Professional Carwashing & Detailing

Touch-up

October 11, 2010

Last November, Mark VII Equipment Inc., the U.S. subsidiary of WashTec AG of Germany, announced that Murray Kennedy would replace Christian Bernert as Chief Executive Officer and President. Professional Carwashing & Detailing® asked Kennedy what he has planned for Mark VII.

Professional Carwashing & Detailing: Congratulations on your new position and welcome to the industry. Tell me a little about your engineering and management background.

Murray Kennedy: Thank you. Before joining Mark VII, I worked for Richardson Electronics, Ltd., where during my twelve year tenure I held the position of Executive Vice President and General Manager of the Electron Device Group and the Industrial Power Group. I’ve also held management positions with Litton Electron Devices Group and ITT Electron Devices Division.

I have a B.S. and M.S. in electrical engineering. Nowadays, it’s difficult to distinguish mechanical from electrical engineering; one bleeds into the other. The carwash industry’s hot topics now are uptime and reliability. I’m working with a team of engineers to develop a reliable machine with as much uptime as possible.

PCC: Mark VII recently celebrated its one-year anniversary under WashTec. What does that mean for the company?

MK: We have spent the past year aligning our manufacturing processes to run more like those in the WashTec factory. Many manufacturing techniques have already been incorporated into our facilities and our Colorado factory renovation is just about complete.

Most of our engineering processes will be focused on things like commonality of parts and making it easier for technicians to service the equipment. I’d also like to have self-serve, friction, and touch-free use the same components so the programming and wiring schema are the same for all product offerings.

PCC: In a past interview with past Mark VII President and CEO Christian Bernert, he indicated a desire to accelerate WashTec’s penetration into the US market by manufacturing equipment in Colorado facilities. What initiatives have taken place to accomplish this goal?

MK: We are currently utilizing parts kits from Germany to manufacture friction machines in Colorado where the manufacturing and assembly is completed. In the future, we will begin sourcing those products locally, leveraging off commonality of parts in order to gain further efficiencies in our manufacturing process. This will eventually eliminate the shipments of heavy metals and motors, saving freight and duty costs.

The WashTec name carries with it great brand recognition in Europe, slightly less in North America. Customers speak to me about WashTec’s technology even before I have a chance to mention it, making me believe Americans recognize German engineering and technology.

We feel there is strong brand recognition with Mark VII, one that has been carried with it for years. We aren’t going to do away with the Mark VII name or brand, but rather tie it to German engineering and technology emphasizing U.S. manufacturing

PCC: Do you have any new product offerings on the horizon?

MK: We are about to introduce a new tunnel offering. In discussions with our customers, we realized they have aging equipment. As the equipment ages, the book value decreases. When those same investors want to expand or grow into new locations, they are having trouble receiving financing because banks don’t recognize depreciated equipment as a viable asset.

One thing we’re introducing as a new product is a leasing concept. Leasing companies do exist today, but we believe we can lower the leasing costs for the customers by lowering the costs in that area.

PCC: Can you tell me more about the recent Tennessee acquisition?

MK: On January 9, we acquired our long-time distributor Mid-Tenn Mark VII, Inc. of Lebanon, Tennessee, now called Mark VII of Tennessee. The former owners Robert Taylor and Moose Tyree will continue to work for the subsidiary as consultants. Larry McCarty, who has served Mid-Tenn customers for over seven years in sales, marketing and training capacities, has been promoted to General Manager.

Robert and Moose built what has consistently been one of the highest performing territories in the Mark VII distributor network. The acquisition frees them up to work on special projects that extend and enhance their legacy of excellence in sales, service and support.

With the strong financial backing of Mark VII, we’re looking forward to taking the business to the next level by creating new programs and services that can benefit all Mark VII customers.

PCC: How does the European industry compare to the U.S.?

MK: As a newcomer to the industry, I see a lot of small competitors in the U.S. market. In comparison to Europe, it’s not that way.

The U.S. is begging for someone to come in to take it to the next level, making this a very exciting opportunity. When you are a smaller company you don’t have the ability to do some of the things the industry demands.

We are fortunate to have a strong backing in Europe: WashTec. They have the investment power and the backing to bring Mark VII to the next level.

PCC: What does the future hold for Mark VII?

MK: We are seeing a lot of growth in the friction market. The previous stigma accompanying friction roll-overs is disappearing. I’ve heard that from both our customers and investors alike.

From our standpoint, we’ll get the tunnel offering up and running, continue with a strong focus on touch-free roll-overs and cost-reduction. Because we’ve seen a rise in the friction market, we’re planning on increasing sales.

We saw the express tunnel surge; still a thorn in the side of customers with in-bay automatics. In that market, we’ve seen carwashes having trouble sustaining profitability with a $3 wash. The prices are increasing in the market. I hear a sigh of relief from our in-bay automatic customers. They are less fearful to install new carwashes.