How MH Equipment Company came back from the brink of bankruptcy to one of the industry’s most successful companies
By Steve Guglielmo
MH Equipment Company (Peoria, IL) is one of the largest and most successful distributors in the Material Handling industry today. With more than 900 employees, 500 technicians and 31 facilities, the company is one of the fastest growing distributors in the country. That’s a far cry from 25 years ago, when the company was on the brink of bankruptcy.
MH Equipment was founded in 1952 by Clarrie Houston. After 20 years, it was purchased by Bob Black. In 1994, the company was purchased by its current ownership.
“In 1994, MH was virtually bankrupt,” says John Wieland, CEO of MH Equipment. “It was then that Hyster decided to make a change. It was going to require a large investment on their part to make this happen. I just happened to be in the right place at the right time.”
Hyster appointed Wieland as Dealer Principal in 1994, a move which he says required great faith on the part of the manufacturer.
“Hyster was taking a huge leap of faith, as I was 35 years old, had never run a business and had zero mechanical skills,” Wieland says.
It’s a leap of faith that has paid off in spades, as the company’s footprint now covers the territory that 11 independent dealers covered 25 years ago. A focus on culture has been a hallmark of the company over the past 25 years, as Wieland’s tenure as CEO has been marked by passion to enable employees to grow, serving the customer with excellence and investing in the community.
“We are a culture driven company and have focused on being good stewards of what our customers entrust us with,” Wieland says. “Hyster/ Yale Group (HYG) has encouraged our growth over the years. We have always tried to be opportunistic, flexible, and adaptable to opportunities as they come our way. But, at the end of the day, we are recipients of luck, or God’s Grace, whichever way you want to look at it. Our success is far above my pay grade, so staying grateful has been pretty easy to do.”
When Wieland took the reins in 1994, MH Equipment had 50 employees. He established an outside board that helped tremendously. Currently, there are a dozen people on the executive team that are part of the ownership group of the company.
“Our vision is to be regarded as an employer of choice, a trustworthy partner and an ethical market leader in our communities by providing our customers with innovative solutions and unparalleled value,” says Wieland. “Our mission is to deliver exceptional service while honoring our vision and believing that ‘People Matter, Passion Inspires and our Purpose Unites Us.’”
In addition to his role as CEO, Wieland considers his primary job to be the Chief Culture Agent.
“There is a natural truth that birds of a feather flock together. Our leadership team and most of our employees really do embrace our values and culture,” says Wieland.
Every other year, MH conducts an employee survey. And each year that the survey is conducted, the questions relating to company culture always receive the highest scores. Questions like, “Employees are treated without discrimination, regardless of gender, race, ethnic background, age, religion, disability or sexual orientation,” “I support the company’s belief that we need to invest in our communities to make them better,” and, “I never feel pressured here to do things that are unethical or dishonest.”
“Stewardship is a key word for culture,” Wieland notes. “Stewardship is the careful and responsible management of something entrusted to your care. This means that our decisions have to be in the best interest for our customer, even if this decision may cost us significant profit. We believe in the long run, our customers will stay with us for a long time as they see us making recommendations that extract costs from their spending.”
One example of this was working with a customer in Iowa. Says Wieland, “We had a company who was renting more than 100 trucks from us. We kept telling them, ‘There is a better way. You’re spending way too much money. Let’s convert this to a fair market value lease with guaranteed maintenance.’ They finally agreed to do that and that decision cost the Des Moines branch $250,000 of net income on an annual basis. But we are going to make the decisions that are in the best interest of our customers, not in our best interests. And that was 12 years ago and to this day they’re a very loyal customer because they trust us and they know that we’re going to be concerned about being a good steward of their resources.”
And while every company has some sort of mission, vision, values statement, it’s one thing for those words to be on paper, but another to actually live those each and every day. MH Equipment walks the walk.
“A few years ago, we did a strategic planning exercise with GE and Wells Fargo consultants that was sponsored by HYG,” Wieland says. “At the end of the retreat, the consultant who had been in the business for more than 40 years said that she had never seen a company whose actual business practice was so closely aligned to their vision, mission and values.”
