The Mheda Journal

I’ve been referencing the Second Quarter 2011 issue of The MHEDA Journal in this space for several weeks now, and I’m happy to report that it is now at the printer, ready for distribution by mail in mid-April and at MHEDA’s 56^th Annual Convention at the end of the month. (By the way, once again this year, I’ll be blogging and Tweeting live from the show, so I hope you follow the goings-on even if you’re unable to attend.)

 This issue is all about the Convention and, more specifically, the Convention theme of “The Customer Convention.” The magazine features articles all about customer-centric topics such as how customer service can put money in distributors’ pockets, handling customer complaints, when it’s OK to say no to a customer, partnering with the manufacturer to handle difficult customers, using social media to engage customers, customer survey best practices, encouraging customers to go green, and much more! There’s even an interview with an end-user customer, who describes what he looks for in a distributor partner.

I’m a little bit biased, but I think this is a tremendous issue. It will be available in print and its full online glory within the next week or so. I hope you enjoy it. On to the Third Quarter!

While the attendance at ProMat 2011 seemed to be a bit ligther today, that didn’t dampen the enthusiasm of those who were at the third day of the show. Exhibitors continued to rave about the number of quality leads they recieved at their booths. End-users from around the globe made the show worthwhile for a high number of MHEDA members who had their booths on display.

I spent the morning walking the show with Steve Guglielmo, visiting the distributors who had booths. We also took in a seminar about using lean practices to improve forklift operations.

One highlight of the afternoon was taking a few moments to wander the Automate 2011 show, which collocated with ProMat. There were several different kinds of robots on display, including ones that dealt blackjack, putted golf balls and drank from a water bottle. They were all pretty neat displays. Other, more-relevant-to-material-handling applications for the automated equipment were also shown off, including a robotic palletizer, high-speed scanning equipment and lots of cutting and welding uses. To be honest, I think a lot of the robot applciations, both in Automate and in ProMat, were more to show off what can be done with the technology rather than showcasing useful applications. One robotic truck we saw wouldn’t have eliminated any manpower, as it still required lift to place the itmes it picked on high shelves. Though, admittedly, it did look cool.

Regardless, though, if the booths at ProMat were any indication, automation and robotics will remain the waves of the future. As systems engineers continue to perfect these technologies, some unique products will surely be develoepd soon.

All in all, it was a productive show. I learned a lot, made a host of new contacts and re-connected with some members I’d met before. MHEDA Members, both suppliers and distributors, always have a lot of information to share. I’m glad I was there to soak it all in. See you in 2013!

MHEDA Past President Jim Bowes of Peach State Integrated Technologies visits MHEDA's booth at ProMat.

Day 2 of ProMat was another filled day. We took the shuttle over early to attend a press conference where TGW  Systems unveiled a new picking product. After that, the show opened up and it was another day of walking the aisles and meeting suppliers and distributors. I also attended a seminar on the future of robotic case picking with robotic industrial trucks. It was a good look at trends in distribution centers.

In my time walking the aisles, there was good traffic flow. Most exhibitors were very pleased with the amount of leads they’ve generated so far, far more than at the previous ProMat show two years ago. The beauty of a stronger economy, I guess. At MHEDA’s booth #1878, for example, they were able to sign up 5 new members, which is a lot considering that most attendees are end-users and not distributors. That’s not to diminish the presence of distributors here, as they were out in full force.

Perhaps the most informative part of the day was at MHIA’s State of the Industry press conference, where MHIA COO George Prest went through some material handling industry statistics and forecasts. New orders grew 18% in 2010 and are expected to grow 11-12% in 2011. Shipments rose by 6% in 2010 and are expected to grow 11-12% in 2011. Domestic demand grew 3.5% in 2010 and is expected to grow by the same 11-12% in 2011. Exports will be stronger than imports in 2011, according to the data.

Part of the MHIA presentation also included a short speech by Jock Menzies, president of the American Logistics Aid  Network (ALAN), about the industry’s help of the recent tragedy in Japan. He spoke of all the efforts of the peopel in our industry and others who helped out and compared the cleanup in Japan (a modern, financially rich country) to the recent efforts after disasters in Haiti and other poorer, less advanced countries. It was a striking contrast.

One other interesting fact: Did you know that “material handling” is called “intralogistics” in Europe? I didn’t. But two gentlemen promoting the CeMat show in Hannover, Germany, in May enlightened me to that fact.

All in all, it was another busy but fun day. Needless to say, my brain is almost as sore as my feet from all that’s going on. Stay tuned to live updates via Twitter by me @liftmoveandstor and my colleague, Steve Guglielmo (@MatHandlingEdge). We’ll be on the floor for a half day Wednesday before heading back to upstate New York. If I haven’t seen you yet, maybe we’ll see each other on the floor tomorrow!

