Board mee)ng – Brasil São Paulo, Octubre 2008
Market
Macroeconomic Overview – Key indicators 2005
Population M GDP growth, %
2006
2007
2008
2009
26,69
27,17
27,48
28
28,384
10,31%
11%
8,4%
7%
5%
2010
28,83
5% 5.8
6.4
7.2
12,8
13,4
14
Inflation, %
14%
17%
22%
34,5%
25%
20%
Devaluation, %
12%
0%
0%
0%
20%
15%
11,04%
9,3%
6,2%
7%
6%
6%
GDP/capita, Usd
Unemployment, %
General comments on Politics Economy Agriculture Forestry sector • • • • • • •
A lot of uncertainty in the economy. A lot of na)onaliza)on of key strategic industries Land expropia)ons limit demand of agricultural machinery generally Imports con)nues limited via Cadivi that supplies usd at official exchange rate. Government is suppor)ng the agricultural sector with credits and proyects. Municipal elec)ons in november is expected to increase liquidity )ll the end of the year. Strong forestry projects in Eastern Venezuela with Proforca. Reduc)on of black market exchange has reduced the smuggling to Venezuela
Size of market per client segment 90
Generalist Consumer
Value in Usd.
Forest
80
Commercial
70 60
Farmer/Rural
50
Demanding Consumer
40 30 20 10 0 2007
2008E
2009E
2010E
Chain Saw Market Size & Share by Volume Units 80,00%
60 000
70,00%
50 000
60,00% 40 000
50,00% 40,00%
30 000
30,00%
20 000
20,00% 10 000
10,00% 0,00% 2004 Total Market
2005
2006 Husqvarna
Stihl
2007 Others
2008E
2009E
2010E
Chain Saw Market Size & Share by Value V alue in U s d. 70 ,0 %
4 0 .0 0 0 .0 0 0
3 5.0 0 0 .0 0 0
6 0 ,0 %
3 0 .0 0 0 .0 0 0
50 ,0 %
2 5.0 0 0 .0 0 0 4 0 ,0 % 2 0 .0 0 0 .0 0 0 3 0 ,0 % 15.0 0 0 .0 0 0 2 0 ,0 %
10 .0 0 0 .0 0 0
10 ,0 %
5.0 0 0 .0 0 0
0 ,0 %
0 2004
Total Market
2005
2006
HVA Pro Brands
2007
2008E
Stihl
2009E
2 0 10 E
Others
Brush Cu=er Market Size & Share by Volume Units 70,0%
50 000 45 000 40 000 35 000 30 000 25 000 20 000 15 000 10 000 5 000
60,0% 50,0% 40,0% 30,0% 20,0% 10,0% 0,0% 2004 Total Market
2005
2006 Husqvarna
2007 Other
2008E Shindaiw a
2009E Stihl
2010E
Brush Cu=er Market Size & Share by Value Value in Usd. 80%
40.000.000
70%
35.000.000
60%
30.000.000
50%
25.000.000
40%
20.000.000
30%
15.000.000
20%
10.000.000
10%
5.000.000
0%
0 2004
Total Market
2005
2006
2007
HVA Pro Brands
2008E
2009E
HVA Other Brands
2010E
Stihl
Shindaiwa
Competitors Benchmarking – structure, pricing, mix
2007/2008
•
•
Stihl (Motolandia) • 4 salesmen for cs and outboard motors. Importer. Also strong in Suzuku motorcycles, outboard motors,etc. • Main models 390,381,650,660 • Increased their prices 4times in 2007 and 4 timesin 2008. • Exclusive dealers: 26 • Consumer direct sales to end. • Sucesor Joven, como director, hijo del dueño. Shindaiwa (Agrofor) • Sold by Agrofor, earlier Hva importer. Today manages other brands such as Tojoagro, Tanaka,etc. • 4 salesmen for all brands. Sell to many smaller hardware stores • Very strong with B45 • Sucesor joven, como comercial hijo de dueño
Pricing Comparison, CS 2008. Best price to dealer & going price 3500 3000
Local currency
2500 2000
dealer price going
1500 1000 500 0 235e
MS 250
61 24
MS390 24"
272XP
MS 381
281XP
MS650
288XP 36 MS 660 36
Pricing Comparison, BC 2008. Best price to dealer 3500 3000 2500 2000
dealer price going
1500 1000 500
30 B5
0 FS 45
R 34 3
A 50 L B4
50 B4
24 1R
0 FS 28
5 FS 8
23 0 C
32 3R
0
Competitors news/actions 2007/2008 •
Stihl: Started this year a premium dealer program. Not very successful as it was very limiting, incl motorcycles and outboard motors. Also their previous strategy was more focused on Colombia.