One of those values that is a core tenet of the company is their commitment to community service. “The other thing that is unique about our company is our commitment to our communities,” says Wieland. “Back in 2001, our leadership group agreed to start a foundation. The foundation is called His First Foundation and we commit 10% of our net income (actual or budget, whichever is greater) to this Foundation.”
The His First Foundation supports faith-based organizations whose mission is to share the love of Jesus Christ and meet the physical needs of people in His name. But Wieland stresses that while the company tries to operate based on Biblical principles, MH Equipment is not a Christian company.
“We want people of all faith or no faith to love MH Equipment,” he says. “We know we have plenty of employees who do not embrace the Christian faith, so we also support secular good works organizations and also simple, ‘Acts of Kindness.’ It was this decision that has probably been our greatest watershed moment.”
While it turned out to be the company’s watershed moment, when the foundation was started in 2001, it was somewhat controversial.
“We had lost $700,000 in the first half of 2001,” says Wieland. “We had just bought two other companies and the economy had turned on us. Everybody who had said I was genius was now saying something else. We thought we could recover that loss in the second half of 2001 and I wanted to start the foundation right then. The executive team at the time cautioned, ‘Well we just lost all of this money.’ I felt convicted though that we needed to start it then. So convicted that I would guarantee that payment, so that if we didn’t make the loss up, I would reimburse the company for the amount we gave to the foundation.”
Not only did company make the money back in the second half of the year, the His First Foundation has become one of the cornerstones that MH Equipment is built on.
As part of the company’s community service efforts, each employee within the company receives eight hours per year of paid time to volunteer at the organization of their choice.
While culture and community service are two of the pillars that have helped build MH into what it is today, they have also been very strategic in their growth over the past 25 years. When Wieland took over the company, it had 50 employees. With the encouragement of its partner, Hyster/Yale Group, the company has grown exponentially since, now employing more than 900 employees with 28 servicing locations across Illinois, Indiana, Iowa, Kentucky, Missouri, Nebraska, South Dakota, Ohio, Pennsylvania and West Virginia.
MH has grown organically and through acquisition and have become a company rich in diversity and vast in geography.
Hyster/Yale Group has encouraged that geographic expansion. The biggest purchase MH ever made was Hyster MidEast, which at the time was owned by HYG. The market that MH covers for HYG has increased 18 times in 25 years and the company’s revenue has increased by close to 50 times. And while many OEM’s are going the factory-owned dealership route, HYG has made the conscious decision to keep distribution independent, as they believe the entrepreneurial spirit best serves the mutual customers.
That expansion has gone beyond acquiring more territory, however. MH has also expanded its product offerings to become more of a turnkey provider within the industry. “The most significant service that we created was the focus and investment in our fleet management software,” Wieland says. “It is fully compatible with most telemetry products. Also the creation of our subsidiary Guardian Fleet Solutions, which is fully committed to managing large fleets across multiple states.”
The company also recently acquired Louisville Switching, a spotter/yard tractor dealership, as well as bringing former MHEDA President Scott Hennie into the company to provide a full array of engineered products offerings. Their latest venture is a Specialty Rental Division for equipment dealers who don’t readily have inventory in their fleet.
“Our customers depend on us to understand what is going on with all the technology in our industry,” says Wieland.
MH Equipment has enjoyed astronomical growth since it was on the brink of bankruptcy 25 years ago. Even as the company has grown and evolved, it has never lost sight of its corporate mission.
“Five years from now, we hope to have continued growth with HYG, that the company continues to be financially healthy, we are serving our customers well representing our partners with professionalism and continue to be faithful to our value statements,” says Wieland. “Specifically, we want to become a leader in the changing technology of our industry, such as motive power, automated systems and ways to manage fleets using our software and telemetry. We trust as a company that we will always remain mindful of our humble beginnings, grateful for our success and hungry for our next horizon.”