Rayovac 2010 Annual Report Download - page 19

The pet supply product category is highly fragmented with over 500 manufacturers in the U.S. alone,
consisting primarily of small companies with limited product lines. Our largest competitors in this product
category are Mars Corporation (“Mars”), The Hartz Mountain Corporation (“Hartz”) and Central Garden & Pet
Company (“Central Garden & Pet”). Both Hartz and Central Garden & Pet sell a comprehensive line of pet
supplies and compete with a majority of the products we offer. Mars sells primarily aquatics products.
Products we sell in the lawn and garden product category through the Home and Garden Business face
competition from The Scotts Miracle-Gro Company (“Scotts Company”), which markets lawn and garden
products under the Scotts, Ortho, Roundup and Miracle-Gro brand names; Central Garden & Pet, which markets
garden products under the AMDRO and Sevin brand names; and Bayer A.G., which markets lawn and garden
products under the Bayer Advanced brand name.
Products we sell in the household insect control product category through the Home and Garden Business,
face competition from S.C. Johnson & Son, Inc. (“S.C. Johnson”), which markets insecticide and repellent
products under the Raid and OFF! brands; Scotts Company, which markets household insect control products
under the Ortho brand; and Henkel KGaA, which markets insect control products under the Combat brand.
Our primary competitors in the electric shaving and grooming product category are Norelco, a division of
Koninklijke Philips Electronics NV (“Philips”), which sells and markets rotary shavers, and Braun, a division of
Procter & Gamble, which sells and markets foil shavers. Through our Remington brand, we sell both foil and
rotary shavers.
Primary competitive brands in the small appliance category include Hamilton Beach, Proctor Silex,
Sunbeam, Mr. Coffee, Oster, General Electric, Rowenta, DeLonghi, Kitchen Aid, Cuisinart, Krups, Braun, Rival,
Europro, Kenwood, Philips, Morphy Richards, Breville and Tefal. The key competitors of Russell Hobbs in this
market in the U.S. and Canada include Jarden Corporation, DeLonghi America, Euro-Pro Operating LLC, Metro
Thebe, Inc., d/b/a HWI Breville, NACCO Industries, Inc. (Hamilton Beach) and SEB S.A. In addition, Russell
Hobbs competes with retailers who use their own private label brands for household appliances (for example,
Wal-Mart).
Our major competitors in the electric personal care product category are Conair Corporation, Wahl Clipper
Corporation and Helen of Troy Limited (“Helen of Troy”).
Our primary competitors in the portable lighting product category are Energizer and Mag Instrument, Inc.
Some of our major competitors have greater resources and greater overall market share than we do. They
have committed significant resources to protect their market shares or to capture market share from us and may
continue to do so in the future. In some key product lines, our competitors may have lower production costs and
higher profit margins than we do, which may enable them to compete more aggressively in advertising and in
offering retail discounts and other promotional incentives to retailers, distributors, wholesalers and, ultimately,
consumers.
Seasonality
On a consolidated basis our financial results are approximately equally weighted between quarters, however,
sales of certain product categories tend to be seasonal. Sales in the consumer battery, electric shaving and
grooming and electric personal care product categories, particularly in North America, tend to be concentrated in
the December holiday season (Spectrum’s first fiscal quarter). Demand for pet supplies products remains fairly
constant throughout the year. Demand for home and garden control products sold though the Home and Garden
Business typically peaks during the first six months of the calendar year (Spectrum’s second and third fiscal
quarters). Small Appliances peaks from July through December primarily due to the increased demand by
customers in the late summer for “back-to-school” sales and in the fall for the holiday season. For a more
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