Hamilton Beach 2015 Annual Report Download - page 13

market segment. This segment accounts for
approximately one-third of the U.S. small kitchen
appliance market, and the target consumer is
financially strong. This “only-the-best” segment
offers a strong growth opportunity in an area
in which HBB has not previously participated. In
2014, HBB announced its entry into the “only-the-
best” high-end small kitchen appliance market
segment through multi-year licensing agreements
with the Sub-Zero Group, Inc. and the Jamba Juice
Company. HBB and Sub–Zero Group launched a
full line of Wolf Gourmet®branded small kitchen
appliances and cooking tools in 2015 for sale in
high-end retail channels, in Sub-Zero and Wolf
showrooms, and on the Internet. Hamilton Beach
secured its lead distribution partners for the
Wolf Gourmet®branded products in 2015 and
expects to add additional distribution channels in
2016 both domestically and in its Canadian and
Mexican markets. The company is also working
with the Jamba Juice Company and launched a
product line focused on blending and juicing
under the Jamba®brand in 2015. HBB is pursuing
other opportunities to create additional product
lines that can be distributed in high-end or
specialty stores and on the Internet, including the
introduction of the Hamilton Beach®Professional
premium line of counter-top kitchen appliances.
Fourth, HBB is focused on expanding its retail
presence internationally in the emerging growth
markets of Asia and Latin America by increasing
product offerings designed specifically for those
market needs and by expanding distribution
channels and sales and marketing capabilities.
While HBB has a long-standing presence in the
global commercial products market, HBB’s
historical strength in the retail segment has
been in the U.S. consumer goods market, with
approximately 20 percent of its total sales
occurring outside the United States in 2015.
HBB’s objective is to increase international sales to
35 to 45 percent of total sales by concentrating on
key markets. HBB’s efforts will focus on continuing
to expand its established positions in Mexico,
Canada, Central America and South America as
well as further expanding HBB’s position in the
emerging markets of China and Brazil. HBB expects
to pursue other markets by selectively leveraging
primarily the Hamilton Beach and Wolf Gourmet
brands. To achieve this growth, HBB is working
to enhance its understanding of local consumers’
needs, developing products to meet those needs
and increasing sales and marketing resources
allocated to these markets, especially in the mid-
to high-end segments. HBB began selling retail
products in China in 2013, and in Brazil in 2014.
HBB expects to increase sales in these areas
in 2016.
Fifth, while HBB has a leading position in
the commercial market, it continues to focus
on achieving further penetration of the global
commercial market through a commitment to
an enhanced global product line for chains and
distributors serving the global food service and
hospitality markets. HBB is enhancing its global
commercial product line, particularly with new
innovative juicing, blending and mixing platforms,
and strengthening its food service and hospitality
offerings in order to achieve further market
penetration in this segment. Over the near term,
HBB anticipates continuing to build distribution
capabilities and resources in the international
food service market, where products and services
will be directed at global food service chains.
HBB made significant progress in most
segments of the business in 2015. Momentum
is building in its core business and from efforts
resulting from its Strategic Initiatives. HBB is
optimistic that it will be able to build on that
momentum in the years ahead. HBB believes
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