Marco Cappelletti

The European headquarters of Japanese forklift manufacturer Komatsu Forklift Co Ltd is reorganising its original equipment business to compete with non original spare parts suppliers in Europe.

Komatsu Division's new strategy includes an improved warehouse management system, heavy discounts on certain products, a wider equipment range and an optimised supplier network.

Spare parts pricing & promotion manager Marco Cappelletti said the shake-up in Komatsu Division's original equipment business would "counter its competitors and pledge the best support to customers".

"[We] face competitors who offer non original and therefore less expensive equipment. Non original spare parts have a different quality and don't comply with required quality standards," he said.

Three new Italy-based area managers have been appointed to develop the spare parts business in Europe. They will oversee the spare parts purchasing process, visit customers, find new customers, analyse potential markets and start up new dealers. Komatsu Division says they cannot be named because of a "privacy policy".

Komatsu Division's warehouse, in Lainate, Milan, which supplies parts to 230 distributors, dealers and sub-dealers in Europe, now has a prompt purchasing service supported by a new information system integrated with the importer network, a Komatsu statement said.

Distributors and resellers have entered into "commercial agreements" with Komatsu Division to motivate customers to use original Komatsu parts. Discounts of up to 80 per cent are being offered on "category P" products.

"Products in category P change on a rotation basis. It is not restricted to certain products [but is exclusive to dealers]. The category was created to compete with non original parts by providing parts at heavily discounted prices," Cappelletti said.

After introducing new product categories, Komatsu Division has seen a jump in revenue for the first four months of 2006. Compared with the corresponding period in 2005, revenues increased 410 per cent for transpallets, 72 per cent for tyres, 67 per cent for forks, 35 per cent for seats and 29 per cent for chains.

As part of the restructure, Komatsu Division has adopted a "selection, qualification and certification process" to optimise its supplier base, which has succeeded in keeping costs low, a company statement said.