Sweeping Industry News Bulletin
August 20, 2010
Analyzing the Alliance Between Stewart-Amos and Victory Sweepers
What is it, and what's the likely impact on other sweeping manufacturers and the sweeping industry at large?
by Ranger Kidwell-Ross
This past June, Frank Chulick and Mark Schwarze, presidents of Stewart-Amos Sweeper Co. and Victory Sweepers, Inc., respectively, announced a strategic partnership agreement. Under the joint agreement, Victory Sweepers will be designing and building regenerative air street sweepers that will be marketed by the Stewart-Amos Sweeper Co.
Neither Victory nor Stewart-Amos are among the industry leaders in terms of current size and market share. That said, each company brings an intriguing mix to the 'sweeper table.'
Although Stewart-Amos (S-A) has only been building broom sweepers since 2003, the machines its chief engineer, Mark Stratton, has produced are well-built and well-regarded. This is especially so in the contractor community, a notoriously difficult market segment to please. And, this is no ordinary startup, since S-A's parent company has been around since 1938 and is an economic and market share powerhouse in the mineral processing and aggregate production equipment that has long been its mainstay.
When it comes to its sweeping division the Stewart-Amos dealer network, though decent, is still not truly nationwide. However, one of the things hampering S-A's advancement in signing up quality dealers has been the fact the company didn't field a full sweeper line; i.e., broom and air sweepers. With the Victory Sweepers partnership in hand, any difficulty that Stewart-Amos' may have had in getting more dealers, and better quality dealers, is likely a thing of the past.
Victory Sweepers, Inc. was founded in 2006 by Mark Schwarze. On paper, that makes Victory even more of an upstart than Stewart-Amos. However, Victory quickly became a dominant player in the parking lot sweeping market in those four short years. The company's designs are new and fresh, and the machines get generally good reviews for sweeping performance.
Not too surprising, since company founder, Mark Schwarze, is the son of the founder of Schwarze Industries, Inc., as well as a former sweeper washer, welder, fabricator, salesman, vice-president and president of that company. Mark Schwarze quite literally grew up along with the parking lot sweeping business many consider his father gave an identity to.
As a result, there are few others in the industry with the market smarts and engineering savvy Mark Schwarze brings to air sweeper design. His recent air sweeper innovations, which include the two-piece sweeping head, joystick controls, quick-change gutter broom and more, has generated more than a little scrambling on the part of other American parking lot sweeper manufacturers.
Victory's problem, especially given this economy, has been how to expand its production to gain more economies of scale. In four short years the company covered the single- and twin-engine parking lot market segments, and even added in its T500 tow-behind machine to add some market share toward the bottom end of the market that wasn't previously being covered. However, that wasn't like building the higher dollar street- and construction-class sweepers.
Since Mark Schwarze had already had the headaches from building Schwarze Industries' dealer network from scratch, he could have had few illusions about the time and expense that effort would take. His only alternative to spending the hundreds of thousands it would take to build a new dealer network was, seemingly, to buck conventional wisdom and try to sell street-class air sweepers direct.
Mark Schwarze, veteran campaigner, found another growth avenue entirely via hooking up with Frank Chulick's Stewart-Amos, a company that needed an air-based street sweeper line to sell as badly as Victory needed to be building one.
The merger of machines, marketing and talent appears, at least now at the outset, to be a stroke of genius on the part of both company heads. Each provides what the other needs; each gains economies of scale; each minimizes capital outlay to get a realistic shot at gaining significant market share and instant credibility in the municipal segment of the industry.
Overnight, Stewart-Amos becomes the number three, full lines sweeper manufacturer in America. Mark Schwarze and Victory gets to concentrate on innovation and design, instead of on sales and marketing to municipalities and large contractors.
That said, the top two full line manufacturers – #1 Elgin (backed by public company, Federal Signal) and #2 Schwarze Industries (Mark Schwarze's previous company purchased and now backed by public company, Alamo Group) are doubtlessly not in the process of folding their respective tents. Ditto for what is probably America's third largest sweeper manufacturer, privately held TYMCO, since that company boasts a widespread and competent dealer network as well as a nationwide host of loyal users.
The same may be said for Allianz, which is a full lines manufacturer although not, strictly speaking, based in the USA. Speculation and the industry rumor mill also suggest that Allianz is somewhat in turmoil and may have financial issues in spite of recently winning yet another three-year contract with the City of New York for what amounts to an average of 10 sweepers per month. The company has long had another large, ongoing contract with CalTrans. However, elsewhere the company's sales appear weak nationwide.
My understanding is that Allianz' CEO recently took over the reins as President of the company in addition to his CEO title, after dismissing the person previously holding that post. Also, in the last few weeks a number of personnel were dismissed from Allianz' California office, among them high visibility members of its regional sales staff. In combination, all of that will probably make the Allianz dealers a natural target for the new, full-lines Stewart-Amos' organization.
The Stewart-Amos/Victory Sweepers' alliance (no pun intended) will provide even greater strain on all manufacturers' profit for any municipal deals, something Allianz, especially, appears ill able to afford. (I tried to reach Allianz for comment on this article and topic of the recent company changes, leaving messages for its President, Marketing Director and Sales Manager, with no callbacks or email contacts being received by press time many days later.)
It seems inescapably clear, as this all plays out, that there will be benefit to end-users in at least two significant areas: Foremost is in the area of bid price. With another player in the air sweeper marketplace, all the manufacturers pencils will have to become sharper. In a time of shrinking municipal budgets, perhaps that will encourage a few more municipalities to purchase new sweepers in spite of our somewhat mixed-up economic times.
The other benefit should be in the area of innovation. With the engineering improvements Mark Schwarze has introduced in his Victory line of parking area sweepers, I believe most objective observers would agree Victory is the current innovation leader in that segment of the market. If he can continue that trend in the machines his Victory Sweepers produces for Stewart-Amos, it may spur new features in sweepers across the board.
Plus, prior to rolling the 'electronic tape' in my interview with him, Mark Schwarze commented that his R-4 and R-6 sweepers performed better than any sweeper he'd ever designed (what Stewart-Amos terms its 'Galaxy Class'). That's strong talk from the man behind the initial designs of the vast majority of Schwarze Industries' current air sweeper line.
The rest of this article is composed of a statement I asked Frank Chulick, President of Stewart-Amos, to provide about his company and its new directions. You will find that Frank minces few words in his belief that Stewart-Amos will soon be competing with all comers.
At the conclusion, you will find links to audio interviews I held with Mark Schwarze and Frank Chulick, respectively. For the moment, there is much speculation and rhetoric. Years will pass before the true realities of this merger of talents is fully recognized. There's one thing for sure, however; in the meantime, things should be interesting!
Note: To play the interview conducted with Frank Chulick by Ranger Kidwell-Ross, editor of WorldSweeper.com, click this link or on the small triangle inside the circle you see to the left. If you have any trouble accessing this audio, please let us know.
Note: To play the interview conducted with Mark Schwarze by Ranger Kidwell-Ross, editor of WorldSweeper.com, click this link or on the small triangle inside the circle you see to the left. If you have any trouble accessing this audio, please let us know.
Both of these sweeper companies have previously been profiled on WorldSweeper.com. Click on the company names, below, to view the WorldSweeper.com profile about each of them. For additional information on this agreement, the companies involved, or to schedule a demonstration, you may also reach the companies or view their websites using the contact information shown below.
If you have a question or comment, please let us know. If appropriate, we'll add it to the bottom of this page.
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