New CEO Rodney Miller is determined to right the wrongs that dealers saw since the move from Iowa 3 years ago.
At its national dealer meeting last week in Duluth, Ga., McCormick International USA sent a strong message to its current dealer network (280) and the 800 more it hopes to recruit over the next 4 years. Acknowledging the problems that occurred since the move from Pella, Iowa, to the Atlanta area 3 years ago, McCormick is making changes to re-earn dealers' trust and confidence, and their business.
According to several dealers interviewed, the national dealer convention and the chance to personally meet the many new faces that have joined the company in recent years, represented a major step forward.
CEO Rodney Miller, who joined the firm in June 2007 and took over as the top executive last year, directly acknowledged the firm's poor showing in the NAEDA Dealer-Manufacturer Relations Survey released last year. The entire organization is determined to earn a better ranking from dealers in the 2010 survey, he says.
"It seems the dealer focus was lost with the last move," says Miller. "But we're back on track. You, the dealers, are the heartbeat; we don't exist without you. "We intend to break through the pack and bring new value to you, the dealers."
The major news of the meeting was the announcement of new and larger (120,000 square feet) facility in the Atlanta area (that will now also include light assembly operations) that the company will move into by March 31, which you can read here by visiting here. In addition to significant cost savings ($350,000 in the first year alone) to the company, the ability to bring subcontracted functions under one roof will bring significant improvement to quality control, availability and communications.
The annual meeting also allowed management to address a number of key issues, including McCormick's response to improve operations in 2009.
Profitability. Miller was proud that McCormick USA was able to turn the tide of losses and make its first profit in 2008. "It was absolutely essential that we got to that threshold," says Miller. "No one — not the retail customer, dealer, employees, ownership — can win if you're not profitable." Employees saw their first bonuses ever in 2008, an important sign of progress, Miller says, for a team that is diligently working to correct past problems.
Parts/Service/Warranty. Miller says that the firm made tremendous strides in the parts department, a source of pain for dealers over the past several years. With new personnel and other improvements made, parts fill rates are now consistently at 94-95%, a level Miller says McCormick is as good as any tractor manufacturer in the industry.
And in the service and warranty area, which Miller said was the greatest challenge, the firm has restructured the department to make it more efficient.
New Programs. Miller says McCormick's new programs are among the most aggressive in the tractor industry. The firm was among the first to offer 0% financing for 60 months. And more recently, the firm implemented an attractive cash-in-lieu program and a new a "floor plan bank" on every tractor. With this program, says Miller, a dealer who retails a tractor early gets to "bank" the unused floorplan terms to finance additional units. It was offered previously on compact tractors, but is now available on every McCormick tractor.
"We're spending more per revenue sale on the retail end than ever before," he says.
New Products. In what Miller said was the largest rollout of tractors in some time, dealers are seeing major innovations in 2009 for the CX, MX, TTX, CTU, CTV and XTX model lines. "It could be years before we see this many product innovations," he says.
According to management, the national dealer meeting (held after a long hiatus) is symbolic of the company's new direction. Miller, Vice President Thurman Kirkland and other management presenters also informed the dealers in attendance of a host of other changes they've made or have in the works. These include a major web site enhancement this February, a live body answering the phone, the reinstitution of the dormant dealer council, the restructuring of personnel, the first parts fair that was held in December, plans for more service training and creation of new departments (such as product management).
We're working very hard to make McCormick a company that is easy to do business with," says Kirkland.