World Power Tools - The Freedonia Group

Industry Structure
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Freedonia Industry Study
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• industry composition
Product Development & Manufacturing
INDUSTRY STRUCTURE
• market share
• product development
• manufacturing
• marketing
• distribution
• financial requirements
• mergers & acquisitions
• industry restructuring
• cooperative agreements
Despite the mature nature of much tool technology, new product development is
important in most power tool segments, as moderating growth opportunities have
resulted in increased efforts among manufacturers to develop improved products to
sustain market share. Since the potential for truly innovative new tools is limited,
most research and development activity revolves around making general performance
improvements and enhancing the ergonomic qualities of tools.
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Unlike hand tools, which have existed for centuries, power tools offer significantly
more room for innovation. The design of more powerful, longer-lasting cordless
products allowed by advances in battery technology continues to be one of the
most significant areas of product development. Other trends in new products
include tools targeting specific applications and the development of quieter tools.
Due to the specialized requirements of certain tool users, producers often must
work closely with end users in new product development. Motor vehicle applications
are among the most commonly specialized, due to the use of complex
systems and smaller engine compartments by automotive OEMs. These factors
have led to the increasing need for specialized products, both in terms of function
and size. To target these end users, tool producers must closely coordinate product
development with auto producers, mechanics and technicians.
Ergonomics is another key research and development issue for power tool
producers. The introduction of tools that are more comfortable and cause less
fatigue stimulates replacement purchases, especially among professionals and other
frequent tool users. For power tools, ergonomics are improved by reducing the
weight of the tool and making the grip more comfortable.
Basic power tool manufacturing requirements do not in themselves present a major
barrier to entry in the tools industry, as most of the production processes entail
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World Power Tools #1419
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