3m Executive Summary

Topics: Marketing, Sales, Customer service Pages: 12 (4101 words) Published: December 19, 2010
■ Over 50,000 patents extended over 13 technology platforms ranging from abrasives to polymers ■ Global company – companies in over 60 countries and 139 plants worldwide ■ Strong recognition for standard innovations with practical applications ■ Operational efficiencies - cost of sales declining and margin % increasing over the years ■ IBD’s new strategy was to transform from margin expansion to top line growth ■ Corporate brand strength and technology behind its products with exclusive supplier status, product driven organization with strong R&D direction, and geographic specialization ■ Through lean programs IBD is in progress to shorten the time to go to market ■ IBD is acquiring product specialization in tapes and adhesives are 50%-60% division turnover and abrasives are 40%-50% ■ Access to experience and knowledge pool of the worldwide organization and profiting from close connection in the marketing strategies of over 50 divisions in 3M ■ Natural fit with the culture of the Special and Niche categories ■ Groomed employees grow and develop to become product experts Weakness

■ IBD had not concentrated on the MRO segment because it was fragmented with slight brand loyalty ■ Sales reps were not accustomed to dealing with large corporations driven by networks, procedure and protocol but to store managers of small to medium sized businesses ■ IBD did not obtain customer specialization

■ Weak marketing and sales strategy for National accounts ■ Quick decision making is lacking because 3M is a large corporation and a bureaucracy ■ 3M’s had not changed in terms of product application, service delivery mechanisms, customer expectations and logistics requirements as it has in the Industrial sector ■ IBD did not have cadre of “channel” specialists to complement the product specialists ■ IBD does not have an incentive program with reduction in supply chain costs of the large National players ■ Lacked to be “best in class” in logistics fulfillment, standardizing SKU’s and Just-In-Time delivery ■ No additional marketing resources were available to IBD Opportunities

■ MRO was growing at a double digit rate with large players (mega corporations) ■ Currency (3M Canada manufacturer can become more competitive) ■ IBD’s share of distributor sales was a measly 2% of the distributors revenue ■ In MRO the market share and driving scale was the largest because of its big market, large distributors are surpassing the growth of MRO market, in most product lines there are vacant spaces waiting to be filled, and there is an opportunity area with potential for both revenue and margins in the private labeling ■ IBD had to look outside the OEM segment for clients and revenue ■ Filtration was a future growth area

■ Based on current technology platforms, the division had recognized 9 product opportunities as having growth potential ■ The National category was the fastest growing out of the 4 types to due ongoing distributor consolidation ■ National player has a massive sales infrastructure in terms of branches, delivery center, and sales force, therefore IBD’s opportunity the integrate into the market quickly ■ The price of goods composed of only 39% of the total cost; the remaining 61% represented a large area of opportunity for supply chain savings Threats

■ OEM segment had become mature
■ Labour – 1hr of labour and benefits in Canada costs $11.00US at minimum wage point and China’s labor was less than $0.15US ■ Tracking the customer needs will be more difficult in the MRO market since they are not the end users ■ The alteration of currency can change the market trend fairly easily ■ When there is a slowdown in the industry where OEM is a part, distributors are always the first to be affected and the last to recuperate ■ Decline in Canadian manufacturing was influencing the OEM segment ■ MRO segment is fragmented; products could not be specialized ■ Off shore trends was growing

■ The...
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