So the first day of another ProMat is in the books, and it was a wild one. It started with a visit to MHEDA’s booth (#1878) to get our MHEDA Member ribbons and then to cover the ribbon-cutting ceremony. Then we headed upstairs from the show floor to help with Classroom Day. I didn’t take any students around on the show floor, but those who did had a good time helping new students learn the industry.

More than 250 students and faculty participated in Classroom Day at ProMat.

I attended a press conference put on by The Raymond Corporation, where they talked about working with a distributor to create a 1.1 million sq. ft. headquarters/distribution center for The Container Store. It was an interesting presentation, as Mike Coronado, director of the distribution center said the company has seen a 30% improvement in process time since the facility went live in 2004.

Then, it was back down to the show floor, where I made the rounds and met lots of MHEDA members. Several MHEDA distributors were wandering the aisles as well, including Past MHEDA Presidents Tim Hilton, CEO of Carolina Handling (Charlotte, NC); John Cosgrove, president of Atlantic Handling Systems (Fair Lawn, NJ); Mike Romano, CEO of Associated (Carol Stream, IL); Jim Bowes, president of Peach State Integrated Technologies (Norcross, GA); and current president Chuck Frank, president of AHS Inc. (Cincinnati, OH). That doesn’t even include all the other distributors and the 111 MHEDA members who are exhibiting at this year’s show. Each is sporting a “Proud Member of MHEDA” placard in their booths.

One thing I found interesting was the number of distributors who had exhibits. I always thought of it as a manufacturer thing to exhibit at shows like this, but I walked past exhibits for MHEDA distributors Siggins Corporation (North Kansas City, MO); Peach State Integrated Technologies (Norcross, GA); Vargo Companies (Hilliard, OH); W&H Systems (Carlstadt, NJ); PeakLogix (Midlothian, VA) and Kuecker Logistics Group (Belton, MO). (If you’re a MHEDA member distributor and I didn’t mention you, sorry…I haven’t made it through the whole show yet). I thought that was interesting. I never really thought of it, but it does make sense for distributors to have booths. There are a lot of end-users at this show, so why wouldn’t a distributor want to touch base with potential customers. Particularly if you’re not a territory-specific dealer, ProMat would be a great place to pick up sales leads. Why let a manufacturer get those leads and potentially hand them off to someone else? I have seen distributors exhibiting here before, but it definitely seemed to be more than in past years.

After walking the show for a while, I went back upstairs and watched MHEDA Executive Vice President Liz Richards give a presentation on MHEDA’s Gateway Program as part of MHIA’s Classroom Day. After that, it was back down on the floor to visit more booths and attend another press conference, where Gorbel introduced an aluminum gantry crane. Pretty interesting technology. Finally, I wrapped up the day in Vargo Companies’ seminar on lean distribution strategies. Kudos to the three gentlemen giving that presentation who did a nice job despite some technical difficulties with the sounds system.

MHEDA's Networking Reception was well-attended by members, prospects and guests.

Then it was upstairs to MHEDA’s Networking reception. It was a large crowd, and everyone had a good time. Attendees could place a business card in a bowl and win a prize, including a free Convention registration for the 2011 or 2012 MHEDA Convention. It was still going strong when we left at 6:00, and we just made it downstairs in time to catch the last shuttle.

It was nice to get on the bus and finally have a chance for an extended sit-down. My feet were starting to feel it. We closed the night with a visit to Hytrol Conveyor Company’s hospitality event at the Renaissance Hotel. Thanks to the Hytrol folks for a nice event.

It was a long day, but it was great to get around and see so many MHEDA members. The general consensus was that  the show was off to a good start. End-users appear to have money to spend again and they were out looking for equipment to spend it on. I’ll be back out there tomorrow, and I’d love to meet you if you’re out there! Don’t forget to follow my live tweets at www.twitter.com/liftmoveandstor. My colleague Steve Guglielmo is blogging and tweeting as well. Now it’s off to bed. See you tomorrow!

The First Quarter 2011 issue of The MHEDA Journal, is off to the printer. With that behind me, it’s time to focus on the Second Quarter issue, which will be distributed in April, just in time for MHEDA’s Annual Convention, which this year is taking place in Scottsdale, AZ, from April 30-May 4. This year’s theme is “The Customer Convention.”

