MHIA Makes Annual Forecast
Each year, the Material Handling Industry and its division, Material Handling Industry of America, provide a segment brief to its members, industry participants and interested members of the public, with the sole intent of offering information of interest to parties engaged in the manufacture of material handling equipment. This segment brief is advisory only and should be regarded only as a guide. This segment brief should not be used as a basis for or relied on to make any financial or investment decisions. The segment brief does not constitute a comprehensive or complete analysis and should not be relied upon as such.
Hal Vandiver, executive vice president, business development, says, “We think the business investment environment in 2003 will be improved over 2002. We are already seeing some positive signs this quarter.” As examples, Vandiver cites capital spending, expected to improve by 4 percent to 5 percent compared to 2002, supported and funded by improved corporate profits.
“Industrial output is also expected to improve,” says Vandiver, “probably in the 3.5 percent to 4.5 percent range, while capacity utilization will remain in the 76 percent to 77 percent range throughout most of the year.”
He adds that the forecast for material handling equipment manufacturing is that new orders will improve 7 percent to 9 percent, and shipments will lag but improve 3 percent to 5 percent for 2003.
“There are some downside issues that have to do with confidence more than anything else in our opinion,” says Vandiver. “That is, confidence related to consumer spending and business investment, and Middle East turmoil poses the biggest risk to confidence due to the uncertainty it causes.”
Get the Most from Crane Investment
You’ve spent a lot of money on your overhead crane system. Is there a way to ensure you’ll get the most from that investment, as well as any subsequent investment in equipment, people and service? There is now.
The Crane Manufacturers Service Committee (CMSC), a standing committee of the Crane Manufacturers Association of America (CMAA), has released its newest publication, Specification No. 78, Standards and Guidelines for Professional Services Performed on Overhead Traveling Cranes and Associated Hoisting Equipment. It was developed by CMAA to set higher performance standards and raise customer expectations in dealing with service providers.
“Whether you go with an internal maintenance organization or hire somebody on the outside,” says Hal Vandiver, managing director of CMAA, “now you’ll have some technical qualifications on which to base your decision.”
What kind of work experience should a crane inspector have? At least 2,000 field hours related to maintaining, servicing, repairing and modifying cranes, according to Specification 78. What kind of work experience should a technician have? What physical qualifications should he be able to demonstrate? Those are the questions this document will help answer.
The 40-plus page Specification 78 is available for $30 per copy and will begin shipping in January. Orders can be placed through the Material Handling Industry of America Online Bookstore at mhia.org or via phone to MHIA’s literature department, (704) 676-1190.
PEF Names Scholarship Winners
Kraft Foods and The Packaging Education Forum (PEF) announced the first recipients of PEF’s Scott-Hogue Scholarship Award: Sara M. Damon, senior, University of Wisconsin-Stout, and Emma Hollander, sophomore, Rochester Institute of Technology.
The PEF Scott-Hogue Scholarship identifies and supports two top packaging students at the undergraduate level. The scholarships are named after James E. Scott, director of packaging engineering and graphics design at Eastman-Kodak Co. and Tom Hogue, retired director of packaging markets at Du Pont Co. The award was created in 2001 in recognition for both Jim Scott and Tom Hogue’s “leadership in bringing the PEF programs and services under the management of the Packaging Machinery Manufacturers Institute [PMMI] leadership,” said Ben Miyares, president of the PEF and vice president of industry relations for PMMI.
Kraft is the sponsor of the scholarship and supports the program, administered by the PEF, through a $5,000 grant.
Customer Satisfaction Beats ROI in IT Bowl
A new study reveals that CFOs and CIOs judge customer satisfaction to be a more important gauge of IT investment value.
This insight is one of many spotlighted in the just-released study from CFO Research Services and Saugatuck Technology entitled Customer-Centric Technology Investments: Where’s the ROI? Among the key findings:
• Non-financial metrics outweigh financial metrics as gauges of technology investment value.
• Contact/call center, sales force automation, customer self-service and database integration provide the greatest CCT payback.
• CFOs have begun to surpass CIOs as champions of technology as a strategic growth tool.
• Spending on CCT continues to outpace overall IT spending growth through 2003.
• Overall IT spending will brighten moderately in 2003, with CFOs more bullish than CIOs.
“Reliance upon customer satisfaction as a primary gauge of value indicates that CFOs believe technology investments are essential to successful execution of business strategy,” says Mary Driscoll, president, CFO Research Services.
Outsource or Not?
Third-party logistics providers (3PLs) are a natural extension of today’s logistics business, especially as companies focus on their core competencies and relegate so-called non-core functions to 3PLs. The expectation is that costs will be reduced and service levels improved. But does that really happen?
