engcon was founded in 1990, but the whole saga actually began five years previously, when an inventor from Orust tried to persuade someone to take up production of tilting and rotating worktools for excavators.
This job at Noreco was the first for Stig Engström, son of Strömsund. Noreco was located in Umeå, a service company for the pulp industry. And because Stig is a versatile kind of guy, he worked with design, production and marketing. When inventor Ulf Holmdahl went to see Noreco, he’d already been to see a number of manufacturers with a view to getting them to produce his patented rotating, tilting quick hitch lock. If you ask Stig, he remembers it like it was yesterday. The date was 15 September 1985, and this was a real eureka moment. Stig saw its potential.
Noreco started manufacturing rotators, which were given the name of Rototilt. Because that was what they did – they rotated endlessly and the attachments could be tilted at the same time. And then production gradually began to pick up – in all, Noreco supplied more than 150 worktools.
“But the worktools had lots of teething troubles. They weren’t really up to being driven really hard, and we received a lot of complaints,” recalls Stig. The company also had financial difficulties for other reasons, so quite simply there wasn’t all that much scope for manoeuvre as the 1990s approached.
Birth of engcon
In 1990, Stig offered to take over the company and carry on developing the Rototilt. But his timing was lousy, and Noreco’s owner wanted to carry on doing things his way. So Stig left his job and moved back home to Strömsund. He was really enthusiastic about his idea and wanted to take it a step further. And with that, engcon was born. Noreco went bankrupt a couple of years later.
“I took my ideas back with me and wanted to refine them. My brother Ulf came on board as a silent partner, but he continued to run the family haulage company. Personally, I’d seen the problems with the Rototilt and put my heart and soul into improving the product,” continues Stig. “But it wasn’t that easy a task,” he remembers.
Because it was hard to get it to work the way he’d intended. One of the problem areas was the hydraulics, so Stig’s solution to that was to set about making a completely mechanical-electrical rotator. If it worked, it’d be both cheaper and simpler. It didn’t work. After lots of to-ing and fro-ing, he went back to the hydraulic solution that’s still in use now.
“Things were tough then, back in the early 1990s. We spent the first few years developing the product, and there was no money to be made from that. My personal debts spiralled,” says Stig. “I was without an income for two years, and in September 1992 I needed money so I started working for a company in Dorotea.”
Stig hadn’t worked in Dorotea for long before he realised there was no real future in it. His job essentially involved cutting back on staff, and at Christmas 1992 his desire to get the engcon project up and running returned with a vengeance. He forged new contacts, and in 1993 designer Kjell Högberg, one of his mates at Noreco, joined engcon.
“Kjell designed the current solution and the EC20 was produced. Not many people were that keen on it initially, and sales were slow. The product was untested and the prototype wasn’t entirely reliable, but we were forced to get sales up and running,” says Stig.
Questionable delivery times
Stig had a number of obsessions as regards engcon, and he still has them now. End customers are the be-all and end-all, there has to be scope for international expansion and lots of contract production. So when Stig wanted to start marketing the new EC20, his mother and a few others had to put together a direct mailing to 10 000 potential customers. 50 responded and five actually made purchases.
“Delivery reliability was a bit so-so initially,” admits Stig. Some customers had to suffer, while others ran out of patience and went to the competitor that bought Noreco’s bankruptcy estate,” remembers Stig. But some of them showed themselves to be true friends as regards our development. Harry Persson, the first person to buy a tiltrotator, insisted that he should receive the invoice in 1993. Delivery was estimated to take place in early 1994. That was a request that we had absolutely no problem accommodating.
Quite by chance, Harry’s wife, who dealt with the finances, actually paid the bill early and the money was used to complete the tiltrotator. But in January, Degerberga Grus och Schakt wanted a rotator. Harry decided that spring and the excavator season was a long time away, so that customer received (and paid for) Harry’s worktool. All these years later, Stig has a good chuckle at the memory of the rotator he sold twice and Harry feels he played his part in the success of engcon. And rightly so, too.
At this time, only two people worked for the company: Stig Engström and Jocke Markusson. Monica Engström started working for the company in the autumn of 1993, and in 1994 the team was joined by Håkan Wiik. The division of labour was clear: Håkan did the selling, Stig and Jocke did all the filing and bolting in the garage, and Monica kept an eye on the figures.
“In those days we were as unclear as we dared to be with regard to deliveries. There were times that our delivery dates were more flexible than was strictly allowed, and we were forced to stretch the truth a long way. In our defence, I ought to mention that we took great care to supply things that were as good as possible, and if our customers had problems we came straight to the rescue and resolves the issues. That was important then, and it’s still important now.”
Get that crap off my farm!
Initially, engcon had two enthusiastic dealers on the west coast who enticed Stig to visit and present his tiltrotator on a large farm near Åsa in Halland. The farmer, who was about 50 years old, watched with interest when the rotator was to be mounted on one of the farm’s excavators. Suddenly an old man turned up and wondered what was going on, who these people were who’d come to visit. The farmer tried to explain it to his old dad, but the old boy just yelled: “Get that crap off my farm!” And that was that.
“There was no doubt who wore the trousers there!” chuckles Stig. It was almost surreal at the time, but we had a good laugh about it on many occasions afterwards.”
Tiltrotators were even more unknown abroad than they were in Sweden. If nothing else, Stig noticed this when he was at Bauma, near Munich, in 1995. This is a gigantic trade fair, and Stig made a decision there and then: he was going to be at the next trade fair in 1998. In November 1997, engcon wanted to book a place for the next fair taking place in May. Enough time to be sure of a place. The agent wasn’t all all sure they’d get a place as engcon was a bit late in applying.
“Late? I thought we were applying well in advance.” And that was when the agent told him the application period closed in November – November the year before. But they did their best, and they offered the company a spot near the east entrance, next to the Caterpillar stand. “Sometimes you have more luck than you really deserve,” reckons Stig. “We took the place offered and book it every time now.”
Heading for a trade fair like that on a tight budget is quite an experience. That first time, the company borrowed an exhibition marquee that was packed into Stig’s Audi 100 together with exhibition materials and a tiltrotator. Stig sawed the legs off the marquee so that it’d fit, and eventually the merry band hit the road. Bauma was a success, the tiltrotator demonstration using a hired excavator with a blue-and-yellow bucket attracted a lot of people, and engcon ended up on the cover of the contractor magazines reporting from the trade fair.
Heading for the skies
engcon employed 3.5 people in 1993 and managed a turnover of 600 000 in, but by 1999 the company was employing twelve people and continuing to grow. In 2008, about a hundred people worked for engcon and the company had a turnover of 535 million. Although turnover fell during the credit crunch in 2009, engcon was named Marathon Gazelle for 2009 by Dagens Industri. The challenges the company faces are a little different now, but they’re no less tricky to deal with for that. The whole concept of internationalisation requires a great deal of consideration.
“Here in Sweden, the contractor (operator) owns the job, but in the UK and Germany the responsibility and incentive rests with the people who hold the purse strings – the difficult thing is to get them to realise that the benefits will involve greater competitiveness and a long-term approach. And getting that message across requires a good, clear argument,” reckons Stig.
So work on engcon’s international initiative continues tirelessly. The crisis which both the company and everyone else underwent is nevertheless somewhat temporary – you have to act at the right pace and continue to drive things forward.
“I think you have to have just the right amount of pigheadedness, believe in your targets and not deviate from them. Combine this with a positive attitude and shaking off the setbacks, you’ll get there in the end. It works for me.”