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Supplier Seminar. Barbara McDaniel Manager, External Affairs Toyota Motor Engineering & Manufacturing North America October 2, 2007. Agenda. Barbara McDaniel – TEMA External Affairs Welcome & Agenda Toyota in North America & TMMMS Jamie Todd – TEMA Purchasing

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supplier seminar

Supplier Seminar

Barbara McDaniel

Manager, External Affairs

Toyota Motor Engineering &

Manufacturing North America

October 2, 2007

agenda
Agenda
  • Barbara McDaniel – TEMA External Affairs
  • Welcome & Agenda
  • Toyota in North America & TMMMS
  • Jamie Todd – TEMA Purchasing

Purchasing Overview & Philosophies

  • Gene Tabor - TEMA Purchasing
  • Supplier Diversity
  • Keith Peel – TMMK/MS Purchasing
  • MS Commodities and Schedule
  • Q&A

2

q uestions answers
Questions & Answers

?

Write questions on index cards

Question collection after presentations

Break

Q&A Session

slide4

Toyota Manufacturing in North America

CAPTIN 1985

TMMC 1988

TMMC 2 2008

SIA 2007

TEMA

1996

NUMMI 1984

TMMI

1999

TMMWV

1998

TMMK

1988

BODINE

1990

TABC 1971

BODINE

2005

TMMAL

2003

TMMBC 2004

TMMMS

2010

TMMTX 2006

4

slide5

TMMMS

Blue Springs, MS

Highlander

slide6

Toyota Motor Manufacturing, Mississippi (TMMMS)

  • $1.3 billion investment
  • SOP by 2010
  • 2,000 team members
  • Toyota Highlander
  • 150,000 units/year

3

supplier seminar1

Supplier Seminar

Jamie Todd

Assistant General Manager, Purchasing

Toyota Motor Engineering &

Manufacturing North America

October 2, 2007

slide8
Toyota Purchasing Overview
  • Core Purchasing Principles
  • Purchasing Priorities
  • Supply Base Expectations

6

toyota purchasing overview
Toyota Purchasing Overview
  • Direct Parts & Materials
  • Construction & Equipment
  • Logistics
  • Packaging
  • Service/Export/Trial Parts
  • Indirect Services
  • Plant Assets & Services
  • Maintenance
  • Repair Parts
  • Operating Supplies
  • Services

7

core purchasing principles
Core Purchasing Principles
  • Open Door Policy
  • Mutual Benefit Based on Mutual Trust
  • Contribution to local economies/
  • Good Corporate Citizenship

8

mutual benefit based on mutual trust
Mutual BenefitBased onMutual Trust

Mutual BenefitBased onMutual Trust

10

purchasing priorities
Purchasing Priorities
  • Safety
  • Quality
  • Supply Base
      • Capability
      • Capacity
      • Diversity
  • Cost

12

expectations of our supply base
Expectations of our Supply Base
  • Building Strong Supplier Relationships:
  • Continuous Improvement
  • Achievement of Established Goals
  • Effective On-going Communication

13

supplier seminar2

Supplier Seminar

Gene Tabor

General Manager, Purchasing

Toyota Motor Engineering &

Manufacturing North America

October 2, 2007

supplier diversity
Supplier Diversity
  • Toyota is committed to having a supplier
  • base which more closely
  • reflects the diversity
  • of our customers and
  • of our North American
  • team members

16

supplier diversity targets
Supplier Diversity Targets
  • Toyota Minority Targets:
    • Tier I – 10%
    • Tier II – 5%
  • Toyota Mississippi Construction Minority Target:
    • 15% of General Contractor Tier I Spend

17

mbe certification
MBE Certification
  • A business that is at least 51% owned, managed and controlled by one or more minority persons.
  • A minority person is defined as:
          • African-American
          • Hispanic-American
          • Native-American
          • Asian-American
  • Website – www.nmsdcus.org

18

supplier diversity contact us
Supplier Diversity - Contact Us!
  • TEMA Supplier Diversity is a Resource!!
  • TEMA Supplier Diversity Section

25 Atlantic Avenue, M/C PURSD-ER

Erlanger, KY 41018

Tel: 859-746-4481 Fax: 859-746-4449

E-mail: [email protected]

www.toyotasupplier.com

20

slide24

Making Contact

@www.toyotasupplier.com

21

supplier seminar3

Supplier Seminar

Keith Peel

Manager, Purchasing

Toyota Motor Manufacturing Kentucky

October 2, 2007

indirect plant purchasing
Indirect / Plant Purchasing
  • Buying Responsibilities:
      • Plant-site services / trades
      • Machine spare parts
      • MRO tools / equipment
      • Low $ / Non-Production machinery & equipment
  • FY2007 North America Spend: ~$750m
  • Estimated TMMMS Annual Spend: $65m
  • # of Commodities Managed: ~60

7

what will we buy
What Will We Buy?

