Lift Trucks, Hyster, Yale: NACCO Materials Handling Group

NACCO Materials Handling Group

Program Overview

Programs for Quality & Efficiency

Main Program Areas	Program Objective	Primary Financial Impact	Type of Program	Timing of Benefits
Manufacturing restructuring	Optimize capacity and production activity, reduce complexity and increase efficiency	Manufacturing variances, selling, general and administrative (SG&A) expenses and operating margin	Profitability	2008 - 2011
Quality initiative	Emphasize quality and further reduce overall defect rates	Manufacturing variances, SG&A expenses and operating margin	Profitability	2008-2009
Global supply chain	Worldwide coordination to obtain higher-quality, lower-cost components and assemblies, sourced efficiently from a smaller, more reliable and responsive supply base	Gross margin and SG&A	Profitability	2008 then ongoing

Programs for Flexible, Modular Products

Main Program Areas	Program Objective	Primary Financial Impact	Type of Program	Timing of Benefits
New product development process	Improve product flexibility, increase speed to market, reduce costs through common components and enhance quality through reliability engineering	Gross margin	Profitability	2008-2009
New product introductions	Share gain; superior ability to tailor product to specific customer applications	Revenue and margin enhancement; absorb unused capacity	Growth	2008 then ongoing
Strategic pricing optimization	Extract full value for products, features and services	Gross margin	Profitability	2008 then ongoing

Programs for Sales & Service Excellence

Main Program Areas	Program Objective	Primary Financial Impact	Type of Program	Timing of Benefits
National and global accounts programs	Share gain; increase sales of lift trucks and parts and enhance global account capabilities	Revenue and margin enhancement	Growth	Ongoing, long term; gradual
Dealer structure program	Share gain; further enhance professionalism and improve responsiveness to end users	Revenue and parts volumes	Growth	Ongoing, long term; gradual
Aftermarket parts	Share gain; enhance parts offering for Hyster®, Yale® and other brands of lift trucks; increase customer service	Revenue, parts volumes and margin enhancement	Growth	Ongoing
NMHG Retail improvements	Aims to reach at least break-even results and improved market position	SG&A and operating margin	Profitability	2008

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