.

On the hose side, however, it goes to market as a private brand label under the Jason Industrial name, working with a network of vendors who it partners closely with to develop and produce its full line of industrial and hydraulic hose, couplings and accessories.

These goods are then distributed from five distribution centers—in California, Texas, New Jersey, Illinois and Florida—strategically placed to provide timely service across North America.

Much of its product portfolio is geared toward customers in the industrial maintenance and repair operations (MRO), with a vast majority of the goods sold through its network of distributors. Some of its main targets are the food material processing, chemical and water treatment, petrochemical, and oil and gas-related sectors.

The Jason Industrial value proposition actually is very simple, in that it is geared to having the right product at the right time at the right price, Oh told Rubber News.

"We are basically looking at very narrowly scoped segments," he said during this year's NAHAD annual convention in San Diego. "We want to be the last mile for our customers so that they are able to order and be delivered our product within 24 hours."

Because of its ability to live up to its service and delivery standards, Jason was able to make significant inroads during the COVID-19 pandemic because it was able to get inventory in-hand and deliver those products to distributors.

"Yes, the lead time had gone longer. Yes, the pricing had with regards to transportation gone up at the time," Oh said. "But at the same time we were able to have the product available, so thereby the customer was able to afford the need of the product there and adjust the pricing accordingly in order for us to be able to service them.

Jeff Pence, who has been with Jason/Ammega in a number of roles dating back to 1992, said customers have always come to Jason because of its best-in-class service.

"So when our customer base considers us the last mile and we're basically in their backyard, we never missed a beat during the pandemic," said Pence, director of business development for the Megadyne and Jason businesses since earlier this year.

Oh added that the Jason team now is looking to capitalize on the gains it made during the pandemic. That includes taking a larger "share of wallet," or getting its distributors of all sizes—from local to regional and national players—to source more of its needs from Jason as the Ammega company looks to expand its product portfolios.

"From an industry perspective this is a very common practice," he said. "The products that we have are repair and maintenance products, so therefore when you need it, you must have it. We are in that business, so we are open to servicing our customers as they need, and we are positioning ourselves to be taking on that segment."

Maintaining and growing in this space is no easy task, as industrial MRO accounts have a large number of SKUs and don't always have a clear forecast on what needs will be. Jason officials said this makes it even more incumbent on their team to be able to communicate to their customers the insights necessary that they are ready to serve them.

Since Jason doesn't manufacture its goods, officials said it doesn't feel the need to run production lines at high capacity and push what it wants to sell in the market, but rather have available what the customers need. That's where having a strong roster of senior employees can make a huge difference in terms of customer service and product management.

"We're a customers solution selling organization," Pence said. "We can't survive without our customers, so we have to be contacting our customers. If they're not calling us, we're calling them. It's all about customer engagement."

He added that besides aiming to grow sales in the coming year, Jason will focus on growing its base of customers and, more importantly, knowing more about them. To achieve that, Jason is leaning on its experienced team to develop a true product management vision, something it lacked in the past.

"Earlier, if you asked for a widget, that's what we gave you," Pence said. "Today, we are a true customer solutions provider."

Oh said as Jason Industrial has shown this ability to help customers identify their needs and fulfill them in a timely manner, the firm has moved up in the pecking order of its customers.

"We went from the last call, to the third or fourth call, to the second call, and then to the first call," he said. "We need to be participating with our customers in the servicing of that industry segment that is all about on time, right time, for repair and maintenance.

"There is a cost of operational downtime, so it is imperative that we are able to provide that kind of a solution."

Hence, the investment in its product management team, which includes application engineers ready to provide not only the solutions customers will require today, but what they will need tomorrow.

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And while Jason doesn't manufacture its own products, the company is working with its suppliers to design its own product road map that addresses the needs of its customers, and has the high quality, specifications, testing and validation at the production sites to ensure there are no issues with the lines.

"We constantly roll out new products. We're not happy staying stationary," Pence said. "The last thing you want to do is be a 'me too' solutions provider. You want to be able to provide new and innovative solutions."

Jason has a lot longer history in supplying industrial hose and related couplings and accessories, while it remains a relative newcomer to the hydraulics side of the market. But they said they continue to see significant growth year over year.

"When you look at the quality of our product, for us it's best in class," Pence said. "We compete with the majors. That's how we went to market, and that's what we're continuing to do today."

