Above: TMHA Branch Operations South, Hamish Harper, TMHA President & CEO Steve Takacs, South Australian Government Treasurer the Hon Rob Lucas MLC, TMHA Chairman Toshi Nakazawa (L-R).
Despite a materials handling market that is largely static, Toyota Materials Handling Australia has just closed its most successful year in its 50-year history. MHD editor Charles Pauka spoke with TMHA President & CEO Steve Takacs to find out the secrets behind the success.
In the current challenging economic environment, consumer spending is tight, business investment is restricted, and infrastructure spending – apart from a few over-publicised projects – is also being largely held back. The conditions are in fact perfect for a recession, and anyone in the trade of supplying high-value machinery for businesses could be forgiven for wanting to adopt a ‘batten down the hatches’ approach.
But not over at Toyota Material Handling Australia (TMHA). The company is reaching the peak of its multi-faceted investment program in its three key support areas: people, places and products.
People come first
For a company operating in an industry that is so focused on advanced technology and product specialisation, it is interesting to observe Steve Takacs’s strong focus on people.
Earlier this year, TMHA recruited a record 14 young people in its annual apprentice intake. They joined the several hundred existing service personnel around the country and can look forward to a career of planned progression, with extensive training and advancement opportunities.
The company’s program is underpinned by its step training. The program has three defined steps in the program, resulting in qualification as a Master Technician. Beyond the step program, TMHA invests in specialised training to support its ever-growing range of products.
Training is conducted with both practical and theoretical components. The company has three full-time trainers, who are devoted to ensuring the technicians are trained across the portfolio of products TMHA offers.
“Last year as an example, we invested so heavily that we conducted face-to-face classroom and practical training courses with over 400 technicians represented,” Mr Takacs said. “We brought people in from all over the country and conducted classroom training. We’ve invested in the infrastructure as well: we have three training rooms and three theory areas.”
Service technicians are encouraged through the annual, and very popular, skills contest to test their skills against their colleagues. Recognising the specialisation of machines, there was a service person of the year crowned for electrical and internal combustion (IC) powerplants each, as well as one recognised for overall excellence: the ‘Master Technician of the Year’, who won a trip to the factory in Japan.
“Ultimately, you can sell your product but if you don’t have great service support, you can quickly gain a poor reputation,” Mr Takacs said. “So it’s something we’re really pleased with that we have the opportunity of investing in service and training as heavily as we do.”
Of course, service excellence is not only recognised through the skills contest, but advancement opportunities as well. There’s a path for technicians to progress through the ranks and then on to management – in fact, that is the path Mr Takacs took himself.
“That’s how I started,” Mr Takacs said. “I started as a technician and I moved into sales. When you get a technician who moves into sales, he or she brings a lot of credibility to the sales process and understands what you’re talking about and how things work. That brings a real practical aspect to the sale, and people want that practical aspect. They don’t want fluff, they want a direct answer as such. The salesman bullshit, so to speak, just doesn’t cut it in today’s informed market place.
“Whenever we have an open vacancy, we look within first– this typically applies to all positions within TMHA. Three quarters or more of our senior management team at TMHA started with a spanner in the hand. And the management team takes great pride in saying that all of these guys and girls started with a spanner in the hand.”
Places: you don’t have to go far for support
Another big part of the ongoing investment program put in place by Steve Takacs and his team at TMHA is real estate, the places they do business. In addition to continuously improving and often enlarging existing branches with special attention to service and maintenance areas, the company has an ongoing policy of opening new branches in regional areas (see panel). And they are 100% company owned.
“We’ve also commenced securing land, building and owning our own purpose-built facilities, particularly in the major capital cities,” Mr Takacs said. “So we purchased the land and we built ourselves, we actually 100% own the building as well. We started with Adelaide, next will be Melbourne and we will continue to migrate and invest in Australia as current facility leases expire.
“We don’t have dealers. We don’t contract core competency work out. We have 100% captive business. All of our employees are direct employees and all of our branches are captive. And by that I mean, 100% owned.
“I guess that’s an indication of our stability and our long-term commitment to doing business in Australia.”
Products: technology, innovation and support
There is an extensive range of material handling equipment bearing the Toyota name. You’d have to have a really special need not to find a suitable machine in the current line-up, and there is a program of continuous expansion in the type of machines carried by TMHA (see panel).
An even more important part of the Toyota Material Handling philosophy is the continuous improvement of, and support behind, existing products.
On the very day I visited, a group of Japanese engineers were at the TMHA HQ. The factory has an ongoing consultation process by the way of a periodic questionnaire that is put forward by the factory to source data and comments on how it can improve – the Japanese refer to it as Kaizen, continuous improvements.
“We’ve put forward several suggestions to the Japanese on different types of machines,” Mr Takacs said. “But we felt that there was one model in particular, where there was an opportunity for improvement in that machine. So the Japanese dispatched a team over here and they’re working with our technical people today and going over exactly what we want.
“And not only are they working with our technical team, they take the time to go out in the field, meet the customers at the coalface, not just the guy that signs the purchase order.
“They will go to the forklift operator and spend time with them and talk about the truck and what can be improved and how to do it. And to make sure they are heading in the right direction, because once the change is made, it’s made.