6 main categories of procurement:

  • MRO Items
    • Example: Abrasives, Bearing, Hand Tools
  • OEM Items
    • Example: Robotics, Production Welding
  • Production Support
    • Example: Material Handling, Transportation

7

what will we buy1
What Will We Buy?

Categories of procurement (cont.):

  • Plant Support
    • Example: Janitorial / Grounds, Waste Recycling
  • Team Member Support
    • Example: Child Care, Training, Recognition
  • Trades
    • Example: Electrical, Mechanical, Painting

7

what will be expected
What Will Be Expected?

All suppliers are required to:

  • Achieve pre-defined performance expectations in the areas of:

>Safety / Environmental >Quality

>Delivery >Cost

>Management >Minority Development

  • Adhere to TMMMS Purchasing Terms and Conditions.

7

what will be expected1
What Will Be Expected?

Safety / Environmental:

  • On-site Employees
    • Ensure that all employees are trained on TMMMS safety policies prior to working on-site.
  • Products / Services
    • Ensure that all products delivered to TMMMS adhere to company policies and government regulations.
    • Ensure that all services provided to TMMMS adhere to company safety and environmental policies.

7

what will be expected2
What Will Be Expected?

Quality Expectation:

  • Performance Management:
    • Create, measure and report on key performance areas on a regular basis.
    • Create, document and audit standardized work procedures for all areas of service.
  • Quality of Product / Service:
    • Supplier should provide expert analysis, trouble shooting, engineering, etc. on all products / services provided.

7

what will be expected3
What Will Be Expected?

Delivery Expectation:

  • Goods / services to be delivered:
    • On time (not before or after due date)
    • In quantity / condition required
  • Indirect parts / materials – According to due date calculated using original quoted lead time.
  • Services / trades – According to schedule established / agreed upon with end user.

7

what will be expected4
What Will Be Expected?

Cost Expectation:

  • Cost Control / Reduction:
    • Understand / negotiate all sub-supplier price change requests.
    • Cost increases should be offset through internal cost reduction.
  • Continuous Improvement:
    • Continually seek ways to add value to goods / services provided.

7

what will be expected5
What Will Be Expected?

Management:

  • Administrative:
    • Ensure top-down support of TMMMS within supplier organization.
    • Adhere to all TMMMS terms & conditions.
  • On-Site:
    • Ensure effective management of on-site employees.
    • Implement development / cross-training program for on-site employees to minimize negative impact of turnover.

7

what will be expected6
What Will Be Expected?

Minority Supplier Development:

  • Develop and implement a plan to support Toyota’s goal of 5% Tier-2 minority supplier content.
  • Plan should focus on new, creative ideas to achieve minority purchase goal without impact to cost or quality.

7

what will be expected7
What Will Be Expected?

Terms & Conditions – Pricing:

  • Indirect Parts / Materials
    • Prices will be held for a period of one year.
    • Prices will be reviewed by Purchasing through Annual Price Review.
  • Services / Trades
    • Quotations will be submitted on official TMMMS quote form.
    • Quotations will be broken down to show details of material, labor, equipment, overhead, profit, etc.
    • Labor rates will be held for a period of one year and only reviewed by Purchasing through Annual Price Review.

7

what will be expected8
What Will Be Expected?

Terms & Conditions – Payment Terms:

  • Standard Payment Terms: Net Prox. 25
    • Invoices submitted by 3rd working day for previous month.
    • Payments made on 25th of following month

Example:

  • Electronic Invoicing
    • Select commodities may be required to submit invoices through the Toyota Electronic Invoice Payment and Presentment (EIPP) System
    • XIGN Corporation is the supplier for EIPP.
    • EIPP allows suppliers to select from a list of pre-determined payment terms to take advantage of faster disbursement, while providing a payment discount.

7

what will be expected9
What Will Be Expected?

Terms & Conditions – Insurance Requirements:

  • Suppliers will be required to maintain insurance including, but not limited to:
    • General Liability
    • Automotive Liability
    • Workers Compensation
  • Insurance limits will need to be prudent and appropriate given the particular size and scope of work being performed.

7

procurement sourcing phases
Procurement / Sourcing Phases
  • Initial / SOP
    • Timing: From construction through SOP.
    • Focus on start-up activities / SOP.
  • Competition / Ramp-up
    • Timing: From SOP through SOP + 1 yr.
    • Focus on competition / cost control.

7

next steps communication
Next Steps / Communication

If interested in being considered as a supplier:

Step 1: •Go to http://www.toyotasupplier.com

•Input company information as requested.

(See instruction sheet in packet)

Step 2: •Toyota Purchasing review information.

•Purchasing will request more info as needed.

Step 3: •Toyota Purchasing will visit supplier site as necessary.

7

supplier seminar4

Supplier Seminar

Q&A

Toyota Motor Engineering &

Manufacturing North America

October 2, 2007

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