Top 20 systems suppliers, 2015

Just two years after it tied Schaefer for first place, Daifuku pulled ahead in 2014, edging out its longtime rival by less than $50 million. This development is among the results of Modern’s 18th-annual Top 20 Systems Suppliers list.

No. 1 Daifuku reported $2.54 billion in revenues, up 3% from 2013, when it acquired Wynright Corp.

Schaefer Systems International’s (SSI) $2.49 billion represents an 8% increase in sales for 2014, thanks to strength in food distribution, e-commerce and retail fulfillment on a global basis. However, president Arnold Heuzen explains that SSI’s consolidated results shows a 6% reduction due to a strong dollar and fluctuations in currency exchange rates.

Growth across the list may seem subdued compared to 2013 revenues, when half of the top 10 companies posted nearly 20% year-over-year growth and the Top 20 were up 6.6% overall. But although the list as a whole gained just 2.6% in 2014, industry experts like Norm Saenz, a managing director of St. Onge Co., suggest that the pace of growth remains strong. For instance, St. Onge has been consulting with several clients to justify big investments to support planned volume increases. “Many of these larger projects involve new building designs that require more than a year of planning and implementation to go live,” Saenz explains. As a result of projects and commitments already in place, Saenz expects that 2015 reported revenues will show even further improvement.

Read last year’s Top 20 systems suppliersstory.

The view from the top
As Daifuku and Schaefer jockey for the lead, Dematic again secured third place with $1.6 billion, constituting a 6.7% increase. John Baysore, president and CEO of Dematic North America, attributed the growth to a broadening market of small- and medium-sized businesses aiming to enhance capabilities.

“Companies that produce and distribute products need solutions that optimize their supply chain performance in order to succeed, especially in this era of multi-channel distribution,” Baysore says. “Thanks to new scalable intra-logistics solutions and point solutions for smaller and lower volume operations, more companies than ever are embracing the benefits of automation.”

One driver of Dematic’s growth has been its maintenance and aftermarket services business—a theme repeated by Vanderlande, Intelligrated and Knapp. To support that growing line of business, Dematic acquired Upturn Solutions in 2013, a leading provider of computerized maintenance management systems (CMMS) for distribution, manufacturing and warehouse environments.

In fourth place, and one of only three companies to grow by 10% or more, is Murata Machinery, which reported the highest growth rate at 14.6% to close 2014 with $1.1 billion in revenues. The company acquired Finnish automated materials handling supplier Cimcorp last year, contributing more than $200 million to the revenue figure.

With $1.05 billion, Vanderlande Industries is fifth on the list. CEO Govert Hamers says Vanderlande saw growth in e-commerce, postal and parcel markets along with a substantial uptick in the number of service contracts, which now constitutes 20% of revenue. In addition, Vanderlande closed two acquisitions in 2014: These included Ferdar Automation Technology, a robotics system integrator with experience in the logistics sector, and Smatec GmbH, a provider of sortation technologies, including a pocket sorter and modular bomb bay sorter that can also serve as a tilt-tray sorter.

Given some companies’ fiscal years and ongoing preparations for ProMat 2015 in late March, several companies were unable to report revenues by press time. In these cases, we’ve held previously reported revenues to preserve each company’s relative position on the list. One of those was sixth place finisher Mecalux.

Seventh-place Beumer continues its ascent up the list with 4.4% growth to $902 million. In early 2014, the sortation specialist acquired Dallas-based Glidepath, a designer, manufacturer and integrator of airport baggage handling systems.

Fives Group (Cinetic Sorting) was not able to report 2014 revenues by press time. At No. 9, Swisslog added 8% to finish 2014 with $712 million; in November, KUKA AG announced a successful public offer for Swisslog and now owns more than 90% of Swisslog shares.

Intelligrated reached 10th place after growing by 7.5%, or $44 million thanks to the continued interest in solutions to address Internet retailing and the state of the logistics workforce, according to CEO Chris Cole. “The need for retailers and manufacturers to make the most of capital investments and increase efficiency throughout the supply chain elevates demand for automation, software and aftermarket service, which in turn drives the continuous growth of Intelligrated and the industry,” Cole says.

Growth across the board
Back in 2013, the bottom 10 kept pace with the top of the pack, when each half grew by more than 6%. Not so in 2014, when the biggest players got bigger while numbers 11 through 20 collectively grew revenue by less than a percent.

The combined value of the list continues a rapid climb. For instance, in 2011, it took just $100 million to crack to the Top 20 list and $383 million to make the Top 10. This year, No. 20 (Savoye) posted $138 million in revenue while No. 10 (Intelligrated) posted $627 million.

Knapp, number No. 10 on last year’s list, was unable to report revenues by press time. Still, Kevin Reader, Knapp’s director of business development and marketing, says new orders and a booming aftermarket business are good news for the company. So is a growing focus on software. “Twenty-five percent of Knapp’s employees worldwide are focused on software,” Reader says. “Whether it’s warehouse control and management systems or real-time controls, customers are looking to improve performance and efficiency in their facilities.”

In 2013, after completing a restructuring process that began in 2011, Kardex reported revenues of $556 million, which did not represent an apples-to-apples comparison with the prior year. 2014 revenues were not available.

Despite being unable to report 2014 revenues in time, TGW is again in 13th place, having fluctuated between 12th and 13th place for six consecutive years. After growing 36% in 2013, Grenzebach (formerly reporting as KUKA Systems North America) did not report 2014 revenues.

Following in 15th place, Witron tallied $340 million. A statement from the company explains that although the number is unchanged from last year’s, Witron did see growth that is not reflected due to the exchange rate between the Euro and the dollar.

At 16th place, viastore did not supply 2014 revenues by press time, so its 2013 revenues of $207 million have been carried over.

No. 17 System Group (System Logistics) achieved the second-highest growth rate of 10.8%, adding $17 million to close 2014 with $174 million in revenues. Greg Chaffee, vice president of systems sales and marketing for System Logistics says the company enjoyed growth globally and in North America.

Newcomers Egemin Automation and Bastian Solutions claimed the 18th and 19th spots. Egemin’s Michael Coryn, marketing communications manager, notes substantial increases due to large contracts in warehouse automation for deep freeze applications.

Meanwhile, Bastian Solutions made investments in robotic manufacturing including mixed-case, full-layer palletizing and machine tending robotic solutions, according to Aaron Jones, president. It also released an updated software suite as well as a new modular, low-profile conveyor line. Jones says the company expanded into two new U.S. markets organically within Chicago and New Jersey, and also opened an international office in Montreal.

Savoye just missed the list last year, but returned at No. 20 with nearly 8% growth to $138 million.

This year’s Top 20 companies are joined by countless others committed to helping the materials handling industry continue to improve. Next year’s list could include newcomers, but it will certainly reflect a focus on increasing value.

Making the list
To qualify for Modern’s Top 20 list, companies must be suppliers of materials handling systems, not just equipment providers. In addition to manufacturing at least two major handling system components, a company must also employ full-time staff that designs, installs and integrates materials handling systems.

These systems include at least two of the following: transportation devices, storage and staging equipment, picking units, sortation systems, information management systems, data capture technologies and other types of handling equipment.

To be considered worldwide suppliers, companies must have a presence in North America and must also be able to report materials handling revenues to Modern. (Lockheed Martin, for example, is a systems supplier with a North American presence, but isn’t included in our Top 20 list because they can’t single out the revenue that comes from materials handling contracts.)