With that theme in mind, the April magazine will be full of articles relating to customer issues, including encouraging customers to go green, when it’s okay to say no to a customer, when you should consider dropping a customer, new methods of customer engagment, the definition of customer service, using customer surveys and much more. If your area of expertise is in any of these, please let me know and we can use your knowlege in an article in the magazine. Or, maybe you know of a customer-related issue that isn’t on my list. Even better! You’re probably not the only one wondering about it, so let us know and we can turn it into an article for the magazine.

Remember, it’s your magazine, so let us know what we should be writing about and who we should be talking to!

How many ears of corn grow on one giant stalk? Most people (myself included) think the answer is “a lot.” But if you said “one,” that means you’re either from Nebraska or you attended 2009 MHEDA President Duncan Murphy’s workshop at last week’s MHEDA Convention.

I want to revisit Duncan’s presentation before it gets too much further into the past. Not that the information would be any less timely…I just don’t want to forget to mention what I got out of it. I didn’t really have time to give it the attention it deserved at the time.

Duncan gave a presentation titled, “Strategic Planning: A Practical Application to Help Grow Your Business and Your Profits.” It was well-attended by distributors and suppliers alike, and I have no doubt that everyone left with some new information and tips to better run their businesses. As the title suggests, the session was about the importance of developing a strategic plan. I won’t go into the details of the strategic planning model used (it’s the same one MHEDA uses that has been presented at past conferences) but I do want to focus on the point of the corn analogy above.

One stalk only grows one ear of corn, but each ear of corn has 300 kernels, which are the seeds to grow a new stalk of corn. Duncan explained that the strategic planning process at your company can sprout the same way. He explained that a strong team of managers developed the plan (the ear) and then dispersed the message to all the employees (the kernels). Once the employees buy-in to the plan – which is a multi-step process that includes improved communication, measured results, goal setting, reviews and revisions, etc. — then the “kernels” can sprout. The employees will perform better, and they can be the basis for a new, improved company (the stalk).

I thought this was a really interesting concept. I assure you that Duncan explained it much more eloquently than I just did. (Downloads of presentation materials are available on MHEDA’s website.) All you really need to know is that by following the strategic plan he outlined in his presentation, Riekes Equipment Company was able to increase its profit despite a 18% drop in sales and earned 2009 “Top Dealer” awards from both Yale and Combilift. Not a bad year, all things considered. That’s the importance of a strategic plan.

Technorati token: B8X9XQUR3JHB

Made it back to the office today, and I have a lot of notes to go through. I will be diving into some of the topics I came across for the next several posts. First, I want to go back to a session I attended on Tuesday and make a few quick comments. 

I’m not in sales — and frankly have no real interest in being involved in sales – so I was surprised that I got so much out of Tom Reilly’s “Value-Added Selling” general session. I even had the chance to attend his breakout workshop, which he ran along with MHEDA Member Cary Roulet, VP/GM of Holt of California (Sacramento, CA), and picked up a few useful tidbits.

The official workshop title was “Crushing Price Objections,” and basically it featured tips and strategies for dealing with a customer who says “Your price is too high.” There was a list of about 16 different statements that salespeople hear from customers talking about price. One of Reilly’s biggest points was that most price objections aren’t really about price, they’re about the customer’s expectations. For instance, when a customer hears a price that he deems “too high,” he is probably not considering all the added value that comes with the product. He expects to hear a number that is close to what he has determined he is willing to pay, and if it is different, the natural response is to say, “Your price is too high.” The real problem, according to Reilly, is not necessarily with your prices but with what the customer is expecting.

I’m probably not explaining this very well since it’s not a situation that I run into every day. But it home when he said, “Money is a better conversation to have with customers than price.” I kind of considered them to be the same thing, bu they’re not.

Money is a bigger, long-term issue. Price is what you pay one time, a short term concept. Money is the total amount you spend, whcih includes the sales price, the service costs, warranty costs, etc. That, Reilly says, is how distributors can add value and drive profitabilty. The total cost of what distributors provide is really what matters. When explained well by your salespeople, no customer can argue with that. You’ll never hear, “Your value is too high.”

It goes to show that you never know what you’re going to pick up at a MHEDA Convention. Sometimes you find nuggets even when you’re not really expecting to.

Today was a long day. Breakfast was at 7:00 a.m. It’s now 11:00 p.m., and I’ve been “on” all day. I will say, though, that I came out of the seminars and workshops with a boatload of interesting blog topics. Stay tuned here for the next few days so that I can catch up on most of them.

