3. 3
1. Introduction, Key Figs &
Business Model
Facilities:
Tianjin 5.800 sqm and Shanghai 600 sqm
Personnel: 80 (2 foreigners and 78 Chinese)
Sales Budget ¥100m in China
Etola Group €400m
www.etola.fi
www.etra.fi
Stock Value ¥25m
All Etola Group Cos’
warehouse value
totalling €40m
Business Model
C-Parts Management
5. 5
1. Introduction, Qlty is Nbr.1
Etola hydraulic pipe and hose assemblies have been
approved and registered by DNV
ISO9001:2008 QMS
Etola is commited to continuous
improvement per ISO9001:2008
requirement in product and process
Quality
Etola Management Team will have
meetings on half year basis to
evaluate and develop our value
proposition
6. 6
1. Engineering l Systems
LUBRICATION SYSTEM in an Industrial Gearbox Application
Suction hose
or
+
+
Pressure hose
8. 8
1. Service l Industrial Products
Service at the customer’s factory VMI:
• Hydraulics
• Fasteners
• Seals
• Other C-Parts
C-
9. 9
1. Etola China Milestones
Adding Value to our Customers in each step!
VMI l
LUB System l
ISO9001:
QLTY NBR1!
2008
1st batch of QMS Jan. 2010 –
pipe assys Dec. 2011
Rename delivered
Dec. 2009
to EIPTJ
Move to Sep. 2009
TEDA
First Sales March 2009
delivery
Business Oct. 2008
License Apr. 2006
FTZ
Oct. 12 2005
10. 10
1. Etola China References
Selected List of Customers Etola is supplying
15. 15
1. Introduction, Application Gear Box
Customer Reference: SEW
Factory 2
M & ML –series
40.000 sqm Factory 1
1C & CN –series
40.000 sqm Factory 3
Heavy Series
up to 50 tons BASIC PRODUCT RANG
Q系列行星
CN 系列
M 系列
Compact系列
SEW 减速电机
TIANJIN PLANT
6 40 60 500 1200
扭矩范围 kNm
16. 16
1. Introduction, Application Gear Box
Customer Reference: SEW
Etola Deliverables:
Hydraulic Pipe and Hose assemblies l Etola HFC-Systems
Cooling, Filtration and Lubrication System l Renergy CFL-Systems
Vendor Managed Inventory Service l Etola VMI-Service
17. 17
2. Etola Engineering l CFL-Systems
Renergy CFL(LAC)-System (Air to Oil)
Production will start Q1FY11 in China
18. 18
2. Etola Engineering l CFL-Systems
Renergy CFL(PWO)-System (Plate Cooler l Water to Oil)
Production will start Q1FY11 in China
22. 22
1. Introduction, Application WG&IG
Internal Piping (to lubricate the mesh and bearings) and
external piping (to connect the lub system to gearbox)
Internal Piping System
For Bearings
External Piping System
23. 23
1. Introduction, Value Proposition
ETOLA VALUE PROPOSITION IN PIPE ASSEMBLIES:
High Quality Product
1. Leak-Free Pipe Assembly
2. Very Accurate Bending
3. High Cleanliness Level
Value Added Processes
1. 3D-Customized Engineering
2. QA & QC Product Testing
3. Product Recall & Liability Insurances
4. On-Site Technical Support & After-Sales
Continuous Development & Training
for Etola Company and People
= Attractive Price/Value Ratio
24. 24
2. Raw Material Quality Control
ETOLA test and document all incoming raw materials and
components in our own QC-Lab
Incoming materials quality control
Destructive & Non-Destructive tests
DNV certificate of ISO 9001:2008
25. 25
2. Raw Material Quality Control
Hydraulic Pipes are tested vigorously throughout the whole
supply chain
Tests performed by the suppliers (incl. Chemical composition reports)
