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The UK Business
Ian Ritchie, Brammer UK,
Managing Director
Mike England, Brammer
UK, Sales Director
Intellectual Property Notice
The trademarks, logos and other registered marks of BRAMMER including,
but not limited to, the “BRAMMER” “INSITE” and “GENIE” trademarks and
logos, are the exclusive property of BRAMMER, and may not be used or
reproduced without BRAMMER’S prior written consent.
2
• 872 FTE people
• 93 Branch locations
• 76 Full-time Customer Insites™
• 75 Part-Time Insites™
• 101,000 SKU’s
• 2011 Sales £166.9M : Average order value £245 (£218 in 2010)
: 2.44 lines per order
: 42% of Sales from Site based services
: 60% of Sales from Key Accounts
UK
3
History
Quarterly SPWD Growth Sales 2003 to 2011
-0.8%
5.5%
8.4%
11.2% 11.6%11.3%
14.5%
12.7%
7.6%
12.1%
7.1%
6.2%
3.4%
-1.8%
-3.6%
0.9%
5.4%6.1%
11.7%
9.0%
15.6%
17.4%17.7%
16.6%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2006 2007 2008 2009 2010 2011
% S
ale
s P
er
Wo
rkin
g D
ay
Gro
wth
60.0
80.0
100.0
120.0
140.0
160.0
180.0
1900 1900 1900 1900 1900 1900 1900 1900 19002003 2004 2005 2006 2007 2008 2009 2010 2011
4
Brammer Strategy - implementation
Country Organic Growth People Development Supplier rationalisation Business Processes
Key Accounts Business Skills Development European buying System integration
Insites Distributed Learning IT cost reductions Brand development
Product Range ExtensionInternal Communications &
InvolvementCapital Employed Management
Supplier relationship
management
Geographic Development
GROWTH CAPABILITY COSTS SYNERGY
5
Growth
6
Growth: Organic Growth • Industry sector focus
• Understand core manufacturing processes and MRO needs
• Provide access to technical innovation from world-class manufacturers
• Proactive focus on providing operational cost savings
7
Growth: Organic Growth Brammer Focus on Nuclear Power Generation
8
Growth: Organic Growth
9
Growth: Market segmentation
• Focus on sustainable industry segments, minimise exposure to cyclicals
• Hunting for good quality customers: serious about compliance
• Constant focus on Sales Pipeline management
• Constant focus on Customer Retention
• Constant focus on Cross-Selling the product range
• Negotiate multi-year contracts
10
Growth: Key Accounts
• Top-down ‘corporate sales team’ aligned to key industry segments
11
Growth: Differentiating our offering
How we Add Value to Customers
To reduce total acquisition costs, it is necessary to consider
not just the basic product cost, but the entire process costs.
We have developed a number of solutions to make us a
cost - efficient business partner.
Solutions to reduce total acquisition costs 1
Brammer is in the business of keeping production lines
moving. We offer a number of proven services, which
proactively help avoid breakdowns – and keep costly
downtime to a minimum.
Services to improve production efficiency 2
3
The constant monitoring, and continuous reduction, of working
capital is a key performance indicator for the success of many
businesses. We have developed facilities, competencies,
services and systems to help achieve this.
Expertise and support to reduce working capital
Back
The Customer Challenge = Opportunity
13
Growth: Differentiating our offering
•INSERT TABLE SHOWING COST SAVINGS EVOLUTION LAST 5 Yrs
Saving - £11,500 Ref: 17635
Metal Industry - Increased Production Time
Couplings on a particularly punishing application within a metal manufacturer were failing on average twice a week. Each time a failure
occurred, 2 hours of production time was lost. Sean Devaney (Regional Key Account Executive) made a joint visit with Esco to review the
application. Esco offered their T-series coupling incorporating a design advantage which would cut the time needed to change down to 5
minutes. The customer is pleased to report that after 8 weeks, there have been no failures with the new coupling.
Saving - £240,000 Ref: 17523
Power Industry - Material SubstitutionAn Automated Guided Vehicle used in a plant manufacturing nuclear fuel was failing every 3 weeks or so. The problem
was eventually traced to a containment seal used when the vehicle docks.
Christopher Clarke (Technical Specialist) arranged several joint visits with sealing supply partner Garlock. After
redesigning the seal, it has now been in service for 6 months without failing.
So sucessful has this modification been that the customer has nominated it for their own global cost saving award in
addition to a similar one for plant safety.
Power Industry - Material SubstitutionAn Automated Guided Vehicle used in a plant manufacturing nuclear fuel was failing every 3 weeks or so. The problem
was eventually traced to a containment seal used when the vehicle docks.
Christopher Clarke (Technical Specialist) arranged several joint visits with sealing supply partner Garlock. After
redesigning the seal, it has now been in service for 6 months without failing.
