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Black and Decker Case Analysis

In: Business and Management

Submitted By kikivasan
Words 2367
Pages 10
Black and DECKER: power tools Case study

Problem Statement
Black and Decker has established its brand strength to be among the top ten firms in the United States. By creating the portable power tools business in the early 1990’s and being the world’s largest producer by the end of the decade, the firm has been vouched for offering high quality, differentiated products and excellent service in the Professional-Industrial segment. Powerful brand perception has helped Black and Decker attain the number one position in the Consumer segment. Although Black and Decker has been leading in two of the three segments of the $1.5 billion portable power tools market, it could not make a significant impact in the Professional-Tradesmen segment that was fast growing at 9%. Black and Decker has managed to occupy only 9% with no profitability of the total segment share against Makita and Milwaukee who stand at 50% and 10% respectively. Despite Black and Decker’s success in the Consumer and Professional-Industrial segment, according to surveys conducted of tradesmen, results showed poor quality perception and lack of proud ownership of the tools for the use of job specific applications and instead are perceived to be ideal for home tasks. The low favorability of Black and Decker’s power tools in the Professional-Industrial segment as compared to Makita’s and others may be attributed to (among other factors) the incompetence in product differentiation through the use of color schemes across the three distinctive market segments and the lack of dominance in the retail distribution channels patronized by Tradesmen such as the emerging Home Centers. Black and Decker must implement a suitable strategy to increase Professional-Tradesmen segment share with a major share “take away” from Makita’s leading 50%.

Situational Analysis
Black and Decker holds a total of 30% overall US

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