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Supplier Seminar

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

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  1. Supplier Seminar Barbara McDaniel Manager, External Affairs Toyota Motor Engineering & Manufacturing North America October 2, 2007

  2. 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

  3. Questions & Answers ? Write questions on index cards Question collection after presentations Break Q&A Session

  4. 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

  5. TMMMS Blue Springs, MS Highlander

  6. Toyota Motor Manufacturing, Mississippi (TMMMS) • $1.3 billion investment • SOP by 2010 • 2,000 team members • Toyota Highlander • 150,000 units/year 3

  7. Supplier Seminar Jamie Todd Assistant General Manager, Purchasing Toyota Motor Engineering & Manufacturing North America October 2, 2007

  8. Toyota Purchasing Overview • Core Purchasing Principles • Purchasing Priorities • Supply Base Expectations 6

  9. 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

  10. Core Purchasing Principles • Open Door Policy • Mutual Benefit Based on Mutual Trust • Contribution to local economies/ • Good Corporate Citizenship 8

  11. Open Door Policy 9

  12. Mutual BenefitBased onMutual Trust Mutual BenefitBased onMutual Trust 10

  13. Contribution to local economies, Good Corporate citizenship 11

  14. Purchasing Priorities • Safety • Quality • Supply Base • Capability • Capacity • Diversity • Cost 12

  15. Expectations of our Supply Base • Building Strong Supplier Relationships: • Continuous Improvement • Achievement of Established Goals • Effective On-going Communication 13

  16. Thank You ! 13

  17. Supplier Seminar Gene Tabor General Manager, Purchasing Toyota Motor Engineering & Manufacturing North America October 2, 2007

  18. SUPPLIER DIVERSITY PROGRAM 15

  19. 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

  20. 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

  21. 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

  22. Please Register with Us 19

  23. 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: supplierdiversity@tema.toyota.com www.toyotasupplier.com 20

  24. Making Contact @www.toyotasupplier.com 21

  25. 22

  26. 23

  27. Thank You ! 13

  28. Supplier Seminar Keith Peel Manager, Purchasing Toyota Motor Manufacturing Kentucky October 2, 2007

  29. 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

  30. 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

  31. 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

  32. 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

  33. 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

  34. 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

  35. 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

  36. 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

  37. 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

  38. 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

  39. 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

  40. 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

  41. 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

  42. Upcoming Activities 7

  43. 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

  44. 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

  45. Thank you!!!

  46. Supplier Seminar Q&A Toyota Motor Engineering & Manufacturing North America October 2, 2007

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