7 Dec 2010

Scottsdale Miracle-Gro to Sell Professional Business

Scottsdale Miracle-Gro to Sell its Global Professional Business to ICL in All-Cash Transaction Valued at $270 Million

Sale expected to close in second quarter of FY 2011

MARYSVILLE, Ohio, Dec. 7, 2010 /PRNewswire-FirstCall/ -- The Scotts Miracle-Gro Company (NYSE: SMG), the world's leading marketer of branded consumer lawn and garden products, announced today that it has received a binding offer from ICL (TASE: ICL) to acquire the shares and substantially all the assets of ScottsMiracle-Gro's Global Professional business for $270 million (US), subject to certain adjustments at closing, in an all-cash transaction.

"Today's announcement is another step in our strategy to become a more focused consumer business," said Jim Hagedorn, chairman and chief executive officer, ScottsMiracle-Gro. "Over the past two years, we have evolved our business portfolio to better leverage growth opportunities within our Global Consumer segment, allowing us to better drive shareholder value.

"While we are proud of the efforts that our Global Professional team has put forward over the years, we believe their ability to continue driving growth will be enhanced by being part of ICL, which has articulated a clear vision to invest in this business and support its growth."

The Global Professional business markets professional products to commercial nurseries and greenhouses for ornamental horticulture; sports fields, golf courses and public parks for professional turf applications; and specialty agriculture in North America, Europe, the Middle East, Africa, Latin America and Asia-Pacific. The U.S. professional seed business is not included in this offer.

The proposed sale is expected to close in the Company's second quarter of fiscal 2011, subject to regulatory review and the satisfaction of certain conditions, including works council and employee consultation. The Company intends to apply net proceeds of the sale toward capital investments and debt retirement.

In fiscal 2010, which ended September 30, 2010, the Global Professional business had sales of $242 million, which accounted for 8 percent of the Company's total sales. The purchase price is based on pro forma fiscal 2010 EBITDA of $31.4 million, a non-GAAP measure that includes certain adjustments to better reflect the economic earnings of the business on a stand-alone basis.

For fiscal 2011, ScottsMiracle-Gro anticipates the proposed transaction will be dilutive to its earnings per share in the range of 10 to 15 cents. The estimated 2011 diluted earnings per share impact excludes an anticipated net after-tax gain on the sale and direct costs associated with the transaction. ScottsMiracle-Gro estimates income taxes to be paid on the transaction will be in the range of $30 million to $40 million.

"We are pleased to find a buyer that values Global Professional's market leadership position, talented people, respected brands and positive customer relationships," Mr. Hagedorn, added. "ICL has extensive experience in global markets, is a leader in the global fertilizer industry and is committed to achieving business success. These attributes give us confidence that Global Professional will be a good fit with ICL."

Mr. Akiva Mozes, ICL's president and CEO, commented, "We are very excited about the potential of combining our two companies' specialty fertilizers and horticultural/turf inputs businesses, thereby forming a strong basis for the strategic expansion that we have planned for this area. By combining Global Professional's branded products, experienced global sales and marketing organization and significant R&D capabilities with our own leading products and superior access to raw materials, we believe that we will be able to create a specialty fertilizers and horticultural/turf inputs powerhouse positioned for accelerated growth in a growing marketplace."

Both companies said they will have teams in place to ensure a smooth transition for associates, customers and suppliers. "We believe this proposed transaction will be positive for all of Global Professional's stakeholders, and we are dedicated to supporting the seamless transfer of the business to ICL," Mr. Hagedorn added.

J.P. Morgan Securities Inc. acted as ScottsMiracle-Gro's exclusive financial advisor on this transaction.

About ScottsMiracle-Gro

With $3.14 billion in worldwide sales and approximately 8,000 associates, The Scotts Miracle-Gro Company, through its wholly-owned subsidiary, The Scotts Company LLC, is the world's largest marketer of branded consumer products for lawn and garden care. The Company's brands are the most recognized in the industry. In the U.S., the Company's Scotts®, Miracle-Gro®, Ortho® brands are market-leading in their categories, as is the consumer Roundup® brand, which is marketed in North America and most of Europe exclusively by Scotts and owned by Monsanto. In Europe, the Company's brands include Weedol®, Pathclear®, Evergreen®, Levington®, Miracle-Gro®, KB®, Fertiligene® and Substral®. The Global Professional business has approximately 350 associates and brands such as Osmocote®, Peters®, Sierraform GT®, Sierrablen Plus®, Agroblen® and Agriform®. For additional information, visit us at www.scotts.com.


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7 Dec 2010

The French Connection by John Stanley

Garden retailing in France is controlled by a relatively small number of retailers who between them own the major share of the garden market. The key players are Botanic, Jardiland and Truffaut.

What makes these retailers special and what can retailers in other countries learn from them and the French retailer?

Many of you may think it is the way they put the product together, the French are famous for their flair as fashion leaders, but this was not the main lesson I took away for a week looking at the industry.

My journey started with the annual nursery awards dinner organized by Groupe J, the main magazine company for the gardening and pet sector. The dinner is a combination of wonderful entertainment, fine food and the awards ceremony. The awards are dominated by presentations to the Buyers.

Awards are presented to the best buyers in each category and the buyer is held in more esteem than the store owner, or that is how it seems to come across to a visitor looking at the industry.

The argument is that the key to success is based on a business having a good buyer, as stock turn and getting the right product mix is critically important.