That question and other critical issues are examined in Richmond Events’ Logistics & Supply Chain Forum’s latest white paper entitled 3PLs — Living Up To Expectations? The paper, produced by Adrian Gonzalez, senior analyst, ARC Advisory Group, was based on in-depth discussions with leading logistics executives who were on board the senior-level, invitation-only event last May.
Specifically, the white paper examines topics such as:
• What makes an outsourcing relationship successful?
• What factors contribute to the shortcomings?
• How do you measure performance?
• Is it possible or sensible to bring outsourced operations back in house?
“The 3PL industry is highly fragmented, both in terms of the number of providers in the market and their capabilities,” says Gonzalez. “Similarly, there’s no standard approach to how companies establish and manage outsourcing relationships.”
To receive a copy of this exclusive report, please contact Julie Terach, operations manager, at [email protected] or at (212) 651-8773.
Editor’s Clarification
Included in the article “Charge Up Your Material Handling Tasks” (November MHM) was a commentary on the general use of AC motor technology applied in many lift trucks. Since that article appeared, an industry source commented to MHM editors that not all lift truck classes are prone to AC-related maintenance or heat dissipation problems. Reach trucks, for example, by the nature of their usage patterns and based on field reports, experience benefits from AC motors such as lower maintenance costs, lower motor temperatures, and increased energy efficiency. It was not our intention to imply that all lift trucks have problems with AC motors. We regret any misinterpretations that might have been drawn from the article.
—Tom Andel, chief editor
New Electronic Newsletter
Something new has been added. Starting in January, Penton’s Supply Chain Group launched a monthly electronic newsletter Extending The Enterprise, focused on issues related to trends, technologies and business strategies that affect manufacturing enterprises.
What are realistic business goals and what business strategies are actually working? Which initiatives and technologies are changing the world of manufacturing, from the boardroom to the plant floor? Which companies are responsible for moving best-practice standards forward? These are some of the topics that will be discussed by our cadre of field experts working in the industry — and writing for the industry. Subscribe on http://www.totalsupplychain.com.
See these new industry reports now available on TOTALsupplychain.com in our “Online Store”:
• Spending Analysis and Supply Chain ROI, published by Aberdeen Group Inc. and TOTALsupplychain.com.
• WMS Implementation Report, published by Noll Research Ltd., Supply Chain Technology News and Transportation & Distribution.
• The Rise of the 3PL, published by ARC Advisory Group and Supply Chain Technology News.
Industry Leaders at RPCC Annual Meeting
Representatives of the Environmental Protection Agency, Kroger Company, Harley-Davidson and various research institutions are among the host of speakers scheduled to make presentations at the Reusable Pallet & Container Coalition’s (RPCC) annual meeting, January 14-15 in Dallas.
The theme for the meeting, which is open to the public, is Reusables for a Better America: Economics, Security and the Environment. Presentations and panel discussions by key policymakers and business leaders will explore significant issues surrounding reusable containers and pallets, regardless of material. Topics that will be addressed during the two-day conference include state of the industry and legislative outlook regarding reusables; fire safety update and continuing challenges; and anti-microbial research in reusable material.
Contact the RPCC at either (202) 625-4899, or by e-mail at [email protected]. Additional information about the agenda, application form, and registration fees are posted on the RPCC Web site, rpcc.us.
Managers Making News
Crown Equipment Corporation has announced the appointment of Jim Dicke III as company president.
Jim Dicke III joined Crown as vice president, human resources, and has been serving as executive vice president since 2000.
Jim Dicke II, the company’s president since 1980, will remain active in the business as chairman and CEO. Jim Dicke III will be the fourth generation of the Dicke family, which owns Crown, to serve as the company’s president.
The board of directors of Swisslog has appointed Remo Brunschwiler CEO effective March 1. Brunschwiler was head of the Eurocargo business and a member of the executive board of Danzas Management AG.
Tompkins Associates announced the promotion of Mark Buffum to partner. He will focus on growing Tompkins’ supply chain technology outreach.
Interroll Corporation has appointed Jess Lafollette to operations manager of its U.S. manufacturing headquarters. It has also appointed Ken Bobick global DC product manager.
Printronix Inc. announced the appointment of Jim McWilson as vice president of sales for the Americas, and David Sakai as vice president of worldwide marketing.
Hills Global Systems announced that Robert C. Kennedy has been named chief executive officer of the company. Founder and former CEO Sitaram Geddam will now serve as chief technology officer.
Getting More From Your WMS
More than half of all warehouse management systems fail to deliver value at anticipated levels, according to more than 1,400 respondents in a study of WMS usage. And a similar percentage of large WMS implementations fail to come in on time and on budget.
