Accelerating Our Mid-Price-Point Strategy
The acquisition of Jiangsu Guoqiang Tools (GQ Tools) in June 2013, China's third largest mid-price-point (MPP) tool company, has accelerated the launch of our Global Emerging Markets MPP tools strategy by at least six months. It expands our design/build footprint, giving us a solid manufacturing base that is already entirely focused on serving a strong, existing MPP customer base both in China and around the world, with a full line of power tools and accessories that are designed for durability, reliability and ease of repair. GQ exports to over 60 countries, all of them emerging markets, which represents a third of its revenues. Its facilities and production lines were modernized just two years ago—another factor in our strategic interest in the company.
The GQ brand is highly respected and represents a powerful new addition to our range of brands. We are also beginning to leverage the GQ facilities to manufacture new lines of BLACK+DECKER and STANLEY branded power tools designed to meet the needs of the MPP marketplace, localized to various emerging markets.
In the Market For the Market
Our global emerging markets strategy is to create what markets want—high quality, full lines of mid-price-point products that are defined, designed and manufactured in the market for the market. We approach localization not as a process of adapting existing products, but of ground-up development in tune with the needs of local consumers. This requires building and acquiring engineering and manufacturing facilities that are strategically placed in key markets. GQ Tools exemplifies this strategy in action, as do our other recent acquisitions of GMT in China and Tong Lung Metal Industry in Taiwan, as does the construction of our global engineering center in Pune, India.
MPP tools are the largest and fastest growing tools segment in the emerging markets. Prior to this initiative, many of our feature-rich tools were priced out of this segment. Now we are positioned to leverage a manufacturing base, distribution channels and product platforms that already successfully serve the MPP tool segment worldwide.
Feet on the Street
In advance of the launch of the MPP line in 2014, we have been adding sales talent and expanding our distribution networks to Tier 2 and Tier 3 cities across China and other key emerging markets including Russia, Thailand, the Philippines and Vietnam.