The End of an Era at Pioneer Machinery

Paul and Brenda Leas

  I want to dedicate this post to Paul Leas (pictured above with his wife Brenda) and what was the last vestige of the late, great Pioneer Machinery.  I want to take time to thank my friend and former boss for some really good years and for his contribution to the Forestry Equipment Industry.  It is important to add, that the entire reason for my accepting a position with ’Pioneer Machinery’ was due to my relationship with Paul.  Paul is a good personal friend for going on 18 years now.  I am writing this as a way of saying thank you to Paul on behalf of those who benefitted from his knowledge, integrity, hard work and exceptional decency.  For all of us who worked for or with you, thank you Paul for your example.

  Paul is now working for a company based in Europe that is heavily engaged in the Biomass Industry in West Africa and elsewhere.  He is currently somewhere in Liberia, getting his new house in order, so to speak.  That company has tapped Paul to be their international procurement manager, for which he is perfectly suited.  I would not be surprised if he were running that company within five years.  Those of us who know Paul have often wondered why he was working for Pioneer after all these years.  He obviously possessed the skill, competence and character to do far more than sell iron.  The fact is he loves the business and he loves his customers.  He would talk for an hour or more with a customer he had not spoken with for some time and the conversation would wind its way around equipment, wood prices, family and back again.  He loved to have those conversations.  For Paul it was not simply a sale.

  After some 38 odd years on this planet I have come to regard integrity as the greatest thing a man can possess.  Paul Leas has it in buckets. What further separates Paul from the average person is his remarkable intelligence, focus and his thoughtful demeanor.  Paul might be in the middle of a tense meeting with a customer who wants something but is not necessarily happy to pay for it.  Paul would just sit and listen patiently, not saying anything.  Then he would rock back and purse his lips and put his hands behind his head.  Then would come an uncomfortable pause where those present would wonder if he was going to get around to saying anything today.  You knew a response was coming and you waited for it.  Then he would ask a question, usually a very simple question.  Not a sarcastic or trapping question or anything like that.  It would be a straightforward question like,  “So, the transmission is going to cost about $20,000 to rebuild plus freight to get it here and back totals about $26,000.  You think it would be fair if we pay for all of that?”  He would say it without any irritation or tension.  He would not be excited or animated as he said it.  The words would come off his tongue as plainly as if he were ordering a sandwich.

  Then something strange would happen.  The fellow he was talking to would start to soften up a bit, responding to Paul and this idea called fairness.  Of course you know  they would split the difference in most cases and the two would leave the office smiling and shaking hands and everyone feeling good about things.  I learned a lot from Paul in life and in business.  One of the best things I learned from Paul is to shut-up and listen.  Sit and think it over for a second or two.  As a lasting tribute to him, one of my more common phrases now is ‘let me get back with you on that after I think it over a bit’.  Instead of spouting off and in many cases saying the first thing that comes to mind, I’ll take my time and try to respond with a more thoughtful answer.

  Paul ran his business like a family.  He was not afraid to lead, his way. One small example is his insistence that we pray before company meals/picnics and other events.  This is a small example I realize, but so many are afraid to do this anymore, it is worth mentioning.  Paul and Brenda hosted our company Christmas parties in their home.  I think one of the best things that can be said about someone is that they have a sense of community, a sense of belonging to something bigger than themselves and a real connection to others.  Paul cares very much for the people who worked for him, having hired all of them.  He wanted everyone to feel like they were an important part of the team and their contribution was appreciated.  For this reason, when it was finally time to leave Blanchard, the decision was one that gave Paul a lot of personal anxiety.  I had left four months earlier for similar reasons.  Walking into Paul’s office and telling him I was leaving, was one of the hardest things I have ever done.

  Paul is also gifted with a tremendous memory and he put it to good use on many occassions.  I recall many a conversation where I was shocked by his ability to remember information, facts, figures and dates.  I was talking to a customer on the phone about  a machine that Paul had sold to a gentleman in South Carolina.  I shared the conversation with Paul and he remembered the gentleman perfectly.  He recalled the model year of the skidder, serial number and the way it was equipped down to the last detail.  He had sold the machine over ten years ago.  He did this on a routine basis, to the point where we would joke about how easily he accomplished this.  I can say this power of memory has made many of his peers more than a bit uncomfortable.  You could not get away with half-truths when you dealt with Paul.  He would recall every word of your conversation, when, where, how, etc.

