Nobia Ab · OMXSTO:NOBI
Nobia Ab — Investor Day (September 2004)
23 slides from Nobia Ab's investor day presentation, Sep 2, 2004
Slide 1: Category Management in Multiple Retailers
Category Management in Multiple Retailers Presentation by Richard Reynolds 2 September 2004 1
Slide 2: Introduction
Introduction Richard Reynolds • Joined Nobia when the Group acquired Gower in December 2003 • Vice President with responsibility for Gower (UK), Optifit Group (Germany) and multiple retailer development 2
Slide 3: Significance of Multiple Retailers
Significance Significanceof ofMultiple Multiple Retailers Retailers Nobia NobiaGroup GroupMultiple Multiple Retailer RetailerSector SectorPresence Presence Key Keyto toSector SectorSuccess Success–– Committed CommittedPartnerships Partnerships through throughCategory Category Management Management 3
Slide 4: Significance of Multiple Retailers to Kitchens
Significance of Multiple Retailers to Kitchens • Growth of multiple retailer formats in all major markets • Share of kitchen furniture market via multiples is increasing • Sector outperformance expected 4
Slide 5: Multiple Retailer Formats Selling Kitchens
Multiple Retailer Formats Selling Kitchens DIY Sheds Builders’ Merchants Furniture Stores 5
Slide 6: DIY Multiple Kitchen Market Share – Major Markets
DIY Multiple Kitchen Market Share – Major Markets Exhibit Preliminary % Sales 1998 2004 Germany 1 3 France 6 15 UK 20 25 Note: Excludes MFI. Source: Nobia estimates; CSIL; Verdict 6
Slide 7: Factors Underpinning Kitchen Growth Potential in Multiple Retailers
Factors Underpinning Kitchen Growth Potential in Multiple Retailers • Europe wide increase in DIY, and DIY retailer store growth • Multiples are well placed to compete effectively in the kitchen market • Increasing kitchens’ participation and scope to increase further led by growth of service busine
Slide 8: UK DIY Market Projections
Example UK DIY Market Projections Proportion of income spent on Total number of households, DIY market growth, % p.a. home improvements, % million 26.0 24.4 24.7 25.3 22.8 23.5 21.1 Average UK GDP growth 2.5% 8.3 7.5 6.5 5.4 1996 2001 2006 1996 2001 2003 2006 1996 2001 2002 2003-2006 The higher prop
Slide 9: Wickes' Store Growth Plans
Example Wickes’ Store Growth Plans = Planned Wickes stores Store numbers Extracts from Focus Extracts from Focus Group Statements Group Statements “50 Focus conversions “50 Focus conversions 200 planned by 2006” 185 planned by 2006” Retail Week 170 Retail Week “10 151 “10Wickes WickesExtra Extraperp
Slide 10: Factors Underpinning Multiple Retailer Success
Illustrative Factors Underpinning Multiple Retailer Success Sourcing Distribution Sales • Scale to achieve low • Economic benefit of • Marketing clout cost shared logistics with • Prime locations driven other products by better store metrics • Store footfall Source: Nobia 10
Slide 11: Kitchen Furniture Participation
Exhibit Examples Kitchen Furniture Participation1 % 6.0 4.0 1.5 0.9 Retailer A Retailer B Retailer C Retailer D Germany Sweden France UK Note 1: Kitchen furniture sales as % of total retailer sales; assumes 30% GM Source: Nobia analysis 11
Slide 12: Nobia Group Multiple Retailer Sector Presence
Significance Significanceof ofMultiple Multiple Retailers Retailers Nobia NobiaGroup GroupMultiple Multiple Retailer RetailerSector SectorPresence Presence Key Keyto toSector SectorSuccess Success–– Committed CommittedPartnerships Partnerships through throughCategory Category Management Management 1
Slide 13: Nobia Presence in Multiple Retail Sector
Nobia Presence in Multiple Retail Sector • Multiple retailer business is a growing part of the group • Nobia is building strong relationships in each of its operational areas – Britain, Germany and the Nordic Region • Nobia group scale is a significant attraction to multiple retailers 13
Slide 14: Nobia Group Sales by Channel
Nobia Group Sales by Channel % of Sales 100 100 Other Channels • Business with multiple retailers is growing fast Multiple Retailers • Multiples now represent ca. 20% of Nobia Group sales Company controlled Outlets 2001 2004 Source: Nobia Analysis 14
Slide 15: Attractions of Nobia to Multiple Retailers
Illustrative Attractions of Nobia to Multiple Retailers Purchasing Production Product Development Sales and Service • Scale to pursue • Multiple manufacturing • Multi-market research in • Sharing of best “global” best price and units offer supply materials and colours and practice service security c
Slide 16: Key to Sector Success – Committed Partnerships
Significance Significanceof ofMultiple Multiple Retailers Retailers Nobia NobiaGroup GroupMultiple Multiple Retailer RetailerSector SectorPresence Presence Key Keyto toSector SectorSuccess Success–– Committed CommittedPartnerships Partnerships through throughCategory Category Management Management 1
Slide 17: Key to Future Success – Committed Partnerships
Key to Future Success – Committed Partnerships • Nobia’s most successful multiple retailer relationships are characterised by a high degree of interdependence • Underpinning relationships is Nobia’s commitment to category management • Category Management is yielding strong results • Barriers to chan
Slide 18: Interdependence between Nobia and Multiple Retailers
Interdependence between Nobia and Multiple Retailers Contractual Financial Operational Long term supply Major investments from Individual order picking agreements with financial both parties – in-store on short lead times penalties for early infrastructure, customer Consolidation with termination. s
Slide 19: Category Management – Key Rules in Nobia
Category Management – Key “Rules” in Nobia SUPPLIER MANUFACTURER RETAILER END CONSUMER 1. “Category Management” considers whole supply chain in a business partnership – co-operation beyond traditional boundaries 2. “Category Management” aims to know the retailer’s business better than he knows it hi
Slide 20: Potential Sources of Competitive Differentiation as Category Manager
Potential Sources Of Competitive Differentiation as Category Manager Nobia NobiaResponse Response • •No Nofundamental fundamentaldesign designoror material materialprocess processskills…. skills…. Nobia Product • Specialised suppliers and NobiaResponse Response • Specialised suppliers and product •
Slide 21: Sources of Sales Growth with a Retail Multiple Customer 1998 - 2004
Estimated Sources of Sales Growth with a Retail Multiple Customer 1998 - 2004 86 9 -24 21 % of total growth MEUR 1.6 4.7 24.2 16.0 -3.1 Over Over20% 20%ofofNobia’s Nobia’s sales salesgrowth growthwith withaa leading leadingretailer retailerhas has been beenresult resultofof organic organicgrowth, gr
Slide 22: Cost And Capacity Required To Change Supplier
Example Cost And Capacity Required To Change Supplier Cost of Change from Competitor to Nobia1 Capacity Required to Supply Multiple Customers’ MEUR 34% of year 1 Business 0.5 3.6 purchases 000 cabinets per week 0.5 0.9 Customer A 30 1.6 Customer B 17 Stock Handling Display Lost Sales- Total Customer
Slide 23: Conclusions
Conclusions • Multiple retailers represent a growing share of the kitchen market • Nobia’s presence in multiple retailers is large and increasing • Nobia believes that working closely with multiple retailers in a category management role will be an important contributor to future success • Successfu