ecolab ReviewOperations


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ecolab ReviewOperations

  1. 1. Clearly UNITED STATES: INSTITUTIONAL Institutional delivered record sales in 2005, growing 7%, thanks to new business gains, increased market penetration and successful new product launches. The division also implemented comprehensive cost-saving initiatives to help offset substantial rises in raw material and fuel costs. Ecolab HIGHLIGHTS • Launched the highly successful 360º of Protection program, which 2005 dramatically increases food safety, operating efficiency, guest satisfaction REVIEW OF and employee safety for Ecolab’s foodservice, hospitality and long-term OPERATIONS care customers. • Entered into a strategic alliance with Minnesota-based Pentair, Inc., a provider of industry-leading water Innovative solutions. purification solutions, including Reliable results. Everpure® water filtration and conditioning systems, thus enhancing Clearly, Ecolab delivers. Ecolab’s ability to develop and market Our business units water management solutions in its core account base. consistently provide • Introduced a slate of new products and services, including EcoLogic, a our customers with the new line of cleaners that includes right products, systems products certified by Green Seal as meeting its environmental standards and service expertise and features less packaging to reduce to help streamline their waste, Pathways Solid Drain Sanitizer, a drain treatment program, and Oasis operations. Ecolab is 146 Multi-Quat Sanitizer, a food contact hard surface sanitizer. clearly committed to • Successfully integrated the Daydots being a trusted partner acquisition and leveraged its food safety product line for the foodservice for every customer, and restaurant segments globally. every day. • Strengthened its sales-and-service infrastructure with enhanced training programs, a new e-learning platform and service automation. The following is a detailed summary of OUTLOOK Institutional plans to leverage its proven 2005 and outlook for programs to drive expanded growth in 2006 from each of our 2006. This growth is expected to be driven primarily by delivering more core businesses. superior product and service solutions to existing accounts, new account gains, new product launches including a next-generation warewashing program, new water management solutions, and sales force additions. | Ecolab | Annual Report 2005 14
  2. 2. PROFESSIONAL PRODUCTS PEST ELIMINATION KAY Kay achieved another year of Professional Products sales rose 2% in Pest Elimination posted another year 2005, fueled by new product offerings, double-digit growth, increasing sales of double-digit sales growth in 2005, effective utilization of the Circle the increasing 12%, driven by strong 1 1%, with continued strong Customer strategy, and a strong focus performances in all of its market performances across its markets. Kay on the retail market segment. segments. These gains were led by also streamlined processes and drove government, food and beverage, and costs out of its operations to further non-food retail sectors. enhance and drive its aggressive growth goals. HIGHLIGHTS HIGHLIGHTS HIGHLIGHTS • Introduced successful new tools, • Solidified its retail floor care presence • Continued to serve as principal driver including the Allur-Ring Pheromone of the enhanced MarketGuard through participation in the cross- Pad for cockroach control, the divisional MarketGuard program and program, which combines the best in Electronic Duster, a metering tool for the aggressive marketing and food safety, pest elimination and floor successful launch of the Bright FX dispensing dust-type insecticides, and care to enable food retail customers Protector System, a family of High Performance Floor Care System, to complete the cleaning and products that improve the safety and which provides exceptional gloss and sanitation circle. • Introduced Q-Sure Towels, featuring efficiency of Ecolab’s service durability in high-traffic areas. • Introduced the GlossTek line of patented QuatSmart technology, specialists. • Added two new sales training premium ultra-durable floor finishes, which help maintain more constant programs that are driving increased offering exceptional durability and quat sanitizer concentration within sales productivity, as well as a new high gloss floors for facilities where the holding solution, thereby reducing food retail training program for all regular burnishing is not feasible, health code violations. • Launched its new Chlorinated field associates. such as patient rooms, nursing Cleaner, designed for heavy-protein • Achieved double-digit sales and stations and corridors in healthcare operating income growth in its and acute care facilities. soils common in food retail EcoSure food safety and quality environments, and Coffee Pot • Entered the stone care market with a Cleaner, a high-performance solution assurance business through major complete line of stone care products, account gains, expansion into the equipment and tools that clean, that cleans hard-to-reach buildup and hospitality segment and increased restore and protect natural and stains without scrubbing. penetration with existing customers. manufactured stone floors. • Gained significant new business by • Introduced territory routing software securing several new corporate to field associates, which helps OUTLOOK account customers. improve service efficiency and Professional Products expects to response. continue building on the successful OUTLOOK • Improved worker and driver safety foundation of 2005 by partnering with Kay is primed for further attractive performance among field associates. key distributors and large customers, as growth in 2006 in its markets, well as leveraging the proven Circle the propelled by additional corporate OUTLOOK Customer strategy. In 2006, the division accounts gains and new product Pest Elimination’s field service and plans to continue to strengthen its field innovations. Kay’s focus on process sales organizations are well positioned team to better serve the unique needs improvement and driving its new for growth in 2006. Increases in of large corporate accounts. The business pipeline should continue to corporate accounts and better division also expects further success in enhance its position as the market penetration of existing markets are the retail market and additional leader in quickservice and food retail expected to again drive double-digit penetration of the healthcare arena markets. sales and operating income growth. through the introduction of new In addition, programs that further product innovations. demonstrate Ecolab’s superior responsiveness to customer needs should help fully circle customers and increase sales within existing accounts. Ecolab | Annual Report 2005 | 15