Third-Party tests in authorized institutions (incl. Chemical composition
reports to verify the original material reports)
Final inspection by the ETOLA QA/QC Team
(salt test and measure)
26. 26
2. Raw Material Quality Control
Salt Spray Testing for Pipes, Nuts, Cutting Rings and Pipe
Fittings
Salt spray test according to the ISO 9227-2006
27. 27
2. Result High Quality Materials
ETOLA high quality steel pipes can meet the standards
below:
Stainless Steel
ASTM A269-2000
GB 14976-2002
Carbon Steel
DIN 2391
28. 28
2. Result High Quality Materials
The Nuts, Cutting Rings, Support Sleeves and Pipe Fittings are imported
from Germany and according to the ISO standard, there is a very high anti-
corrosion capability due to international advanced techniques of zinc-
nickel plating
37°flaring connectors according to the ISO 8434-2
the hour of appearance of red rust, according to the DIN 50021-SS salt spray
test > 720 h
30. 30
3. Design & Engineering
Prototype series
ETOLA engineers participate to the prototype phase by making the
prototype piping on-site and then using 3D-measuring and AutoCAD
to prepare drawings for the serial production (5-Step Process)
31. 31
3. Design & Engineering
From Customer’s General Drawing
Etola engineers can transform General Drawings into 3D Drawings and
produce the required pipe assembly
32. 32
3. Design & Engineering
We also design pipe assembly based on the customer's real
pipe assemblies
First we measure the pipes with high-precision 3D measuring machine
From the 3D-report our engineers do a bending feasibility study and
after that make autoCAD drawings (radius 2 x OD)
34. 34
4.1 Pipe Cutting, Deburring
and Pre-Cleaning
Cutting Pipe with Belt Saw Machine
Deburring Machine
Pre-cleaning by Pneumatic Pellet Gun
35. 35
4.2 Pipe Bending
We have an advanced high-precision computer-controlled
automatic CNC bending machine and a professional pipe
assembly team
36. 36
4.2 Pipe Bending
Etola bending machine is imported from Europe and fully
computer controlled thus making our pipe assemblies the
most accurate in Northern-China
Bending Range: 6 – 42 mm (carbon steel)
Axis Accuracy: Size Accuracy +/- 0.05mm
Angle Accuracy +/-0.05⁰
37. 37
4.2 Pipe Bending
We can reach the following accuracy levels the ready pipe
assemblies:
A length tolerance of ±1mm
An angle tolerance of ±1°
A roundness / Ovalization within 10%
38. 38
4.3 Bend Pipe 3D-Measuring
High precision bending and measuring with 3D machine to
verify the high accuracy
39. 39
4.3 Bend Pipe 3D-Measuring
Etola controls bending with high-precision 3D testing
machine which creates test reports that can’t be modified
You get what you have
ordered!
40. 40
4.4 Roll Flaring
ETOLA uses JIC 37⁰ Roll Flaring connecting technology to
ensure that the flaring joint's surface is of high quality
ETOLA flaring accuracy standard is 74⁰ +/- 0.1⁰
41. 41
4.4 Roll Flaring Advantage
Roll-Flaring is very accurate technology. In cold forming the
joint surfaces always stay in the desired position in relation
to the axis of the pipe
42. 42
4.4 Roll Flaring Advantage
Roll-Flaring flares the possible scratches away from the
pipe’s joint surface
Roll-Flaring is key to LEAK-FREE pipe assembly!
