1. Assess the Spectrum organization and each of the markets in which the company operates. What are the key elements from each industry about which Falconi should be concerned?

Over the years, with help from a number of acquisitions, Spectrum in 2005 had become a leading supplier of consumer batteries, lawn and garden care products, specialty pet supplies, and shaving and grooming products.

In the battery market, North American consumers of household batteries sought convenience and quality when purchasing batteries and tended to gravitate towards the brand names they knew and trusted, with Duracell and Energizer dominating the market. These two firms were leaders in this market because of their ability to adapt to consumer needs and to merge with other consumer goods companies to create brand portfolios, thus gaining negotiating power with retailers, which was the most traditional channel. Of these retailers, mass merchandisers, home and garden centers and niche electronic stores accounted for 60% of sales. The growth within this segment has become relatively flat, at only 1-2% annually. The overall battery market in Canada was estimated to be 300million. The market for household batteries was highly seasonal, with the large majority of sales occurring during the months leading up to and following Christmas sales of electronics.

The shaving and grooming industry was dominated by a select group of companies selling electric shavers and accessories, electric grooming products and hair care appliances. The shaving and grooming market was growing at a rate of 3-4% annually. The market for these products was highly seasonal with peaks during the months leading up to and following Christmas holiday season and around Father’s day and Mother’s day weekends. Competitors sold their products largely through traditional retail channels with a heavy emphasis on