•
Shindaiwa: Strongest player in BC. Forced to reduce pricing as market idnot accept new pricing based on parallel dollar price.
•
Few activities and promotions and launches due to country situation.
Product mix, 2008 vs 2007 (from Robinsons GP report)
2008
2007
0; 0% 118; 2%
0; 0%
0; 0%
0; 0% 712; 9%
19; 0%
1.098; 16%
232; 3%
2.064; 26%
5.076; 62%
5.779; 82%
OA
OB
OS
OL
OT
OY
OA
OB
OS
OL
OT
OY
Chainsaw product mix, 2007-2008 (robinsons report)
2008
2007
53; 1%
3.835; 52%
858; 9%
3.382; 47%
2.944; 29% 6.180; 62%
Chainsaw (<45cc)
Chainsaw (>45cc;<65cc)
Chainsaw (>65cc)
Chainsaw (<45cc)
Chainsaw (>45cc;<65cc)
Chainsaw (>65cc)
YTD - 2006 x 2007 x EX2008 x 2009 Chain saw volumes
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
2006
386
705
1189
1904
2790
3379
3894
4478
4992
5607
6307
6822
2007
800
2295
4052
5192
6337
7785
8624
9982
11265 12621 13112 14170
BU 2008
1040
2140
3415
4736
6046
7202
8377
9533
10688 12054 13509 14945
EX 2008
1149
2305
3121
4082
5074
5592
6627
7270
8415
BU2009
1.260
2.540
3.810
5.060
6.235
7.400
8.575
9.750 10.895 12.185 13.475 14.655
9705
10995 12175
Chain Saw Market Share Evolution
60000
35
50000
30 25
40000
20
30000
15
20000
10
10000
5
0 Market HVA Sales HVA %
Gr. Market Gr. Husq
0
2004
2005
2006
2007
Exp. 2008
16029
24583
34702
50000
50072
54155
55500
1529
4383
6822
14170
12175
14655
16500
10
18
20
28
24
27
30
35% 65%
29% 36%
31% 52%
0% (-14%)
8% 17%
2% 11%
2009
2010
Brushcu=er mix, 2007-2008 (robinson report) 2007
2008
131; 8%
1.515; 92%
Brushcutter (<40cc)
Brushcutter (>40cc)
598; 14%
3.731; 86%
Brushcutter (<40cc)
Brushcutter (>40cc)
2006 x 2007 x EX 2008 Brush cu=er/trimmer volumes
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
2006
144
259
343
552
740
994
1039
1618
2125
2297
2975
3425
2007
460
751
914
1498
2171
2628
3312
4329
5363
6135
7089
7194
BU2008
650
1240
1860
2570
3300
4090
4830
5590
6210
6880
7550
8190
EX2008
42
76
302
394
585
1171
1310
1646
2046
2446
3096
3750
BU2009
400
850
1.300
1.800
2.350
2.950
3.550
4.150
4.550
4.950
5.512
6.124
Brush CuLer Market Share Evolution
50000 40000 30000 20000 10000 0
2004
2005
2006
2007
2008
2009
2010
Market
12691
14702
29045
42194
40000
44384
45000
HVA sales
1391
1602
3425
7194
3750
6124
7000
11
11
12
17
10
13
16
HVA %
Gr. Market Gr. Husq
14% 13%
49% 53%
31% 52%
-5% -92%
10% 39%
1% 13%
18 16 14 12 10 8 6 4 2 0
Spare Parts + Accesories Sales EvoluOon KUsd. Spare parts Chains Accesorios
2006 475 130 55
2007 EX2008 BU2009 708 813 1200 325 67 234 264 280 300
• Main accesories: Chain, Bars, kit de afilados, limas, cascos y nylon. • Great complement as to become a complete supplier for professional users
Other Products EvoluOon
2006 Tillers Lawn mower Blowers HT Motoazada Power Cutter Tractors Podadora
33 678 0 0 0 0 22 36
2007 EX2008 BU2009 112 0 0 1024 199 0 27 0 0 0 0 0 6 8 0 61 0 0 93 0 0 85 40 40
Margin development, 2006-2008, Local, consolidated for OS, OL and total company
70%
60%
50% Cons OS Cons OL Cons Total Local OL Local OS Local Total
40%
30%
20%
10%
0% 2006
2007
200806
Marke)ng
MarkeOng acOviOes + investments, 2008 Professional logger segment • Chainsaw logging competition – Amount: Usd. 60.200 – Result: excellent PR, improved relations with logging companies, especially Proforca, improved relations with dealer.
