Power Tool Industry July 2017
A Bosch tool kit is one of the program benefits Associated General Contractor (AGC) member business owners and their employees participating in AGC’s On The Job program can choose to receive.
STANLEY BLACK & DECKER
From the Electrical Products Group Conference:
Innovation is incredibly important to them, both core innovation, which CEO Jim Loree defined as day-to-day innovation in the product lines, and breakthrough innovation, new ideas that can each generate at least $100 million in revenue. They believe there’s a “decent chance” there will be a breakthrough innovation in the next 12 months and a strong chance there will be one in the next 24 months.
Unlike many companies, they subscribe to a 50/50 theory on cash accumulation; they give fifty percent of the cash back to shareholders and invest fifty percent into their world-class brands and growth platforms. Most companies take 95% of capital and reinvest in mergers and acquisitions (M&A). Their goal is to generate free cash flow that’s greater than net income.
They are now investing heavily in what Loree called Industry 4.0, which he says will enable tremendous labor efficiency gains and will enable them to manufacture goods that historically would have been manufactured in developing countries.
He told the audience that thanks to FlexVolt, one battery system could now power all power tools, enabling job sites of the future to be cordless. For this year they have $400 million in manufacturing capacity for FlexVolt and have new SKUs coming out in the fall that could spike demand. They have $200 million in revenue in their guidance, but it could be higher. They have patented the technology required to extend FlexVolt into gas engines, and are trying to understand if patents can be protective as they are in power tools, as they can certainly replace hydraulic power with the FlexVolt battery technology.
They know they are converting accounts from their competitors to FlexVolt, but they don’t know yet if the accounts are in a test mode or experimenting; they do not believe they are converting en masse. They are not licensing any technology involved in FlexVolt, they own it all outright.
The Black & Decker acquisition opened their eyes to the power of revenue synergies, and they stopped accounting for them at $500 million. They have done $3 billion in acquisitions since August of last year, and they are now focused on absorbing and maximizing them.
One of the analysts asked about the possibility of them making an acquisition of some sort in outdoor and expanding the FlexVolt technology, and Loree said the answer was “maybe.” They need to do more investigative work to better understand the category.
Craftsman is a unique brand and they have intensive customer discussions going on now, primarily with home centers, potentially involving ecommerce. Craftsman will also have a presence in industrial and automotive repair. Craftsman is unique in that as far as they know, it’s the only brand that plays in all four of the markets they are focused on: construction, DIY, industrial and automotive repair.
DeWalt will launch a fully connected system, including a WiFi mesh network and eventually an Internet of Things platform, designed to enhance productivity, profitability and safety on jobsites. DeWalt’s patented WiFi mesh technology uses access points built to withstand the harsh and variable conditions of a construction jobsite. The platform enables contractors to collaborate in real-time across large-scale jobsites and access site information such as prints, schedules, budgets and RFIs. The DeWalt Tool Connect inventory management system is one component of total asset management for contractors.
SB&D will invest more than $29 million in facility upgrades for their plant in Jackson, Tennessee. The expansion is expected to create about 255 new jobs. Jackson is designated a “lighthouse” facility that will serve as a model for new advanced manufacturing techniques, systems and processes. One of the reasons Jackson was chosen was the quality of the current staff and the availability of a high-quality workforce.
SB&D announced a five-year, $50,000 scholarship program at the Tennessee College of Applied Technology.
SB&D has invested in Veloxint Corporation, a developer of nanocrystalline metal alloys with transformational properties based in the U.S. Veloxint is a high-tech startup that’s commercializing high-value products and parts based on fundamental science developed at MIT. The alloys are designed from the atomic level up for the thermodynamic stability that is needed for long-term stable operation at elevated temperatures. The two companies have also entered into a technology development agreement to jointly develop metal alloys for applications of mutual interest.
SB&D veteran Jim Cannon is the new CEO of Flir Systems. Flir’s largest business is providing thermal imaging cameras for military and security applications, but the company has a new line of technology aimed at contractors and consumers, including a $250 camera that attaches to smartphones and lets users look inside walls.
The city of Greenwood approved a 10-year ad valorem tax exemption on almost $4.5 million worth of property involved in Milwaukee’s recent expansion and on an inventory of up to nearly $15.3 million.
Trimble acquired privately-held Network Mapping Group Limited headquartered in Knaresborough, United Kingdom. The acquisition expands Trimble’s energy solutions portfolio to provide high-value data modeling and 3D visualization services for the utilities industry.
Trimble acquired Innovative Software Engineering, an engineering and systems integration firm that delivers
end-to-end mobile and enterprise solutions. The company will operate as part of Trimble’s Transportation Segment.
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