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issue: May 2004 APPLIANCE Magazine

Appliance Line
Strength in Numbers

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Editorial from Lisa Bonnema, Editor, APPLIANCE Magazine

Instead of getting overshadowed by the Electrolux's and BSH's of Europe, a group of small and mid-sized European appliance companies are banding together in an effort to make their presence—and products—more well-known.

Lisa Bonnema, Editor, APPLIANCE Magazine

They call it ProBusiness, and the name suits it perfectly. Anything "pro" indicates "action," and that is exactly what these companies are taking.

"It's a matter of fact that most of the small and medium companies do not have the capacity to resist the expansion of the big international companies," Heinz Werner Ochs, chairman of ProBusiness, tells APPLIANCE. "They need an association that takes care of their special demands in the market."

And so ProBusiness ElektroHausgeräte e.V. was born. The German organization is essentially a joint marketing initiative for smaller appliance companies that make electrical housewares and have distribution in Germany. Member benefits include coordination and development of promotional activities and materials, most of which revolve around trade fairs.

"An association like ProBusiness can synchronize specific demands and push these demands through and strengthen the individual competitiveness," explains Mr. Ochs. "Every company is 100-percent independent in their own strategy and policy, but in some areas, they speak with one voice."

One of the main drivers for creating the organization was the HomeTech Cologne 2004, the new combined trade fair comprising the former Domotechnica, which was last held in 2001, and HomeTech, which debuted in 2002 in Berlin.

"In 2003, there was the possibility that there would be no leading fair for appliances in Germany any more because the big players didn't want to attend HomeTech Cologne," says Mr. Ochs. "The result? Small and medium companies would have no chance to present their brands and sell their products to an international audience."

Knowing that smaller companies still needed a way to get their names and products in front of international trade partners, the group officially formed in May 2003 and immediately started searching for venues to promote itself. After negotiating with several exhibition companies, ProBusiness chose trade fairs Ambiente (Frankfurt, Germany) and HomeTech (Cologne, Germany)—both held in late-February—to internationally debut ProBusiness.

"In some cases, this had a mutual effect; more companies decided to exhibit [at HomeTech] after ProBusiness's decision was published, and our members had an excellent performance," says Mr. Ochs. "The success would not have been realized if only one or two started negotiations. Eleven companies had more weight and got attention."

The group currently has 16 member companies based throughout Europe. Members include French iron producer Domena, Swiss espresso/coffee machine maker JURA, and Irish floor care company Glen Dimplex, among many others. All participating companies must have German distribution and must also be a member of German electronic trade association ZVEI. New members also have to be approved by current participants before joining.

Even with just a little more than a dozen members, ProBusiness claims to have 30 percent of sales in the German market, with the goal to get bigger. "We want to increase the number members in a selective way to get more and more attention by the market partners," Mr. Ochs says.

It may also be gaining attention of its larger competitors. When asked how the "big guys" of Europe's appliance industry are reacting to ProBusiness, Mr. Ochs responded, "In general, we can say that the development of our organization is watched very carefully and with interest by other companies."

With the vast amount of consolidation that has taken place during the last several years—both in Europe and worldwide—it is refreshing to know that there is still room for "the little guy," even if it does mean combining forces. What is even more refreshing is that these companies—some of them competitors—are willing to work together to achieve a common goal, a strategy not typical of the appliance industry.

Sure, it's only a few months old, but I think this humble German organization might be on to something. While I know a group like this probably wouldn't go over in the U.S. because of anti-trust laws, if done correctly, this just might help give smaller European appliance companies the brand awareness they need to stay alive, especially in some of Europe's regional markets. And if the "big guys" of Europe continue to stay out of the trade fairs so that the "little guys" can get the full attention of attending retailers and wholesalers, perhaps tomorrow's small appliance market has room for more than three or four players after all.

A Few Changes

As you page through this month's issue of APPLIANCE, you'll notice that we've made some updates. First, on page 21, is a new department called Executive Corner. Using Q&A, this new department gives readers a glimpse into the thoughts of leading appliance industry executives on topics ranging from how they handle financial crises to international competition. Our debut features Invensys CEO Richard Haythornthwaite, who has managed to keep his Appliance Controls and Climate businesses alive in a challenging market. Keep your eyes peeled during the next few months for the next executive to be featured, which we promise is one OEM executive you'll want to hear from.

The next "update" can be found on pages 46-50. In an effort to better represent the industry, we've changed the name of our biannual Coil Winding section to Electrical Manufacturing. The change was made in conjunction with the Electrical Manufacturing & Coil Winding Association's decision to rename its annual exhibition to Electrical Manufacturing Expo (formerly Electrical Manufacturing & Coil Winding Expo). As with the Expo, which will take place on Sept. 20-22, our updated section will now give readers a broader scope of coverage on the new components and processes used in electrical manufacturing.

As always, we want to know what you think of our editorial coverage as we add new departments and features to keep you up-to-date on what's happening in the ever-changing global appliance industry. Let us know how we're doing.


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PLEASE NOTE : Any correspondence submitted to editors_mail@appliance.com may be published, in full or in part, on our web site or in our printed publications. If you would like to send us email that is NOT intended for publication, please send to: editor@appliance.com.


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