Tabla de resultados de impacto informativo WLC
Radio: 103 minutos............ T.V: 140 minutos................ Prensa: 3508 cm /col......... Resultado de publicidad no pagada: Usd.200.875
MarkeOng acOviOes + investments, 2008 Farmer segment • Ads in magazines
– Amount: Usd. 9.500 – Result
• Brand image • Good dealer support
• Field days
– Amount: Usd. 23.400 – 18 field days – Result – More sales, raise awareness of our product mix.
Marketing activities + investments, 2008 CLG/Farmer • Campaign with BC including protective equipment • Amount: Usd. 58000 – Result: Se venderan este ultimo trimestre 2500 desmalezadoras 241R • Brand image • Good dealer support
MarkeOng acOviOes + investments, 2008 General
• Profiling: Usd.27.940 – Interna – Externa. – 14 Stores
• Sales ConvenOon – Usd. 55.800 – Public RelaOons – Usd. 4.400
Dealer coverage and loca)on- (HVA+Compe)tors) 3
Stihl (77) Hardware 18 Serving 9 26 exclusivos y resto 50 sub distribuidor.
Shindaiwa (132) Hardware 76 Serving 56
2 2 2 5
1 3 14 5
4
1 4
2 61 2 4 1 3
A=34 B=27 C=15 D=14
12
8
2 5
2
6 4
2
1
1
2
16
Husqvarna (90) Serving.....76 Hardware 10 Farmer C...2 Other.........2
2
9
4
2
Venezuela Distribu)on
Dealer terms, 2008 HUSQVARNA – – – –
Credit terms 30 days Discount of 2-3% for advanced payments Logistics Delivery same day if order before 11 Dealer pays for freight if less than 5 machines. For spare parts: if less than 500usd. STIHL Credit terms Dealers exclusive: 30 Days credit Other clients: cash There arent advanced payments Logistics Customers paid the 1% of sales by the concept of transport The transport of spart parts is canceladed by the dealers. The machines can are deliveries for the warehouse of Stil
Total Mapping of channels Dealer Dealer Dealer Dealer Dealer
Hardware Servicing Home center/DIY/Masivo Farmer/COOP Others
Number of dealers 2007 2008 181 188 60 67 90 90 11 11 5 5 15 15 2007
Number of HVA dealers Dealer Hardware Dealer Servicing Dealer Home center/DIY/Masivo Dealer Farmer/COOP Dealer Others
• • •
2008 107 33 67 3 1 3
2009
2010 187 69 92 11 5 10
2009 90 10 76 0 2 2
192 71 95 11 5 10 2010
95 11 80 0 2 2
104 16 81 3 2 2
Number of Points of sales 2007 2008 1430 1479 1200 1250 66 65 85 85 79 79 0 0 No de tiendas 2007 2008 132 139 15 18 38 42 0 0 79 79 0 0
2009 1534 1300 70 85 79 0
2010 1584 1350 70 85 79 0
2009 143
2010 149 19 45 0 79 0
% of sales 2007 23% 40% 20% 12% 5% 2007
20 50 0 79 0
37% 55% 0% 5% 3%
90% of our dealers are servicing dealers. 90% of dealers are focused on OS and OL. The other half have complete range. Most dealers are shared.
