Business activity and strategy
The Adhesive Technologies business unit provides tailor-made solutions worldwide with adhesives, sealants and functional coatings in two business areas: Industry, and Consumer, Craftsmen and Building. With our global presence, our unique portfolio of technologies and our leading adhesive specialists worldwide keeping us in close contact with our customers, we are able to provide innovative customized solutions of the highest quality, combined with the best service. At the same time, shared technology, structures, and systems along our value chain create a strong platform for synergies.
In the Packaging and Consumer Goods Adhesives business, we work with major international customers to develop innovative solutions for the production of grocery packaging and consumer goods. Our customers benefit from our comprehensive applications expertise, which we provide through our global technical customer service. Strategic partnerships with the manufacturers of adhesive application equipment make a significant contribution to the continued development of our portfolio. Because of our global presence, we are able to offer tailor-made solutions to customers around the world.
In the Transport and Metal business, we provide the automotive, aircraft, and metal processing industries with superior system solutions and specialized technical services. Our customers are major international manufacturers and suppliers. Through our early involvement in our customers' design and development processes, we consistently succeed in providing innovative solutions to new challenges in, for example, lightweight construction. Our customized products and services are based on our broad technology portfolio and global applications expertise that extends across our customers' entire value chain.
In the General Industry business, we offer a comprehensive portfolio of products for the manufacture and maintenance of durable goods. Our customers in this area range from manufacturers of household equipment and appliances to producers of wind power plants. In addition to our in-house technical customer service experts, we tap into a strong global network of trained distribution partners to provide our customers with best-in-class service. Regular training programs for users and the joint development of new adhesive solutions are also important drivers of growth and differentiation.
Our Electronics business offers customers from the electronics industry worldwide a comprehensive portfolio of innovative high-technology adhesives for the manufacture of microchips and electronic assemblies. We combine our expertise with substantial investments in our technology portfolio to develop innovative solutions for both current and future product generations. Our global presence enables us to collaborate closely with development centers of major electronics firms while providing intensive support for the production processes, which are mainly located in the emerging markets.
In the Adhesives for Consumers, Craftsmen and Building business, we market a wide range of brandname products for private users and craftsmen. We offer innovative products and full system solutions based on our strong brand platforms, leveraging the latest developments from our broad technology portfolio. To provide an optimal level of service to our customers worldwide, we work closely with both international distribution partners and wellestablished local distributors.
For the Adhesive Technologies business unit, we aim to further expand our competitive advantages by offering tailor-made solutions based on comprehensive expertise in products and technologies, our global presence, and close partnerships with customers. The size of Adhesive Technologies and its position as a market leader in various businesses allow us to leverage extensive synergies in research and development, production, and materials management. In addition to strong organic growth potential, acquisitions – and their rapid integration – are important instruments for the further development of our business. Active portfolio management plays a central role in continuing our profitable growth. This entails both reinforcing organic sales growthorganic sales growth
Growth in revenues after adjusting for effects arising from acquisitions, divestments and foreign exchange differences – i.e. “top line” growth generated from within.
through targeted investments in particularly attractive emerging markets, and investing in growth through acquisitions. It also involves deliberately reducing the importance of businesses that offer little opportunity for differentiation, and carving out non-core activities with no strategic significance.
Expanding our leadership in innovation is another important cornerstone of our growth strategy. Here our activities center on opening new fields of application through innovative adhesive technologies, as well as optimizing the performance and sustainability of our existing solutions. In 2013, we generated 30 percent of our sales from products successfully launched onto the market in the last five years.
To strengthen our relationships with customers, we often start working with them right from the design and product development phase. We also extend our partnerships to other strategically important players in the market. Our product solutions are aimed at around 130,000 direct customers with very different requirements. Thus, stronger differentiation in customer service is playing an increasingly important role in the configuration of our portfolio of products and services.
We drive the globalization of our businesses by accelerating expansion of the strong positions we hold in emerging markets. We accomplish this by continuously investing in capacity expansion there, and by strengthening our teams both quantitatively and qualitatively. This enables us to ensure a high level of local service and technical competence for our customers around the world, while specifically promoting growth among local customers. Our focus in North America and Europe centers primarily on utilizing economies of scale and strengthening our leading market positions.
We are continuing to consolidate our brand portfolio in order to provide customers across all of our businesses with a simpler and more direct understanding of our overall offering, and to further improve efficiency. This involves structuring our industrial business into the brands Loctite, Bonderite, Technomelt, Teroson and Aquence, each of which represents a group of specific technologies and applications. In the consumer business, we are further strengthening our four existing brand platforms Loctite, Pritt, Pattex and Ceresit. In 2013, over 70 percent of our sales were generated by our top 10 brands.