Laundry may not be a concern for all hospitality sectors, but to many operators across the globe, being able to present clean linen to customers every day is as essential as ensuring that the food and service hit their marks. Having worked for 17 years in a range of roles for Wisconsin-based parent company Alliance Laundry Systems, the largest commercial laundry manufacturer in the world, few in the industry are better placed to understand that need than the leader of the firm’s global division, Alliance International.
Richard ‘Rick’ L Pyle has been president of Alliance International, the company responsible for all business outside of North America, since August 2014. Originally an accountant, training with Deloitte & Touche, Pyle was previously vice president of international sales at Alliance Laundry Systems for three years. Employed with Alliance since 1998, he has held various management positions, including controller of a number of divisional operations, materials manager, VP of customer support and VP of marketing services. Prior to joining Alliance, Rick served in various accounting and operations positions for eight years with Alliance Remanufacturing, Inc.
When we met in London earlier this year, in the offices of Alliance’s PR agency, Pyle told me that 70% of his time is spent “on the road”, or, to be more precise, “up in the air”. His life is a blur of airports, trade show conferences, manufacturing plants, client facilities and hotels. Prior to London, he was in Brazil for a few days, then the Philippines, then Chicago, Paris and Belgium (“but just for a day”). The day after we meet he is off to Scotland, then back in Chicago for three days before flying on to Dubai. He is hugely reliant on Skype and social media to keep in touch with his 17 and 20-year-old daughters back home in the US.
Is he starting to flag at all, or tire of the itinerant businessman’s life I ask? Not a bit of it. “With the opportunities I’ve had, I feel extremely fortunate. I think I’ve got the best job in our company and I wouldn’t want to be doing anything else,” he says with a broad smile.
A global brief
Pyle’s mission at Alliance Laundry Systems is to grow the business outside the US and Canada. “We have historically had a large market presence in the US, but our growth opportunity has been outside the country,” he says. “As we’ve grown and developed, our real business has changed. Our company has recognised that international business is different and we have to approach it differently. Previously we were largely seen, and actually behaved, as a company that just exported product. Now there’s a keen awareness that’s not how we can best get to these markets. So Alliance International is under the umbrella of Alliance Laundry Systems, but in effect it’s a separate internal organisation that is responsible for really focusing on those markets and not something that’s driven out of one central corporate area in Wisconsin.”
Alliance International segment the rest of the world into four regions: Europe, Middle East and Africa, Asia Pacific, and Latin America. Pyle has a director in each of those regions reporting to him, and they are ultimately responsible for all sales and marketing activity within their region. The division has sales and service offices in São Paulo, Delhi, Barcelona, Lyon and Pribor in the Czech Republic, where the firm also has a manufacturing plant. Another plant operates in Guangzhou, China, while the European headquarters is in Gullegem, Belgium.
“We previously also had a manufacturing facility in Belgium, but we transferred production to the Czech Republic, which is where our main product is manufactured for the international markets. Wisconsin in the US and the Czech Republic are our two main manufacturing centres of any volume production. In China, we build our largest product, but it’s at fairly low volume,” he says.
Alliance’s products are, says Pyle: “not the lowest-priced product in the marketplace,” but they steal a march on their rivals through their design, quality of materials and value-added services.
“We have to be competitive, but our product is positioned as a premium product in the marketplace. We wrap a lot of services and support around that heavily engineered, reliable product. What also differentiates us is not where the product is manufactured, but the design of that product and the tooling investment. We emphasise the structural parts of the machine, the electronic controls, which help our customers generate more revenue. We also have field service people whose total focus is to provide training and technical support. No other company in the commercial space can do this. We can because of our scale. To have personnel supporting our brands is another differentiator of our company,” he says.
Alliance International offer customers two types of product categories: a small chassis and a large chassis washer product, the latter is a washer extractor and a larger tumble drier. While each type of product serves different segments and markets, the approach to marketing them is quite similar. “We try to maximise the requirement of the amount of water, the temperature of the water used and the energy consumption,” says Pyle. “We do this through the electronic control.”
