Spectrum Case

1166 Words Jun 28th, 2013 5 Pages
1. Assess the Spectrum organization and each of the markets in which the company operates. What are the key elements from each industry about which Falconi should be concerned?

Over the years, with help from a number of acquisitions, Spectrum in 2005 had become a leading supplier of consumer batteries, lawn and garden care products, specialty pet supplies, and shaving and grooming products.

In the battery market, North American consumers of household batteries sought convenience and quality when purchasing batteries and tended to gravitate towards the brand names they knew and trusted, with Duracell and Energizer dominating the market. These two firms were leaders in this market because of their ability to adapt to consumer needs
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Growth in this market had been between 4-5% annually and was expected to continue at this pace. Competitors within these markets sold mainly through mass merchandisers, home centers, independent nurseries and hardware stores. Home centers and mass merchandisers typically carried one or two premium brands and one value brand on their shelves and 50-60% of sales passed through these two channels. The lawn and garden market was highly seasonal. Products were shipped to distributors and retailers beginning as early March and demand for the products typically peaked during the first six months of the calendar year.

The specialty pet supply industry had historically been one of the fastest growing consumer product categories with annual growth between 6-8%. In North America, this was an $8 billion dollar market in 2004, and was expected to grow to over $11 billion by 2007. The specialty pet supply industry was highly fragmented with over 500 manufacturers in North America, consisting of both large and small firms. Products were sold through specialty pet stores, independent pet retailers, mass merchants, grocery stores and through various professional outlets. The majority of sales were made through pet stores, of which there were over 15,000 in the United States and more than 5,000 in Canada. Sales in this segment remained fairly