43. 43
4.5 Roll Flaring Measuring
Etola Measures roll flaring angles are in the required
tolerances 74⁰ + 1.2⁰
44. 44
4.6 Pipe Assembly Flushing
Etola provides inherently clean pipe assemblies
We have two flushing media oil and steamed water
45. 45
4.6 Pipe Assembly Flushing
Flushing Cleanliness
A cleanliness level of ISO4406 standard class 17/14/11 (or NAS1638
class 5) or even lower is achieved
System ISO 4406 NAS 1638
Low pressure systems with 18/15 - 20/17 9 - 11
traditional valves
High pressure systems with 17/14 - 19/16 8 - 10
traditional valves
Proportional valve systems 16/13 - 18/15 7-9
Regulating valve systems 15/12 - 17/14 6-8
Servo valve systems 14/11 - 16/13 5-7
Extremely sensitive heavy duty 12/8 - 13/10 3-4
systems
47. 47
4.7 Cleanliness Measuring
Flushing report generated by Argos-Hytos particle
measurement machine
After flushing the pipes are plugged
48. 48
4.8 Working and Maximum Pressure
Testing
ETOLA has in-house testing facilities to make Proof Pressure
Tests and Burst Pressure Tests
Two test benches
0-700 bars
0-2100 bars
49. 49
4.8 Working and Burst Pressure
Performance Tests
Proof pressure test : 2 x WP
50. 50
4.8 Working and Burst Pressure
Performance Tests
Burst pressure test : 4 x WP
51. 51
4.8 Working and Burst Pressure
Performance Tests
Maximum torque test
52. 52
4.8 Working and Burst Pressure
Proof Pressure and Maximum Pressure tests gives an
ultimate safety factor for pipes used in high pressures and
ensures that bursts in pipe assemblies due to sudden
pressure peaks are avoided
53. 53
4.9 Pipe Marking
Finally, we mark with marking machine and pack in the
plastic bag the pipe assembly before delivery to customers
Customers item number can be marked to the pipe
Every producted pipe assembly can be traced back to the
production date
55. Table of Contents
1. Introduction
2. Raw Materials Quality Control
3. Design & Engineering
4. Hose Assembly Manufacturing
5. Performance Tests
56. 56
1. Introduction
Etola VALUE PROPOSITION IN HOSE ASSEMBLIES:
High Quality
1. 3D-Design & Tech Support
2. Manufacture
3. Swaging Quality Control
4. Flushing
5. Working & Maximum Pressure Testing
6. Hose Marking & Packing
Efficient Services
1. On Time Delivery (D2D or VMI)
2. After Sales Service
Attractive Price/Quality Ratio
Everything Done In-House!
1/19/2010
57. 57
2. Raw Materials Quality Control
Etola test and document all incoming raw materials and
components in our own QC-Lab
Incoming materials quality control
10-Step Procedure
Destructive & Non-Destructive tests
DNV certificate of ISO 9001:2008
1/19/2010
58. 58
2. Raw Material Quality Control
Salt Spray Testing for Hose Fittings and Ferrules
Salt spray test according to the ISO 9227-2006
Anti-corrosion requirement per customers needs
1/19/2010
59. 2. Raw Materials Quality Control
Measure hose reel
Measuring hose-ID, hose-OD and wire-OD with caliper gauge
Hose-OD
Wire-OD
Hose-ID
60. 2. Raw Materials Quality Control
Measure the fittings tolerances
Thread and Caliper Gauge as tools
Typical fitting types METRIC, JIC, BSP, SAE and ORFS
61. 3. Design & Engineering
Etola offers a dedicated engineering service, supply
customers with product and value-added services
We have inhouse design capability, our engineers can design hose
assemblies according to customer’s drawings or specifications
62. 3. Design & Engineering
Whether you need to develop new products, re-design
existing applications, or design completely new systems,
Etola offers unparalleled engineering expertise
63. 4. Hose Assembly Manufacturing
Etola hose assemblies manufactured by experienced
professional operators according to strict production process
65. 65
4. Hose Assembly Manufacturing
Etola manufacture hose assembly according to the following
process chart strictly
1/19/2010
66. 4. Hose Assembly Manufacturing
Measuring
We measuring hose length and fittings before swaging
67. 4. Hose Assembly Manufacturing
Cutting hose
High technology cutting machine guarantee vertical section with hose
centerline
