Category Archives: Sales

Industry Scuttlebutt

Hydromat of St. Louis is suffering through a soft spell and has let about 35 people go from its peak employment. But a sign of the times is a fresh notice on the company’s Web site looking for new people.

They need a design engineer, a draftsman and an electrical control integrator.
I also heard through the grapevine that Bruno Schmitter, the head of the company, would like to buy a couple of CNC lathes to make more components in-house.
There is a strong rumor that Pfiffner in Switzerland has a severe cash flow problem and that company founder, Mr. Pfiffner, has infused the firm with a sizable sum of personal cash.

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Tad Yamamoto has been named CEO of Okuma America. He spent 1994 to 2002 in the U.S., then went back to Japan for six years and then spent a year getting reacclimated to the American company. This is not an unusual career path for a top executive of a Japanese multinational company.
By moving back and forth between Japan and the U.S. a Japanese executive keeps his ties and credibility strong in both places. The home Japanese execs keep their confidence that the man still shares the parent company values and the Americans believe that he knows the territory. Larry Schwartz continues as President and COO of Okuma America.

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The glutted screw machine market is going to get even more saturated in September. Niagara Machine Products in St. Catherine’s, Ontario, is being auctioned off by Glenn Gray’s Premier Asset Recovery Group September 16th and 17th. There are 50 multi-spindles including an MS32-C Index and (2) 8 spindle Euroturns to go with 40 Acmes and 60 centerless grinders.
This sale will be followed a week later by a DoveBid sale in Athens, Alabama, with 25 more 8 spindle Acmes and Conomatics.

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Chad Arthur, whose Arthur Machinery was the most dynamic dealer in machine tools in Illinois until his company spiraled into bankruptcy, has resurfaced as exclusive distributor for DMG in Illinois. Chad’s company, CDA Machinery, is based in Elk Grove Village Ill., as was Arthur Machinery. I think this is a good move for DMG because they needed a surge of energy, and few people in the business have more energy than ex-hockey player Chad Arthur when he is truly engaged.

Question:

Which machine tool builder from your experience has the best service?

And, which is more important for customer service, the builder or the distributor? (You can also comment at www.shopdoc.com)

Tad Yamamoto

Tad Yamamoto

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Motivating Employees

Daniel Amos, the head of Aflac, the remarkably successful medical insurance firm, was interviewed in the New York Times on Sunday. His remarks on leadership and motivation are intriguing. He treats employees like voters and challenges his sales staff not with overt quotas but by telling his people he wants them to make a particular figure. For instance when he used to be a sales manager he would say to an employee, “I want you to make $60,000.” He recounts that employees couldn’t say, “No, I really don’t want to make that much.” He says they didn’t know how to argue with him when he said, “I want you to make more money.”

Link to full article: New York Times

Question: Do you think it’s advisable to treat employees as if they were voters?

Dan Amos

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Inside the Swiss Screw Machine Industry

Paul Huber of Comex comments on the recent Bosch auction in which 75 Escomatics were sold by Asset Sales Corporation. Paul came to the U.S. as a Tornos service engineer and is now the wise man of the Swiss screw machine industry.

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Thank God for Guns and Ammo!

By Lloyd Graff   

With the machining community so riddled with woe at the moment, the guns and ammo boomlet is manna from heaven.
    It’s a great time to be in the gun business. The buzz on the Web is that Barack Obama is going to push for a ban on assault riffles, something households need more than refrigerators.
    Evidently, Obama’s campaign reference, that “bitter” small-town Americans “cling to guns or religion,” has fueled a tremendous surge in gun and ammo sales. People are buying AR-15s, the civilian version of the M-16 military rifle, like 42” HD televisions. At $1000 a pop (sorry) they are pumping out of the gun shops and gun shows. Wal-Mart is struggling to keep ammunition in stock because the NRA is implying that a big tax will soon be coming on each ammo box.
    The high profile mass murders in Binghamton, N.Y. and Pittsburg are reinforcing a sense of insecurity, even panic, while right wing commentators foment unease as the economy slides.
    But the gun run is a great boon to the Swiss CNC business as manufacturers rush to cash in on the gun bubble. While hunting rifles are currently dead, hand guns are the new Rolexes as folks look to show off their fancy shooting hardware.
    It is still quite doubtful that Obama is going to risk his political capital in a quixotic joust with the gun lobbies. But the power of fear, for the moment, trumps rationality.

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New Credit Game for Industrial Equipment

By Lloyd Graff

I think we got an important signal Tuesday when Bank of America decided not to raise credit lines for McDonalds franchisees to buy new equipment such as coffee machines. They’re keeping credit lines as they are – that doesn’t mean they’re cutting them, it just means they’re not raising them as a general policy. This is important because it shows that the Wall Street mess is starting to filter down to the lending habits of major banks.

I think this is going to affect industrial equipment purchases because it affects the money available to borrow. It’s going to mean that distributors and machine tool builders are going to have to become more resourceful in enabling their customers to buy new and used equipment. A Haas or an Okuma is going to have to be more involved in the financing issues of their customers, using their clout with lenders to find money for them. They will probably be paying more for the money than in the past, but I think this is part of what the FED is all about in providing ample liquidity in the system. The sources for the money may not be the traditional ones that people have used in the past. There will be leasing money, off-shore money and bank money available, but the banks will probably be lenders who fall to the sidelines, because the more resourceful and nimble lenders will probably be the ones to step in.

