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Black & decker corporations(A) : power division tools

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Introduction

- Black and Decker (B&D) is a household name across America. Having received the patent for the first power drill, they are well known for their power tools.

- In addition to power tools, B&Dis also known for its various household products,like the Dustbuster.

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Vision

- To establish itself as the preeminent global manufacturer and marketeer of powertools and accessories ,hardware and home improvement products, and technology based fastening systems.

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Brands

- Brands include:-- Porter-Cable- Delta Machinery- DeVilbiss Air Power- Kwikset- Baldwin- Weiser Lock- Price Pfister- Emhart Technologies- DeWalt - Oldham Blades- Black and Decker Firestorm- Vector

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Swot analysis

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Strengths

1. A widely recognized market leader in power tools and power accessories.

2. Strong brand name and company reputation.3. Ability to take advantage of economies of scale.4. Good customer service reputation.5. Well known for high quality products.6. Strong financial position.7. Strong distribution capabilities.

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Weaknesses

1. Poor common stock performance and financial results

2. Troubled acquisitions and failed acquisitions of other companies.

3. Gaining respect for products in proffessional tool segment.

4. Not clear on strategy direction.

5. Lacks in e-commerce.

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Opportunities

1. Gain market shares from GE( general electronics small appliance segments through acquisition.

2. Opening opportunities in eastern europe and other developing nations in household appliance segment.

3. Proffessional tradesmen market is fastest growing power tools segment at 98%.

4. Expand product lines to meet broader range of customer needs.

5. Acquisitions of companies with attrative business opportunity.6. Creating the dewalt brand name and line of products.7. Expand in e-commerce.

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Threats

1. Mature market.2. Cyclic market.3. Poor market conditions.4. Strong competition in power tools segment.5. Growing bargaining power of retailers.6. New products development, products

innovation and redesign from competitors.7. Competition in small appliance segment.

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Buying behaviour in three market segments-tradesmen, industrial/commercial $ consumers:-

1.Tradesman:- buyers such as carpenters, plumbers, farmers, bought tools for their use on a job itt. They lend to patronize newly emerging retail distribution channels including home creates such as the home depot and lowe’s, in addition to traditional hardware stores, such as ace.

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2.Industrial:-In industrial, the proffessional buyer was generally a corporation purchasing tools for use by employees. In this segment , distributors played an important role in providing technical expertise and service.

3.Consumer:- these non-proffessional buyers purchased commodities for “at home” use. They bought tools at mass merchants such as walmart and kmart. B&D brand recognition and image helped it attain 1st position in market in this segment.

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Why is b&d in trouble with the first segment? How might this trouble be avoided?

1. Despite of being in the top most position, b&d was not proffessional tradesmen segment. One of the reason of the reasons of this was because black & decker brand name was too closely affiliated to household products.

2. Some trades people viewed all b&d products as for use at home rather than on the job and conversely, there had been instances of a b&d product designed for at home use being subjected to demands of the job site and failing.

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3. The lack of differentiation in product classes within the B&D brand , these proffessional tradesmen are inclined not to purchase B&D tools, as they percieve them to be primarily for those seeking tools designed for consumer segment.

4. The trade was asking for advertising allowances and rebate money on B&D’s tradesmen products and profitability at this segment was near zero.

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Reasons for the bad image of B&D:-

1. Quality of their product.

2. Consumer level tools are not built for kind of rigrous or sustained use as tradesman and industrial levels tools.

3. Lack of differentiation in B&D brands.

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Changes made to positon b&d product to tradesman segment:-

1. Understand the tradesman segment ‘s customer behavior.

2. Word of mouth and personal perception are key means to selling a brand.

3. B&D performed an assessment for comparing its products in competitive products.

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Recommendations

1. The company must continue to strengthen its core products within this portfolio so that these products will act as a “cash cow” that will allow the company to find other opportunities of expansion.

2. Black & Decker must find international companies that already have a strong presence in the countries.

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