Case analysis in

sales and
distribution

By :
Ashutosh Mayank
Abhishekh Chaurasiya
Swapnil Kale
introduction
 Spectrum Brands Inc.


 Different product lines –



 Consumer battery
 Lawn and garden care products

 Specialty pets supply

 Shaving and grooming products

Shaving and grooming product
market
 Growth rate : 3-4% annually
 Nature of market : seasonal

 Primary competitors : Norelco(philips),

braun & remington , Gillette(P&G)
 Mode of selling : traditional retail channel
with heavy emphasis on mass
merchandizers and specialty retailers.
Lawn and garden market
 Growth : 4-5%
 Market size : US$4 billion dollar

 Nature of Market : Highly Seasonal

 Primary competitors : United Industries

(United)/Nu-Gro, Scotts Miracle-Gro
Company ( Scotts )and Central Garden &
Pets Company(CGPC)
 Mode of Selling : Mainly through mass
merchandizers, home centres, independent
nurseries and hardware stores
Specialty pet supply market
 Market Size : US $ 8 Billion in 2004
 Nature of Market : Fairly stable

 Growth : 6-8 % annually

 Primary Competitors : Highly Fragmented

( 500 manufacturers in North America :
CGPC, United Pet Group/ Tetra and Hartz
Mountain )
 Mode of Selling : Through specialty pet
stores, independent pet retailers, mass
merchants, grocery stores and through
various professional outlets

Spectrum brands, Inc.
Annualized Revenue : US $ 2.8 billion
 Mergers & Acquisitions :
 Remington Products, Inc. (Shaving & Grooming
Products) in 2003
 United Industries (Lawn & Garden Care, Insect
Control Products)
 Nu-Gro Corporation (Lawn & Garden Care
Products)
 Tetra Holdings Inc.(Fish & Aquatic Supplies)
Benefits of acquisitions
 Leverage Global Distribution Channels,
Purchasing Power & Operational Processes
 Extended Brand Portfolio

 Access to new retailers & ability to gain shelf

space
 Increased ability for each brand to compete
within its given market
 Position of Spectrum : 1st in aquatic supplies,
2nd in lawn & garden industries, household
insect market and shaving & grooming
industries, 3rd in battery industry
Current sales forces
 Rayovac & Remington
 - organized by distribution channel
 - 8 sales representatives serving this division
 - sales representatives organized
geographically
 also
 - effective and efficient working
 Nu-Gro
 - tems of 30 consumer sales representatives
 - geographically distributed
 - struggling as operations and product
offerings
 were extremely unfocussed

Current sales forces ( Contd. )
 Tetra/United Pet Group
 - regionally based sales representatives in US
 - sales handled by distributors of Canada

Real Issue
 To create a national sales force from the
teams of the newly merged companies
 To capitalize on the synergies across the
various businesses
 To immediately implement the plan to avoid
disrupting the growth momentum of
individual brands, maintain customer
relationship and to preclude competition
from taking advantage of any perceived
disruptions
Sales force options
 Separate sales forces
 Advantages : (1) Greater degree of expertise
 (2) Less or no additional training
 (3) Maintenance of momentum of
 sales representatives & more
 focused sales force capable of
 better consumer services
 Disadvantages : (1) No advantage out of
 synergies due to mergers, no
 expense reduction
 (2) No efficiency improvements
 by the use of sales repres. during
 slower seasonal periods
 (3) Duplication of efforts by sales
 representatives
Merged Sales force ( One bag )
 Each representative is required to become an
expert on all product lines & selling to their
specified customers
 Advantages : (1) Capitalize on potential
synergies
 due to merger of
companies
 (2) Consolidation of existing
teams
 into a smaller unit saving
upto
 US $ 2 million
 (3) More efficient teams able
Merged Sales force ( One bag )
 Disadvantages : (1) Difficulty in creating an
 effective & efficient
merged
 team
 (2) Additional training
required
 leading to increased
cost
 (3) Highly unfocused sales
reps.
 resulting in killing the
 existing momentum

Distributors
 Provides sales & logistic services in exchange
of commission
 Advantages : (1) Well-organized, existing
relatio-
 -nship with retailers
 (2) Large sales group serving
large
 no. of customers in an
efficient
 manner
 Disadvantages : (1) High service cost
(App.15%)

Decision
 Can opt for combination of merged sales force
& distributors
 To create “Platform Teams”, business
managers responsible for relationship with
retailers, product experts support the
managers during sales pitchers
OTHER CONSIDERATIONS

 Change in position of current employees

 Dealing with sensitivity of employees to avoid

potential disturbances & to preserve current
momentum
