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We're right on track

by George Hohmann
Daily Mail Business Editor

March 29, 2012 Charleston Daily Mail

Technician Kenny Houston of Sissonville talks to Monty Boyd, who bought Walker Machinery two years ago. Boyd is visiting every Walker location to talk with employees.


Two years since Monty Boyd bought the locally rooted Cecil I. Walker Machinery Co., he says the company remains on target for success.
"We're right on track, where we wanted to be," Boyd said.
"I'm pleased with our progress," he said in an interview. "We're ahead of my expectations."
When Boyd bought the Caterpillar equipment dealer headquartered in Belle on March 31, 2010, some of Walker's employees were anxious.
"They had concerns because Walker had been a long-established business and they wondered what was going to change," Boyd said. "Our message was, 'Nothing!' We would continue to service and support our customers like Walker. We wanted to maintain and grow our employee base and continue to provide a high level of service to customers. Those were our goals.
"We've done exactly what we said. The customer feedback we get is the level of customer satisfaction has increased."
Walker sells, services and rents Caterpillar machinery in western West Virginia and southeastern Ohio. The only change in locations to occur since Boyd bought Walker was the November 2011 closure of the company's store in Athens, Ohio.
Tim McLean, Walker's vice president of operations, said the Athens store, which rented equipment, was opened about five years ago so the company would have an outlet near American Electric Power's power plants along the Ohio River. Many of those plants were undergoing environmental upgrades.
The decision to close the Athens store occurred when the power company construction business diminished. All three employees remained with Walker and were transferred to other locations, McLean said.
Walker currently has eight locations in West Virginia and one in Ohio. Plans are underway to expand the company's Huntington office, McLean said. Walker had just over 600 employees when Boyd bought it. Today, it has just over 700.
Boyd also owns Whayne Supply Co., which is headquartered in Louisville, Ky. Whayne is the Caterpillar dealer in 120 counties in Kentucky and 16 counties across southern Indiana. Whayne has grown from just under 1,300 employees in 2010 to about 1,400 today.
"We certainly saw some improvement in business last year over 2010," Boyd said. "That's why there has been an increase in the number of employees."
Walker has always relied on the coal industry for a majority of its sales. That will not change, Boyd said. But to help Walker ride out the coal industry's ups and downs, Boyd is diversifying the company's customer base, primarily by pursuing opportunities with businesses involved in the natural gas-rich Marcellus and Utica shales. Those opportunities include:
• Rebuilding the large diesel and natural gas-fired engines that transmission companies use to move natural gas through pipelines.
• Selling earth-moving equipment to companies that build drilling pads.
• Selling equipment to build roads in remote areas, to clear rights of way and to lay pipelines.
By diversifying, Walker can retain its highly trained employees and constantly be poised to respond to the coal industry's needs, Boyd said.
Demand for steam coal, used to generate electricity, has weakened in recent months because of the mild winter. Also, some power plants are switching from coal to natural gas because natural gas is cheap.
Meanwhile, demand for metallurgical coal, used to make steel, also has slackened.
"We've seen some major economies soften," Boyd said. "But I believe we will see a little bit of an increase - China is starting to pull back on some of their restrictions. I think we'll see a little faster growth in China and India.
"The uncertainty that's out there puts the same uncertainty in our business," he said. "As a business that serves the coal industry, we have to have the equipment available when there's an upswing. When the market starts to soften, we have to adjust inventory levels. As a distributor to the industry, we certainly look at our inventory levels and employment levels. We're trying to maintain employee levels to meet the demand when the demand begins to increase.
"Our employees are highly trained and skilled so it is a challenge when business takes off to ramp up to that level of skills that are needed to perform.
"I'm very impressed with the abilities, the skill level of our employees," Boyd said. "We have a great group of very talented people at the company. They exceeded the level of expectation on my part."
Many of Walker's key employees are diesel technicians. "They have to have a high level of understanding of computer systems, electrical systems, hydraulic and mechanical systems, in order to diagnose problems with our machines and make the correct repairs," Boyd said.
"The machines appear to be large pieces of iron, but the products we sell are very sophisticated, complex pieces of equipment.