68. 4. Hose Assembly Manufacturing
Skiving hose
No skiving for 1SN, 2SN/ skiving for 4SP, 4SH
69. 4. Hose Assembly Manufacturing
Etola uses the state-of-the-art swaging machine:
Finn-power FP120
Crimping
Crimping range Crimping range Crimping Crimpings / Max. hose
force
(mm) (inches) force (kN) hour size (inches)
(tonnage)
10 — 87 0.39—3.42 2800 280 2400 2.5
70. 4. Hose Assembly Manufacturing
Swaging
Hose is attached with fitting and sleeve and taken to the Finn-Power
swaging machine
The biggest size can reach 2 ¼ " and mass production is available
71. 4. Hose Assembly Manufacturing
Etola can make following kind of joint connections:
BSP, JIC, ORFS, METRIC, SAE and other customer tailor-made joint
connections
72. 4. Hose Assembly Manufacturing
Hose Assembly Accuracy Control :
Fitting angle orientation tolerance +/- 3°
Length of the hose ≤ 300 mm, tolerance max +4.5mm
Length of the hose ≥ 300 mm, tolerance max +1.5%
73. 4. Hose Assembly Manufacturing
Etola use oil as flushing media, we internally clean every
hose assembly we produced
The Ultra Clean system reduces downtime, extends pump-valve-filter
life
74. 4. Hose Assembly Manufacturing
Flushing
A cleanliness level of ISO4406 standard class 17/14/11(or NAS1638
class 5) or even lower is achieved
System ISO 4406 NAS 1638
Low pressure systems with 18/15 - 20/17 9 - 11
traditional valves
High pressure systems with 17/14 - 19/16 8 - 10
traditional valves
Proportional valve systems 16/13 - 18/15 7-9
Regulating valve systems 15/12 - 17/14 6-8
Servo valve systems 14/11 - 16/13 5-7
Extremely sensitive heavy duty 12/8 - 13/10 3-4
systems
76. 4. Hose Assembly Manufacturing
Finally , Etola hose assemblies are marked by hot marker
before delivery to customers
Identification of the part number
Identification of manufacturer
Identification of production date
Hose assemblies will be fitted with plastic plugs and packed
into plastic bag before delivery
77. 77
5. Performance Test
Etola has in-house testing facilities undertake Proof Pressure
Tests and Burst Pressure Tests
1/19/2010
78. 5. Performance Test
Relying on performance test, Etola hose assemblies are
successful in avoiding the following pressure related
problems:
Hose abnormal burst
Coupling crimp improperly
Hose pinhole leaks
Coupling blow-off
79. 5. Performance Test
Etola hose assemblies work perfectly in high pressures
We can reach up to 2100 bars in our pressure testing bench
80. 80
5. Performance Test
Proof Pressure and Maximum Pressure tests give an ultimate
safety factor for hose assemblies used in high pressures and
ensures that bursts in hose assemblies due to sudden
pressure peaks are avoided
1/19/2010
81. 81
5. Performance Test
Proof pressure test : 1.5x WP
1/19/2010
82. 82
5. Performance Test
Burst pressure test : 4x WP
1/19/2010
83. 83
4. VMI-SERVICE
CONCEPT;
CASE SEW
Sales l 2011-4-1 l Henri Manner
84. 84
OUTLINE
1. VMI Concept
2. How Does ETOLA Operate VMI?
3. ETOLA VMI Benefits to Customer
4. Statistics and Feedback From Customer
5. Challenges and Continuous Improvement
6. Wrap Up and Q&A Session
85. 1. Etola VMI Concept
What is Etola VMI? Vendor Managed Inventory is a out-
sourced service which performs customer’s daily working
routines to supply the industrial parts (commonly
categorized as C-Parts) to satisfy the production line needs.
85
86. 86
2. Business Case l SEW IG
Factory 2
M & ML –series
40.000 sqm Factory 1
1C & CN –series
40.000 sqm Factory 3
Heavy Series
up to 50 tons BASIC PRODUCT RANG
Q系列行星
CN 系列
M 系列
Compact系列
SEW 减速电机
TIANJIN PLANT
6 40 60 500 1200
扭矩范围 kNm
87. 87
1. How Does Etola Operate VMI? l
Planning Period SEW Tianjin Plants
SEW-IP VMI Implementation Record
No. Start Date End date Steps Responsible Person/Participant
1 2009-12-01 2009-12-07 VMI parts list clarification & confirmation, including intake quantity for last 12 months Customer Mgr.
2 2009-12-07 2009-12-27 VMI implementation proposal given to customer Customer Mgr.
3 2009-12-07 2009-12-07 Visit & check customer's layout for VMI parts in workshop Customer Mgr.