  It is dificult to find men like Paul anymore in the corporate dealerships today.  They don’t value individual employees much because in their opinion the brand is what sells (certainly not people) and they refuse to pay anyone more than the bare minimum.  Most folks would be surprised to know how little of their bill actually goes to pay their salesman or a seasoned mechanic.  From what I have seen over the years it is typically less than 2%.  When Blanchard took over Pioneer (South Carolina) in 2008, they quickly let go of some of its best and most seasoned staff.  Billy Roundtree was one of the first to go.  A more knowledgeable and respected man in forestry, cannot be found.  Billy was the liason between Pioneer and its manufacturers to make sure our forestry customers were getting what they needed and issues were resolved quickly.  Billy would advise Timberjack, Blount and others on engineering changes that were needed or recommended.  Over the years some very meaningful improvements were credited to Billy as a result of working with customers in the field.  CAT and its dealers do not need a man like Billy of course.  As you probably know, CAT machines are not delivered on lowboys but actually descend from heaven to the music of harps and choirs of angels.

  Paul also maintained a quaint little idea that was important to the founder and leadership at Pioneer Machinery.  ‘Do what is right for the customer’.  This idea personified the Pioneer way and it is no small thing.  A good example of this was their aproach to parts and service.  When you visited a Pioneer parts counter they would give you at leat two options for a spare part.  They would offer you the Timberjack or Prentice part and then they would offer you an after-market alternative that in many cases was exactly the same, but presented in a less costly package. Not surprisingly, loggers opted for option B.  This may seem insignificant, but it sends a message to your customers that you care enough about them to find them an alternative and save them money.  This in fact was very good for our manufacturers because it forced them to look hard at their costs/prices.  CAT has no such counterweight acting against the prices they demand for parts because their dealers are forbidden to offer any alternatives.  At least Pioneer was willing to earn their margins by finding the customer a better value.

  I was recently sharing with a good friend who happens to be a customer, that doing what is right, keeping your word, almost always costs you money.  For some in this business, their integrity and reputation is just not as important as the profit margin on a deal.  Having that conversation reminded me of Paul and prompted me to write this.  I can credit Paul with that lesson as well and too many others to write about here.

  The Pioneer Machinery that many of us knew and loved is now gone and becoming a fading memory.  I wanted to take time to thank one of the people that made that memory a very pleasant one.  His name is Paul Leas and he is a great man and a good friend.  He is hard at work on his latest venture in Africa and his friends wish him all the best and much continued success.

Jesse Sewell

 

PS, It is worth mentioning that my comments relating to integrity in the second to last paragraph are not related to the way CAT chooses to sell its parts.  The two thoughts were meant to address entirely different issues, not meant to suggest there is anything dishonest about how CAT sells parts/service.  I obviously am not a huge fan of the business model CAT has chosen but it is certainly not dishonest.  The matter of integrity is related to used equipment sales and those who are engaged in that business.  I realize I may have offended some who linked the two thoughts together and that was not the intent.  JS

Dutchman Global Launches New Website!

Most of my regular visitors here on Skidderzone are well aware of the fact that I am the Forestry Division Manager for Dutchman Global in Florence, South Carolina.  The following is both a shameless promotion and something I am personally very excited about as someone who has worked in the heavy equipment business and the information technology field.  I am extremely proud of what we have accomplished over the past six months and especially since launching our Agent Program.  Now we have a new website design to support their efforts in the field and allow our customers to access our inventory more easily.  JS

Dutchman Global has launched an all new website and with it given birth to an entirely new way of doing business.  Please take time to visit www.dutchmanglobal.com and see for yourself.  Here is a homepage snapshot.  I have highlighted below some of my thoughts as to why this is more than a website, this is in my opinion a silent revolution in the heavy equipment industry.

