Perry Saunders has been president of Harrington Hoists & Cranes since 1985 and under his leadership the company’s turnover has grown from $3.5m a year to $31m this year. It seems that he is doing something right.
Harrington is often cited by competitors as a US company that has a clear vision and strategy. Talking to Saunders it becomes apparent that the key has been deciding what the company is best at and minimising involvement with the rest. Therefore, while customers may see the company as a manufacturer of hoists and cranes, Saunders regards the company more as a service organisation. “Our forte as a company is sales and marketing,” Saunders says. “And we have expertise in designing and fabricating crane systems. We do not present ourselves as an A to Z hoist manufacturer. We buy product in, and do the assembly and modify it. We are not building from nuts and bolts all the hoists that we sell.” He continues: “The industry is evolving into those companies which are manufacturing oriented and those which are sales and marketing oriented. We are in the latter category. But we retain our technical capability.” In the former category, he suggests, are Columbus McKinnon, Demag and Kito. The Japanese manufacturer Kito is Harrington’s parent company. Harrington had been Kito’s US distributor in the 1970s and 1980s and when the company was put up for sale in 1990 Kito took ownership.
“It has been a very successful marriage,” says Saunders. “They have very much let us alone to run our own business and not tried to impose their culture on us. Naturally we get input from them and share ideas back and forth.” Asked who gets what out of whom in the Kito-Harrington relationship, Saunders replies that the Americans have the business expertise and the Japanese have the manufacturing expertise. “We have developed a forecasting system that is extremely accurate. Our parent company has adopted that,” he says. “From a manufacturing side, we learn from them. From a business side, they learn from us.” Saunders offers an example of the benefits of being on a loose rein. “Two years ago I told them I needed to expand the size of our facility here in Manheim, Pennsylvania. One presentation, one board meeting and it was agreed.” Elsewhere, that decision making process could have dragged on interminably.
The expansion of the Manheim facility to 6,600m2 (72,000ft2) was completed earlier this year. The size of the Californian premises in Corona has also now been tripled to 2,000m2 (22,000ft2). The Corona site is mainly just a depot, “but we will do more assembly and fabrication there, now we have the space,” Saunders says.
Although it has expanded its premises, Harrington is unlikely to see its turnover grow this year. The company has roughly doubled in the past five years (1996’s turnover was $17m), but those boom years for the US economy appear to have come to a halt, at least for the time being. “We are not insulated from the softness of the market,” Saunders acknowledges. He is confident, however, that the company is well placed for an upturn. “Our business is even compared to a year ago, yet the industry is down 11%, so we are fortunate. We are still gaining market share. We are not laying anyone off and it’s not going to happen. It’s against my basic instincts.” Saunders is not prepared to talk about how many units Harrington sells, but most of the electric and manual chain hoists that Harrington sells are Japanese-built and shipped over from Kito. The badge will say “Harrington. Made in Japan.” Kito produces about 30,000 electric chain hoists a year and 150,000 manual and lever hoists. But Harrington has looked beyond its parent company for product to sell. It also badges Toku’s tiny air hoist, which it calls the Mini-Cat. And last year, needing an electric wire rope hoist range, it teamed up with Donati of Italy. Harrington’s RH series is not an off-the-shelf Donati product, Saunders says, but includes an element of Harrington specification. It is a European style hoist but certain parts, such as the wiring, are Americanised by Harrington, he says.
Take up of the Harrington RH has been slower than desired, he admits. The market began to soften at about the time that the RH became available. It is an important addition to the product range though. “The wire rope hoist market is new for us. It lets us have a much more serious dialogue with the crane builders,” Saunders says.
The Donati and Toku deals are typical of the way that Harrington has succeeded. Take a product that already works rather than investing heavily in new product development and manufacturing. Concentrate instead on providing a service to customers. Although Harrington does not actually make its own hoists, despite appearances to the contrary, it takes pride in acting as if it were the manufacturer, according to Saunders. “If there is a warranty claim or a service problem, it’s as though we made it.” Customer responsiveness, Saunders believes, is a defining characteristic of Harrington. “It sounds trite, but we totally outservice our competition. Our industry is like the steel industry. They forgot who the customer is. We never did forget who the customer is. That, more than anything, distinguishes us from our competition.
“That sounds trite,” he repeats, “but it’s true.” Saunders joined Harrington Hoists & Cranes from a sales and marketing position in the packaging industry in 1983 as operations manager – “with the intent of becoming president if it worked out.” Clearly it did work out for him. He is 54 now. He has been president for 16 years and an employee for 18. Has he any unfulfilled ambitions? Not beyond Harrington, it seems.
“Harrington is quite a dynamic company,” he says. “We’re gonna do things in the next five years that are going to be major changes for Harrington and could be noticeable changes for the industry.” Like what? He won’t be drawn, other than to murmur vaguely that it could be acquisitions, it could be expansion into Central and South America. “We’ve got a whole lot on the table now.”
