Too often the service department of a material handling distributorship is regarded as a cost center. To many in the forklift industry, a service department exists solely to support the sales department. To some, the service department is indeed regarded as a loss leader.
Growing up, Jack Balint, founder and president of Balint/Ryder Handling Equipment, helped out in his family’s forklift repair business. Later, when his father’s business was acquired by the local Clark dealer, he worked in both service and in sales at the new dealership.
In 1968, when Balint ventured out on his own, he planned to focus his energies on general lines. Thirty-four years ago he saw a window of opportunity. He believed that a distributor’s sales of new equipment could be directly tied to the success of a distributor’s service operation. According to Balint, at that time many distributors regarded the service department as a loss leader. “The service department existed because the distributor had to have a service department. There was little emphasis on building a top-notch service department by investing in mechanics, equipment and training. There was also friction between the sales and service departments.” As a salesperson, Balint realized that when running up against a competitor, a supportive service department was his ace in the hole.
Two Companies Are Born
Balint’s solution was simple: by operating two separate companies, each mutually supporting the other’s success, both would flourish. Balint/ Ryder Handling Equipment, established in 1968, counts its relationship with BT Equipment Service as a major asset in its ability to serve its customers. BT Equipment Service personnel look forward to providing its number one customer, Balint/Ryder Handling Equipment, with the best service money can buy.
These two corporations were strengthened and perfected over a period of time, and the success today of Balint/Ryder Handling Equipment is a direct reflection of this novel concept devised by Balint. Today a total of 34 employees work for the combined companies. Balint/Ryder Handling Equipment employs seven salespeople; BT Equipment Service employs 25 people.
“Sales and service complement each other,” says Balint. “It is after the sale when our customers need us the most.” Over the years, Balint/Ryder salespeople have learned to appreciate the fact that the company’s reputation for customer support is usually a deciding factor in winning the sale. Balint/Ryder customers have come to appreciate the value of a capable service technician who responds quickly and efficiently, every time.
Affiliated Companies Function Seamlessly
While the companies remain headquartered in South Bend, Indiana, both operations maintain a sizable presence in Goshen, Indiana. There the companies occupy two buildings totaling almost 32,000 square feet on an 8 acre plot. In South Bend and in Goshen, both companies work seamlessly, side by side, to provide sales and service to a large base of customers. Says Balint, “We function as though we were one company, but each invoices the other for product and service. A visitor to our shop would not necessarily realize that there were two separate, affiliated companies working side by side.” A third location in LaPorte, Indiana operates as a sales office.
While turmoil between a sales and service department can have negative impact on the customer, when each affiliated company is trying to do its best for their customer, the end-user reaps the rewards. In this family of affiliated companies, that turmoil is eliminated and the customer is the major beneficiary. In short, it’s a win-win situation for everyone.
Investment in Service Pays Off
In order to stay ahead of the pack and maintain service levels that continually outperform industry averages, the two companies have had to consistently push the envelope by thinking outside of the box. Their innovation has helped both companies to lead the way in service and in sales.
One such innovation is the response to the pressures created by increased transportation costs. A few years ago, in the midst of a fuel crisis and a push to control transportation costs, many distributors began replacing the traditional “bread truck” with Econo vans. While cheaper to operate, their size eliminated much of the inventory that could be carried on routine service calls. Too often, a part would have to be sent for or delivered the following day. Disregarding the logic of decreased transportation costs, BT Equipment Service continued to use the traditional bread truck, focusing efforts on maintaining its inventory in its “service shop on wheels” and maintaining an average response time of 3.5 hours.
During the early 1990s, BT Equipment Service began acquiring diesel-powered Dodge Dualies, a large pickup truck with two rear wheels on both sides. These Dualies were equipped with a fifth wheel and a 22-foot trailer that is even larger than the old “bread van” type of service truck. Even with increased capacity, operational costs were reduced. Best of all, the mechanics’ ability to perform onsite service was not compromised. In fact, the trucks are in some ways similar to a mobile service department. Each truck is equipped with forced air heating, providing the mechanic with a comfortable place to work even when the temperature is below zero and the end-user has no available space for him to perform the service work.
Today, eleven trucks are equipped with a heavy-duty work bench. Each truck carries a minimum of $30,000 in inventory. The trucks are equipped with the tools, parts and supplies needed to service and maintain all lines. Balint, a Linde Baker dealer, says, “Linde Baker accounts for 35% of our service business.” The fleet of service trucks is further supported by several van-type trucks and step vans.
