What do you get when you bring together one of the world’s largest providers of materials handling automation (Number 9 on Modern Material Handling’s annual list of the Top 20 System Suppliers with $712 million in revenue) with a small systems integrator best-known in the Midwest and for its warehouse execution software?
That’s a question Swisslog and Forte are about to answer following the announcement of Swisslog’s acquisition of the Mason, Ohio-based system integrator.
Bill Leber, Swisslog’s director of business development and marketing, described it as “a growth scenario for both companies.”
Tom Rentschler, Forte’s vice president of sales and marketing, described it as an opportunity for Forte to compete for larger projects with bigger companies. “We have always had a reputation for doing excellent work with mid-size companies in our region, but that has never scaled because a lot of bigger clients as about our size and our succession plans. That all goes away with the backing of Swisslog.”
First, the nuts and bolts. According to Leber, Forte will continue to operate within its well-established business model as a separate unit of Swisslog from its Mason, Ohio headquarters.
However, it will have access to Swisslog’s broader portfolio of technologies, including automated storage and goods-to-person solutions.
With the acquisition complete, management transitions from Founder Gene Forte to AK Schultz, who was previously vice president of customer service for Swisslog North America. Otherwise, Forte’s management team will remain in place. “One of the things that Swisslog told us throughout the process is that they were buying our management team,” Rentschler says.
Despite the differences in their size and geographic reach, both Leber and Rentschler believe the combined companies complement one another.
Swisslog, for instance, tends to focus on highly-automated implementations at large companies, including those with a national or global reach. It tends not to work with small-to-mid-size companies or those that are just introducing automation into their operations with conventional pick modules and conveyor systems.
Forte, on the other hand, has a portfolio of small-to-mid-size customers operating in the Midwest and with mid-levels of automation. When it comes to Tier 1 customers who are looking for support on a national basis or high levels of automation, Forte is not invited to the dance.
The idea of bringing them together is that Forte can help Swisslog break into the middle market, serving those companies as they evolve from conventional to automated solutions. Swisslog, meanwhile, allows Forte to take its customers to the next level.
“Long term, this is going to allow Swisslog to address a new customer base,” Leber says. “We’ve always competed at the top of automation. Forte is going to help us serve this other segment of the market.”
Looking at the deal, I think Swisslog potentially also benefits from Forte’s expertise in warehouse execution software (WES), the emerging application that picks up where WMS leaves off to synchronize order fulfillment processes in automated facilities.
Forte was named a Gartner Cool Vendor In Supply Chain Services in 2013. As I wrote following ProMat, it’s all about the software ...we may love watching mechanical systems at work, but increasingly ours is a software- and not a hardware-driven industry.
I ran that idea by Leber and Rentschler. “I think that’s absolutely the case,” Leber said. “Swisslog’s expertise has always been on advanced, goods-to-person solutions. We haven’t had software that directs people.”
Rentschler adds, “We think the market is looking for an integrated system with the precise level of automation needed for the application and the right degree of software to support that. Our technology platform allows us to cost-effectively deploy the specific functionality required for an implementation right up to and including some warehouse management functionality.”
Related: Warehouse Management Systems & Warehouse Control Systems in the Age of the Internet of Things
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