Right now, after a 16-hour day, I’m a little tired and not sure how much sense I’ll be making. So let me just retire tonight with a few quick bullet points before hitting a more in-depth topic tomorrow:

• Major props to Edward Fanning of Wells Fargo Financial, who plays a wicked harmonica.
• I was very impressed with the improv comedy performance of Laughing Stock at the closing party, who took the time to learn some material handling terminology (Maybe they used wikiMHEDA?) to pepper throughout their performance.
• Speaking of, the MHEDA Board “volunteers” were exceptional. Like they said, “They were making it up as they go along, like you all do every day.” Your improv skills were great.
• The Internet search tools shared by Sam Richter were awesome. I was scared to think about what might be out there on me in the “invisible Web.” Luckily, I didn’t have to find out in front of a crowd, like some Board members did.
• Interesting discussion from my fellow lunch table folk, about Internet security issues. Sam Richter definitely gave us all a lot to think about.
• Even though I’m not in sales, I found Tom Reilly’s general session and workshop extremely interesting. Value-added selling always seemed to be one of those nebulous concepts, like “better service,” but he and Cary Roulet provided real, practical examples.
• Finally, kudos once again to the MHEDA staff and board, who produced one of the best Conventions I’ve been a part of. It flew by, but I learned a lot. After 7 years of coming here, that’s notnecessarily easy to do.
• To all the new faces in the crowd, thanks for coming. New perspectives are one of the reasons that I was able to learn so much.
• Thanks to everyone who was willing to participate in the MHEDA Convention Connection, whether in videos, quotes or photos. We couldn’t produce what we do without you. Great job by everyone.

And with that, it’s off to bed. Stay classy, MHEDA.

This afternoon, I participated in a Roundtable Discussion. The topic was Manufacturer-Distributor Relations for Industrial Trucks. The group was composed of two lift truck distributors and four manufacturers of forklifts and forklift parts.

It was a lively discussion. I found the most interesting parts to be about the change in mindset of end-user customers. Both distributors indicated that price has become the number one concern of end-users, when as recently as two years ago, quality or availability were ahead of price in the why-I-want-to-buy-your-product scale. In a down economy, low price trumps all. While the viability of that strategy can be debated at another time, my point revolves around what that mentality has meant for where distributors get their parts.

Often, a forklift OEM buys its parts from a third-party provider, and the OEM sells the part to the distributor. By the time the distributor sells that part to the customer, it’ goes through three markups, meaning a higher price for the end-user. This forces the distributor to make a decision in order to satisfy his customer. Remain loyal to the OEM, or find a separate source for those parts.

In today’s environment, the decision is increasingly becoming option B, and that often means heading to the source where the OEM gets the part in the first place. Obviously, this can cause some consternation for the OEM, who, like a distributor, makes much of its profit on parts. But as long a customer knows that a distributor can get a part cheaper somewhere else, he’ll demand it be done that way. It’s up to the distributor to either work out a better arrangement with his manufacturer, lose a customer or anger its supplier. Not a great set of options. What do you think? What’s the best course of action?

After an outdoor breakfast, attendees at MHEDA’s 55^th Annual Convention & Exhibitors’ Showcase filed back into the Palms Ballroom for the opening business meeting. 2010 MHEDA President Greg Morrison gave an update on the association’s financials, saying, “MHEDA was able to finish 2009 in the black thanks to sound financial management, avoiding a hefty hotel room penalty and a tight budget.” Morrison then presented last year’s president, Duncan Murphy, with the traditional Past President’s green jacket. Murphy took the mike and gave a challenge to the members for everyone in attendance to recruit one new member in 2010.

Dr. Lowell Catlett, an economist, gave a humorous twist to the current economic situation, basically saying that we’ve had 14 recessions in the past 80 years, and the U.S. GDP continues to rise every time, so we need to have confidence that it will do the same this time. His message resonated with several members, who were glad to have a positive outlook, without being sugar-coated. It was sound advice.

His outlook was echoed later in the day by Michael Marks, who predicted a quick recovery for the material handling industry and outlined ways for business executives to do business differently. “Success in this economy is about doing new things, not doing the same things better,” he said. I thought that was a very succinct way to say what The MHEDA Journal has been trying to say all quarter: The Rules Have Changed, and material handling distributors (and suppliers) must adapt.

In between was the always popular Exhibitors’ Showcase. A lot of new faces, particularly new exhibiting companies, made for a great opportunity for networking. See tomorrow’s MHEDA Convention Connection for comments from attendees.

Finally, wanted to give two quick shout-outs. First, to Barbara Morrison, the first lady of MEHDA, who turned 50 today. Happy birthday! Second, to the students and faculty – Dr. Malini, Chase Ubernosky and Carl Gerken – from Texas A&M, who unlike in past years when MHEDA paid their way to Convention, paid their own way because of the value they received from the experience in previous years. Nice to meet you and I hope you found value once again!

Check back later for a more in-depth update.