Rayovac 2007 Annual Report Download - page 16

14 SPECTRUM BRANDS | 2007 ANNUAL REPORT
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 tech-
nology innovations. Research and development efforts associ-
ated with our electric shaving and grooming products allow us to
deliver unique cutting systems to the market. Research and
development efforts associated with our electric personal care
products allow us to deliver our customers products that save
them time, provide salon alternatives and enhance their in-home
personal care options. We are continuously pursuing new inno-
vations for our shaving, grooming and hair care products, including
foil and rotary shaver improvements, trimmer enhancements
and technologies that deliver skin and hair care benefi ts.
During Fiscal 2007, we introduced a new men’s shaving
system designed for young men, called “Code,” which is specifi -
cally targeted to the transitional skin of teenagers and young
adults. We also introduced the world’s fi rst electric shaver with
a disposable head, called “CleanExchange” that we believe
provides a closer and more comfortable male shaving experi-
ence and will also establish a consistent recurring revenue
stream on a per-customer basis, atypical for the electric razor
market. Advancements in shaver blade coatings continued to
be signifi cant with further introductions of Titanium, Nano-
Diamond, Nano-Silver and Tourmaline on a variety of prod-
ucts, which allow us to continue to launch new products or
product enhancements into the marketplace.
During Fiscal 2006, we introduced a new men’s shaving plat-
form, including such new features as ComfortSelect and improved
ComfortFlex, designed to improve the comfort and closeness of
the shaving experience. In the lawn and garden category, we
introduced Mulch with Weed Stop, the fi rst premium landscape
mulch with weed preventer, the Smart Seeder, the fi rst ready-to-
use combination grass seed container and spreader, and the only
termite killing stakes product for the do-it-yourself market.
During Fiscal 2005, we launched a new self-cleaning women’s
shaver, the world’s fi rst vacuuming haircut kit with a built-in
vacuum and a new product line-up of hair dryers, setters and
stylers under the “All-That” platform. Also, during Fiscal 2005,
we brought to market a new self-repairing, self-spreading grass
seed using RTF (Rhizomatous Tall Fescue) technology under
the Vigoro and Expert Gardener brands. In the household insect
control category, we introduced a new product during Fiscal
2005 called Cutter Advanced™ Insect repellant. Cutter Advanced
introduced Picaridin as an active ingredient, the only non-DEET
alternative recommended by the Centers for Disease Control
and Prevention.
Competitive Landscape
We compete in seven major product categories. Our continuing
operations include the following fi ve major product categories:
consumer batteries; pet supplies; electric shaving and grooming;
electric personal care products; and portable lighting. Our dis-
continued operations include the lawn and garden and household
insect control product categories that are sold through our Home
and Garden Business.
The consumer battery product category consists of non-
rechargeable alkaline or zinc carbon batteries in cell sizes of AA,
AAA, C, D and 9-volt, and specialty batteries, which include
rechargeable batteries, hearing aid batteries, photo batteries and
watch/calculator batteries. Most consumer batteries are mar-
keted under one of the following brands: Rayovac/VARTA,
Duracell, Energizer or Panasonic. In addition, some retailers
market private label batteries, particularly in Europe. The
majority of consumers in North America and Europe purchase
alkaline batteries. The Latin America market consists primarily
of zinc carbon batteries but is gradually converting to higher-
priced alkaline batteries as household disposable income grows.
We believe that we are the largest worldwide marketer of
hearing aid batteries and that we continue to maintain a lead-
ing global market position. We believe that our close relation-
ship with hearing aid manufacturers and other customers, as
well as our product performance improvements and packaging
innovations, position us for continued success in this category.
Our Global Pet Supplies business comprises aquatics equipment
(aquariums, fi lters, pumps, etc.), aquatics consumables (fi sh food,
water treatments and conditioners, etc.) and specialty pet products
for dogs, cats, birds and other small domestic animals. The pet
supply market is extremely fragmented, with no competitor hold-
ing a market share greater than 20%. We believe that our brand
positioning, including the leading global aquatics brand in Tetra,
our diverse array of innovative and attractive products and our
strong retail relationships and global infrastructure will allow us
to remain competitive in this fast-growing industry.
We also operate in the shaving and grooming and personal
care product category, consisting of electric shavers and acces-
sories, electric grooming products and hair care appliances.
Electric shavers include men’s and women’s shavers (both rotary
and foil design) and electric shaver accessories consisting of
shaver replacement parts (primarily foils and cutters), pre-shave
products and cleaning agents. Electric shavers are marketed
primarily under one of the following global brands: Remington,
Braun and Norelco. Electric grooming products include beard
and mustache trimmers, nose and ear trimmers, body groomers
and haircut kits and related accessories. Hair care appliances
include hair dryers, straightening irons, styling irons and hair-
setters. Europe and North America account for the majority of
our worldwide product category sales.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Spectrum Brands, Inc.