Graco 2007 Annual Report Download - page 26

Newell Rubbermaid Inc. 2007 Annual Report
24
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The following discussion and analysis provides information which management believes is relevant to an assessment and understanding of the Company’s
consolidated results of operations and financial condition. The discussion should be read in conjunction with the accompanying Consolidated Financial
Statements and Notes thereto.
Executive Overview
Newell Rubbermaid is a global marketer of consumer and commercial products that touch the lives of people where they work, live and play. The Company’s
multi-product offering consists of well known name-brand consumer and commercial products in four business segments as follows:
Segment Description of Products
Cleaning, Organization & Décor Material handling, cleaning, refuse, indoor/outdoor organization, home storage, food storage, drapery hardware,
window treatments
Office Products Ball point/roller ball pens, markers, highlighters, pencils, correction fluids, office products, art supplies, on-demand
labeling products, card-scanning solutions, on-line postage
Tools & Hardware Hand tools, power tool accessories, manual paint applicators, cabinet, window and convenience hardware, propane
torches, soldering tools and accessories
Home & Family Premium cookware and related kitchenware, beauty and style accessory products, infant and juvenile products,
including high chairs, car seats, strollers and play yards, and other products within businesses that are individually
immaterial and do not meet aggregation criteria
The Company’s vision is to become a global company of Brands That MatterTM and great people, known for best-in-class results. The Company remains
committed to investing in strategic brands and new product development, strengthening its portfolio of businesses, reducing its supply chain costs and
streamlining non-strategic selling, general and administrative expenses (SG&A).
The key tenets of the Company’s strategy include building large, consumer-meaningful brands (“Brands That MatterTM”), leveraging one Newell
Rubbermaid, achieving a best total cost position and commercializing innovation across the enterprise. The Company’s results depend on the ability of its
individual business units to succeed in their respective categories, each of which has some unique consumers, customers and competitors. The Company’s
strategic initiatives are designed to help enable these business units generate differentiated products, operate within a best-in-class cost structure and
employ superior branding in order to realize premium margins on their products. The business units use the premium margins to fund incremental demand
creation initiatives, driving incremental sales and profits for the Company.
The following section details the Company’s performance in each of its transformational initiatives:
Create Consumer-Meaningful Brands
The Company is continuing to move from its historical focus on push marketing and excellence in manufacturing and distributing products, to a new focus
on consumer pull marketing and creating competitive advantage through better understanding its consumers, innovating to deliver great performance,
investing in advertising and promotion to create demand and leveraging its brands in adjacent categories around the world. This effort is creating and
expanding core competencies and processes centered on consumer understanding, innovation and demand creation, to drive sustainable top line growth.
The Company’s progress in implementing this brand building and marketing initiative is exhibited by the following:
• The Company’s Tools & Hardware segment achieved low single digit sales growth in 2007, due largely to continued strength in its international
Irwin and Lenox businesses. One of the primary drivers of the growth in the Lenox business is its marketing efforts and the expansion of its team
of trained professionals who work with end users to educate them on the benefits, use, installation, and servicing of its band saws.
• In the Company’s Beauty and Style business, Goody has introduced a major marketing campaign to support the introduction of its innovative
Styling Therapy line of brushes that are infused with special substances that help control dandruff, add shine, and protect hair color. Sales of
Styling Therapy products have doubled since the launch of the consumer driven advertising and promotion campaign.
• In the Company’s Office Products segment, the Dymo labeling technology business’ sales have increased in 2007 due largely to aggressive
television marketing campaigns in Europe. Additionally, the Office Products segment is launching the Sharpie Ultra Fine Retractable Marker in
early 2008. This distinct product, developed based on consumer understanding and demand, allows for precise permanent marking and writing
with an easy one-handed operation.