Power Tool Industry December 2019
Bosch Power Tools debuted their biggest contest ever, “Break Up 2 Trade Up”, an interactive contest that invites contestants to share why they’re willing to abandon their current battery platforms. A total of 1,000 winners will receive a prize package that includes a Bosch CORE 18V battery kit and their choice of seven tools. The CORE 18V lithium-ion battery delivers 80% more battery life than their previous generation despite being lighter weight. The new battery is compatible with all Bosch power tools and chargers and features a CoolPack design that maintains a low temperature much longer while still delivering maximum power. Contestants entered by posting a brief video on Instagram. The contest ended November 21st.
Stanley Black & Decker
Robert Baird Global Industrial Conference:
Jim Loree is finishing up his third year as CEO but has been with SB&D since 1999. When he started, they were at about $2 billion in revenue; this year they’ll be about $14 billion.
They have long-term financial objectives of 4% to 6% organic growth and 10% to 12% revenue growth. The last three years have been challenging due to the $900 million in headwinds they’ve had to deal with due to tariffs, foreign exchange, the strongest dollar in decades and some cost inflation two years ago.
Their ecommerce business is the leader in their industry, with $1 billion in revenue and annual growth of around 20%.
They’re expecting between $100 and $150 million will be freed up next year due to their margin resiliency program. That program doesn’t have much to do with volume, it’s really all about cost and margin, and its impact is not included in their guidance.
The Lawn & Garden business is counter-seasonal to their Tools business, which is helpful, because the first quarter is always a challenge in terms of volume, but it’s a great quarter for Lawn & Garden outdoor power equipment.
Their acquisition of MTD and Sears outdoor power equipment opened up a $20 billion market, which has similar or sometimes identical channels as the ones they are already in. Their option to acquire the remaining 80% of MTD becomes effective in July 2021 and remains in effect for 10 years.
They believe they have the battery system market covered, and the batteries they offer cover a broad spectrum of requirements. They described their one serious competitor, who they defined as Milwaukee, as very aggressive and very strong, and said that they believe that Milwaukee is the company to beat in North America. They feel that SB&D and Milwaukee are doing most of the innovation in North America today.
Since acquiring Craftsman and MTD they’ve had their hands full with dealing with what they’ve bought and going through a major definition of what they refer to as “the swim lanes,” which brands go into which channels. They think sometime in 2020 they will have some capacity for acquisitions and there will also be some capital available.
About two-thirds of the $300 to $500 million in savings they’re looking for over the next three years will come from cost reductions. Many are coming from structural changes, such as merging the Emerging Markets groups with the tools group. They also reduced the Industrial business from three business units to one.
The Security business used to be a star performer, and was a great stabilizer during the Great Recession, contributing 50% of operating margin in 2009. But over the past 5 to 7 years it’s really begun lagging. They put the Security business group on review and so far they are doing a terrific job of turning the business around.
SB&D will close their Greenfield, Indiana production plant and lay off 139 employees as part of their plans to consolidate worldwide operations. The move is part of SB&D’s announced plan to cut $200 million in annual costs. The Greenfield facility was in expansion mode as recently as 2015.
SB&D was named Best Corporate Steward by the US Chamber of Commerce Foundation as part of their 2019 Citizens Awards. The program recognizes the most innovative and impactful corporate citizenship initiatives that raise the bar for social responsibility and help spearhead the transformation to a strong, healthy and sustainable future. By 2030 SB&D plans to enable 10 million creators and makers and ensure that their global operations are carbon positive.
SB&D chose DataRobot to help them turn their business into one driven by artificial intelligence. DataRobot will allow them to enhance their predictive analytics capabilities and reduce time spent on data wrangling and building models so the team can focus on other business challenges and opportunities. DataRobot will be deployed across various business units.
SB&D appointed Adam Wayne Hughes as the new president of Houston-based Stanley Oil & Gas, SB&D’s oil field services company that performs inspections, welding, coating and bending services for the pipeline sector.
A large office building planned for a Menomonee Falls business park is most likely part of a secondary corporate campus for Milwaukee Electric Tool, according to the Milwaukee Business Journal. The 120,000-square-foot office building has room for a 12,000-square-foot future addition. Last year Milwaukee began construction of a three-story, 114,500-square-foot global new product development center across the road from their headquarters that should be completed soon.
David Barnes will join the company in December and become Trimble’s new CFO in January 2020. Barnes was most recently CFO at MWH Global, a supplier of engineering and construction services, and after MWH was sold to Stantec, Barnes took over operational responsibility for Stantec’s businesses outside the U.S. He brings more than 35 years of financial, strategic and operational management experience to Trimble.
Trimble, Hilti and Boston Dynamics will collaborate on exploring the integration of Trimble’s and Hilti’s construction management software solutions, GNSS technology and reality capture devices with Boston Dynamics’ Spot Robot platform. The companies believe that autonomous robots can play a significant role in construction, handling routine and repetitive tasks, especially in hazardous environments.
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