Rayovac 2014 Annual Report Download - page 51

Business”); and (iv) Hardware & Home Improvement, which consists of residential locksets and builders
hardware and plumbing products (“Hardware & Home Improvement”). Management reviews our performance
based on these segments. For information pertaining to our business segments, see Note 11, “Segment
Information” of Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K for
further information on our operating segments.
Global and geographic strategic initiatives and financial objectives are determined at the corporate level.
Each business segment is responsible for implementing defined strategic initiatives and achieving certain
financial objectives and has a general manager responsible for sales and marketing initiatives and the financial
results for all product lines within that business segment.
Our operating performance is influenced by a number of factors including: general economic conditions;
foreign exchange fluctuations; trends in consumer markets; consumer confidence and preferences; our overall
product line mix, including pricing and gross margin, which vary by product line and geographic market; pricing
of certain raw materials and commodities; energy and fuel prices; and our general competitive position,
especially as impacted by our competitors’ advertising and promotional activities and pricing strategies.
Cost Reduction Initiatives
We continually seek to improve our operational efficiency, match our manufacturing capacity and product
costs to market demand and better utilize our manufacturing resources. We have undertaken various initiatives to
reduce manufacturing and operating costs.
Fiscal 2014. To reduce operating costs we implemented a series of initiatives to rationalize the international
operations within our residential hardware and home improvement business, which was acquired in Fiscal 2013
(the “HHI Business”). These initiatives will include headcount reductions and the exit of certain unprofitable
international business within the Hardware and Home Improvement segment (the “HHI Business Rationalization
Initiatives”).
Fiscal 2013. To reduce operating costs we implemented a series of initiatives throughout the Company
comprised principally of headcount reductions in the Global Batteries & Appliances and Global Pet Supplies
segments and within Corporate (the “Global Expense Rationalization Initiatives”). On November 3, 2014, we
announced an expansion of our Global Expense Rationalization Initiatives, which consist of headcount
reductions. Costs associated with the expanded initiatives, which are expected to be incurred through
September 30, 2015, are currently projected to total approximately $46,500, which include costs associated with
the Global Expense Rationalization Initiatives announced in Fiscal 2013.
Fiscal 2009. In connection with our announcement of a plan to reduce headcount within each of our
segments and to exit certain facilities in the U.S. related to the Global Pet Supplies segment, we implemented a
number of cost reduction initiatives (the “Global Cost Reduction Initiatives”). These initiatives also included
consultation, legal and accounting fees related to the evaluation of our capital structure.
Meeting Consumer Needs through Technology and Development
We continue to focus our efforts on meeting consumer needs for our products through new product
development and technology innovations. Research and development efforts associated with our electric shaving
and grooming products allow us to deliver to the market unique cutting systems. Research and development
efforts associated with our electric personal care products allow us to deliver to our customers products that save
them time, provide salon alternatives and enhance their in-home personal care options. We are continuously
pursuing new innovations for our shaving, grooming and hair care products including foil and rotary shaver
improvements, trimmer enhancements and technologies that deliver skin and hair care benefits.
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