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Hoffman Equipment Lands Major Daewoo Deal in NYC

Thu April 21, 2005 - Northeast Edition
David S. Chartock

In sports, dedicated teamwork can result in much success on the playing field. In the equipment industry, teamwork also can breed success. Such was the case with a Piscataway, NJ, equipment dealer when it landed a major contract with the New York City Department of Sanitation (NYCDOS).

The contract is a three-year deal, with an option for a fourth year, for Hoffman Equipment Co. to supply NYCDOS with up to 130 Daewoo Mega 200-V wheel loaders.

Winning the contract was no easy task, according to Michael Anderson, Hoffman Equipment’s senior vice president of marketing and sales.

NYCDOS currently has a fleet of 600 similarly sized machines. And a number of pat contracts resulted in NYCDOS buying non-Daewoo-manufactured wheel loaders.

The contract, which was competitively bid, closed January 2003. But even prior to that, Anderson said, winning the contract was like a well executed triple play.

Who was on first? Well, according to Anderson, it was Del Wayne, the Northern Division sales manager of the construction equipment division of Daewoo Heavy Industries America Corp. of Suwannee, GA.

“Del Wayne was the catalyst. He not only told us we should bid, but he convinced us we could win the bid,” Anderson explained, adding that Wayne’s encouragement was based on Daewoo’s experience with bid processes in New York State and its previous successes in helping its equipment distributors win municipal bids in other states and in Canada.

“We knew that the NYCDOS contract had repeatedly been won by one vendor and we felt we could match the very detailed equipment specifications,” Wayne said.

Elaborating, Anderson said the equipment specifications required enhancements be made to a standard machine. Some of these enhancements included longer loader arms and special cooling system enhancements, including a reversible fan, both of which are not standard features on Daewoo wheel loaders.

Other enhancements, he noted, include additional steel, belly plates, a special towing package and more durable radiator guards with a lot of special decaling and tethering. In all, Anderson said, each wheel loader will have approximately 140 enhancements.

While bases are being covered for this contract by Hoffman Equipment and Daewoo, the third base is being covered by Keen Transport of Carlisle, PA.

According to Anderson, Keen Transport’s Assembly Division manager, Bill Campbell, does modifications on machines to meet any end user’s or dealer’s requirements.

“Campbell has experience with many New York City agencies. He understood NYCDOS’ needs and wants and exactly how to read the agency’s specifications,” Anderson said, adding that “Daewoo, Hoffman Equipment and Keen Transport worked as a team with Del Wayne dissecting the specifications and Campbell assisting Daewoo in interpreting the specifications and doing the design work for the enhancements.”

Some of Keen Transport’s work includes fitting the wheel loaders with ACS couplers and buckets. The ACS coupler system allows interchangeability of attachments from machine to machine and to and from non-Daewoo-manufactured machines, Anderson explained.

Continuing, Anderson said, “Keen Transport’s input accounted for a large portion of the engineering required to help win the contract.

“NYCDOS also liked Daewoo’s engineering,” he said. “In some instances, NYCDOS would require additional engineering information from Hoffman Equipment. Hoffman Equipment e-mailed requests to Daewoo Heavy Industries America Corp., which, in turn, sent it to its factory in South Korea. Because of the 14-hour time difference between South Korea and America, Daewoo was able to provide overnight detailed answer and detailed drawings from Daewoo’s factory,” he explained.

“This kind of sale is a big deal to any equipment manufacturer. It’s the kind of deal you consider carefully before you bid because of the large amount of time and resources that goes into it,” Wayne said.

“Each party exhibited the highest level of skill and professionalism in providing what was required to help Hoffman Equipment win this contract,” Wayne added.

The “high level of skill and professionalism” started at Daewoo’s factory in South Korea, where the wheel loaders are partially customized to NYCDOS specifications. Then, Keen Transport takes possession of them to do its modifications. Next, Hoffman has the modified wheel loaders delivered from Keen Transport to Hoffman Equipment’s yard for cleaning and dealer preparation. Next, Hoffman Equipment delivers the machines to NYCDOS.

Anderson said the entire process, from the work at the factory to the final delivery, takes approximately three months.

He added that the wheel loaders are delivered in groups of seven and that Hoffman Equipment provides warranty repair, which, depending on the component, ranges from one to five years.

Hoffman Equipment also provides service and support from its Holtsville, NY, branch.

“Bruce Pascale,” Anderson said, “is the Holtsville branch manager. He personally oversees and troubleshoots any issues, which may arise with regard to NYCDOS’ machines, including parts availability and repairs.”

The service and support by the Holtsville branch was part of a detail plan that was required after the award of the contract.

“We still had to prove we could meet the specifications. To do this, we participated in a ’Plans Meeting’ where every one of the bid items was proofed. Once NYCDOS was satisfied we could meet the specifications, we were ’approved’ to build a prototype. This took four months,” Anderson said, noting that it was built in South Korea, completed at Keen Transport and finalized at Hoffman Equipment.

This prototype was then put through a hands-on, 40-hour performance test by NYCDOS operators. Once the prototype passed the test and was “accepted,” delivery was made of the first of the remaining units.

During the first year of the contract, 26 machines were delivered to NYCDOS. In this second year of the contract, 44 additional wheel loaders are being built and delivered.

“We were incredibly impressed with the management and operation of NYC Sanitation,” said both Anderson and Wayne. “They know what they want and they have solid reasons for every spec item. The operations and training guys were totally professional in their roles as well. They learned the special nuances of the Daewoo machines and made sure that every operator knows how to run them efficiently. We are very comfortable that tax dollars spent by NYC Sanitation are well spent.”

If NYCDOS buys all 130 wheel loaders, the contract could eventually be worth more than $16 million, Anderson said. CEG

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