“So yes, we have a large input into product development and that is something that pleases us, having that input.”
Success is sweet
“At TMHA, we’re in an enviable position where the dedication of our people and the strategies associated with buying the supply chain back over the period 2001 to 2007 is paying dividends for us,” Mr Takacs said. “It didn’t just happen overnight, we are truly blessed – the loyalty, dedication and devotion of our people has ensured our sustainable success.
“There’s a hive of activity around the business. And as we continue to grow, it just gets bigger and bigger and bigger. Whether it’s training, growing our service team numbers or testing potential new products, there’s an air of optimism around the place l haven’t seen in my 35-odd years in the industry.
“The especially pleasing thing is that we retain our customers. So we are satisfying the customers that we’ve got, and on top of that a good part of our sales is conquest business. So we’re dealing with segments and customers that we haven’t dealt with before. Recently we signed a customer that was maybe a 30-year customer with somebody else. And they had 400-odd trucks out in the in the field!”
And what has been the winning factor behind the successes?
“What customers won’t tolerate is no support on safety, no support from back-end services such as engineering and service, and so on,” Mr Takacs said. “So that’s where we’ve put our infrastructure over the last, I guess, 10 years.
“I have been with the Toyota business now for 13 years, and we’ve really focused on stability and making sure that the back-end of the business is able to deliver what the salesman at the front-end of the business is offering.
“Another thing that’s been very good for us as well is the stability in the business. People who have dealt with Toyota are basically speaking to the same person to whom they spoke ten years ago: we don’t have churn. We’ve got a very stable business – we are a type of company that faces outwards towards our customers, but equally just as much we face inwards towards our people, because we have great people. We really put a huge effort into making sure that our staff are happy, healthy, and looked after.”
For more information call 1800 425 438 or visit www.toyotamaterialhandling.com.au.
Support is just around the corner
In addition to enlarging and improving existing branches and service centres, TMHA has a continuous program in place to build and open new city and regional branches.
For example in Adelaide, the ongoing growth of the branch encouraged it to recently move from its former site to a brand-new 12,000m2 facility in Gepps Cross, South Australia.
The state-of-the art facility was opened in May and follows a significant increase in market share. TMHA general manager – Branch Operations South Hamish Harper said: “We’ve gone from a mid-twenties market share ten years ago to our present market share, which is in the forties, so inevitably we required infrastructure to match increased demand.
“There were constraints on the volume we could put through our workshop before and we now have vastly increased resources to meet growth in equipment sales and our rental and servicing requirements.
“Our new state-of-the-art 5,000m2 workshop area, accompanied by another 6,000m2 of hard-stand area for loading and unloading, is impressive – especially given it’s three times the size of our old workshop. That’s a huge difference for us. It gives us the ability to service over 4,000 forklifts that we have under service and rental.”
And in the NSW regional town of Orange, above-average market share, organic growth and a need for more site-control have been key drivers for a purpose built, brand-new state-of-the art facility.
TMHA Orange branch manager Richard Bopping said the new premises is an improvement for staff and customers in every way.
“There is now a one-way flow through the workshop, for vehicles and equipment being processed such as for servicing or pre-delivery for new units. There’s also a closed-off area with no access for customers or contractors and designated delivery set-down and pick-up areas, which are isolated to be much safer.”
“Our core business is our forklift rental fleet, which is over 200 units-strong and is serviced out of the branch. We have more than double that, again, with retail customers that we service and provide parts and repairs for.”
A product range that just keeps expanding
On the product front, TMHA recently became the distributor for Taylor-Dunn vehicles and a total range of sweepers and scrubbers, as well as showcasing and releasing for sale in Australia the automated Toyota BT RAE160 reach forklift.
TMHA has become the national distributor for Taylor-Dunn transport and material handling equipment after recently entering into an agreement with Taylor-Dunn’s US-based parent company, Polaris Industries.
The agreement will bring a great deal of confidence to existing and prospective Taylor-Dunn customers in Australia, with the entire range of Taylor-Dunn products to be available via TMHA’s national branch network.
TMHA has also added industrial sweepers and scrubbers to its product range. These easy-to-use and highly manoeuvrable battery electric and internal combustion floor sweepers/ scrubbers are ideal for use in warehouses, logistics and distribution centres and most industrial applications where a dust-free environment is essential.
The new Australian distribution agreement gives the sweeper range the product-support and back-up of TMHA’s 17-branch national network and huge mobile service fleet.
TMHA also debuted the automated Toyota BT RAE160 reach forklift at the recent Auspack, and it is now for sale in Australia. The autonomous (driverless) 1.6-tonne capacity reach forklift features a 10-metre mast and is also available in 2- and 2.5-tonne capacity models.
The forklift integrates with warehouse management systems to operate according to a customer’s unique requirements. It uses a laser-based navigation system and complex range of sensors to safely and accurately handle materials, automatically.
The RAE range of autonomous material handling equipment is designed and manufactured by Toyota Material Handling Europe, with programming and installation performed locally by TMHA engineers.
The demonstrator Toyota BT RAE160 reach forklift showcased at Auspack is fitted with optional 3D cameras to further enhance its load detection and rack detection capabilities – presently the only such product in Australia.