Alliance’s acquisition of Belgian competitor Primus Laundry Equipment Group in March 2014 enabled them to incorporate new control technology that Pyle describes as: “the most innovative product our industry has seen in the last 15 to 20 years.”
This acquisition, says Pyle, “filled gaps on the product side that we felt that we were going to have. It established a bigger footprint in Europe, which was a desire of ours, and that product platform then gave us the springboard for where we believe our growth is coming from in some of those emerging markets.”
So, would Pyle describe Alliance as an acquisitive company? “We don’t just say, ‘that company looks good, let’s buy it’. It’s a bit more strategic than that,” he says. And Pyle knows all about that strategy, having worked across so many facets of the Alliance business. “Our history has always been in the commercial laundry space. That provides a clear direction for us. We don’t get into debates internally – as some of our competitors do – of vying for attention, resources or investment. We wake up every day thinking about commercial laundry, that’s what we do, it’s who we are.”
Market insight
In the commercial laundry sector there are four segments that Alliance services. First, on-premises laundry, for operators such as hotels, hospitals or anywhere where there exists a requirement to actually do laundry on site. The second is the laundromat segment, which in many mature markets is the coin-operated market for people to wash their own clothes. Third is ‘multi-housing’, a shared or common laundry for an apartment building or condominium, military installation or anywhere where a large number of inhabitants need to share a common laundry space. Finally, the home or consumer segment, where Alliance is also experiencing “some really nice growth,” according to Pyle.
According to Pyle, one of the advantages Alliance International has is that they have products and a presence in every one of those four segments. “That is a differentiator from, not all, but many of our competitors. When you compare the North American business verses the international business, there are growth opportunities in each of those segments internationally. We have only just begun. Even though our market position is quite strong, when you consider the laundromat market, you have countries such as China, where you don’t have launderettes. It’s a totally emerging market, a country of 1.4 billion people, that is a much more secure opportunity.”
For Pyle, those emerging markets, whether in Asia, parts of Latin America, or even some parts of Europe, the opportunities are significant. “We’ve seen, since the first laundromats back in the 50s in the US, that every emerging market goes through the same evolution cycle with respect to our industry. I never use the word ‘guarantee’, but it’s highly predictable that when certain economic and social demographics are in place, right behind that is an opportunity for our business. We feel very fortunate to have that history, to be the largest in the world, but we’re also humbled by that.
“It’s a credibility issue. Not just with the product itself, but with the relationships we have with our customers. We are largely selling through a distribution base, and some of those distributors have been with Alliance for 50, 60, 70 years, so we’re on our second and third generation of those relationships. It’s hard to put a value on that. We know how important it is, but it carries with it a responsibility that we want to continue. So, you combine that responsibility with an appetite for growth and that’s what continually drives and motivates us to invest in product, invest in acquisition or offices around the world in these emerging markets. The opportunity is still quite significant for us.”
The value-add
Alliance’s presence and size ensures it can provide round-the-globe, round-the-clock service to its customers, says Pyle. Something that most competitors, particular those operating in the emerging markets, cannot match.
“If I’m a business owner and know that Alliance has a field service manager 10 kilometres away so if, in the middle of the night, that piece of equipment has a problem I can make that call and they can be there, there’s a value in that. That’s what marks us out from someone that would just sell a piece of equipment.
“When you talk about parts delivery, online tools and offering, when you talk in some markets about a financing option – where people can actually finance their equipment through Alliance rather than have to go to a bank, these are all things that help support our position. That’s the advantage of scale – some of our competitors can’t take that approach.”
Part of that ‘approach’ is also about using local expertise where appropriate. “We keep a central oversight of brand, making sure that the brand stays consistent. However, all of the marketing execution is done locally. There are only a few things that are ultimately managed by the corporate entity, otherwise all our people live in those regions or are from those regions. We try to hold to the belief that the people in those markets are the market experts, not someone sitting in Wisconsin.”
That kind of strategic thinking comes from years of Pyle and his team studying the cyclical nature of the world economy and how that relates to an operator’s investment in equipment. Fortune, it appears, does indeed favour the brave. When many manufacturers began downsizing operations in European markets that were bearing the brunt of the financial crisis, Alliance began increasing their investment there. And it has paid off.
