Bosch Power Tools Company
High demand meets a strong brand:
Bosch Power Tools achieves sales record
Bosch Power Tools achieved sales of 5.1 billion euros in more than 190 countries in the fiscal year 2020. This growth corresponds to nine percent adjusted for currency effects (six percent nominal-ly) compared to the previous year. “We achieved record sales in 2020 in a very dynamic environment induced by the pandemic. This record was primarily due to the trust which users and customers placed in our company, as well as the dedication of our employees,” says Henk Becker, President of Bosch Power Tools. Business developed much better than initially expected. Following the drastic drop in turnover in spring, demand in the industry rose substantially in the second half of the year as a result of changes in the purchasing behavior in the wake of the corona pandemic.
Double-digit sales growth in around 30 sales organizations
In 2020, the company experienced double-digit sales growth in around 30 sales organizations. Following currency adjustments, the division’s turnover in Europe rose by a total of 13 percent. The increase in Germany was 23 percent. In North America, Bosch Power Tools saw its sales rise by 10 percent, while the corresponding figure in Latin America was 31 percent. Asia-Pacific was the only region to record a decline. Here, sales were around eight percent below the level of the previous year. This can be attributed to the restrictions caused by the much longer and stricter lockdowns than in other regions. India and the ASEAN region were particularly affected by these lockdowns. In 2020, the ad-dressable markets for Bosch Power Tools grew by 5 percent globally, which means that the company gained market shares as a result of the reported sales increase.
Innovations, a multi-channel strategy and a strong brand as growth drivers
The reasons for the overall very successful year 2020 are manifold, but can be attributed to three overriding factors: Product innovations geared to user needs, a multi-channel strategy focusing on different target groups, a systematic brand management and the resulting positioning of the Bosch brand.
Long before the start of the corona pandemic, Bosch Power Tools based its activities along the entire value chain on an agile set-up in order to systemati-cally focus on the users’ needs. “We dealt with the subject of agility in a con-sistent manner at a very early stage. The principles upon which this is based, such as short-cycle iterative work in sprints, are experienced and improved by us daily,” concludes Becker. In his opinion, the early and lasting involvement of users is always the starting point for innovations. The company again successfully launched more than 100 products on the market even in this very dynamic environment. The expansion of the cordless tool portfolio proved to be a special highlight last year. For example, more than 30 new tools were added to the portfolio for professional users. Particularly significant are the Biturbo tools which attain performance dimensions that were previously reserved for corded tools. The Bosch cordless miter saw GCM 18V-305 GDC Professional is one of these new tools. The success story of innovative products for home and garden in the DIY segments was also continued. The Atino, for example, is a line laser with an integrated measuring tape. This laser makes it easy to align and affix objects to a wall without a second person having to help. Another convenient product is the EasyPump, a light and extremely compact cordless pneumatic pump weighing just 430 grams. Featuring an autostop function for the required pressure, it can be used to inflate different types of tires or balls in any location.
The company has been continuously investing in the digitalization of sales and marketing processes for years and the flexibilization of its value chain and was thus ideally prepared for the rise in online purchases. As a result, direct deliver-ies of online orders to consumers were made possible at very short notice, de-spite the restrictions in previous months. This has enabled the division to take advantage of the trend towards digitalization and actively shape the associated change. This affects both the sales channels and the company’s actual value proposal. For example, online purchases proved to be a major growth driver last year. Their share increased substantially and accounted for almost 25 per-cent of sales. “Since there has been a rapid change in the information and buying behavior of our users, we expanded our digital information and interaction services as well as our cooperation with multi-channel and online retailers,” says Henk Becker.
Bosch Power Tools is systematically implementing the relevant brand promises in the marketing mix both in the segments for DIY and for professional users. This results in two brand worlds: The green world is geared to the needs of DIY users, who want to turn their own ideas into reality in their home and garden projects. The blue world, on the other hand, is geared to the needs of profes-sional users, who are essentially concerned with efficient and effective work on the construction site. The presentation of the prestigious in the category “Best Brand Overall” in February this year clearly indicates that this strategy fulfills users’ needs. What makes the awards so special is that they are based on a representative consumer survey conducted by GfK. Two criteria are decisive: The actual economic success of a brand (“Share of Market”) as well as the attractiveness of the brand as perceived by consumers (“Share of Soul”). 72 percent of the participants stated that they trust Bosch as a power tools brand – the highest rating across all brands. Satisfaction with the brand also led to the highest cross-buying readiness in the award. “This award is a motivation to further focus consistently on our user’s needs and to offer them added value,” says Henk Becker.
Optimistic forecast for 2021: Growth based on sustainability
Against the backdrop of the general economic recovery, Bosch Power Tools al-so expects a positive development for the current fiscal year. The objective is still to outperform the market in the most important industries and regions. In addition to the already existing focus topics such as the expansion of the cord-less platforms and digital services, the company will devote itself intensively to the topic of sustainability in 2021. “We are systematically working to improve the sustainability of our value chain. A special team was created for this pur-pose. It will continuously examine and implement suitable measures worldwide, for example regarding recycling of packaging and power tools.” The introduction of tool cases made of recycled plastic in the DIY segment has already led to savings of 3,000 tons of CO2 since 2019. “The main objectives are to reduce the CO2 footprint of our products in the long term and to promote a circular economy,” says Becker.
The first product made of recycled plastic from the measuring segment will be launched as early as this fall. Bosch Power Tools is thus contributing to the sus-tainability of the business activities of the Bosch Group, which was one of the world’s first technology companies to attain CO2 neutrality of its plants in 2020.