DistribuOon Strategies •
Marke)ng/Communica)on- increase investments on sell-out (coop ads in local media) and sell-in ac)vi)es (increase plan ac)vi)es to dealers). – – –
Further increase sales in the Farmer market (in the dealer network). Successfully launch new products (chainsaws). Secure Sales Plan and margins.
• • •
Na)onal Coverage (a saleman more). focus on the consumer. Approach the exclusive dealer.
•
New Dealers- ALrac)veness business program for new dealers (profit & financial). – –
•
Increase the number of dealer in specifics and strategic areas (Farmer areas; i.e.: Southern states) Reduce the dealer turn over à increase the dealer retenOon
Financing Dealers growth- use the financial poten)al in order to funding our dealer network. – – – – –
Protect our margins Build up entry barriers to Chinese products in our Farmer dealer network - Loyalty Dealers Increase the product line packet Increase the sales volume MoOvate the dealer network to invest on increasing their field sales structure and improving shop faciliOes.
Venezuela Organisa)on 2008
Venezuela Organisation 2008 Ola
Eduving Porras Sales
Lorena Morales Sales admin
Bernardo Requena Service Manager
Alejandro Noda Admin
Wilinton / LuĂs / Miguel/ Anibal - Warehouse
Jhoselyn - logistics 4 Salesmen
Asist CADIVI
Otto Neri -field supervisor
Yaneth More . AR
Organisation Development 2008 1.â&#x20AC;Ż
Marketing to salesman
Gina ClavelAccounting / reporting Blanca. invoicing
Total employees: 18
SWOT Analysis Fortalezas:
Debilidades:
ü Únicos representantes directos de marca. La mayoría son importadores.
ü Ordenes de repuestos atrasadas
ü Estamos presentes en gran parte del territorio nacional.
ü No contamos con un mix de accesorios
ü Perfilaciones en la mayor parte de los distribuidores
ü Barreras de importación.
ü Mas planes promociónales.
ü Control de cambio.
ü Mayor contacto con los distribuidores por parte del equipo Husqvarna.
ü Aun queda mucho trabajo con la tecnificación de los distribuidores.
ü Buena relación con los distribuidores, somos atendido con prioridad ante otros.
ü Dependemos solo de la 241R. ü Capacitacion del equipo de ventas
ü Plan de markeOng avanzado con relación a la competencia.
Amenazas: ü Próximas elecciones Regionales, Nov 23 ü Clonación de modelos Husqvarna con productos Chinos, modelo 61, algunos casos. ü Shindaiwa esta implementando promociones bajo precios y canOdades compras 20 te obsequian 2. con sus productos. ü B&S, incorpora nuevas desmalezadoras de 32 y 42cc. ü SOhl, logra captar clientes exclusivos. ü Domosa nos copia en cuanto a talleres y perfilacion. ü PoliOca, economia
Oportunidades: ü Mercado en crecimiento, se espera que el gobierno invierta este ulOmo trimestre, y desarrolle proyectos Forestales y agricolas este 2009. ü La marca es reconocida por su calidad, oportunidad de captar nuevos clientes. ü Nuevas zonas a explorar e incorporar clientes, norte de Oriente, Costas del centro, Occidente. ü Relaciones futuras con personas involucradas en el gobierno. ü Ampliar el mix de productos Husqvarna. Y accesorios. ü Crecimiento en usuarios Farmer. ü Implementacion de Worksop Comcep ü ConOnuar el WLC ü Nuevas reglas de CADIVI Usd. 50.000 mensuales. ü Agroisleña. ü PoliOca de SOhl poco aceptada.
Plan 2009-2010
Scenario 2009-2010 PoliOcal/economic; more agricultural and forestry projects. Li=le local producOon, plus imports. Possible devaluaOon. Cuts in the government's 2009 budget. Foretal market growth, projects in the Orinoco belt. • Focus on major projects by associaOons of farmers, producers and so on. • tendency to consume medium-cylinder capacity. • • • • • •
Marketing Strategies 2009-10 Venezuela
Forest and Farmers customer groups
Forest professional - Main products Chain Saw: 55, 61, 272, 281, y 288 *MADE IN BRAZIL
Forest professional campaign
OBJECTIVES 1. 2.