Question: Have you had a problem in buying equipment recently?

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Rick Simons Back at Hardinge

Hardinge Inc. has made a significant change in management bringing in Rick Simons as CEO, a veteran of the company who had left to go to Carpenter Technology
Corporation
for three years before coming back ultimately to replace Pat Ervin.

Hardinge stock has been on a long plunge over the last year. Simons appears to be a popular change from the old regime. Under Ervin, Hardinge focused on developing its worldwide business and had acquired prestigious Swiss brands like Kellenberger and Tschudin, but the North American machine tool business had decayed from the Haas onslaught on the less expensive end of the market and Japanese and Korean builders on the upscale side.

The Hardinge machine tool brand has been lost in the blizzard of brands and marketing. Simons has the advantage of knowing the cast of players in Elmira N.Y. and the insight from spending three years in Hardinge exile.

Since Simons has taken the reins, the stock has bounced like a yoyo, hitting a low of $11 and then quickly jumping up to $17. Could this indicate interest by an acquirer? With the cheap dollar, you never know.

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Stimulus Plan for Manufacturing

The stimulus package for business will be kicking in this fall in a big way as companies and individuals figure out if they are making money for the year, and make the calculation that if Uncle Sam is giving money away they might as well catch it in their basket. The doubling of the expensing provision to $250,000 means that a small business could buy a couple of A-20 Citizens and get a fat $75,000 discount thanks to Uncle.

This could be a rollicking fourth quarter for machine tool builders if they position themselves with appropriate financing packages for buyers who know a good thing when they see it.

Permac (video below), a PMPA member from Burnsville, Minnesota, is one firm that is taking advantage of the Bush Stimulus.

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Auction of the week: Allen-Bradley Aftermath

Allen-Bradley’s auction online on July 10 (see auction of the week: June 25), was a good example of the axiom that if the buyers are disinterested in a machine they will ignore it at almost any price, but if it’s something hard to find, the bidders will extend themselves even in a stinko market.

The multi spindle National Acmes, though they were in nice shape and well equipped, virtually died. The 1” RAN6 machines with threading and pickoff brought from $2,500 to $6,500 plus a 16 percent buyer’s fee. The 7/16” RA6, went begging, most not even reaching the $1,000 reserve price except one that fetched $6,300.

The exception on the Acmes were the two 3/4” RA8 machines. Eight spindles are still in demand and the 3/4” is rare on the market. The machines were nicely equipped with threading and pickoff. One machine had been in a crack-up recently and had a bent spindle. It brought $31,000 plus the 16 percent buyer’s fee. Another one hit $42,000.

When you hat you hot, when you not you not. Amen.

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A Gas Guzzler May Save You Money

A Gas Guzzler May Save You Money

With ridiculous gas prices sweeping across the U.S., it might seem intuitive for a car buyer to look for something fuel efficient like a Smart Car, Prius, or Honda Civic. But with dealers struggling to get rid of trucks and SUVs (domestic brands in particular) some unprecedented deals for gas guzzlers are appearing which may actually make sense for buyers to jump on.

Manufacturers are offering between $2,000 and $5,000 in discounts on once popular models like the Ford Explorer and Chevrolet Suburban, and dealers say there’s room for negotiation after that. Used SUVs and trucks often have even greater discounts, with some selling at roughly one-third the price they would have fetched new four years ago.

Among the better bargains are Ford’s SUVs, the Expedition and the Explorer. An Expedition with four-wheel drive has a sticker price of about $35,000, but in many areas, consumers can get one for $30,000 after discounts and negotiations. The all-wheel-drive Explorer with V-8 engine lists for about $31,000, but can be had for $25,000.

These deals only make sense if your driving routine is local or you simply want a truck or SUV. If you only drive five or 10 miles a day it will take years for even $4.00 gas to surpass the value of many discounts, and by that time your lease may have ended.

Source: Wall Street Journal

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Pringles Can — The Key to Success

Fredric Baur, the man who invented the tubular can that packages Pringles potato chips, died May 4, 2008, at the age of 89. Yesterday it was announced that he has had some of his ashes put into a Pringles can which was put into his coffin.

Baur was an organic chemist and food storage technician who specialized in research and development and quality control for Cincinnati-based Procter & Gamble Co. A patent for the can was granted in 1970, according to P&G archivist Ed Rider.

Pringles have always been my favorite potato chips. I’ve always felt their flavoring was superior to other chips – from the Original Salted, to Sour Cream and Onion, to Cheez Ums. But I know what attracted me to them originally was their unique presentation, not only the can, which seemed so classy compared to regular potato chip bags, but the uniformity and aesthetics of the chips.

Pringles are the ultimate combination of quality, presentation, and branding. Those are the keys to success when producing and selling any product which can seem generic and commoditized, whether it be a food, computer, or machined part. In the world’s capitalist economy fueled by consumer choice, the only way to succeed in business is to use Procter & Gamble’s Pringles model. Yes – price also plays a huge part in competition, but the companies which truly dominate the world always strive for excellence – to produce their own Pringles.

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