  3. 3. HEALTHCARE GCS SERVICE TEXTILE CARE Establishing itself as an industry leader On the heels of extensive operational In 2005, Textile Care sales grew 5% and in infection control, Healthcare enjoyed improvements, GCS achieved 8% sales profitability improved. New product a strong 16% sales increase in 2005 as growth in 2005 and significantly offerings, cross-divisional partnerships, the business further penetrated its core improved its bottom line. Growth within highly trained service personnel and markets and made its first entrance existing accounts and major corporate gains in the tunnel washer segment into the operating room, while account gains helped drive sales, along helped drive sales growth, and cost- simultaneously building its long-term with a continued emphasis on quality savings initiatives offset a significant product pipeline. control, associate retention and increase in raw material prices. expense-control management. HIGHLIGHTS HIGHLIGHTS HIGHLIGHTS • Introduced full cycle solutions, a • Picked up business with several large, • Significantly expanded its presence multi-unit national corporate account comprehensive program of products, with integrated delivery networks with customers and laid the foundation for equipment and service that helps the continued success of the more new business expansion in commercial laundries economize their Asepti-Solid line for convenient, 2006. operations and reduce costs. effective instrument cleaning, as well • Introduced Unitrax, which assists • Leveraged collaboration with its as the introduction of new products customers in tracking important European counterparts to develop the and technologies. information regarding their kitchen industry’s most experienced and • Successfully entered the operating equipment, providing details such as best-trained service specialists for the room market with the launch of cost per unit and frequency of repair. tunnel washer segment, resulting in Endure 450, a surgical hand • Continued its aggressive efforts to good growth. antiseptic that provides excellent enhance customer satisfaction and • Successfully made key customer gains persistent antimicrobial protection quality while simultaneously in the healthcare and hospitality while maintaining skin health with a improving associate productivity, segments. combination of moisturizers and performance and retention. • Continued working with Ecolab’s conditioners. • Made additional improvements and Water Care Services Division to bring • Bolstered its infrastructure through investments to its service model, solutions to customers in both the growth of its sales-and-service team, improving service excellence through wash aisle and wastewater areas. and leveraged the Circle the its quality assurance initiative. Customer strategy through key OUTLOOK partnerships for preventive OUTLOOK Textile Care expects continued growth maintenance with other businesses GCS Service plans to aggressively in 2006 on the strength of groundwork in the Ecolab team. leverage Ecolab’s Circle the Customer laid in 2005. While higher raw material • Achieved ongoing success with its strategy in 2006 as it continues prices will present operating challenges, established waterless hand hygiene partnering with sister divisions to help Textile Care plans to leverage new and central sterile processing drive strong growth. Increases in both product offerings and effectively utilize solutions. parts and service sales are expected, its corporate accounts team to expand building on the momentum generated business with several large, multi-unit OUTLOOK in 2005. The division also plans to national operators. In addition, the Healthcare expects another robust year expand its corporate accounts team as division will continue its partnership in 2006 as it builds on investments it continues to streamline its internal with other divisions to offer full cycle made in its sales-and-service force, operating systems and division-wide solutions and realize Ecolab’s differentiated new product and system infrastructure. value-added proposition. solutions, and innovative research and development. These effective tools should be key drivers for Healthcare as it expects to continue to grow its business scale and drive strong organic growth. | Ecolab | Annual Report 2005 16
  4. 4. FOOD & BEVERAGE WATER CARE SERVICES VEHICLE CARE Food & Beverage experienced a 9% Water Care Services increased its Vehicle Care enjoyed a solid year, sales increase in 2005, due to the national presence in 2005 with the growing sales 12% in 2005, spurred by successful integration of the Alcide acquisition of Midland Research the introduction of new, innovative acquisition and outstanding perform- Laboratories Inc., which – along with products, sales-and-service automation ance in the dairy and beverage markets. good organic growth – enabled the tools and several large account gains. Global customer relationships were also division to drive a 34% sales increase. These results were bolstered by an impetus for growth for the division, New products and systems focused on Ecolab’s ability to offer complete with several key customers seeking energy and cost savings added depth service solutions to its customers. standardized operations worldwide. to the division’s product offering. HIGHLIGHTS HIGHLIGHTS HIGHLIGHTS • Introduced