4 2009-12-27 2010-01-29 Prepare bins and other necessary tools for VMI project e.g. Label & Bin Local buyer
Customer Mgr./Warehouse Sup./VP/GM-Etola VP-
5 2010-01-04 2010-01-04 Kick off meeting held by Customer's GM Production, Purchasing Mgr./Assy. Manager/Warehouse
Mgr.-Customer
6 2010-01-14 2010-01-29 To discuss stocktaking and make schedule Warehouse Sup.
7 2010-02-04 2010-02-04 To discuss the concerns with customer when taking stocktaking Warehouse Sup./Customer Mgr./VP
8 2010-02-07 2010-02-22 Stocktaking in Customer side Customer Mgr./Warehouse operators
Customer Mgr./Warehouse Sup./VP-Etola
9 2010-02-25 2010-02-25 Second meeting to review the first stage work by management members from both parties VP-Production, Purchasing Mgr./Assy.
Manager/Warehouse Mgr.- Customer
10 2010-02-26 2010-03-01 Stock transfer from customer to Etola Truck driver
11 2010-03-01 2010-04-09 Start to feed the bins by Etola VMI Specialist, but information transfers via paper and manually VMI Specialist/Customer Service Specialist
IT Engineer./VMI Specialist/Customer Service
12 2010-04-09 2010-04-16 Testing of information collecting via wireless terminal and e-mail the replenished parts list to Etola
Specialist/Customer Mgr./VP
VMI Specialist/Customer Service Specialist/Customer
13 2010-04-16 Now Daily routine run
Mgr.
88. 88
2. How Does ETOLA Operate VMI? l
Business Case SEW China
ETOLA assigns 2 operators in SEW-IP production floor, totally 3 facilities, F1
plant, F2 plant, F3 plant.
8:30 – 10:00 am:
ETOLA operators check the allocated responsible areas to replenish the short quantities
10:00 am:
Receive the shipment coming from Etola and check at customer’s warehouse
10:00am – 12:00am:
Items replenishment, feeding bins
15:00pm:
Start to check the short items and transfer the shortage list to Etola internal staff.
16:00pm – 17:00pm
Replenish the items to the bins and balance the short parts from different location
* Operational manual
90. 90
3. ETOLA VMI DELIVARABLES to CUSTOMER
1. Consistent QUALITY
2. EASY for CUSTOMER
+Removes Unnecessary
Work Processes
3. Costs SAVINGS!!!
91. 3.1 ETOLA VMI Competitive
Advantage; Quality Nbr.1 !
Quality Management System ISO9001:2008
Destructive & Non-Destructive Tests for all
incoming C-parts. ETOLA conducts strict QC-
procedures to guarantee your C-parts are
qualified!
C-Parts Testing Equipment
Salt Spray Corrosion Tests
Coating Tests
Hardness Tests
Tensile Tests
Thread Tests
91
92. 3.1 Fasteners Quality Control
1. Visual Inspection
Rust or corrosion
incorrect plating
Wrong parts or mixed parts etc
2. Dimension Measurement
Based on DIN + ISO standards and
customers special application requirements
3. Testing l Destructive Tests
Tensile and Hardness tests
Salt Spray Corrosion Tests
coating and plating thickness measurement
4. AQL (Accepted Quality Level) and
Visual inspection criteria
Based on ISO 3269 and customer’s needs
95. .2 ETOLA VMI = EASY FOR CUSTOMER!
Minimizing Customer’s Purchasing, Warehouse and
Assembly Operations Lead Times
SEW purchasing department can save time from releasing purchase
order (also SEW doesn’t have to do internal time-taking processes before
PO), getting order confirmation & clarification from Etola, which saves
averagely 1 week to go through above process. Also, minimizing the
paperwork!
No need to search parts from warehouse, just pick up directly from KANBAN
bins, e.g. some items cannot be easily found by assembly operator, ETOLA VMI
operators are able to provide them and send to the position immediately.
ETOLA has a good product knowledge so the sales technical support is able to
give a very good help to customer’s relevant departments (e.g. purchasing,
warehouse and production)
Maximize production efficiency by cutting unnecessary work
We are now handling total 443 items for SEW VMI.
