MTD exclusive! BKT discusses 2010 plans
Balkrishna Industries Ltd. (BK-Tyres) is on a roll. The Mumbai, India-based OTR and farm tire manufacturer more than doubled its sales from 2007 ($15 million) to 2008 ($34-plus million) in North America and is on track to achieve $50 million in sales this year.
Much of those gains can be attributed to the hard work of Rami Bitran, general manager, BKT U.S.A., and Bill Haney, sales manager. Together, they have built a network of distributors that includes Batesville, Miss.-based Dunlap & Kyle Inc., Memphis, Tenn.-based TBC Corp., and other major players. “People know us by now,” says Bitran.
Modern Tire Dealer Senior Editor Mike Manges recently discussed BKT’s plans for the rest of the year and 2010 with Bitran and Haney, who also shared their forecasts for both the farm and OTR tire markets.
MTD: What has your business been like this year?
Bitran: We are (on track) of achieving $50 million in 2009. But we’ve had to work harder because the market, as you know, is getting harder. This year we are capitalizing on our previous performance. Those who signed up with us last year are increasing their business.
Haney: Some opportunities were not available to us in 2009. Our increases this year (are the result of) plain, old-fashioned hard work and good service.
MTD: Have you beefed up your sales team?
Haney: We added an OTR specialist and we added a regional sales manager to service our southeastern accounts, where we’ve gone into big expansion.
Bitran: The major big groups there like Dunlap & Kyle and TBC… have multiple locations, so it’s only natural.
MTD: Are you well-represented coast to coast or are there some areas that need to be filled in?
Bitran: We still have what we call black holes, but we try to focus and are not shooting in all directions at one time. We have a (long way) to go as far as full coverage and we have a (long way) to go in (terms of) OE (fitments), which is a future market for us.
Don’t forget this was a very, very hard year on everything that (required) OTR, construction and industrial tires. In OTR, we kind of maintained the position we had last year. We didn’t grow a lot. But with ag, we exploded.
MTD: What is your assessment of the North American ag market right now? Is it as robust as 2008?
Haney: 2008 was one of those gift years. This is what I would call a typical year.
MTD: Last year we reported that BKT was shipping 100 to 120 containers to the U.S. each month. How many containers are you now shipping?
Bitran: One hundred and fifty. We expect to ship about 350,000 tires in 2009, of all sorts and kinds. In 2008, we shipped 260,000, so you can see the growth.
MTD: You’re a container company. Do you plan to establish distribution centers or warehouses in the U.S. or will you continue to ship directly to your customers?
Bitran: We are shipping directly. We see it as a principle because once you establish a warehouse, you’re perceived as a competitor of your own customer.
Haney: There are a lot of large distributors with mega-warehouses… and they certainly view themselves as the preferred channel. They would not be very happy to see us open a large warehouse.
MTD: Are you pursuing OE fitments in the U.S.?
Haney: I would describe it as coming off the ground. It’s premature to make any big announcements but certainly we have the attention and the cooperation of the large OEMs.
MTD: Is your parent company (India’s Siyaram-Poddar Group) allocating more resources to your operation?
Bitran: There is no cap on resources available to us when we need them. They do not make up their minds daily (based on) the situation of the dollar or the euro. They’ve determined that America is a major market for them and they want to be here.
MTD: What does 2010 look like for BKT in North America?
Bitran: We’re projecting at least the same. And in the current economic environment, this is going to be an achievement.
MTD: What will the ag market look like next year, industry-wide?
Bitran: I think it will be more of the same. There’s no indication of any major catastrophe or crisis.
Haney: I think ag will be very similar to 2009. We’re on a path of seeing BKT win acceptance among the top tier performers, which is very heartening.
MTD: I think that follows what Rami told us last year (note: in the October 2008 issue of MTD), when he said, ‘Everyone in the business carries at least two lines. Our aim is to be the second chosen line…’”
Haney: We saw more manifestation of that this year. It’s been an exponential effect. That level of acceptance seems to be happening quicker than we thought we would.
Bitran notes that BKT will have “a serious presence” at next week’s Specialty Equipment Market Association Show in Las Vegas, Nev., “not because we want to show off but because we want to show the commitment the company has for the U.S. market.”