Still, a service truck capable of carrying the parts and tools needed to service all lines is not enough. Mechanics continually receive training in order to meet the service requirements associated with a population of lift trucks that varies not only in age but by brand. BT Equipment Service’s 15 mechanics have worked for the company for an average of 13 years. According to Balint, “Three of our mechanics are capable of handling any and all challenges whether it involves electronics or diesels. Each of the other mechanics has completed years of lift truck service training and is capable of servicing all lines of equipment.”
All preventative maintenance work is performed by fully trained mechanics. The reason is simple: it’s best for the customer. For example, when a unique allen screw is missing from the back of a fork bar, the average service technician’s response is to search for a replacement in what Balint calls the “five-gallon bucket of hardware.” He says, “At $70 an hour, this search becomes an unwarranted expense for the customer, and if the $0.35 bolt is not in the bucket, the mechanic has to go get it and return.”
Balint’s service technicians, however, are not average. The mechanic can literally go to his truck, pull open a drawer and locate the required bolt. Each time a part is listed on a work order as sold, it is replenished from BT Equipment Service’s warehouse, assuring future customers of the level of service they have all come to expect.
When asked why service trucks are not routinely outfitted with a minimum of $30,000 in parts and tools, Balint notes, “It’s expensive. We have invested in BT Service over a period of many years. The total cost of each truck, including the inventory, the truck itself, and the costs associated with training totals in the neighborhood of $80,000-$90,000. We did not see a true return on our investment until we had been in business for 12 or 13 years.”
Specialists in Service and Sales
Within BT Service Equipment and Balint/Ryder Handling Equipment are several departments that function as independent stand alone mini-companies in their own right. Each is monitored and expected to perform profitably. Each group is supported with totally independent accounting systems and checkbooks in order to best monitor their performance and profitability. Balint says, “We don’t just throw them together and hope for the best.”
Within BT Equipment Service, two departments operate as special teams. The Battery Chargers Systems Group sells and services batteries and chargers. They also sell batteries to Balint/Ryder, admittedly at a less than list price. Still, BT Equipment Service generates a profit from its sales to its largest customer, Balint/Ryder. Balint/Ryder also benefits when BT Service continues to service the battery and charger products.
Another department specializes in the repair and servicing of loading dock equipment. That group also has a strong relationship with the Balint/Ryder sales personnel who just happen to sell dock levelers and other related equipment.
Within Balint/Ryder, the Allied Lines Division and the Lift Truck specialists each focus on their own niche products. The Climate Adjuster Group manufactures loading dock seals.
A rental fleet, numbering 100 pieces of equipment, is owned by Balint/Ryder Handling Equipment and is serviced and maintained by BT Equipment Service. Balint says, “The size of our rental fleet has positioned Balint/Ryder as one of BT’s largest customers who guarantee the rental customer a product that has been serviced and is ready for use.”
Like most distributors, Balint takes advantage of the training offered by various manufacturers. His service personnel also benefit from the training provided by key personnel. In fact, according to Balint, when his key personnel attend factory schools, they contribute as much knowledge as they walk away with.
Salespeople are also provided with intense training. Most recently, a mix of six experienced veterans and newer employees took advantage of MHEDA’s Sales Boot Camp. Says Balint, “They attended the two levels last year and I am still receiving feedback and reaping the benefits of the knowledge they acquired. Sending them to Boot Camp was expensive, but well worth the cost. They continue to use the classroom materials that were distributed by the facilitator. The Boot Camp graduates are more organized and focused.”
Investing in the Future
Balint admits that this past year has been more challenging than most. Fortunately, he can tap into the experience and wisdom of the past three decades. And he’s taking some important lessons learned from the past, into the future. One key lesson is never to underestimate the value of investing in his companies’ futures. In an environment of cutbacks and layoffs, Balint has hired two additional salespeople. “I am investing in our personnel,” he says, “When the economy does break, we must be staffed appropriately in order to meet the needs of our existing and prospective customers. We must be ready to serve our customers when they need us.”
Being ready, with out-of-the box ideas, will take Balint/Ryder Handling Equipment and its affiliated service company, BT Equipment Service well into the future.