According to Husqvarna’s recently released 2010 annual report, dealer channel sales in the Americas grew substantially in 2010, but not enough to offset a reduction in mass merchant-sold product.
A quote from the report: “In North America we lost part of a large contract with one of the major retailers. Despite a strong sales increase to other customers, particularly to the key dealers, we were unable to increase sales compared to last year’s level in this market. Efforts to strengthen the positions with dealers resulted in double-digit growth in this channel in Americas, as well as in Europe and Asia/Pacific.
Husqvarna’s Focus. Improving economic conditions and increasing demand for forest, park and garden products is helping drive growth. However, Husqvarna also points to several key initiatives as reasons for the company’s success in 2010:
- Increased sales for premium brands
- Increased dealer channel sales
- Increased market share in key product categories
- Highly efficient distribution network, reduced cost
- Reduced production cost as positive effects of the Husqvarna Operating System (lean manufacturing) begin to set in.
Reasons for dealer channel growth. At the end of 2010, roughly 35% of Husqvarna’s forest, park and garden sales in the Americas took place in the dealer channel, compared to 65% at mass retailers. This shift toward dealer-sold product puts Husqvarna slightly ahead of the industry average, as roughly 70% of lawn and garden equipment is sold through the four biggest mass retailers of Sears, Home Depot, Lowe’s and Wal-Mart, according to Husqvarna.
Husqvarna points to several factors contributing to the increase in dealer channel sales, including:
- Recruitment of new dealers
- Improved showroom displays
- Improved end-user advertising and branding efforts
- Increased offering of parts and accessories.
As a final note, the McCulloch brand will be positioned as a global premium brand in 2011.