So sucessful has this modification been that the customer has nominated it for their own global cost saving award in
addition to a similar one for plant safety.
Saving - £11,500 Ref: 17635
How we DELIVER Value – Documented Cost Savings
: 2011 > £20M of value
: to more than 500 customers
: from > 3,600 signed off added value savings
14
Growth: Insites™ • Insite Services provide customers
with dedicated site based resource - 76 full - time locations in UK - captive market for Brammer - accelerated product penetration
• Part - time Insite™ solution - 75 locations in UK
• Each Insite™ is different - inventory requirements - product profile - operating environment - stores management needs - etc …
a high value adding service
Power Station
& Bio Mass
Pot Lines (350)
Cast House
Anode Plant
15
Growth: Insites™ - Examples
Externalise internal core competences to differentiate and add value
16
Growth: Insites™ - Before lopment
17
Growth: Insites™ - After
18
Growth: Geographic expansion In UK, being local and close to the Customer is critical
New branches: added 13 since 2005/6 (excl. Buck & Hickman)
2010 Inverness : July
Pembroke : October
Reykjavík : December
2011 Fort William : April
ENTRY STRATEGY
Support committed Key Account Customers and grow from there
19
Capability
20
Capability: Differentiating our offering • Access to world-class brand portfolio
- brand ‘sponsorship’ is mission critical
• Committed supplier relationships
• World-class MRO distribution centre
• Agile, low-cost, minimal human
intervention
• Continuous improvement culture
21
Capability: Differentiating our offering • Striving for World-Class business
systems
• External accreditation / certification
CENTRE OF EXCELLENCE
• Innovative environment to showcase
product & technical expertise - takes ‘price’ off the table
- great for building supplier rapport
22
Capability: Differentiating our offering • Investing in our people
: > 2,000 training days in 2012
: new Training & Development Centre
- opened August 2011
23
Costs
24
Costs: Capital employed management
• Stock / Sales ratio below 10%
• Focused Debtors Management and Commercial Policy
: customers pay us before we pay suppliers
• Cash generation better than Profit
0.08
0.10
0.12
0.14
0.16
0.18
0.20
Sto
ck :
Sale
s r
ati
o
25
Costs: Year on Year Productivity Improvement • SDA is managed in line with required capacity
• Revenue / Head productivity gains is a given
23.0%
24.0%
25.0%
26.0%
27.0%
28.0%
29.0%
30.0%
SDA : Sales %
MAT
Synergy
Synergy: Supplier relationship management • One European approach + process
• Virtual Purchasing Team maximise opportunities
• ‘Bottom-up’ aligned management of supplier management
• Driving continuous improvement
: scorecard approach vital
: tangible evidence to customers we are serious and competitive
Synergy: Business processes • Employee Survey
• Customer Survey
• Reporting and KPI’s
• Customer loyalty programmes
• Etc.
Synergy: Brand development • Brammer identity implemented in UK in 2007 : Brammer acquired “BSL” in 1968
• Successful strategy to enable us to reposition our MRO offering
• Thought leadership & Case study PR strategy
• Brammer identity is gaining traction as a
recognised and trusted brand with customers and suppliers
Synergy: System integration • MDM
: centralised Master Data Management MRO Database
: no-one else in European MRO market has this level of granularity
• Data warehouse - transactions consolidated in central system
: providing visibility and drill down for reports / analysis
: key enabler for inventory planning, purchasing tactics, customer
analysis, customer / supplier reporting, etc…..
• Inline – stock visibility throughout Europe
• The market is not a constraint : Growth drivers in place
• Focus on the right customers : right segments
: customers with a compliance culture
• Differentiation is key : People and ideas make the difference
: adding value to the customer is the order winner
• Make selective investments : good development roadmap in place
: bolt-on acquisitions work
UK: Summary
32
Growth
Acquisitions
• 182 year old British company
• 28 branches
• £105M t/o (2011 annualised)
: No. 3 by size in £2Bn UK Tools, General Maintenance & Health & Safety market
• Strong key account portfolio, inc: : Rolls Royce, Siemens, GE, Tata Steel, Westland
• 140 year old “Roebuck” exclusive private label brand : good quality, good margin Hand Tool range
• 540 employees
• 100,000 sq ft NDC in Coventry
Buck & Hickman: Summary
• £7.5M annualised over 3 years
: Purchasing leverage
: Roebuck brand
: Branch co-locations (18)
: Logistics
: Cross-selling
: Marketing
Buck & Hickman: Synergy opportunities
• Business is performing well, in-line with expectations
• Integration workstream programme to deliver synergies
is on-track
• Future Sales growth pipeline developing
• Leveraging management and supplier relationships to
create European business opportunity
Buck & Hickman: Progress