The site design is clean and easy to navigate and best of all it allows you to find what you want fast, without having to phone a friend.  Two clicks and you can find any machine you are looking for.  At the top of the page is a tab titled ‘Our Equipment’.  By clicking this tab you will be taken to a list of every manufacturer currently listed within the Dutchman Global Network.  Simply find the make you are looking for and click.  It’s just that easy.  The next thing you will see is CAT equipment or Tigercat or Prentice or Morbark, etc.  You can also view listings by type, such as Skidders or Chippers or Loaders.  Once the listing screen pops up you can then sort what you are loking for by price, model, year, etc.

The best new feature that is built into the site is an automatic distance calculator.  The site will automatically detect your location and then calculate the distance of every machine to you in miles.  That number is listed to the right of your screen and the listings are automatically sorted to show you the machines that are closest to you first.  No more having to call and find out where this machine is located or that one, etc.  Now you can see at a glance, exactly how far away a machine is and you don’t have to calculate mileage for freight.  This is a really great feature.

What makes Dutchman Global unique is the way they do business.  All the equipment featured on Dutchman Global is exclusively listed through DG and is only available through its network.  It is very common these days to see a machine listed on a dealer website and then a day or two later see it listed somewhere else, advertised by another dealer or broker, at a different price.  Who actually has the machine and what’s the real price anyway?  Does the guy I’m talking to even know anything about this machine or is he selling me something based on second hand information?

This is the reason Dutchman Global does not list any item for sale unless it is exclusively for sale through Dutchman Global, evaluated by an Agent personally and listed only on our network.  Dutchman Global is working hard to set a new standard in the industry.  Our Agents have decades of experience and their number one priority is to help our customers manage their heavy equipment fleets for maximum return.  That is; the best price possible when they sell and a quality machine at a good price when they need to buy.

Today’s heavy equipment owner does not have many choices when it comes to buying and selling equipment aside from the traditional options.  Brokers are for people who feel like they need a sense of danger or excitement in their lives.  For everyone else, Dealers and Auctions are the only real options.  Auctions remind me of that guy sitting at the slot machine who thinks he is the one who is going to hit it big that night because lady luck is on his side.  Dealers are like the Department Stores of the Heavy Equipment Industry.  They have the nice offices, company trucks and free hats, but the price of doing busines with them is more than the average working man can stomach.  For the first time, a real Company with resources and professionals ready to help you is offering a real alternative in the heavy equipment industry.

To learn more visit www.dutchmanglobal.com or contact the Agent nearest you.  As you may already be aware, we are looking for qualified heavy equipment Agents to serve our customers in Mining, Forestry and Construction.  Soon we will announce our newest Agent serving the Florida forestry market.  Stay tuned for that and other exciting developments as we continue to improve our products and services.

 

Green Building Council Under Fire

Internationally, the Green Building Council and its affiliated organizations like the USGBC and their Australian counterpart; the GBCA, are under heavy fire.  Commercial interests are attacking these organizations like never before and bringing political pressure to bear on an organization that was previously dismissed and disregarded.  Now that global commercial enterprises and government agencies want to comply with and earn the approval of these private regulatory bodies, their procedures and requirements are coming under heavy fire.  I have some personal experience with the GBC here in the United States because I previously worked for a construction company that specialized in green building design and construction.  The GBC is having a tremendous impact on the use of energy efficient, sustainable and recycled materials in building projects.  Their requirements are driving the purchase of high recycled content products from wallboard (sheet-rock) to certified recycled wood content flooring, recycled content carpet, recycled steel lighting fixtures and a whole host of specialty products and materials.  The bottom line being the more recycled, high efficiency or certified sustainable content an architect and builder team can include in their project, the higher the GBC rating.