“Some of our biggest growth in the last two years has been in some of the most economically depressed countries in Europe,” says Pyle. “For example in Spain, when the economic crisis first hit in 2007, 2008 other companies were pulling out, firing people, closing offices. We invested in the country because we’re in this business for the long term. To have a real growth opportunity we believe you have to have a balance in terms of investing in mature markets. You can’t leave those alone. You must have a certain amount of investment in what we call emerging markets and then you have to have some investment in totally developed markets.”
In Spain, Pyle and his team saw an opportunity in the vended laundromat segment in particular. “We began to plant seeds, invest and have a local presence, and now, a few years later, we are able to offer a company financing option for Spain. As things have started to improve, we’re already seated there. We didn’t believe at the time that situation was going to last forever in Spain. Spain was going to come back. Italy is going to come back. Let me use a term we actually use in our business: it’s a ‘bounce back’, and it’s happened specifically within the laundromat segment.
“Over the years, you know, there are economies that go up and go down, but the laundromat business model is an extremely sound one. When the crash first came along, we all were impacted. We did scale back in Europe and North America. But we did not cut so deep that we were damaging the core of what we were doing, and at the same time we salvaged investment for other areas of the world.”
The numbers game
Having such innate financial acumen and insight is not always par for the course in a modern business leader, but Pyle’s background in accountancy has been invaluable to him in his career. Born in Ohio, he grew up splitting his time between Pennsylvania and Florida, which he still considers home. Before attending Oral Roberts University in Tulsa, Oklahoma, Pyle thought he wanted to be a lawyer. “I’d watch lawyers in action on TV shows, but I quickly came to realise it wasn’t the same in real life,” he says. “I couldn’t hone in on any part of the law that I wanted to focus on. But I had always had an interest in business. After a semester or two pursuing law I realised I didn’t want to do that, and it just felt natural for me to go into accounting. Accounting gave me a platform or an opportunity to be involved in virtually all areas of a business.”
Having worked for accountancy firm Deloitte & Touche, Pyle spent eight years as controller, operations manager and finally general manager for Alliance Remanufacturing. “I started in the financial area as the controller and then, maybe because we had some successes, other opportunities were afforded to me.
“I was fortunate enough by the end of my first eight years with Alliance, that I was actually the deputy general manager of a facility. Did I predict that would have happened eight years earlier? No, I didn’t. I never even thought about it, but when you have that experience base and then you have a desire to make some impact, those opportunities can be afforded to you.
“I never sought out a person’s job or a role to say, OK, I’m the controller now, but I want to run HR, or I want to run materials. It was more a case of saying, ‘I’m focused on my responsibility right now, but I’ve got an eye towards advancement and I want to make sure people know that if opportunities come and I can help, I’m available’. Alliance has afforded me that opportunity.
“If I go back to when I first assumed my previous role as VP of international sales, I had no previous sales experience. I had the customer impact side, but no sales experience whatsoever. So, here’s Alliance, the largest commercial manufacturer in the world, their number one initiative is to grow internationally and they’re going to pick this accountant who has no sales experience whatsoever? That is a huge step for the company and I say that because I do feel very fortunate. I have a lot of appreciation for Mike Schoeb our CEO, who took that shot with me. That, again, is why Alliance is unique.”
So, what qualities does Pyle feel Schoeb saw in him at that time to offer him the role of president of Alliance International?
“I will tell you, I had some questions or concerns about the role. I actually asked Mike Schoeb: ‘Why am I the guy for this?’ He said to me: ‘You have the ability to get things done’. It’s not a lot more elaborate or sexy than that. The world is filled with experienced vice president-level sales people. But what he said gave me the comfort level to think, ‘OK I can do this’.”
And with that last, modest self-assessment, Pyle is off to plan the itinerary for his next trip. I find myself hoping the Skype connection is a good one up in Scotland and that he’s keeping up to date with his airline loyalty points. Having had an insight into his attention to detail, one suspects he’s already got both of these covered.
Michael Jones
