The fastest-growing market sector
The fastest-growing market sector
The surest sign of a healthy compact and mini equipment sector is the large number of major equipment manufacturers who have jumped into the sector over the last few years. CAT is now there. So too, is Komatsu, John Deere, Champion, Kubota along with a host of other familiar faces who have either extended or re-marshaled their equipment lines in order to ensure maximum market competitiveness.
Suddenly, 'small', 'compact' or 'utility' is the language manufacturers most like to hear about their equipment. There is clear recognition that this is the only sector of the equipment industry that is truly growing and everyone wants to be a part of the success story. Small gets into tight corners. Small can be more easily custom designed to handle specific tasks and applications. It is easily transported to and from the job site and, once there, can operate with a great deal of efficiency. And small of course, costs less to buy or rent and fits the vast majority of modern job site applications.
There is nothing inherently new about small or compact machinery. The Europeans and the Japanese have been getting by with small- to medium-sized machinery for decades. Monster machines were only for North American appetites. And manufacturers who serve the landscape industry have been thinking and designing small, purpose-built machinery for years. Small tractors and mowers, for example, have been a major market force for over two decades. Technical advancements have also permitted manufacturers to introduce a remarkable range of implement attachments. With simple and speedy connections, versatility has taken on new meaning. Complementing the popular compact characteristics of maneuverability and favourable power-to-weight ratios, attachments also extend machine capability across an increasingly broad range of applications.
Ontario-based Champion Machinery is best known for its full size road building and road maintenance motor graders. Aware of the trend to small and compact it recently extended its lineup to include a full range of compact graders suitable for a wide range of specialty applications. It also added a line of attachments that can turn the same grader into a full-time performer on any job site. A pavement contractor for example, can lay his grades for a new sidewalk and then use the same machine as a front-end loader with a brush attachment for clean up. Finally, when the job is complete, he can quickly load his C Series grader and haul it away to the next job site.
"That's the kind of versatility that has wide appeal to the rental markets and to small contractors with a wide variety of jobs to fill. No machine is earning money when it is parked," says Rob Jerry, product manager for Champion. "Operators like to know they are getting value for money out of their machines. The more applications it can fill, the better."
The advantages of 'small' over 'big' are sometimes best displayed in the big international machinery markets. Champion likes to tell the story of a surprise market it uncovered in Malaysia when it found plantation owners using converted tractors to grade the dirt road systems that service their huge holdings. Champion was quick to convert the capabilities of its compact series of graders into a major sale in the region. The selected C50 grader was the smallest in the Champion lineup, weighing in at just 8,000 lbs.
Komatsu Canada calls the sector 'utility' and has formed a utility team to properly market a line of compact machinery that may look like oversized construction toys but still deliver a considerable punch. Its full line of compact excavators for example, starts at 3,060 lbs. and moves through six different sizings to 13,130 lbs. There is, says Todd Bissonette, Komatsu's Utility Team Manager, a right size of excavator for every task. "They are easily transportable and provide very high levels of working performance and versatility, especially in confined working areas."
Komatsu, like other major equipment manufacturers, makes a marketing point out of building big equipment features into their mini and compact lineups. Komatsu's excavators for example, feature the same patented hydraulic systems and the same easy-to-use joystick control system that operators find on the Komatsu big machines of 30,000 lbs. and more. In the past quarter century, compact equipment has spurred a revolution in the landscaping industry. Flexible, versatile and transportable, these machines offer contractors and maintainers improved productivity at lower cost, with minimum environmental disturbance. Engineers, who follow the industry closely, have focussed upon the issues of durability, reliability and functionality. Design, marketing and financing strategies have resulted in safe, quiet, comfortable and affordable units that meet the widest possible variety of needs.
Technical advancements have also permitted manufacturers to introduce a remarkable range of implement attachments. With simple and speedy connections, versatility has taken on new meaning. Complementing the popular compact characteristics of maneuverability and favourable power-to-weight ratios, attachments have further enhanced capability to the extent that labour is marginalized for many tasks.
Consumers have seen not only a dramatic increase in the application spectrum, they have benefited through competition. Over the past 20 years, the Canadian marketplace alone has experienced a seven-fold expansion of manufacturers. Nearly two dozen major suppliers are jousting for business. For users, this means variety, competitive pricing, distinctive performance and service accessibility on an unprecedented scale.
There are complex factors at work in the industry. Value and performance must be balanced against looming ecological pressures, economy of operation and safety. The advantages of diesel power may well be negated by clean air legislation and gasoline engines could be subject to restrictive emissions regulations. Noise pollution is sure to be addressed. Despite valiant efforts on the part of manufacturers, the safety issue will also continue to dominate regulatory concerns.
On the world mini equipment stage, Canada is a bit player, but Canadians benefit from intense competition elsewhere. Thus, expensive, state-of-the-art research and development comes at little cost to Canucks. For example, the annual U.S. volume for this type of equipment is six to seven thousand units, while in Europe the total is about 30,000, and in Japan, some 40,000 units are sold each year. This compares with annual Canadian sales of approximately 700 units. Forecasts suggest a six to eight per cent yearly increase in the mower sector, and perhaps as much as 20 per cent in the compact/utility field, but obviously the Canadian market is not pivotal. As with many other durable goods, Canada reaps the advantages of the worldwide marketplace.