EXATECH INC IN CONSUMER APPLIANCES (PHILIPPINES)

Euromonitor International May 2012

EXATECH INC IN CONSUMER APPLIANCES (PHILIPPINES)

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LIST OF CONTENTS AND TABLES

Strategic Direction ........................................................................................................................ 1 Key Facts ..................................................................................................................................... 1 Summary 1 Summary 2 Exatech Inc: Key Facts................................................................................. 1 Exatech Inc: Operational Indicators ............................................................. 1

Company Background .................................................................................................................. 1 Production .................................................................................................................................... 2 Competitive Positioning ................................................................................................................ 2 Summary 3 Exatech Inc: Competitive Position 2011 ....................................................... 3

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EXATECH INC IN CONSUMER APPLIANCES (PHILIPPINES)

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EXATECH INC
STRATEGIC DIRECTION
Exatech Inc aims to be the leading distributor of premium and low-cost appliances in the country by providing the latest appliance technology, warm and knowledgeable customer service and value-added services through repair centres. Exatech Inc improved its marketing strategy for its Whirlpool brand in 2011, which helped increase its overall volume share.

KEY FACTS
Summary 1 Exatech Inc: Key Facts Full name of company: Address: Tel: Fax: www: Activities: Exatech Inc 56 Cordillera St. Cor. E. Rodriguez Sr. Ave. Quezon City 1113, Philippines +632 712 0535 +632 712 0537, +632 743 6532 http://www.exatech.com.ph/ General and wholesale trader of large kitchen appliances (ie fridges, freezers, wine/beverage coolers, cookers, built-in hobs, built-in ovens, electric ovens, microwave ovens, washing machines, dryers and air conditioners) and small electrical appliances (ie mixers, water boilers, electric irons and food service equipment)

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Summary 2 Net sales Net profit Number of employees

Source:

Exatech Inc: Operational Indicators 2009 2010 Ps1.08 billion Ps106.7 million 102 Ps1.4 billion Ps199.5 million 102

2011 Ps1.61 billion Ps225.4 million 102

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COMPANY BACKGROUND
Exatech Inc is an independent distributor of major and small appliances. It started in 1982 as a retailer of various appliances and in 1992 it was appointed by Whirlpool International to be its exclusive distributor in the country. It introduced the Fujidenzo line in the market in 2005 and in 2006 Exatech Inc. expanded its product line with the addition of GlemGas, a leading Italian manufacturer of cooking appliances.

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EXATECH INC IN CONSUMER APPLIANCES (PHILIPPINES)

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Exatech Inc distributes a wide range of home appliances including fridges, freezers, fridge freezers, wine/beverage coolers, cookers, built-in hobs, built-in ovens, electric ovens, microwave ovens, washing machines, dryers, air conditioners, small electrical appliances such as mixers, water boilers, electrical irons and foodservice equipment. Exatech Inc has showrooms in Metro Manila and Iloilo. It was able to distribute appliances even in other parts of Visayas and Mindanao through established dealer networks. Since its products are all imported, its main focus of sales activities is the local market and hence it has no regional or international coverage. The company has made no efforts yet to engage in an initial public offering for expansion. There has been no recent news informing the public about Exatech Incs plan on overseas expansion. It is deriving its share mainly from the Fujidenzo brand as it taps the mid-income group. However, in 2011 there was an observed strengthening of the marketing of Whirlpool branded appliances, which are acceptable to the upper-middle-income and high-income groups. Its share has not reached saturation yet and has more potential to grow with more frequent product development and improved marketing strategies. The low penetration rate of almost all appliances is also giving Exatech Inc room for growth. The company advertises products through discounts and promotions in retail channels. In 2010, it launched its 6th Sense refrigerator and washing machine, whose main features are water and energy conservation capacities. In 2011, it banked on promotions to increase sales, with a Whirlpool warehouse sale up to 60% off and the chance to obtain an additional Fujidenzo microwave oven for Ps998 when purchasing a Fujidenzo freezer and beverage cooler. Exatech Inc has also celebrated the 100 years of Whirlpool and made an ad for Fujidenzo cooking to encourage more sales.

PRODUCTION
As a local distributor, Exatech imports all of the products it supplies in the local market. Due to higher demand in the economic recovery in 2010 and stable economic growth in 2011, volume distributed locally has also improved. The number of distribution channels and showrooms remained the same in 2011 and prospects for facility upgrades and expansion will depend on the demand for its brand in the forecast period. As of 2011, Exatech Inc has eight offices in the country, of which five are showrooms. The company is not engaged in re-exportation of appliances. The main strategies of the company are the display of the latest and innovative appliances in its showrooms and availability of service centres and friendly and knowledgeable staffs.

COMPETITIVE POSITIONING
Exatech Inc had an overall share of 2% in 2011, thanks to its Whirlpool and Fujidenzo brands. Higher disposable income, stable economic growth and growth in number of finished dwellings helped the companys volume sales. The brands that Exatech Inc distributes usually follow from the innovations of its competitors. In 2010, it released the 6th Sense refrigerators and washing machines designed to conserve water and energy consumption. In 2011, the new product development was limited, but the company banked on promotional activities such as huge discounts to commemorate the 100 years of existence of its Whirlpool brand. Exatech Inc distributes both the fast-growing and the slow-growing appliances. Amongst these products are small kitchen appliances, fridge freezers, freezers, washing machines, ovens, split air conditioners and desk fans. It also gets most of its share from the mid- to high-

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income segment and lately included the low-income segment as customers. It strengthens the other brand it distributes, Fujidenzo, to win share in the local market. Its distribution partners are retailers and no or negligible percentage of its products is distributed through construction. The company distributes a narrow array of large and small appliances because of the brands it distributes. For its Fujidenzo brand, it targets the middle-income consumers aged in the 20s and up whilst it targets the upper-middle-income to high-income group of the same age bracket for its Whirlpool products. These strategies can be reflected through its offers and events attracting young professionals and other well-earning consumer groups. The new product development of Exatech Inc in 2011 was the Whirlpool one-door upright silver manual-defrost. Summary 3 Product type Microwaves Freezers Cookers Semi-automatic washing machines Automatic tumble dryers Split air conditioners Fridge freezers Automatic washer dryers Automatic washing machines
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Exatech Inc: Competitive Position 2011 Volume Share 34.5% 21.5% 17.6% 17.0% 16.8% 13.4% 10.9% 9.4% 5.8%

Rank 1 2 3 3 3 4 5 5 6

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