The higher the rating the more ‘earth-friendly’ the project is considered.  What is often not considered is the long term benefit and life-cycle costs associated with products that are simply smarter in terms of design or performance.  In other words the GBC may assign points or credits for the installation of light fixtures that are constructed with recycled steel, but the fixtures themselves may be very inefficient in the way they illuminate a space, requiring more fixtures (more cost, more CO2) than an alternative fixture that may not contain recycled material.  Or they may assign a point value for recycled gypsum sheet-rock walls, but they won’t assign a point value for a modular wall that can be reconfigured at a later date without creating landfill waste and the need for more raw material to replace the traditional wall.  In the beginning as standards were being developed the process was clumsy and fairly desserving of intense criticism.  To be fair it is much improved in recent years and products are much more readily available, giving specifiers greater freedom to choose locally derived products.  In fact the GBC has recently begun to assign credit for local products because it reduces the pollution generated by transporting materials over great distance. The GBC has a long line of critics and I am certainly not someone who would defend it as a flawless body.  However, its impact has been nothing short of amazing.  The GBC is affecting the purchasing and specification activities of more than half of all US architects, engineers and contractors.  This has brought both praise and intense resentment when their certification process does not favor a particular manufacturer of building materials.

Recently the Australian Timber industry has launched a series of bitter attacks on the GBCA, accusing it of favoring foreign suppliers over Australian producers of structural timbers and other finished wood products like plywood.  The Fifth State has reported in detail just how nasty the fight has become.  Timber companies have enlisted political representatives, legislative bodies and government agencies to help them force the GBCA to adopt a more Australia friendly model.  The problem with this effort if it is successful, is it will ultimately destroy the GBCA.  Which of course is of little concern if all you are interested in is finding a scape goat to explain declining profits and sales.  I am certainly not a VP of Marketing and don’t hold degrees from distinguished Universities like the big shots that run the Australian Timber Industry and its Unions.  So my opinion is of little real consequence.  I just can’t help but think that the Timber Industry would be better served by leadership that embraced competition, instead of running from it.  If Australian timber producers would simply step up and meet the more stringent SFC standards for sustainable timber products, they could then compete on a more global scale for GBC projects.  That might I-N-C-R-E-A-S-E Sales and Revenue and improve the long-term outlook for jobs and worker income in the Australian Timber Industry.  But, what do I know?  Its obviously easier to just call your local political boss and see what kind of trouble he can stir up.  To read the full article click the link below.

The Fifth State – ‘Bullies Win in Timber Industry and Union….’

Existing Home Sales Jump 10%!

Rueters is reporting that sales of existing homes jumped over 10% in October.  US Forest Products companies need new homes sales to rebound if they are to see any positive movement in consumer demand for lumber.  However, this is a universally positive sign as buyers who can afford to do so are taking advantage of some deflated prices to purchase homes ahead of any price increases that might result from a recovery and an increase in demand for housing.  To read the full article please visit the link below.

Rueters – ‘Home Sales at Two and a half Year High!

Who Needs the Conference Board? We Have the Underwear Index!

The Washington Post is reporting along with other major outlets that the buying habits of men, (when it comes to underwear) could tell us more about the short term economic forecast than indexes such as Consumer Confidence.  The logic goes something like this;  Men put off buying necessities when things look bad economically speaking.  For a variety of reasons they feel uncomfortable about their personal financial situation and so they put off the purchase of basic necessities.  Thus the Mens Underwear Index.  Those who track these purchases with major retailers and maintain the index, claim that when sales for these garments go up, it is a short term signal that men are feeling better about their financial future.  In the past few weeks retailers are reporting that mens underwear sales are up sharply. To read the full article follow the link below.

The Washington Post – Blue Chip, White Cotton: What Underwear Says About the Economy

Pellet Manufacturer Ready to Compete with Power Co.

A Pellet Manufacturer is poised to go direct to the public in Maine and compete head to head with the local electric utility, offering consumers metered electric power and heat with no up-front capital investment.  The plan is simple really; offer customers what they want.  By providing a no-hassle, metered boiler with a large capacity hopper that needs to be filled only once or twice a month, consumers get cheap, reliable heat and electricity.  In the US we enjoy reliable power, but cheap is not something that is often used to describe the bill we all receive every month.  Wood Pellet boilers cost about 60% less to operate per BTU or KW, than metered electricity in New England.  Mainebiz, an online news outlet, published an in-depth interview with Steve Mueller, President of International WoodFuels.  Mueller’s company has begun construction of a new mill to produce pellets in Burnham, Maine.  The facility will also offer metered electric, wood pellet fired boilers to customers in the Burnham area as an integrated part of their business model.  To read the full article follow the link below.

Mainebiz.biz – Putting the punch in Pellets

International Trade Commission Votes to Pursue Investigation!

