Rayovac corporation case analysis

Spectrum Brands Situation Analysis roblem Statement: Spectrum Brands, formerly known as Rayovac Corporation, had recently made a number of acquisitions to diversify its brand portfolio and expand its product line. In November 2005, Bob Falconi, vice president of sales and marketing for the Canadian division of Spectrum Brands Inc., was faced with the demanding task of creating an effective sales team that would capitalize on the synergies across the diverse portfolio of business units while effectively and efficiently continuing to increase the sales of each business unit. Because of Spectrum’s wide variety of offerings, differences in products, logistics, costs, and profit margins, its current salesforce strategy is not going to be sustainable. Situation Analysis: Company Spectrum Brands is a global consumer products company that has recently made multiple acquisitions to expand and diversify its product and brand portfolio, and in the process it launched itself into the leading supplier of a wide variety of consumer goods. Spectrum Brands is composed of three main business units: Rayovac/Remington, which sells battery, lighting, shaving, and grooming and hair products; Nu-Gro (United Industries Corporation), which is the leading manufacturer and marketer of insect pesticide products and consumer lawn and garden care; Tetra Holdings (United Pet Group), which is responsible for the sales of specialty pet supplies such as—aquarium products, fish food, and books on aquarium keeping. The current salesforce is made up of 38 sale representatives for the Rayovac/Remington and Nu-Gro segments, and four of those positions are playing dual roles of both sales manager and sales representative, with 2 managers for each division, and dividing their time 65 percent to 35 percent respectively amongst sales and managing their teams as well as the distributors that are responsible for the Tetra division, which uses distributors and does not have its own internal salesforce. Since the recent acquisitions, Spectrum Brands has realized that its current salesforce strategies are not sustainable for its current size and diverse portfolio. Customers The company has a broad line of products and expansive business operation. Therefore, the relationship with customers are specific and designed to support each of the Spectrum Brands. Their focus is to increase sales of their products, gain market share and broaden brand portfolios. Within the battery market (Rayovac), their customers are wholesalers, distributors, professionals and OEM’s and traditional retail channels. The majority of their sales come from traditional retail chains such as merchandisers, home and garden centers and electronic stores. In the shaving and grooming products market (Remington), customers consist of mass merchandisers and specialty retailers like salons and hair car spots. The lawn and garden care market (United/ Nu-Gro) has two customer segments. The first being various retailers such as home and garden centers, large home supply retailers and general mass merchandisers. The second segment is their professional division where customers are golf courses, lawn care companies, pest control operators and farms. In the specialty pet supply segment (Tetra) customers consist of mass merchants, supermarkets and distributors who sell to specialty pet stores and independent pet retailers. Competitors The markets that Spectrum Brands operate in are highly competitive on a global basis. Companies compete against each other for shelf space and market share by building powerful relationship with retailers. Each segment under the umbrella of Spectrum Brands operate differently to compete with their competition. Spectrum Brands compete in brand name recognition, quality, price, distribution strategies, consumer acceptance and valuable negotiation power with retailer. The major competitors of Spectrum Brands are Procter & Gamble and Energizer Holdings Inc. within the battery market. Central Garden and Pet company (CGPC) and Hartz Mountain Corporation in the specialty pet supply market. Within the personal care and hair products sectors Spectrum’s main competitors are Norelco, Conair Corporation, and Helen of Troy Limited. There is fierce competition based on the quality and price of products within these market segments. Collaborators Spectrum Brands collaborates with distributors in their Tetra Division and they are responsible for sales to the highly fragmented Canadian specialty pet retailer market. Distributors offer the same service that an internal salesforce would provide, including promotions and point-ofpurchase displays. They work on commissions and provide an advantage because they have existing relationships with small retailers, and can operate large sales groups to service a large number of customers. Context The consumer brands industry has become a highly competitive market on a global scale. Over the past decade a few large companies have emerged that dominate the industry.