Bruce Krueger has 4 million reasons to crack a smile, knowing his employees labor safely.
Krueger, vice president and general manager of CNH Industrial Reman, and his 270-strong crew at 2707 N. Farm Road 123 have clocked some 4 million hours of work without a single employee missing time via major injury. It’s no easy task when retooling heavy equipment parts – think combines and other monstrous agriculture and construction machinery.
The Springfield-based, international heavy-equipment parts remanufacturer turned 8 years old Dec. 31, and Krueger says the safety feat came rooted in tradition, not happenstance.
“We’ve been building the culture from the beginning,” he says.
Making the future
CNH Industrial Reman formed and continues to operate as a joint venture between London-based CNH Industrial NV (NYSE: CNHI) and SRC Holdings Corp., known for its Springfield ReManufacturing Corp. business.
CNH Industrial Reman operates as a stand-alone LLC that acts as an international headquarters in remanufacturing heavy-equipment parts for 2,300 dealers of Case and New Holland brands throughout the United States and Canada.
The partnership began with fewer than 10 employees and $2.6 million in annual revenue, according to Springfield Business Journal archives. CNH Industrial Reman now employs 270 at its 250,000-square-foot, three-level remanufacturing facility on the city’s northwest side.
In recent years, the company eclipsed $100 million in revenue, and the team is projecting $126 million in 2018, says Candida Deckard, the company’s director of human resources and safety. Production can ebb and flow with the agriculture and construction markets.
Now, Krueger says the major hurdle for CNH Industrial Reman is convincing buyers to choose remanufactured parts over buying new.
“Our main issue is educating our end-users – the owners of the equipment – on the full value-proposition of using a remanufactured part to lower the total cost of ownership over the life cycle of them owning their equipment,” he says, declining to disclose current year revenue or projections.
He says the key initiative is investing heavily in capital improvements, this year with a $1 million investment to upgrade the company’s computing power. Think stronger data collection and more effective parts tracking.
By 2020, CNH Reman Industrial plans to have invested nearly $20 million in capital improvements since its start, according to company materials.
“We’re putting our money where our mouth is at the end of the day,” Krueger says.
The joint venture is reviewed annually by SRC Holdings and CNH Industrial NV. Both companies recently agreed to re-up for 2018.
The Reman in remanufacturing
CNH Industrial Reman essentially takes worn heavy equipment parts – known as “core,” for which equipment dealers get credit – and fully restores those parts to like-new condition, Deckard says.
CNH Industrial Reman touts best-in-class warranties: a two-year parts and service warranty for long blocks and replacement engines and a one-year warranty for most other parts. The work also nets clients in the European and Australian markets, says Marketing Manager Jamie Sullivan.
S&H Farm Supply Inc. is among the dealers, with its stores in Joplin, Lockwood, Mountain Grove and Rogersville. Gerry Ruark works as the parts manager at the company’s Lockwood shop northeast of Springfield.
Aside from some misgivings about CNH Industrial Reman’s core-credit policy, Ruark says he stands by the product. He says he deals daily with the company, the main benefit being that CNH Industrial Reman parts carry a warranty that outlasts original equipment manufacturer parts.
“It’s cheaper than the OEM new parts, and it has twice the warranty,” Ruark says. “We very, very seldom ever have a problem with any of the parts. It’s just their business practice on the core money that’s returned – it sits sideways with me.”
S&H Farm Supply’s expenditures on CNH’s remanufactured parts range from thousands of dollars to upwards of six figures in a year’s time.
Money saved, money earned
Krueger says safe working habits equate to less money spent overall on workers’ compensation, thus helping keep company costs lower and revenues higher.
“It’s very important mostly for the employees’ safety, but obviously, it also helps our financials by having lower worker’s comp cost,” he says.
The 4 million hours equates to 24 years worked with no employees missing time because of an injury, Deckard says. The other 16 years prior to CNH Industrial Reman’s formation carried over from employees acquired from Avatar Component Corp., a former SRC Holdings affiliate in Marshfield.
In addition to offering monetary awards to employees for working safely, the company has a volunteer, employee-driven safety committee. Other proactive attributes include safety investigations and audits, weekly meetings and a trauma simulation this past year that included a mock amputation and an employee feigning a heart attack.
CoxHealth helped orchestrate the simulation, for which employees only were made privy of that day.
“They do all the makeup and cosmetics, so the employees walked out after break to see someone lying on the floor with guts out,” Deckard says. “They try to make it as realistic as possible for what might happen.”
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