Competitive strategies for Swiss industries Philip Mosimann, CEO

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Competitive strategies for Swiss
industriesPhilip Mosimann, CEO
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Contents

1. Brief portrait of Bucher Industries
2. Pre-conditions in Switzerland
3. Examples of competitive strategies
4. Some personal considerations
5. Discussion

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Our businesses since 1807
Agricultural implements Worlds leading
manufacturer of specialised agricultural
machinery for tillage, seeding, fertilisation,
spraying, landscape maintenance, hay and forage
harvesting, livestock bedding and
feeding. Sales CHF 1000 m Employees 4 500
Municipal vehicles European and Australian
market leader in municipal vehicles, offering a
whole range of compact and truck mounted
sweepers, winter maintenance equipment and refuse
collection vehicles. Sales CHF 400 mEmployees
1 500
Hydraulic systems International leader in the
design and manu-facture of custom mobile and
industrial hydraulic system solutions, offering
an array of products encompassing pumps, motors,
valves, power units, elevator drives and control
systems. Sales CHF 400 mEmployees 1 700
Glass container machinery World market leader in
glass container manu-facturing and inspection
machinery, offering a portfolio ranging from
glass forming and inspection machinery to
complete production lines and components for the
glass container industry. Sales CHF 350 m
Employees 2100
Small businesses Machinery and equip-ment for
winemaking, systems and machinery for processing
fruit juice, instant products and dewatering
sewage sludge as well as the Swiss
distributorship for tractors and agricultural
machinery. Sales CHF 200 m Employees 600
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Major manufacturing sites worldwide
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Bucher group strategy (1)

• Principles
• Stakeholder approach with long term, industrial
  view
• Increase of enterprise value (RONOAgtgtWACC)
• Businesses with worldwide technology and market
  leadership with 1 to 3 market positions
• Profitable growth, where profit growth is
  prioritised
• Focus on organic growth enhanced with specific
  targeted acquisitions strengthening existing
  businesses
• Strong balance sheet with high liquid funds for
  independance from banks and stock exchange

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Bucher group strategy (2)

• Implementation of principles
• Do what we understand machinery and vehicles
• Do what we can best Best owner of our
  businesses
• Do what we can handle number of businesses 4 to
  6
• Do what we can finance Cash-flow and growth
• Do what creates value Innovation and profitable
  growth
• Consequences in group management
• Lean and decentralised management structure
• Lived entrepreneurial attitude with common
  methodologies
• Balance of trust and reasonable controls

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Pre-conditions in Switzerland

• Generell environment
• Excellent infrastructure for business, living,
  and leisure
• High security level politically, socially,
  financially
• Internationally open society, entrepreneurial
  freedom, competitive tax systems both in business
  as well as in private
• High cost country with strong currency
• Education and innovation
• Universities, technical high schools, dual
  education system
• Established knowledge transfer fro universities
  to businesses
• Swiss businesses
• No or very small home market
• Quality, reliability, innovation, automisation,
  work ethics
• World champion in exports per capita

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FOREX issues a new phenomena?
USD / CHF
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Euro Problems with previous currencies and
related governmental behavior?
EUR / CHF
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Competitive strategiesTopics on any board agenda

• Access to main markets which are outside
  Switzerland
• Manufacturing at one place, export worldwide
• Split of value supply chain why, how?
• Protectionism today and tomorrow
• Which technologies for which markets
• What can we do better here than elsewhere? Why,
  how?
• What exactly means better customers decide!
• For which technologies, products, applications is
  Swiss made the best solution? For which ones
  not?

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Internal external growth Investments 70
internally, 30 externally
Net sales CHF million
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Acceleration of structural change
CHF million
2008 Net sales CHF 2.8 bn 8400 employees
2004/06 Divestment Laeis Division
1998 Acquisition Emhart Glass
1996 Creation of divisions
1986 Public offering Net sales CHF 0.4 bn 2730
employees
12 Acquisitions Focus Europe, first transaction
in Asia 1 Divestment
5 Acquisitions USA, CN, Europe1 factory
closed 1 Divestment
23 Acquisitions EU, USA, India, Brasil 6 factory
closed 8 Divestments
3 Acquisitions in DT and FR
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Global Footprint (1) 1807 - 1990 Focus Europe
(CH, FR, GE)
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Global Footprint (2) 2012 36 production sites
worldwide
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Acquisition 2002 Knight Manufacturing, Brodhead,
USA
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integration and internal growth Agricultural
machinery, Brodhead today

• USD 30 million invested in buildings since 2003
• Total campus 13 ha 32 ha testing area

2006
2008
2004
2011
2008

• Number of employees doubled in the last 6 years

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Production and R D Glass container industry
2007 RD Center Windsor (USA)
2008 Johor Bahru (Malaysia)
2011 Majority interest in Sanjin (China)
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Swiss success story (1) Hydraulic systems,
Frutigen
2000
1974 1993
Bei der Übernahme 1997
Heute
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Swiss success story (2)Hydraulic systems,
Neuheim

• Bilder folgen

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Swiss success story (3)Municipal vehicles,
Ventspils, Latvia
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Swiss factory (1) High automisation
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Swiss factory (2) Automated manufacturing
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Swiss factory (3) Rationalised assembly testing
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Swiss owned run factory (4) Manufacturing and
assembly
WTO 27 March 2012
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Investments since 2002
sales 2011 sales 2011 employees 2011 employees 2011 Capex 2002-2011 Capex 2002-2011
CHF m CHF m
Switzerland 117 5 997 10 117 16
Rest of world 2 219 95 9 139 90 617 84
Total 2 336 100 10 136 100 734 100
factories factories Capex / factory CHF m
Switzerland 3 10 39
Rest of world 33 90 20
Total 36 100 22
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Personal considerationsCometitiveness in
Switzerland

1. Expand excellent pre-conditions in Switzerland
2. Intensify co-operation with universities
3. Innovation and RD Continuity as success factor
4. Make structural changes fast position company in
   major markets
5. Adapt supplier base to major markets
6. Permanent modernisation and automisation of
   factories
7. Create culture of continued improvement Kaizen
8. Secure strong balance sheet and financing in good
   times
9. Understand FOREX hedging as buying of time
10. Build dedicated, competent and creative work force

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Thank you for your kind attention