Consolidate Premium Brand in this segment Increase market share from 25% to 40% within 2010
Strategies • • • • • • • • • •
Increase the market share.Volume and value growth Dealers New. XP campaign, selling in and selling out activities World Logging Championship Service Platform communication Dealer network support Field days – product demonstration (coop. advertising) Premium after sales service PR in magazines Brand building
AcOviOes
• WLC
• POS materials • Coop. advertising • Field days • Professional logging campaigns • Contact with prof logging companies • PR
Customer Groups/Segments
Farmer/ Rural
Farmers/Rural Scenario (Venezuela) Could be divided into 2 sub-groups:
Large properties owners Small properties owners
Farmer / Rural buying reasons
Ø Brand Ø Communication Ø After sales service Ø Product reliability (trustful) Ø Convenience and availability Ø Easy to use Ø Dealer quality Ø Price
Famer/Rural â&#x20AC;&#x201C; Main Products Brazil
Chain Saw: Launch: 235e (X-TORQ), y ,445e (X-TORQ), Current: 55 and 61 (made in Brazil) Brush cutter: Launch: 241R (made in Brazil)
Famer/Rural OBJECTIVES • Increase volume and value (Profit) • Increase volume and value within low “cc” chain saws market • Increase the perception of Husqvarna products within this segment • Product Launch: BC 241R, 235e/445e
STRATEGY Main strategies a) Use specialized asociations, sales channels, fairs and magazines to reach more effectively this customer b) Maximize use of news such as X-TORQ in POS and PR c) Maximize use of Service Platform/after sales support d) Work strongly Field days – product demonstration (coop. advertising) – Dealer for customer
Famer/Rural campaign
ACTIVITIES • Revise and get correct dealers. More farmer coop • Radio ads • Evaluate spots in regional tv • Continue with ads in specialized magazines • PR • Coop Advertising • Fairs • POS Material • Field days with end consumers/dealers
*Also adapt for all communication materials
Activities • WLC
Logros • Brand Building. • Contacto Directo con el usuario. • Ruedas De Prensa, Media Tours en Medios Radiales y Television. • Publicidad Gratuita (Valos Percibido): Usd. 200.875 • Retorno de Inversion cercano al 100%
MEDIA SAMPLES (Magazines and TV)
Magazines TV (regional)
OrganizaOonal Development 2009-201 Ac)on Plan 2009 - 2010
•Entrenamiento a grupo de vendedores, técnicas en ventas, recursos de negocios, )pos de clientes, herramientas de ventas. •Entrenamiento a grupo de vendedores, argumentos de ventas, conocimiento del producto. •Universidad Husqvarna. • Capacitación en Seminarios Técnicos, medio y avanzado. • Desarrollo del equip de logis)ca. • Desarrollo de sistema de informacion • Capacitacion en negocio. • Administradora en ventas (enfocar a telemercadeo). • Demostrador. (realizar eventss, carpas, capacitaciones, demostraciones, ferias). • Vendedor Occidente. (Zulia,Merida, Trujillo, Falcon) desarrollo de la zona 11% mas en ventas netas. • Desarrollo de recurso humano.
Sales and Distribution
Action Plan 2009 •
Sales team organization –
Reorganize the sales structure in 4 regional (key account managers) in order to be more productive and keep focus on A & B dealers. Cauntos distri???
–
Increase the number of dealer – Prospects donde?
–
Create internal sales structure in order to be more efficient, reduce sales cost and keep focus on C & D dealers. Lorena CUANTOS SON C Y D
•
Renewed focus on dealer profiling: internal externañ
•
Dealer meetings –
•
•
MEETING NO CONVENT
Logisics improvements –
Internally: forecasting main clients
–
Externally: product supply/cadivi
Train and develop dealer organization –
Focus on product knowledge/training and field activies
–
HU