Interview: David Dronfield, general manager, Famco
It’s a scorching hot day at pallet distributor, CHEP’s headquarters in Jebel Ali. A marquee tent with air conditioners blasting cold air, is the only respite contestants have from the 40 degree plus sweltering heat. Yet, there is barely one of the 56 competitors inside. Each one is outside, expectantly listening to instructions from organisers Famco, about the next Linde Challenge.
The Linde Challenge, now running for the second year in the UAE, is a forklift challenge, run in conjunction with Australian pallet manufacturer CHEP, which offers drivers the opportunity to showcase their skills. The event, which began in Europe and is still running in the UK, is a great opportunity to promote the industry, according to Famco general manager, David Dronfield.
“This is not a competition based on winning a prize, it shows how good the drivers are. It promotes and showcases the industry’s capability.” The competitive spirit is electric as each contestant awaits their turn to undertake one of the four challenges. Each of the events is designed to challenge forklift know-how, with different objectives to complete. At one station, participants attempt to identify five faults with a Linde forklift that has been deliberately interfered with, designed to assess a competitor’s ability to routinely check for problems before use in the real work environment.
Meanwhile, at another station, assessors monitor a driver’s aptitude in stacking and de-stacking pallets in the right order within a 10 minute time frame, assessing safe operation techniques, such as looking behind whilst reversing. Shane Craven, from Al Reef Institute of Applied Technology, judges competitors carefully stacking and de-stacking pallets. This is a fantastic event, he says. “There are some great drivers here today, the facilities laid on by Famco and CHEP make for a great event, but there is room for improvement with drivers’ observations and a need for proper controlled driving in the country,” he adds.
Events such as the Linde Challenge demonstrate the initiatives Famco has undertaken to improve the knowledge, expertise and safety of the forklift trade. Without it there would be little opportunity for drivers to improve. But as Dronfield explains, Famco’s solutions for the logistics sector are not constrained to the forklift industry. It is just one element of how the rapidly growing firm is resolving logistics issues one solution at a time.
Famco is the auto machinery company section of the automotive division of Al Futtaim. Starting in 1978, the firm has been in operation for 33 years. Originally, Volvo and power product brands helped grow the business, but it was not until 15 years ago when German forklift manufacturer Linde approached Al Futtaim to become the UAE distributor, that the business really began to evolve.
“As the Linde aspect of the company grew, it became evident that a large proportion of the Linde business was within warehousing, not just outside of warehousing. It became attractive to other principals who wanted to promote their product within the warehouse environment, so then storage equipment providers approached Al Futtaim to be part of the Famco business as well,” Dronfield explains. Over the years, the firm added Dexion (Power Racking and Storage), Nassau (Industrial Doors), Stertil (Docking products), and then Hart (High Speed Internal Doors).
But Famco’s company evolution did not stop there. When the company became agents for mobile storage and benching solutions firm Bott, it was a logical progression towards workshop design and fitout. Dronfield comments: “Every time the firm talks to a customer about an industrial solution for their distribution or warehouse, they will always have an office, so the firm then moved into office solutions based around interior design and interior fit out. This is where we moved out and beyond the industrial into the commercial section,” says the general manager.
Currently, Famco has nine brands in the storage and solutions side of the business, with aggressive expansion plans for the future. But Dronfield is quick to point out that this does not mean the firm will be looking to grow the business at any cost. If a brand does not complement the premium brand range Famco currently offers, it will not be pursued by the company. “Everything that we deal with has to be premium. We can’t just go to a country and buy something and on-sell it, it has to be part of our premium brand which we can support afterwards. The Al Futtaim mandate is that if we are going to provide a product, we need to be able to service it and provide after sales service. Premium brands approach us all the time asking if we will distribute their product, but if it doesn’t fit, we don’t take it any further, that’s why we don’t have 100 brands.”
