Robert Bosch Tool Corporation
Bosch Power Tools won the Best Brand Overall for 2021 in the most recent Best Brands Awards, which were initiated to honor approaches in successful brand leadership and to provide a forum for trendsetting communications solutions. The awards are based on a representative consumer survey conducted by GfK in addition to the economic success of the brand. Bosch received the highest ranking across all brands in the category of Brand Trust, where 72% of respondents said they trusted the Bosch brand. Bosch Power Tools launches more than 100 product innovations every year. In addition to being awarded Best Brand Overall, Bosch Power Tools also made it into the Top 10 in the category “Best Brand Customer Centricity.”
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Dealing with the impact of the global pandemic that started in March 2020 created several supply chain challenges. They dealt with supply shortages, labor shortages, inefficiencies associated with airfreighting products and choppiness in fill rates, all of which made it challenging to keep the supply chain moving along smoothly. However, they’ve kept customers “relatively happy” and grown their market share.
CEO James Loree said that the ecommerce business was a $1.8 billion channel growing at about 40% annually and that they have what he referred to as a 3:1 relative share advantage over any other player that is in the tool business.
They were expecting some deceleration during the first quarter, but POS at the major Home Centers is still running in the 20% to 30% growth range and ecommerce is continuing to grow between 30% and 40%.
They are about four weeks below where they would like to be from an inventory perspective, so they are scrambling to meet end user demand. They were hoping to be back to normal inventory by the end of the second quarter, but now they think that is too optimistic and will be the end of the third quarter. They feel the market has become a bit supply constrained.
They noted that the increased demand was not confined to North America, but rather has been a global development that has included Europe, Latin America and Asia.
Their guidance for Tools & Storage growth this year is 4% to 8%, which is significantly higher than growth percentages expected by The Home Depot or Lowe’s.
They believe that DeWalt will be a very powerful brand in the dealer channel in lawn and garden once they exercise their option to acquire the remainder of MTD.
SB&D brands won 14 Tool Awards from Popular Mechanics, which tests more than 1,000 tools every year. DeWalt, Craftsman, Stanley, Irwin and Lenox all won awards for various products.
Joe Simms is SB&D’s new chief diversity officer. He will report directly to CEO Jim Loree. Prior to taking on his new responsibilities, Simms was vice president of human resources for SB&D’s Global Tools & Storage business. SB&D has taken a number of steps to advance their diversity and inclusion efforts, including supporting nine employee resource groups. In addition, CEO Jim Loree was among a group of prominent CEOs that signed the CEO Action for Diversity & Inclusion.
2020 was a record year, with full year sales growth of 28% and growth of 42.3% during the second half of the year. Sales were robust in all geographies and for all business units.
Organic revenue grew 28% to USD 9.8 billion, an increase of USD 2.1 billion over 2019.
The Power Equipment division accounted for 89% of the group’s total revenue, growing 28.5% to USD 8.7 billion. Milwaukee Professional, Ryobi DIY and Ryobi outdoor all grew in double-digits, with Milwaukee continuing to deliver more than 20% growth for the seventh consecutive year, growing 25.8% in 2020.
North America accounted for 78% of the group’s revenue, with sales in North America up 29.5%.
To support the above-average growth they anticipate, they have continued to strategically build inventory. They believe the end of the year is the worst time to cut inventory, as they said their largest competitor did.
CEO Joe Galli stated that “2020 was the year we seized control of the global tool market.” Milwaukee became the number one professional tool brand in the world last year and is also the fastest-growing professional tool brand. Ryobi solidified its position as the Number One DIY brand in the world.
They are strategically focused on developing the right kind of ecommerce that will not cannibalize existing important customer and distribution channels. Last year they were awarded the Home Depot Omnichannel Interconnected Partner of the Year award because of their partnership with THD in overall ecommerce, which includes BOPIS and activities at the store level where they help drive sales to the ecommerce platform if that makes sense.
They have hundreds of ecommerce partners around the world that enhance their strategy and support their long-term direction.
Suppliers are working very hard to support them because they recognize that TTI is the fastest growing tool company in the world and they want to team up with them. Suppliers have helped fund their ability to build inventory.
Their mission is to help move the world from gas-powered products into cordless ESG-friendly solutions for end users anywhere they possibly can. They believe that the gas-powered outdoor market will be extinct by the end of the decade. They want to be the Tesla of lawnmowers globally.
They decided to become bold and aggressive during the pandemic, and they built out a vast amount of additional manufacturing capacity. They built a new campus in Vietnam and have built out a North American manufacturing system that will enable them to produce products for the US and Canada closer to where those products are purchased and used.
The new Ryobi high-performance brushless cordless power tools are reenergizing the brand. They are rolling out 18 new power tools this year that complement their existing range and offer higher performance, professional-grade tools priced at a DIY level.
They are also building out many verticals in their DIY program that they think have been under-developed, including hobby and craft products; for instance, they are introducing a cordless glue gun. They believe this entire category is ripe for innovation.
They intend to aggressively expand their Ryobi One+ cordless platform, which currently has 182 tools.
Their professional industrial tool business grew 25.8% last year. They believe their strategy of having inventory in place really paid off. They intend to grow the Milwaukee brand 20% annually. They currently have 216 cordless tools that work off their Milwaukee M18 platform. They are going to add a myriad of additional breakthrough products.
Their 12-volt subcompact platform now features 130 products, and they intend to introduce a new assortment of products that utilize this platform.
TTI’s $650 million project in Ho Chi Minh City is six months behind schedule. Vietnam News reported the big delays were due to the fact that foreign experts cannot enter the country due to CV19 restrictions. The plant will manufacture hand-held cordless power tools and outdoor power equipment, and will reportedly be TTI’s second-largest plant and research and development center. In their initial permits, TTI committed to starting construction by the third quarter of 2020 and finishing construction and starting operations the first quarter of 2022.
Makita bought 80 acres of land in Hall County, northeast of Home Depot headquarters in Atlanta, as part of their plan to expand their distribution capabilities in the US.
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