Big Fleet Owners Want Suppliers with Service That Stands Tall
Meatballs, deer and insects may sound like lunch gone awry, but they may also bring to mind the logos of some well-known construction equipment suppliers. For years, images of the red-hot Manitowoc meatball, the leaping John Deere and the determined Caterpillar have turned up on countless hard hats and purchase orders, burrowing into the minds of engineers, estimators and superintendents.
| || |
|"Suppliers have to convince me they will be around tomorrow." |
Thad Pirtle, VP of equipment management, Traylor Bros. Inc., Evansville, Ind.
"Manufacturers are getting close on quality."
But corporate brands are less resilient than they appear and they are constantly changing with the times. One supplier may merge with another, and then its brand image is at the mercy of a new executive regime. Another company may license its trademark overseas, attempting to gain a global reputation. Sometimes, a once-prominent brand, long discontinued, gets lost in the fleeting memories of an older generation of workers. Just think of once-huge, now-extinct names like Allis-Chalmers, Clark Michigan, Hough and Euclid.
Long ago, choosing machinery for a project was easier, when fewer manufacturers vied for the construction market. Now, people who supervise the industrys biggest fleets look back with a longing smile. Thad Pirtle, an equipment chief in Evansville, Ind., recalls, "I dont know of an equipment manager who was ever fired for buying Cat."
Other equipment pros tell similar stories. "Many times, a contractor either had to buy the old-style, Caterpillar product, or take a chance on a different brand," says Ernie Copp, a semi-retired construction veteran in Anaheim, Calif. "When I was young, you bought Cat heavy equipment, Case loader backhoes, Mack dump trucks and Ford pickups," says Dave Markey, vice president of equipment services for American Infrastructure Inc., Worcester, Pa. Thats not so today, he says, because "your brand loyalty is with your company."
Service is King
Construction machines are more uniform than they used to be, and quality is more transparent. The global tidal wave of options means equipment owners have to work harder to buy a bad machine. The downside is the selection process, where its easy to drown in a vast deluge of logos, roll-ups, buyouts and shutdowns, they say.
More contractors are taking a long-term approach to procurement. Savvy construction firms are constantly studying manufacturers and dealers, forecasting their financial solvency and evaluating their ability to keep up with demand. That means they associate a brand name more with the track record of the supplier, and less with the hard goods that it sells.
"We are paying for the hard goods and services."
Granite Construction Inc. Watsonville, Calif.
One way to measure a brand: Resale value."
VP of Marketing
International Truck and Engine Corp., Warrenville, Ill. (Photo by Tudor Hampton for ENR)
"It is not at all about the equipment. It is about how the suppliers are going to support it," says Andrew M. Agoos, senior vice president for Hubbard Construction Co., Orlando Fla. He operates a large fleet of machinery with an approximate replacement value of $205 million. "All of us are trying to figure out what Cat, Deere and others are going to be doing in the next 20 years," he adds, pointing to a flow chart on the wall that helps him track "who owns who" among Hubbards various suppliers.
Pirtle agrees, saying that product support must "stand tall." He is in charge of a $175-million fleet for Traylor Bros. Inc., and is president of the Association of Construction Equipment Managers. The 32-member forum, which operates under an iron veil of invitation-only secrecy, has taken its praises and grumbles to equipment designers since 1983.
Were actually selling a change of process."
Worldwide Sales Manager, Trimble Navigation LTD., Sunnyvale, Calif. (Photo by Tudor Hampton for ENR)
We are always looking for more supply."
Senior Manager, Business & Industrial Products, eBay Inc. (Photo by Tudor Hampton for ENR)
Manufacturers have listened, and their efforts at cooperative engineering have dramatically changed the quality of construction machines in the last 20 years. The opportunity to design side-by-side with top engineers at major manufacturers like Caterpillar, Volvo and Deere is a contractors dream come true. Together, they solve the toughest equipment challenges, such as safety, electronic interoperability, fuel efficiency and maintenance, and find ways to standardize the cost of ownership for each class of machine.
Ironically, manufacturers always seem to worry about becoming a commodity in the design process, even though they are building better machines. Still, Deere & Co.s implementation of "customer advocate groups" for new products has helped the $19.9-billion-a-year machinery company prove its long-term stability to the construction industry. "Thirty to forty years ago, John Deere meant agricultural equipment," says Agoos. "Today, it has one of the best lines of construction equipment out there."
|Identity. Owners look for stability in logos.|
Randy Jaminet, manager of worldwide customer support for Deeres Construction & Forestry division, Moline, Ill., says that manufacturers like to design cooperatively to help clients achieve "low daily operating cost, machine uptime and productivity." Those are the hot-button words of the new brand loyalty.
Other manufacturers are taking the hint. Terry Dolan, a vice president for Bermuda-based Ingersoll-Rand Co., asks: "Who better to help design the product than someone who uses it every day?" Lately, his firm is expanding its line of compact machinery and taking a focused aim at small to mid-size contractors.
These changes translate into a larger, global supply of reliable equipment. However, some think that consolidation and a massive breakdown of brand recognition is coming along for the ride.
"Regardless of the marketing hype, most manufacturers are getting really close together on quality," says J. Pat Monnot, vice president of global operations for AMECO, Fluors equipment division in Greenville, S.C.. "When I was growing...