95
96. 96
.3 ETOLA VMI Benefits to Customer
On Time Delivery Rate – Normal Parts VS. VMI Parts
OTD - Normal parts OTD - VMI parts
110%
100% 100% 100% 100% 100% 100% 100% 100%
100%
99%
98% 97% 98% 98%
90%
80%
70%
60%
50%
MAR APR MAY JUN JUL AUG SEP OCT
* Above OTD rate for normal parts are calculated by Customer every month
97. .3 ETOLA VMI Benefits to Customer
Normal order items VMI order items Normal order Qty. VMI order Qty.
2,500 120,000
169,418.86 2,373
100,000
2,000
80,000
1,500
60,000
1,000
40,000
500
20,000
- -
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT
98. 98
.3 ETOLA VMI Benefits to Customer
Save Warehouse Space
ETOLA CUSTOMER
Etola assigns 500 ㎡ to Our customer save 500
stock VMI items and a
professional team to
= ㎡ space and all the cost
incurred !
manage these parts.
OUR INPUT = YOUR
SAVING
99. 99
.3 ETOLA VMI Benefits to Customer
Shift the risk of inventory from customer to ETOLA
Our customer will enjoy significant reduction in cash spent
on safety stock, managing stock, and also warehouse area
allocation
Also, indirect purchasing costs are reduced significantly. This
is what in Finland and Sweden we call efficient logistics
management – nowadays coming more important in China
as salary levels rise especially in the supervisor and mgmt
level!
100. 100
.3 ETOLA VMI Benefits to Customer
Dramatic Cost Savings
Cost saved in 7 Months
(Mar.01’2010-Sep.30’2010)
1.Labor Cost RMB89,600
2.Transportation Cost RMB20,280
3.Warehousing Cost RMB105,000
4.Stock value reduced RMB2,800,000
Total Tangible Cost Saved for Customer: RMB 3,084,100
* Cost Calculation sheet
101. 101
.3 ETOLA VMI Benefits to Customer
What We Saved for Our Customer
Non-VMI After VMI
100% 100% 100% 100% 100%
70%
50%
30% 30%
20%
Labor cost Transportation Mgmt cost Inspection Warehousing
cost cost
102. 102
4. Happy People at Work
Save a lot of time to from the customer production line l
assembly managers to focus on their core work; managing ops
Creates happiness w/in customers WH-operators reduces
employee turnover and thus stabilizing work processes
120%
100%
80%
60% Non-VMI
After VMI
40%
20%
0%
Sharp contrast
103. 103
4. Happy People = Efficiency
In one of our customer’s factory - F2, after VMI Service, to
assembly one ML90 type gear box can save almost 30% ~
50% time.
In other words, almost 100% efficiency increase!
Before VMI - 1pc After VMI - 2pcs
104. 104
5. Challenges and Improvements
Challenge
Not enough information about customer’s production plan, which will
lead to urgent requirement especially after 17:00pm for 2nd shift.
Improvement solution
Hope to share more information w/in customer and ETOLA, such as
production plan and accurate forecasts
Provide an isolated area (50m2 is enough), ETOLA will store some parts
according to usage frequency
105. 105
6. Benefits Wrap Up
What benefits can you get from Etola VMI ?
1. Very easy for customer because Etola will fill the bins and no POs issuing
2. Cuts drastically indirect costs in purchasing and work load and thus
overall costs
3. Lower handling costs at every stage to enhance competitiveness
4. Minimizes customer’s inventory value and need for the warehouse space
5. Etola will together with customer optimize the capital spending to the
inventory
6. Technical and logistic support from Etola sales team
7. Etola will together with customer optimize the upstream supply chain
8. Stabilize customer’s manufacturing through well-organized parts
replenishments
9. Etola a partner devoted to continuous improvement together with
customer
10. Etola a Trustworthy and Solid Partner geared towards long-term
partnerships!
106. XIE XIE! THX! KIITOS!
Sales l 2011-4-1 l Henri Manner
