Power Tool Industry September 2020
Stanley Black & Decker
SB&D raised their forecast for organic revenue for Q3 to 7% to 10% growth from their July forecast for revenues to be flat to down 7%. They cited stronger demand in the Tools & Storage segment, modest improvements in store level inventories in US retailers and stronger trends in the Security and Industrial segments. SB&D said that the upwardly revised guidance will most likely result in operating margins being relatively flat compared to 2019.
SB&D was named as one of the 100 Best Workplaces for Innovators on the second annual ratings list from Fast Company. SB&D ranked 55th in their first appearance on the list. Fast Company collaborated with Accenture to score nearly 900 applications; winners were chosen by a panel of eight judges.
First half 2020 sales rose 12.8% to USD $4.2 billion. The core Power Equipment segment grew 12.8% to USD $3.7 billion. The Milwaukee professional business grew 13.3% overall and 12.8% in North America. The Ryobi Outdoor business grew 25%. CEO Joe Galli said that new product development fueled their strong first-half performance, which was also aided by an expanded global sales network, improved manufacturing productivity and a strengthened supply chain.
First Half 2020 Earnings Call
First half revenue rose 12.8% to more than USD $4.2 billion.
Power Equipment sales grew 12.8% to USD $3.7 billion. Both Milwaukee and Ryobi ONE+ delivered double-digit growth. The Power Equipment division accounted for 89.1% of the group’s revenue.
North American sales grew 14.5% and North America accounted for 77.3% of the group’s revenue.
They deliberately avoided the path taken by “competitors” who announced expected double-digit sales declines and massive cost-cutting efforts. Instead they worked literally around the clock in late March and early April listening to their customers and sales people all over the world. After analyzing input, they implemented a dramatically different plan of attack.
They invested in production and inventory, ramped up manufacturing and invested in more manufacturing capacity. They also invested aggressively in even more product development, because they believed there was an unprecedented opportunity for them to capture market share.
In addition, TTI “dramatically expanded” their salesforce to help customers and help end users.
They now have momentum going into the second half and are confident they will continue to outperform their competition and the market.
They are not achieving growth through price; their gross margins are actually increasing.
They hired more than 1,000 people in 2020 in sales, marketing, engineering and operations for their Leadership Development Program.
The Milwaukee business grew 13.3% globally and 12.8% in North America despite the industrial construction business getting hit hard. They are rolling out new cordless products now, including a metal-cutting circ saw, an impact wrench and a portable bandsaw and chainsaw. CEO Joe Galli stated Milwaukee now offered the broadest line of cordless subcompact tools for industrial construction.
CV19 delayed the rollout of MX Fuel a bit because it was necessary for them to visit job sites and demonstrate the tools. They developed very stringent CV19 protocol and are now welcomed on job sites.
The Milwaukee Packout system has reportedly become the preferred mobile storage solution for professional and industrial users, and they are now expanding it and have dozens of concepts underway.
Their Milwaukee team developed a line of personal protective equipment (PPE) and safety equipment. The line includes masks, ear protection, hard hats and more. It is now in distribution and reportedly selling well.
The Ryobi DIY brand also has big developments in store. They will be rolling out a line of high-performance brushless products in the second half of 2020. These subcompact DIY tools are also appropriate for professional use.
They have also been working on a line of Ryobi cleaning products that utilize their unique battery technology and leverage the fact that there are so many users of the Ryobi ONE+ 18-volt line.
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