Rain-X Online Protectant, • Integrated Midland Research • Leveraged the power of Sanova, the Laboratories Inc., a Kansas-based the industry’s first complete surface revolutionary antimicrobial food water treatment company, enhancing protectant used across full-service, additive that significantly reduces Ecolab’s national coverage and quickservice, self-service and fleet pathogens on food surfaces, which is gaining a strong position in the sugar markets. This innovative technology generating excitement and new processing market. delivers outstanding shine, enhanced business in the antimicrobial market. • Significantly expanded and visibility in poor weather, and advanced • Effectively marketed its value reorganized its sales team, creating all-weather protection for multiple proposition, emphasizing food safety, nearly two dozen new territories and vehicle surfaces. time savings and operational adding scale in areas such as • Expanded service coverage by adding efficiencies to help customer facilities marketing, finance and R&D. sales-and-service associates, and run more smoothly. • Made key investments in sales force continued developing its strong distri- • Helped to significantly expand productivity, including a training bution network with strategic partners. Ecolab’s international business program based on its value • Increased its fleet segment sales using through key corporate account gains, proposition and the addition of tablet the proven Circle the Customer model resulting from its strong global personal computers for field with large corporate accounts. customer relationships and the Circle personnel. • Successfully developed new detail the Customer strategy. • Introduced new products and segment sales by building new • Introduced WPA-1000, a whey equipment specifically focused on business around large dealership processing additive that prevents saving energy and reducing costs, chains as well as local and regional mineral deposits and buildup in including Precision Plus, a customers. processing equipment, and Eco-Wipe revolutionary boiler technology, EZ • Enjoyed strong results in the self-serve FCS, a convenient, easy-to-use hard Blue Controller, an all-in-one cooling market due to a focus and surface sanitizing wipe ideal for water control system, and ChillerCalc, revitalization of Westley’s Self-Serve cleaning and sanitizing areas where an efficiency tool for chillers. product line. water use is limited. • Automated sales-and-service functions OUTLOOK for field personnel through wireless OUTLOOK In 2006, Water Care Services plans to personal computers and printers, Food & Beverage expects continued leverage its strengthened field presence enabling quicker, more efficient growth in sales to the dairy and food to better serve its customers with its training, enhanced multimedia product processing markets in 2006. Its broadened product and service launches, and real-time service reports partnership with Ecolab’s Water Care offerings. Despite challenges from high for customer operations. Services group should offer additional energy and raw material costs, the avenues for growth by enhancing division expects continued growth OUTLOOK Ecolab’s complete customer solutions through aggressive sales efforts, new Vehicle Care expects continued for commercial and institutional program offerings and strategic attractive growth in 2006. This will be customers. The division also expects to acquisitions, as well as further utilizing driven by new product innovation, continue to invest in and capitalize on including developments in the Rain-X, its cross-selling strategy to enhance the highly successful Sanova product Blue Coral and Black Magic product lines, Ecolab’s integrated customer solutions line to further penetrate the to food and beverage, commercial and as well as by continued expansion in the antimicrobial food treatment market. institutional customers. detail and fleet segments. The division also plans to leverage its four-pronged value-added model, which is based on advanced technology, superior service, operational excellence and powerful marketing programs. Ecolab | Annual Report 2005 | 17
  5. 5. INTERNATIONAL: EUROPE/MIDDLE EAST/AFRICA ASIA PACIFIC Asia Pacific accelerated sales in 2005, Despite sluggish markets in the larger Western European countries, Europe grew growing 8% in fixed currency exchange its business 3% in fixed currency exchange rates, leveraging new products, rates, turning in strong performances strengthening its food distributor network, and leveraging the Circle the Customer throughout the region, most notably in approach to secure new corporate account customers. Europe also achieved good China and Australia. The business also geographical expansion, turning in strong results in Eastern Europe and Turkey. worked closely with its many customers Middle East and Africa experienced solid sales growth through customer gains in in recovery and rebuilding efforts in the Institutional and Pest Elimination. aftermath of the Southeast Asia tsunami that struck the region in December 2004. • Pest Elimination solidified its strong HIGHLIGHTS HIGHLIGHTS market position in the United Kingdom • Institutional secured new corporate • Introduced new technologies for the and France, with double-digit sales accounts, enjoyed good growth Food & Beverage market, including growth from new programs including Lubodrive AP and Lubodrive ZF, through its expanded partnerships EcoPro for Food & Beverage with food distributors and its core conveyor lubricants that increase customers and bird protection product range, invested in training for production speeds while reducing systems for the food retail segment. bottle tipping, and Advantis, a its field organization and successfully • Middle East and Africa recorded partnered with Professional Products value-added line of clean-in-place strong gains, led by solid Institutional to capitalize on large floor care detergents that work well in ambient growth, as well as good results in opportunities. temperatures, therefore reducing Turkey and the South African