Oh said the firm has a big target for continued growth in hydraulics, and thinks there is a place in the market for the company to participate, particularly given the applications that tie closely to Jason's commitment to support a renaissance in U.S. manufacturing.

Jason traditionally has focused its sales efforts in the Americas, mostly in the U.S., but Oh said it also continues to grow in Canada and Latin America.

And as Ammega moves forward with distinct plans for its Jason and Megadyne brands, there are areas where overlapping customers give the opportunity for both brands to work together. While some distributor customers focus primarily on fluid power markets, there are others that are more multi-purpose in standard industrial, selling into both power transmission and fluid power end applications.

"For us, we have a very strong B2B presence, and our customers can go online and they can build an order across all products," Pence said. "A lot of our customers helping us build growth have been looking for a one-stop shop when it comes to conveyance and power transmission products."

Oh said that is shown by the number of distributors participating both in NAHAD for its hose business, and then PTDA and NIBA for their belting-related needs.

"Part of that is unique to the United States," he said, "where the center of servicing these industries is crosslinking in their location, where you need to have similar products available for servicing similar machineries in those working processes. That's where a lot of the commonality comes."

Jason Industrial business activities have been tempered in 2024 compared to last year, Oh said, as various industry segments have shown flat growth against 2023. "Much of the industry was focused on tighter working capital control and cautious capital expenditures," he said.

"We anticipate a soft landing in Q4 and anticipate a majority of the industry segments returning to growth patterns in 2025," he said.

Rather than sitting still to wait out the stagnant business period, both Jason and Megadyne are continuing their long-term plans that target company growth by filling in segments it hasn't served before, and also identify areas where it can add value by expanding what the firms can supply within a variety of product systems.

These efforts date back to when Oh joined Ammega in 2021. He had a long history with Gates Corp., where he served roughly two decades during two separate tenures, so he was familiar with the lay of the land in both the belting and hose sectors.

"I had a dream when I came on board in 2021 that there is significant white space in our market that is not being filled by legacy manufacturing companies where I believe we are able to contribute significantly," Oh told Rubber News.And he didn't dream small. Instead, he put forth the goal for the businesses to double their sales. "That is a sentiment to say that there is significant room to grow, and there is available space for us to service."

The Ammega team leaned even further into this goal, naming Pence as the newly created director of business development for both the Jason and Megadyne businesses.

Oh said this takes Pence out of the rigors of the day-to-day sales activities, so the two of them can partner to see where they want to put the firm's investments in time, effort and capital to develop the next set of growth within the business.

"We believe the market is about to change, and exploration will take effect," Oh said. And given the portfolios it has put together on the belting and hose sides of the business, the official said the Ammega businesses are primed to be able to fill the space that larger firms can't service in a timely fashion.

"Because we are able to move quickly with regards to our goods and money investments, we are able to be faster in being able to meet the demands and changing landscape of our business," Oh said.

Pence said this involved looking more closely at their customer base and seeing what more they can provide.

"Because of our many years in business, we're connected to just about every distributor customer," he said. "But we're not leveraging all of our products, all of our capabilities.

"... At the same time, we're going to bring new products to market for these white spaces where we're not participating in today. We just introduced some new products in the logistics area that are brand new for us, and that brings a whole new set of customers."

With Pence's new business development role, Oh said there is room to explore, finding different ways to put together complementary product lines to create new systems. It could be belts and pulleys on the power transmission side, or hose, couplings and accessories in fluid power.

"There is technical knowledge required to even buy things," Oh said. "Technical knowledge for you to figure how and when it's going to fail. Technical reasons why you need to do something. So when you are there you are not only replacing your part, but the neighboring part is also to be serviced in order for that whole system to work.

"So I think there is an area where we are able to support our distribution partners to configure things that are needed together in order for our value to come out."

Over the three years he's been with Ammega, Oh said he's had the chance to understand where the market needs are and how his firm can participate with the solutions by focusing on customer experience and solutions.

He's now opening up his second set of three-year plans to hone in on further realizing the unit's growth targets.

"I am optimistic on what I have observed in the beginning with regards to the opportunities the industry has for us to grow, the anomalies seen from a pandemic, and the reality of the new normal that it creates is never the same normal that it was before," Oh said. "But that new normal that we face and the way manufacturing is being taken here in the U.S. is truly supporting our initiatives, and I believe that our strategy and our mission vision is still valid and is still resonating with our customers."

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