Annual Report 2009 - Husqvarna Group

20 Husqvarna Annual Report 2009 Consumer Products
Customers and distribution
Consumer products for the mass market are sold mainly
through major retail chains and DIY outlets. The US market is
highly consolidated, with the four largest chains – Sears,
Lowe’s, Walmart and Home Depot – accounting for approximately
70% of the market.
Sears has been Husqvarna’s largest customer since the
1980’s. Sears is the world’s largest retailer of outdoor products,
under the Craftsman brand, and has a market share of approximately
25% in the US.
Husqvarna-branded products are sold mainly through servicing
dealers, i.e. small independent retailers who also offer
technical service.
Consumer Products, Rest of the World
In 2009, Rest of the World accounted for somewhat less than
half of sales of Consumer Products. The greater share of sales
refers to Western Europe.
Operations in Rest of the World involve sales to both major
retailers, i.e. mass-market channels and servicing dealers.
Sales through mass-market channels are mainly under
the Gardena, Flymo, Partner and McCulloch brands. The
Husqvarna brand stands for premium products that are sold
through servicing dealers.
Market position
The Group has strong market positions particularly for chainsaws
and other handheld products under the Husqvarna,
Partner and McCulloch brands, as well as for Husqvarnabranded
garden tractors and riders. The Group is also a market
leader in electrically-powered products in the UK under the
Flymo brand, which also has a strong position in Scandinavia.
Gardena is the leader in the consumer market in Europe for
irrigation products, and also has leading positions in garden
tools, garden ponds and pumps.
Customers and distribution
In comparison with North America, the European market is
more fragmented in terms of distribution channels, and features
a number of national and international retail chains and
DIY outlets such as B&Q, Leroy Merlin, OBI, Bauhaus and
K-Rauta.
Husqvarna-branded products are sold through servicing
dealers, who have strong positions for high-end products.
Production
Most of the Group’s production is carried out at own plants in
the US. These facilities are specialized and highly flexible, in
order to enable response to seasonal and weather-related variations
in demand. The Group is a net exporter from the US.
Electric lawn mowers and the robotic lawn mower
Automower ® is manufactured at a plant in the UK, while other
handheld electrical products are sourced from Asia. Gardena
products are manufactured at three plants in Germany and
three in the Czech Republic. Petrol-powered lawn mowers are
produced at a small plant in Italy. In 2009 production of chainsaws
and other handheld products at this plant was relocated
to the Group’s facility for consumer products in China.
In October 2009 a number of restructuring measures were
introduced, aimed at reducing costs by eliminating overlapping
and duplication in production. These measures will
involve consolidating the manufacture of handheld products in
the US to a single plant, instead of the existing two, as well as
relocating production of garden tractors and lawn mowers
from two facilities in Sweden to a new plant in Poland. The
restructuring is expected to be completed in early 2011.