Find out why and what you can do about it in the new study from Supply Chain Technology News and Transportation & Distribution.
Conducted as an independent project in conjunction with Noll Research and Prestobiz, the 2002-2003 Warehouse Systems Implementation Report studies why implementations succeed and fail, and much more. At 238 pages, it includes:
• Average age and update schedules of existing systems;
• Implementation costs, timeframes and success factors;
• Features used and shelved;
• Vendors selected;
• Integration with other systems;
• Benefits anticipated and realized;
• Alternatives to WMS.
Information is broken out by industry and company size, making this a valuable benchmark for anyone using or considering a WMS system. The report is available for immediate download for just $495 at http://list.pentonmedia.com/cgi-bin3/flo?y=eOpY0DyNx30Dfg06cH0Ah.
Justify Your Investment
JustMat is a team-centered decision support system for justifying capital investments in material handling systems.
The user-friendly software is geared for both individual and team use. Developed in visual basic for use on a PC in Microsoft Windows operating environment, the system supports the detailed analysis of discounted cash flow as well as the anticipated benefits that are not easy to quantify in terms of dollar returns. The software and the user manual come complete on a CD-ROM. More details can be obtained by contacting the Material Handling Institute at (704) 676-1190 or visiting the institute’s bookstore at www.mhia.org/bs.
Lift Truck Maker Downsizes
Nacco Materials Handling Group (NMHG) will close its Lenoir, North Carolina, lift truck component facility and restructure its Irvine, Scotland, lift truck assembly and component facility.
The Lenoir component facility, which employs 310 people, will be phased out over 12 to 15 months. The Lenoir plant’s lift truck component operations, including mast and cylinder manufacturing, will be consolidated into NMHG plants in Sulligent, Alabama; Berea, Kentucky; and Greenville, North Carolina.
The Irvine assembly and component facility, which employs 450 people, will be restructured to an appropriately sized operation in the next three years to manufacture three- and four-wheel electric rider lift trucks and mast components for the European market. Other components currently manufactured there would be outsourced to independent suppliers.
A spokesman for NMHG says it recorded a $8.3 million restructuring charge in the fourth quarter of 2002. The move will provide about $6.8 million in extra net profit by 2006.
Companies Making News
Menasha Packaging Company LLC has acquired Triangle Container Corporation of Philadelphia. The acquisition fortifies Menasha’s design and production capabilities related to consumer packaging and point-of-purchase solutions. Founded in 1947, Triangle Container maintains core competencies in high-end flexographic printing, corrugated manufacturing, and precision die cutting. Included in the acquisition are a 300,0000-square-foot pack-out and fulfillment center in Philadelphia and a state-of-the-art design center in Englewood, New Jersey.
Manhattan Associates has signed a letter of intent to acquire the assets of Logistics.com. Purchase price is reported to be $20 million.
Data Systems International Inc. has formed a strategic marketing agreement with Logility.
Integrated Barcoding Systems (IBS), provider of data collection technology and services, announced it has established a strategic marketing partnership with FieldCONNECT Inc. Under the terms of the agreement, IBS will market and sell the FieldCONNECT suite of wireless and Web-based software products.
Cyposoft Corporation, a developer of data collection software and connectivity tools, announced its launch with headquarters in Ann Arbor, Michigan. Cyposoft’s mission is to provide its customers with user-friendly software products that easily integrate accurate, real-time data into existing inventory control, SQL database and enterprise resource planning software packages.
Diversified industrial manufacturer Eaton Corporation announced it has signed an agreement to purchase the electrical division of Delta plc for £130 million ($205 million). The transaction is expected to close in early 2003, following regulatory review and the approval of Delta’s shareholders.
Future Looks Bright Ahead
According to a survey by global accounting firm Grant Thornton and Wirthlin Worldwide, eight out of 10 (79 percent) U.S. middle-market companies are optimistic about the future of their business over the next six months, and half plan to increase hiring.
“To survive and thrive in the current economic climate, middle-market businesses are tightening their belts and getting back to basics,” says John Desmond, partner-in-charge of the Grant Thornton Business Owners Council and the firm’s Long Island, New York, office.
Additional findings of the Grant Thornton Survey of Middle-Market Business Leaders include:
• 84 percent are optimistic about the growth of their business over the next 12 months.
• 54 percent expect their business’ growth to be organic, 17 percent predict growth through a joint venture/strategic alliance, 16 percent by acquisition, and 4 percent by merger.
• 50 percent expect to hire more employees over the next six months, with only 7 percent expecting to reduce work force.
