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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


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


TMMMS

Blue Springs, MS

Highlander


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


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


    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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