B&J Rocket Sales Sharpen Up
Retreading tool and rasp manufacturer B&J Rocket Sales AG has reported that its sales are back on the up after the recession. Speaking to Tyres & Accessories, managing director Andreas Mueller explained that during the first 7 months of 2010 sales showed “a strong upward movement” compared to the previous year. This probably isn’t too surprising considering the fact that like other players in the sector sales plummeted due to the economic recession. But in B&J Rocket’s case the effects of the recession were amplified by the fact that 2008, says Mueller, was the exact opposite of 2009 – it was a record year.
While it must be said that the company is reporting strong sales growth so far this year, the company is not yet experiencing the same levels it achieved in 2008. “But we are catching up as the year progresses,” said Mueller, adding a global perspective: “On the Americas side of our business we have seen a slow and steady climb since we took over in August 2009. This is certainly also due to the recovery of the retreading industry since this year there are more truck miles driven after recovery of the crisis also on these continents.”
Increased emphasis on Central and South America
Following the so-called premiere of B&J Rocket as a global company at Reifen Messe Essen in June, the firm now has new opportunities to approach its business activities on a broad international basis. This all came about because the B&J branches outside the US were sold to Swiss investors in 2002. However, since the same investors bought the American unit in 2009 the re-united company can now act on global customer interests. According to Mueller: “Synergy effects can be materialized… Customers can benefit from expertise from both sides of the Atlantic.” This means product ranges can be both expanded and consolidated. The first fruit of the united B&J will be its global catalogue in English, German and Spanish.
So with this global approach in mind which markets are driving the recovery? “Controlled by our office in Switzerland, countries in Europe, especially our EU neighbours, take the lead in the recovery,” Mueller answered. But in the Far East, the recovery is said to be “much slower” and more varied. This is not a great surprise for the company as the firm reports it often observes a three to six month lag effect between Europe and Asia when it comes to the ups and downs of the economy.
And on the other side of the Atlantic? “Steered from our office in Middlebury, USA there is an increased emphasis on the Central and South American countries in an effort to continue to grow and increase B&J’s global presence in emerging markets. This is in no way at the expense of the North American market in terms of service or marketing. In fact, the team in the Americas is expanding with a new sales representative beginning 23 August,” Andreas Mueller commented.
Of course no-one is insulated from a recession, but Mueller reports that the retreading industry consumable tools sector appears to experience more moderate ups and downs than many others. “This may be due to the fact that capital investment slows in recessions more, whilst interest in money saving recycling holds its ground,” Mueller offers as an explanation, adding: “in boom times sales are supported by increased demand for transportation.”
So how does this affect customers’ purchasing strategies? Does a recession push buyers towards more budget-orientated products? “You will always have customers seeking to buy on price alone, but this is not our strategy. Our strategy is to provide the best quality tool at a competitive and fair price. We may not be the least expensive, but buying quality tools will save you money in the long run.”
Revived capital investment
While many companies reduced their staff Andreas Mueller reports that B&J Rocket has strengthened its internal management and sales team recently and is currently looking for another sales representative for South Europe and Asia. The company has also invested in a global, high-gloss catalogue, new websites customized according to its operations in Europe, Asia and America, available as well as a catalogue in various languages.
So while capital investment is often postponed during a downturn, the fact that B&J Rocket is now enacting investments designed to increase efficiency at its manufacturing plants through the increased adoption of automation in the production process is another sign that things are on the up. However, following the quasi-re-merger to the two B&Js into a global company, considerations of the economies of scale may “influence investment and the movement of parts of production in future.” But as Andreas Mueller told T&A: “It may also allow for more efficient sourcing, all of which will come to benefit the end user and customer of B&J Rocket quality products.”