Famco is not a company which limits itself to a local supply chain, drawing on its international reach to provide quality products to local clients. Unit products are manufactured overseas to order by their principals, which are then shipped to the UAE. Containers arrive generally at Jebel Ali and come through to Famco’s warehouse where they are then distributed throughout the region. Whilst the majority of Famco’s supply chain originates overseas, the business does manufacture some components in the UAE. “As part of our solution, we have a mixture of different components that we manufacture locally, then the parts and service back up is from our own distribution centre.”
Though Famco prides itself on the products and brands it provides, it’s the solution selling aspect of the business that sets it apart from other competing firms. Famco is not a retailing company explains Dronfield. “You can’t buy from us on the internet. I have had customers call up looking to buy A,B,C, but what we do is sit with them to come to a solution. It’s a consorted solution,” he says.
Unlike many companies who will wait for the client to come to them, Famco sales people are very proactive in seeking business. “What we do is go to the client before they are even looking. The customer already has a problem and getting to know the client’s business, talking with them, and understanding their business in order to introduce solutions for their everyday problems, is what the company does. It’s the job of our sales team to talk with the client and say ok, you’ve changed this, therefore your customer profile has changed. The sales people are trained to sell a solution, and within that we have our brands and our components that build up that solution.” Dronfield comments.
Listening to the general manager, you get the impression the company runs like a well oiled machine from top to bottom, but like every business it has had its fair share of down times. The global financial crisis was no exception, but it was Famco’s modest expansion plans and diversity that saw it through. “I think one of the advantages during the downturn is that the company was not over stretched. You could see the faltering come through, but what we have got is diversity. Across our five segments of storage and materials and handling, what we do is say: ‘we know this one will come down because the whole industry is coming down, so what can we do with this one and move into a different industry sector’,” Dronfield explains.
“In 2010, we felt the bite on the industrial sector, but at the same time we grew our commercial aspects of the office interiors and workshops and vehicle fitout sides of the business, so in some areas, recognising that we were coming down, we were able to grow in other areas, so our profile only saw a very tiny hiccup. We are already growing 20 per cent on last year,” he adds.
Whilst the challenge of the global financial crisis may be gradually fading, there are still some pressing issues that lie ahead for the whole logistics industry. As Dronfield observes, industry understanding and a lack of experienced personnel remain key hurdles for the sector to overcome. In terms of industry understanding, getting the aspect across to clients that cheap is not always the way, can prove to be a sticking point. “It needs to be a solution. You can’t just buy this from here, buy this from there, put it together and hope that it works. Raising the professionalism within the industries associated with what we do is our hardest challenge.”
According to the general manager, the client, however, is only part of the problem. In satisfying the growing demand for key personnel, it can be difficult to find the right people. “It’s hard getting the talent. We can’t just go and get sales people. These are not retail sales people they are consultants. On average it takes us two years to train a sales person into the industry to be able to sell the solution. They have to work with the customer to find out what the problem is and convince the customer that this is the solution and that it will work in this order.”
Seemingly, degrees are unlikely to fill that void in the near future either. “To go and get a degree doesn’t mean you are qualified in it. It’s only been a few years that they have brought out logistics degrees and you bring those people in and it’s the practical aspect that they’re really missing.” Despite the industry challenges, Famco has some bold plans for the future. Traditionally, the firm has been a UAE based company which has spread quietly into different areas such as Sri Lanka, Singapore and South America. But the firm recognised two years ago that it had a very solid base and that it was time to move out and expand.
“The model that we have here we want to leap frog from one country to the other. Talking to key accounts here, they know what our products, service, and brands are and they want the same service, products and brands in other countries,” Dronfield exclaims. “We have only scratched the surface. Growth is coming from expanding on the brand relationships that we already have here. This business will grow very aggressively within the region. I see it evolving throughout the Middle East”
Back to the Linde Forklift Challenge, competitors are still enthusiastically competing in the scorching sun. On a simplistic level, this event is an opportunity for forklift drivers to improve their skills and showcase the industry and from the reactions of the drivers, it’s a lot of fun as well. But in reality, the event is much more than this. It is a well organised event indicative of a company which tries to listen to the industry, clients and contractors and work with them to achieve solutions. As with its approach to the Linde Challenge, if there is a problem, Famco has the solution.