Businessmodel of Terex

Customer Segments

Terex offers a range of products and services to commercial and industrial customers. The Company serves customers across a number of industries, including the following:

• Property Development and Construction, including commercial contractors, property development businesses, and specialist construction companies;
• Infrastructure, including various engineering, infrastructure development companies, and telecommunications operators;
• Energy, including energy producers, transmission companies, and utility businesses;
• Oil and Gas, including national and independent oil and gas producers, as well as downstream operators such as refiners;
• Transport and Logistics, including specialist logistics companies, and port and rail operators;
• Manufacturing, including various industrial manufacturing companies; and
• Metals and Mining, including mining operators, metals processing companies, and industrial foundries. Terex serves a number of high-profile companies, including JM Smucker, Kennametal, and Decatur Foundry.

Terex’s principal market is its native US, which accounts for the largest portion of its annual net sales. The Company also services an international customer base, including markets across Asia Pacific, Europe, and Latin America. Outside of the US, the Company’s key markets are the UK and Germany.

Value Propositions

Terex provides value to its customers in the following ways:

• Its industry standing and reputation, with the Company established as a reliable manufacturer and provider of industrial equipment, serving a number of high-profile companies around the world, such as JM Smucker;
• The quality and breadth of its product portfolio, with the Company providing a wide range of reliable and effective products, including scissor lifts, telehandlers, tower cranes, electric motors, and concrete mixer trucks that are utilised across multiple industries;
• Its international operations, with the Company serving customers across the Americas, Asia Pacific, and Europe;
• Its commitment to innovation, with the Company dedicating significant funds to the development of innovative products and processes, utilising patented technologies in the its manufacturing operations;
• Its industry expertise and experience, with the Company employing specialist technical personnel across its five operating segments, as well as a team of experienced industry executives. ### Channels

Terex operates a website at www.terex.com, through which it provides information on its various products, target industries, and locations. The Company does not operate an online sales portal, nor does it provide customers with an online customer portal, through which they are able to manage their transactions and accounts.

Terex operates its own in-house direct sales force across its five operating segments, organised by division and geographic region. The Company’s sales personnel operate out of the Company’s network of sales and administrative offices, notably its principal operating office in Miamisburg, Ohio. Terex also utilises the services of a number of third party distribution partners, selling many of its products through a global network of dealers, rental companies, independent sales agents, distributors.

Terex operates its own manufacturing facilities across the North America, Asia Pacific, Latin America, and Europe, allowing it to serve customers efficiently through local and regional facilities. The Company also services customers through its network of industrial crane service locations across the US.

Customer Relationships

Terex does not offer products and solutions to its customers on a self-service basis. The company’s sales personnel consult directly with clients, in order to accurately establish the details of each individual sales and distribution contract. The Company provides services tailored to each client, seeking to establish longstanding customer relationships and secure recurring business.

Terex provides ongoing support to customers for the length of their sales and distribution contracts, with larger client provided their own account management teams. The Company also allows existing and prospective clients to contact the Company directly and provide feedback, either over the phone or through an online contact form. Terex does not provide any significant online support resources, beyond product information and news articles.

Customers are able to follow Terex’s activities and interact with its personnel directly, through its social media accounts, including with Facebook and LinkedIn.

Key Activities

Terex is a lifting and material handling solutions company. The Company provides a range of products and solutions that are designed to assist commercial operators primarily in the construction, infrastructure, mining, manufacturing, transportation, and energy and utility industries.

Terex aligns its operations into five reportable business segments: Aerial Work Platforms, which designs, manufactures, services and markets aerial work platform equipment, telehandlers and light towers; Construction, which designs, manufactures and markets construction equipment and related components, as well as replacement parts; Cranes, which designs, manufactures, services, refurbishes and markets mobile cranes; Material Handling and Port Solutions, which designs, manufactures, services and markets industrial cranes; and Materials Processing, which designs, manufactures and markets materials processing equipment.

Key Partners

Terex collaborates with a network of partner companies and organisations around the world. These partners can be organised as follows:

• Supplier and Procurement Partners, including suppliers of materials, equipment, and tools used as part of the Company’s manufacturing operations, as well as suppliers of services and technologies that support the Company’s operations more broadly across all five operating segments;
• Channel and Distribution Partners, comprising the Company’s network of third-party distributors, sales agents, dealers, and rental companies that extend the reach of the Company’s in-house sale and marketing teams;
• Joint Venture Partners, including various industrial and manufacturing companies with which the Company jointly manufactures, markets, and or sells products through mutually owned entities; and
• Strategic and Alliance Partners, including companies from a range of sectors, with which the Company collaborates on various marketing and other projects. Terex has numerous partners across multiple business sectors. This includes a strategic partnership with China SINOMACH Heavy Industry, a deal with AML Equipment as a service partner, and a distribution partnership with Cowin Equipment.

Key Resources

Terex’s key resources are its intellectual properties and technologies, its materials and supply chain, its manufacturing facilities, its sales and distribution infrastructure, its It and communications infrastructure, its partnerships, and its personnel – notably its technical staff.

Terex incorporates a number of proprietary technologies into its products and processes, which are protected by patent. Searches of records published by the US Patent and Trademark Office identified a number of patents filed in Terex’s name, including applications entitled ‘Con crusher’, Integrated carriage lighting system for concrete pavers’ and ‘Support assembly for supporting part of a machine’.

Terex also owns a number of physical properties that are key to its operations, This notably includes the Company’s manufacturing, warehouse, service and office facilities across North America, Asia Pacific, Europe, and Latin America.

Cost Structure

Terex incurs costs in relation to the development of its technologies, the procurement of supplies, the operation of its manufacturing facilities, the operation of its sales and distribution channels, the implementation of marketing campaigns, the management of its partnerships, and the retention of its personnel.

In 2015 Terex recorded total cost of goods sold in the amount of $5.23 billion, and selling, general, and administrative expenses totalling $918.6 million.

Revenue Streams

Terex generates revenue through the manufacture and sale of various industrial products, as well as the provision of materials handling and lifting solutions. The Company’s products include loader backhoes, mini and midi excavators, wheeled excavators, site dumpers, telehandlers, and trailer-mounted light towers.

In 2015 Terex recorded annual net sales of $6.54 billion, down on the $7.31 billion recorded by the Company in 2014. The Company’s largest revenue generator was its Aerial Work Platforms segment, which recorded net sales for the year totaling $2.21 billion. This was followed by the Cranes segment with $1.70 billion, and the Material Handling and Port Solutions with $1.45 billion.