"Even during slower economic times we continue to have a full group of full-time training instructors to continue to train our employees, to keep them at the skill level we need."
McLean said, "In West Virginia in our industry, the solution for us has been and will be the community college system. The community colleges have wrapped their arms around what the industries in this state need and are aligning their curriculums to match our needs."
Boyd said, "We work closely with them."
McLean said, "And we support them. We contribute financial aid to students to attend those programs."
Boyd said the highest number of job openings in the company is for diesel technicians. In addition to trying to recruit top talent, "we try to promote and advance people within our organization," he said.
Boyd is an example of that kind of success. Right out of school, he worked for Caterpillar for 10 years and "then decided to make a career change and went to work for a dealer, Whayne Supply Co. I worked for them for 25 years. I worked my way up the organization and became president of the company."
"The Whayne family was transitioning to the third generation, and the third generation elected to sell the company," Boyd said. "I acquired the company at the end of 2008. In the middle of 2009, the people at Caterpillar asked me to consider the purchase of Walker.
"I tell employees quite often I pinch myself as I wake up and realize the opportunities I've been given to grow and advance."
Boyd operates Whayne Supply and Walker Machinery as separate businesses. Asked why, he said, "If you mention Caterpillar in West Virginia, the next word mentioned is Walker. In Kentucky and Indiana when you mention Caterpillar, the next mention is Whayne Supply. I think that brand, that reputation of serving customers is the value. I think it would be a major business mistake to eliminate that brand."
Although they are operated as separate businesses, "there are some Walker employees with dual responsibilities and some Whayne employees with responsibilities for both organizations. We look at the employees who have the skills and talents, who are going to do the best. They are two sister companies working to make each other a better organization."
Boyd spent several days last week and this week meeting with employees at every Walker location. At the end of each meeting there was time for questions and answers.
Asked what he's hearing at the meetings, Boyd said, "In any ownership transition there's tremendous uncertainty, almost to the level of anxiety, about what would occur with the company. Would they be employed? Was the company going to change names? Now, two years later, employees have a better sense of the company's direction. I think their trust and confidence in the company going forward was very apparent in these meetings.
"I think our employees are seeing our company invest in our facilities. We're making a major investment in our operating system. It's one of the largest investments that either company has made in a long time - quite honestly, in either company's history.
"It will be implemented over the next 18 to 24 months, starting with human resources, then finance and accounting, and will then move into some of the operational areas. We've already chosen the vendor and have begun the work. I think they're seeing this investment is very positive."
In 2009, Walker and the Walker family's foundation were together making charitable contributions of $300,000 to $400,000 a year. Steve Walker said at the time, "We give to a lot of local schools. We're in every yearbook. We try to do it where our employees are."
Boyd was asked about the company's charitable giving now.
"As part of our company's mission statement, we want to support our communities," he said. "I think it's very important for us to be a good corporate citizen. We support our communities where our employees live and work. We want to support those (charities) that our employees also are involved in.
"I don't know that I support just putting our name out on a front banner. We especially want to support educational institutions that provide education hopefully for future employees. There are a lot of individuals out there in great need - we want to support those areas also. It is more than dollars. Sometimes it's the use of equipment. Sometimes it's manpower. We put a significant amount of equipment out in Logan, trying to help people recover from the flooding."
As the owner of two Caterpillar dealerships, Boyd was asked if he would consider buying a third.
"It's a rare occurrence for someone to be afforded the opportunity of one Cat dealership, let alone two in the time we accomplished that," he said. "We're looking at any opportunities for growth. If the opportunity presented itself for another, I would consider it, but I'm not out actively looking. I have plenty to do."

Photo credit: Craig Cunningham
Monty Boyd, owner of two Caterpillar dealerships, the Cecil I. Walker Machinery Co. and Whayne Supply Co., stands in the equipment yard at Walker Express - The Cat Rental Store in Nitro.

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