November 10, 2009

The International Trade Commission voted unanimously to proceed with an investigation into complaints by major US Paper Companies that Malaysian and other Asian paper producers have dumped cheap imported paper onto the US market and cost the industry hundreds of millions in revenue and thousands of lost jobs.  The vote comes on the heels of several high-profile paper mill closings announced by Georgia Pacific and International Paper.  International Paper alone reduced its workforce at three mills by over 1600.  This figure does not account for the loggers and timber companies affected by their decision.  The accusations are being strongly considered as southern US paper manufacturing facilities are historically some of the most efficient and most productive facilities in the world.  Nonetheless, they do not appear able to compete with virtually free timber, provided by Asian governments as an incentive that appears likely to be declared illegal.  To read the full article follow the link below.

Packaging Digest – ITC Issues Preliminary Determination

South Carolina Logger Improves Safety & Bottom Line!

In Bethune South Carolina, a successful logging operation has created a custom solution that improves worker efficiency and safety.  Lawrence Smith, owner of Smith Timber, has developed several great ideas into real savings and improved safety and the bottom line.  Lawrence got his start many years ago, when his father in law made him an offer he could not refuse.  Frustrated with not being able to find good workers to help him in the woods, he offered Lawrence a hefty salary for the time and a company truck to go with it.  Lawrence soon left Columbia and moved to Bethune to help the family business.  Since then he has worked hard to build on the business he eventually bought.  Smith Timber performs a variety of harvesting services including thinning, clear cuts and in-woods chipping.  Over the years Lawrence discovered that one of his biggest adversaries was fire and minor break-downs like hose failures.  Fire destroyed a brand new Timberking 380 Feller Buncher that he purchased new in 2004.  Fire also nearly destroyed a Peterson 5000G Chipper as well.

To combat this challenge he devoted some time and thought to building a custom firefighting rig that his operators could use in the woods.  The result is very simple in its design and construction and was very inexpensive.  It consists of a 200 gallon tank mounted on a small trailer with a box welded onto the rear for a small gasoline engine and pump.  A hose reel with about 50ft of heavy duty hose and spray nozzle completes the rig.  If a fire breaks out on a piece of equipment at the landing, the rig is stationed nearby to put out the fire.  If it breaks out on a machine in the woods, a skidder operator can easily back up and grab the trailer, carry it to the fire and put it out.  The operator simply fires up the small engine which drives a pump and the operator can place foam fire retardant on target, up to 30ft away.

Lawrence claims the rig has saved him thousands and thousands of dollars not only in reducing loss due to fire, but also in protecting his workers from the incredible heat of an equipment fire.  Often machines are so hot, that a operator will get burned trying to get close enough with an extinguisher to help control a fire.  With the pump trailer, an operator can stand at a safe distance and completely suffocate a fire with the foam retardant.  In addition to the fire suppression rig, Smith also uses a very innovative fuel and tool trailer that he constructed specifically to support his in the woods chipping operation.  “You lose so much time going back and forth into town to replace a hose or get a minor part that it just makes good sense to have as much on the job as possible”.  Smith even fitted the trailers with a microwave and storage for the crew to keep snacks and meal supplies for lunch.  Inside the trailer is a hose machine and a wide range of fittings as well as belts, spare chains, saw teeth, packing kits, filters, extra knives for the chipper, welder and supplies, etc., etc.  “I got so tired of a hose blowing on a machine and the entire crew sitting for half a day.  Now the rest of the crew never stops while we make a hose in the woods or fix a leak on a machine”.  One thing that makes the supply trailer really work well is the hose and fitting maker has supplied Smith Timber with a hose machine and they come out to the woods once a month to replenish his supplies, billing him for what he has used.

The trailer is a very simple thing to construct, starting with a standard loader frame, Smith added a 20ft shipping container and a 3000 gallon tank.  To the underside of the container and the tank on both sides he welded locking tool boxes for power tools, hoses and a pump and pony motor to run the fuel tank.  The major benefit is being able to refuel his machines in less time with a higher pressure hydraulic pump.  He can refill a 300 gallon tank on his chipper in 8-10 minutes, instead of the 30 minutes or more he once waited with a standard 12 volt electric pump and fuel tank.  “It’s hard to be out here 10 hours a day and you are tired and want to get home, then stand there and wait on a fuel pump for half an hour”.