Pest • Food & Beverage benefited from a time and energy requirements at Elimination business. pan-European approach, which bottling facilities. resulted in growth gains organically, • Aggressively entered the retail OUTLOOK with new corporate account market in East Asia and Japan Europe expects improved growth in customers and via successful through the cross-divisional 2006, based on its strengthened MarketGuard program for food acquisition integration. Eastern foodservice distributor network, Europe was a source of good growth retailers. expanded cross-divisional and for the division, as was the • Accelerated its floor care offering pan-European efforts, incremental with the introduction of Wash ’n Walk, pharmaceutical market. additions to its field sales-and-service • Healthcare strengthened its position the revolutionary no-rinse floor force, and introduction of proven as market leader in endoscope cleaner first introduced by programs including 360º of Protection. reprocessing with Sekusept easy, a Institutional in North America. Europe also plans to continue to explore high-level disinfectant for manual and • Achieved significant corporate additional opportunities for geographic automatic reprocessing that offers no account gains, creating a platform expansion of smaller divisions in 2006. activation period, short contact times for future growth in the region. and easy disposal, as well as increased focus on hand care disinfectants and OUTLOOK investments in automatic instrument Asia Pacific plans to continue its disinfection. attractive performance in 2006. The • Textile Care growth was driven by Asia Pacific team expects to leverage key corporate account gains that new product and program introductions expanded its market share, as well as in floor care and lubes to continue to a focus on its next generation of water gain market share in the Institutional and energy-saving systems that and Food & Beverage markets across strengthen customers’ bottom line the region. In addition, the division will by reducing natural resource continue to focus on the high growth consumption. China market, as well as accelerate • Professional Products strengthened development of Ecolab’s new business its approach to the retail market, in India. Asia Pacific also plans to drove its innovation portfolio in the invest in its infrastructure, with key Healthcare segment with HealthGuard, investments in its sales-and-service an all-in-one janitorial cleaning system team and in strengthening its supply for healthcare facilities, and chain position to meet the increasing strengthened its cross-divisional customer needs of this growing region. approach with Institutional. | Ecolab | Annual Report 2005 18
  6. 6. CANADA LATIN AMERICA In 2005, Canada delivered a healthy Latin America enjoyed another strong sales performance, rising 8% in fixed year of double-digit growth across the currency exchange rates, as solid region. Sales grew 15% in fixed performances in its core markets currency exchange rates, outperforming benefited from the introduction of new its previous five years of strong double- products and programs. These were digit growth through good gains with further leveraged by a renewed focus global accounts, high growth in targeted on customer satisfaction and segments, and success in rolling out cross-divisional collaboration. innovative products and solutions. HIGHLIGHTS HIGHLIGHTS • Increased its success with both • Continued to leverage the global and independent restaurants and large regional customer relationships chains by leveraging the power of established through Institutional, Food Wash ’n Walk and 360º of Protection & Beverage, Kay and Europe to for foodservice customers, further accelerate sales growth throughout penetrating this core market. the region. • Forged a highly successful partnership • Strengthened growth platforms with utility companies to offer through enhancing the field firepower restaurant customers with spray and productivity, developing total heads that reduce energy, water and solutions to deliver higher value sewage costs. propositions and targeting high-growth • Gained market share with building segments. service contractors through the help • Continued its successful penetration of Professional Products’ new and expansion of the food retail GemStar Stratus, a long-lasting, segment with the cross-divisional MarketGuard program. durable floor finish ideal for high traffic areas, as well as strengthened • Aided growth with flagship technology its presence in the retail floor care upgrades, such as the introduction of DryExx dry lube for beverage bottling segment. • Added strength to its Pest Elimination plants, a dry lubricant that eliminates service force, as well as emphasizing the need to use water to dilute the and increasing divisional employee lubricant, resulting in less soil buildup, safety through dynamic safety no slime formation, and no water or programs. lubricant dripping on the floor, thereby increasing productivity, and the Oasis Pro product line, featuring color-coded OUTLOOK Canada expects to continue to build on super-concentrated products, reduced the momentum of 2005’s focus on packaging, and controlled dispensing, cross-divisional collaboration in order to into the high-growth hospitality secure additional business with both market. large corporate accounts and • Expanded geographic coverage, as well independent “street” customers. Canada as Pest Elimination and Water Care also plans to make investments in Services, to deliver the Circle the additional resources to bolster growth in Customer – Circle the Globe promise its smaller divisions and further in key areas. leverage the collaborative efforts through the Circle the Customer OUTLOOK strategy. Latin America expects to continue its strong growth in 2006 as it further builds on the Circle the Customer platform by strengthening value propositions for targeting high-growth customer segments, enhancing quality service delivery, improving supply chain efficiency and enabling better execution. Ecolab | Annual Report 2005 | 19