Business View Magazine interviews Brent Parent, CEO of Material Handling Services (MHS), as part of our focus on America’s Fastest Growing Private Companies.
When it comes to outsourcing their forklift, industrial door, and industrial dock needs, mega-corporations Home Depot and Walmart place their faith in Material Handling Services – as do hundreds of other highly successful national, regional, and local companies throughout the United States. MHS is the holding company for multiple businesses, offering innovative solutions across every aspect of the material handling industry.
Under the savvy direction of Founder & CEO Brent Parent, MHS has spent over 20 years developing data-driven solutions that increase productivity, improve safety, and lower operational expense for clients that require facilities and equipment to move and manage materials on a large scale. Parent was honored as a 2017 Ernst & Young Entrepreneur of the Year for the Michigan and Northwest Ohio Region, and recently shared his take on the phenomenal growth and success of his company. The following is an edited version of that Business View Magazine interview.
BVM: What was the vision when you founded MHS?
Parent: “Our parent company is Material Handling Services (MHS); our primary forklift brand is Total Fleet Solutions (TFS); our primary industrial door and industrial door brand is Miner. TFS was founded in 2000. The thought process was: there are 20,000 plus material handling vendors in a fragmented market that offer one territory, and one brand of equipment or one trade (forklifts, industrial doors, industrial docks are all trades). I didn’t want to be number 20,001 doing the same thing. So, we offered all brands, all territories, all trades.
“We started out offering comprehensive consulting services as a better solution for managing those three assets. I was a one-person show at the time, and gave our first couple of customers good consulting information, they just didn’t implement the ideas. It dawned on me after 60 days, they didn’t want ideas, they wanted fulfillment. So, I changed the model to “here’s the ideas and we’ll implement them.” It worked, because those clients were busy doing a million other things that were core to their business.
“Say a customer has five locations. One has 25 forklifts – five different brands with an average age of 15 years, because they accumulated them over time. They didn’t have good data to make decisions on what assets they should have, or the quantity. So, we gave them a recommendation of what their fleet should look like, and a path to get to it over the next six months, by right-sizing the fleet from 25 down to 20; moving over a couple years to a more consistent brand, or consistent specifications of assets, that would make the operators more effective.”
BVM: How did you develop such a strong network in the industry?
Parent: “We’re an outsource model. When customers want to outsource the complete function –all brands, locations, aspects, and services required to manage a fleet of forklifts, doors, and docks – you need to be well rounded to do that. My background was a perfect fit. I worked for Dana Corporation for 11 years, and gained experience in finance, strategic planning, purchasing, running a business unit, audits, acquisition. One of the last jobs I had was involved with buying all their forklifts, and I got to know many players in the industry.
“TFS went on by itself until 2005. Then, Todd Roberts (one of the first people to work with me at TFS, and an owner and integral player today) and I sold part of the company and brought in private resources from Southfield Capital. We grew and formalized the business, making big investments in people and technology. In 2011, we had grown enough that it was time for Southfield to move on. We brought in our second private equity sponsor – C. I. Capital. We had done zero acquisitions in our 12-year history, and C. I. taught us and pushed us to do acquisitions that would complement either more trades, more territories, or more services along the asset life cycle.
“Phil Miner, simultaneously and unrelated, was the founder of Miner Corporation in San Antonio, Texas. He was working on a similar business as an independent manager and maintenance provider for industrial doors and docks in the Texas area. I had met Phil, and we always thought it would make a good combination. We were the forklift experts, they were the door and dock pros. Phil was a little older than me, and looking to give up full time work. So, MHS acquired Miner Corp. in 2012. Since then, we’ve done 25 acquisitions – that’s where a lot of the brand names come in.”
BVM: Where are your operations based?
Parent: “MHS and TFS are headquartered in Parrysburg, Ohio (a suburb of Toledo); Miner is based in Dallas, Texas. TFS and Miner are about the same size. There are about ten of us sitting in the MHS holding company that provide strategy, management, executive leadership, and IT across all units. The rest of the team works specifically in TFS or Miner. We have around 2,000 employees in total. Revenue has grown from $30 million in 2005, to a projected $600 million in 2017 ($250 million for TFS; $350 million for Miner).”
BVM: Who is the typical customer?
Parent: “We have national, regional, and local customers. National clients, including Walmart, Home Depot, Amazon, and Whole Foods, want complete outsourcing and consistent delivery of our services across all their locations. Being independent of brand helps us drive that. We offer services in 200,000 customer locations.
“Regional customers are recognizable names in their area with fewer assets and facilities than the nationals. Local customers make up the bulk of the locations, collectively, but as individuals, they’re small. Forklifts, doors, and docks represent 90 percent of the approximately 500,000 assets we have under management, today, because they are mission critical. When one of those breaks down, the customer feels pain.
“For our business to be efficient requires density of customers; enough to keep our technicians and maintenance cycle busy. We have services to manage the five life cycle phases of forklifts: procurement, operating, maintenance, data, and disposition. Most of our customers save 20 to 30 percent in the total cost of ownership almost immediately when they outsource completely to us. They get newer, safer, more productive assets and, most importantly, we have data coming into one database in a useful format that allows us to provide better solutions every day.
“Industrial doors and docks aren’t as expensive assets. They last longer, so the key measurable is fixing them fast and correct the first time. We have 800 of our own technicians in 35 states, and over 20,000 affiliate sub-contractors in the other 15 states – it’s an army.”
BVM: How do you differentiate yourselves from the competition?
Parent: “We’re an aggregate solution, whereas our competitors provide a partial solution. If you want a comprehensive model, you come to us and we don’t really have any competition in that area. If you’re okay working with several vendors to package your own solution and manage multiple suppliers, we do have competition in each phase of the life cycle. Our real competition is the customer wanting to do this for themselves. But as the years go by, more people are wanting to outsource. We provide the people, processes, systems, time, and data to do it better than anyone else.”
BVM: Any valuable business relationships that have impacted your growth?
Parent: “All the OEMS – their design of the product gets better and better. There are 20,000 brand affiliates and independent dealerships we do business with around the country. Technology partners, Sales Force and Microsoft, are key. Our financial sponsors: Southfield Capital, C. I. Capital, Harvest Partners. Banks and lenders that have facilitated our growth. And the leasing companies that do financing for our customers.”
BVM: What are your company priorities for the future?
Parent: “Our plan is to stay focused on doing business throughout North America. We have invested a ton to more easily collect data on all our assets, customers, and technicians. We want to get the million plus data points into a more usable format. We continue to invest in training people, hiring new people, acquiring top companies – specifically, investment in technology that gets into our customers’ and employees’ hands – even those in the field – via handhelds in a real-time fashion.
“Top of the agenda five years from now would be geographic coverage. We want to have our own people and offerings in all 50 states. Secondly, consistent use of data to increase savings to our customers from 20 to 30 percent. That’s taking out another 10 percent of waste. We also want to offer a good lifestyle, good workplace, and good culture, as we continue to grow. We’ll be five times the size we are today, in terms of people and revenue, so we want to make sure they’re challenged, they’re happy, they like winning, and they understand that if we’re going to take out another 10 percent, we’ve got to use the data differently to provide a better solution.”
AT A GLANCE
WHO: Material Handling Services
WHAT: Innovative solutions for the material handling industry
WHERE: Headquarters in Perrysburg, Ohio
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