hva template 2008 white®[1]
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Brand Essence
Understanding the Brand essence
• Husqvarna reflects a high degree of quality and
craftsmanship.
• The price point of the product reflects the value we wish to
pass on to our customers.
• Customers satisfaction and LAUGHLIN & DE GANNES ability to
support has proven a successful factor.
The Trinidad Market
STIHL
• A brand perceived as of high quality as the Husqvarna
product, with an excellent track record established over fifteen
years on the island.
The Trinidad Market
Shindaiwa
ECHO
Red Max
• Other brands contend for market share based on a high level
of visibility.
The Trinidad Market
Tanaka
Ryobi
Craftsman
Maruyama
• Additional products which are price pointed as even lower
alternative offering to the customer.
History
• Laughlin & De Gannes embarked on offering the Husqvarna Lawn and Garden as part of its product range.
• Based on the model seeking to establish a network of dealers.
• Our network started with two dealers and expanded to twelve locations island wide.
• The product was also traded through the Laughlin & De Gannes retail outlets – TOOL STORE.
The dealers concept
• The majority of these dealers already carried product lines of
all of the competing brands mentioned.
• Our Husqvarna product entered priced in order to penetrate
the market.
• The brand was new to the consumers and made a
challenging proposition for the dealers as well.
Retail Trade
• While the dealers were struggling to establish the products
even with our full support.
• Our own Retail experience was quite the reverse as the TOOL
STORE sales were in most instances constantly surpassing
the dealers.
Price structure
• The pricing strategy of the dealership network was set to
allow the dealer to assume the benefit of moving the product
at the retail price tag lower than the market leaders.
• Offering the dealer a strong incentive to move the product.
• This structure while envisioned to move the product bore low
margins for us.
LAUGHLIN & DE GANNES
Dealers
Profit structure
10% 25%
Pricing structure
• Dealership: (Laughlin & De Gannes to Dealers = 10%
margin, Dealers through sales to their customers= 25%
margin).
• Retail: (Laughlin & De Gannes to TOOL STORE Customers
35% margin).
• Even with the strategy seeking to grow the business through dealerships; the sales out of the TOOL STORE were exceeding
the sales of the dealers.
Trinidad & Tobago’s Market conditions
• Data from our Central Statistical Office regarding Trimmers
and Chainsaws importation into Trinidad & Tobago spanning
2007-2009 also indicates a decline of the product line across
the board.
• 2007-2208 the importation decreased by -2%.
• During 2008-2009 there was a further decrease in importation
of these products by -22%.
0
5,000
10,000
15,000
20,000
25,000
30,000
2007 2008 2009
CSO Out Garden Products imports 2008-2009
Trinidad & Tobago’s Market conditions
Trinidad & Tobago’s Market conditions
• This Central Statistical Office data regarding Trimmers and
Chainsaws importation spanning 2007-2009 indicates the
following countries of origin as the source of products entering
the market here in Trinidad & Tobago.
• While this indicates the potential for the Husqvarna brand,
other conditions impact on the growth.
Trinidad & Tobago’s Market demographics
11%
27%
8% 13%
2%
39%
CSO Trimmers & Chainsaws Importation 2007-2009
BR:BRAZIL
CN:CHINA
DE:GERMANY
JP:JAPAN
SE:SWEDEN
US:U. S. A.
Market conditions
3,822
5,765
2,466
3,122
181
7,996
3,286
6,281
537 889
268
3,628
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
BR:BRAZIL CN:CHINA DE:GERMANY JP:JAPAN SE:SWEDEN US:U. S. A.
CSO Trimmers & Chainsaws Unit Imports 2007-2009
2007
2008
2009
Potential
• While this data also indicates the slow down of the imports
based on the current economic constraints.
• It also paints a picture for potential growth if the conditions are
right.
• As even while the imports of the other brands decreased,
Laughlin & De Gannes has maintained a 10% growth of our
Husqvarna line.
• During this downturn.
Existing Market conditions In Trinidad & Tobago
-40%
-31%
-21%
-6%
3% 10%
DE:GERMANY JP:JAPAN US:U. S. A. BR:BRAZIL CN:CHINA SE:SWEDEN
CSO Trimmers & Chainsaws Import trend as % 2007-2009
Laughlin & De Gannes New Road Map
Proposal
• With the decline of sales within the current economic
constraints, coupled with the need to maintain a higher
degree of visibility via Advertising and Promotion activities
going forward.
• Laughlin & De Gannes is poised to present to Husqvarna new
strategy based on the research conducted.
Re-Focus on Retail
• The new proposal is due to showcase our commitment to
refocus the brand using our retail strength within the Trinidad
& Tobago Market.
• Seeking to maintain the core sales volumes through our TOOL
STORE branches which maintains a strong retail presence
island wide.
• Coupled with our Industrial sales force which has a current
penetration into key sectors of the industry.
• As our previous quest to run parallel dealerships and the
pricing structure which made the trade uncompetitive on both
us and the dealer.
Get the product in the hands of the end
user
• The key to the success of this strategy achieving the volumes
is the proposed revised pricing structure.
• The product is made available to the consumer through our established Laughlin & De Gannes TOOL STORE® three
locations on the island, with a fourth due to be set up next.
• Along with a Husqvarna dedicated sales and service branch.
New Pricing Structure
• Unlike the previous model which needed to provide for the dealer
making a profit.
– Even while said dealer was trying to benefit from the incentives
of the other brands.
• The new pricing structure seeks to pass this directly to the end user.
• Therefore allowing us to focus on moving the product through our
strong retail network with a 20% reduction as an introduction period
realizing increased volume.
Reforecast
-
10,000
20,000
30,000
40,000
50,000
60,000
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep
USD Forecast Sales figures 2010 - 2011
2011
2010
2009
Revised sales forecast
• With our current sales forecast we are poised to net US 225K
in product sales in 2010.
• With the new strategy we have outlined we anticipate a 30%
increase in volume.
• In 2011 the long term of the strategy allows us to move up the
margin on the penetration we have made the sales figure is
estimated to grow to US 294K.
Husqvarna product mix at LDGTT
Brushcutters
Chainsaws
Spares and Repairs
Accessories
60%
20%
15%
5%
Summary
• Our strategy to refocus on selling the products through our Laughlin & De Gannes TOOL STORE Retail outlets primarily,
was being proposed to offer Husqvarna before the
unforeseen termination of our dealers commitment which we
initialized just four years ago.
• We would like to have the opportunity to fully explore the
potential of our researched strategy.
• As the way forward for both our interest in the product
success.