Best of all Smith Timber enjoys a good discount on their insurance because they have the fire suppression trailer on site whenever they are working.  With workers compensation and property and casualty insurance taking an ever bigger bite out of the bottom line, a logger needs all the help he can get.   Smith Timber has a few more secrets that help them reduce fire loss and improve productivity.  One of them is an Ingersoll Rand, High-pressure air compressor.  “I used to clean all my machines with a pressure washer but it just takes too long and when they are done the machine is so wet you can’t see your leaks to fix them.  Now with this air compressor, I can blow trash and pine needles, leaves and wood debris out of a machine in a lot less time and the compressor dries the machine while it is cleaning.  As soon as we are done we can turn on the machine and find leaks immediately.  This is the best investment I have ever made.  This machine keeps all my machines clean and significantly reduces the risk of fire because it helps you find leaks faster.  You have to be careful and be sure to wear a face shield because its high-pressure, but nothing cleans better or faster.”

Lawrence was more than happy to agree to let me post some of his tricks of the trade here on Skidderzone for our visitors to read and enjoy.  If you have some good ideas, tools or techniques that have helped you get a leg-up, please feel free to email or call and I can stop by and see you the next time I am on the road.

Until next time,  God bless you and all our logging and sawmilling communities.

Jesse Sewell

Market Roundup – October 2009

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Weak Dollar Giving Exports a Boost!

I cannot explain why the US market has been so slow to recover but I can tell you that overseas markets are seeing an increase in activity and it is broad based, from Asia to South America to Europe.  Requests for Heavy Equipment from all of these markets are up substantially and orders as well.  If this is an indication that the global market is improving than I am certainly happy for it.  In the past three weeks we have received requests for equipment from five foreign markets that in recent months have been relatively silent.  I would like to think this is due to stronger demand for wood products from all of these regions but my gut tells me it has more to do with the current favorable exchange rate than anything else.

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Rain in Southern US Set to Boost Pulp Prices

In the southern US there has been almost steady rain for weeks and the Gulf States have been hit again just the previous day or two with another system that dumped several inches accross east Texas, Arkansas and Louisiana.  This same storm is now slowly working its way accross Alabama and will put a damper on logging activities that have already been curtailed by a very wet September and early October.  This can only have one effect on pulp prices and that is upward pressure to get loggers back in the woods.  This should be a welcome pre-holiday boost for loggers if prices can move upward and hold for a few weeks heading into the holidays when things tend to normally slowdown, plants schedule shutdowns, etc.  Perhaps this year we will have a more active holiday season than in years past.

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Availability of Credit

WY Campbell publishes an extensive quarterly report on the business activity and strength of mid-market companies in the $10 million to $500 million range.  They continue to cite the availability of credit as the most significant negative factor contributing to a protracted recovery.  The report is excellent and it gives a very thorough analysis of our current market conditions and factors that are both deteriorating and improving.  The conclusion is a positive overall improvement, but doubts as to whether the market will continue to improve unless we can get credit markets moving again.  To see the report in full or download a free copy simply click this link

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If you have a market update, good or bad you would like to share with our visitors please feel free to share a comment by clicking the link below.  We appreciate anything you might have to add from your neck of the woods.

Germany Moving Toward Renewable Energy!

Rueters is reporting that Germany is resisting any new efforts to promote nuclear power as a clean energy option for Europe’s largest economy and the EU as a whole.  German opposition is credited with keeping nuclear energy off the table when the EU drafted its recent ‘Climate Change Strategy’.  All this bodes well for wood industry investors and workers producing fuel pellets and biomass destined for European markets.  Germany is already the largest purchaser of wood pellets for home and commercial energy and heat.  With continued resistance to nuclear, that market will continue to grow at an alarming rate.  Demand for Wood Pellets in Europe has doubled annually for the past 5 years and there appears to be no end in sight.  To read the full article visit the link below.

Rueters – ‘Germany Votes for Nuclear Autumn – Not Spring’