Having seen the French industry and the industry in other countries I can see why the French put so much emphasis on the buyer. Heroic buyers can make a big difference. I talked to Brond Wagenaar,

a French garden centre consultant, concerning the awards and how they are judged. He informed me that they are judged based on the following criteria.

Technical Knowledge

Partnership approach with the supplier

Mid and long term vision of the business and the industry

Respect and commitment.

With the shift in consumer thinking, this type of award needs to be promoted in other countries as well.

HOW ARE THE FRENCH PERFORMING?

The average French garden centre generates between 1000 and 1500 Euro per square metre with an average sale per customer of around 30 Euro, except this does rise to 40 euro in the more wealthy Paris region.

Pets are part of the garden centre scene and a typical centre will donate between 25% and 30% of retail space to the pet category. The return on pets is higher than the return on gardening.

The segmentation of the market is interesting. At the higher end is Botanic, the middle market is supplied by Jardiland and Truffaut and the lower end of the market by Garden Price

Botanic

First stop was Botanic  

who promote themselves as the first alternative brand  
in garden centres. The claim comes from them leading the way in natural, eco-friendly garden products. Consumers seem to like the message and have voted the company the best garden retailers in 2007 and 2008

Their Suresnes store, overlooking the Seine just outside Paris, is the flagship store in the chain and offers some interesting new trends in garden retailing. As a consultant I often advise retailers that a lifestyle retail store has to be on one level as it is difficult to get garden customers to travel from one floor to another. This store breaks those rules and is located on three levels and it works.

The lower level is the garden department, the second level is seasonal, including a balcony of outdoor plants and the top level is the pet department. Keeping pets and balcony gardens are the key interests of the local consumers and this business does a great job in serving both.

The middle market is the Jardiland and Truffaut market. Jardiland is a 800 million euro business started 30 years ago and now has 217 stores  aiming  to be the IKEA of the garden industry in France, Spain and Italy. Truffaut, a 440 million euro business is part of the De Haize supermarket family and has 55 stores spread across France, but has a critical 50% market share of the Paris market.

The challenge for these businesses is that 25% of their business comes in 25 days.

In fact Jardiland quoted the “three” concept in their business.

The business relies on THREE months...15 March until 15 June

                                        THREE days...Friday, Saturday and Sunday

                                         THREE hours...2.00pm until 5.00pm

Scarfs and Tea Towels

A new business to me was Garden Price, operated by three ex Truffaut team members .Their aim is to own the bottom of the market. They are the place you come when you want to buy on price. They locate themselves in retail parks near a Truffaut as they realize that their customers will have to finish their shopping at a fully fledged garden centre. You go to Garden Place for a limited range based on price. The stores are a warehouse with pallets and racking as shop fixtures.

During my visit Christmas lead up was in full swing, I asked what happened in January as stock turn was clearly critical to the business.  I was told that while other garden centres moved into garden furniture which does not pick up in sales until March , they move in to tea towels and scarfs to keep female customers coming in and buying product.

The French market has moved forward in the last five years.  It is clear that some retailers have a clear vision of where they want to be in the future and are focused on getting there. They realize that the buyer is a critical player in that process and they are recognised as the retail heroes.

John Stanley is a retail business coach, speaker and author.  John films retail stores with new ideas and films great display ideas or retail trends as he travels around the world for his internet TV program.   Members of his Club can view the TV program for free and receive team training for free.  John has authored several successful marketing and retail books including the best seller “Just About Everything a Retail Manager Needs to Know”. 
John Stanley helps retailers:

·          Increase sales per square metre

·          Train staff to increase the average sale per customer

·          Better manage stock, merchandising and display to maximise potential

·          Marketing more effectively to convert more lookers into buyers

  For more information on John Stanley or how to become a Member of his Club, visit www.johnstanley.com.au or email info@johnstanley.com.au

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28 Nov 2010

Dual Promotion of Keelings Flowers & Chocolates at Applegreen Making it Easier for the Guys to Choose

Imag0087

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27 Nov 2010

Grow Your Brand at Bloom 2011

Grow Your Brand at Bloom 2011

Grow Your Brand at Bloom 2011

Thursday 21st October, 2010:
 Bloom, Ireland's largest garden and food festival, brought to you by Bord Bia, is currently calling for sponsors for next year's show which takes place in the Phoenix Park from 2nd June - 6th June. This unique horticultural and culinary experience, which is now entering its fifth year, is offering tailor made sponsorship packages to best match organisations marketing strategy and budget.

The colourful feel-good festival attracts widespread public attention before, during and after the event and offers potential businesses the opportunity to showcase and grow their brand by interacting with 60,000 visitors over the four days. Visitors to Bloom can enjoy a range of spectacular showgardens, amazing floral displays, a large scale artisan farmers market, live cookery and craft demonstrations, free gardening advice plus dedicated children's activities.

Speaking about the opportunities available to businesses, Gary Graham, Bloom Show Manager, Bord Bia said, "We are very excited about Bloom 2011. The beauty of Bloom is that it allows organisations to interact with potential customers and key stakeholders in a unique environment. Over the past few years we have worked closely with over 30 key sponsors, from many diverse areas where we developed individual packages tailored to suit the specific requirements and budgets of each brand. We are encouraging all companies to consider Bloom as part of their planning for marketing activities in 2011".

For organisations interested in getting involved in Bloom 2011 the following demographics and visitor responses from the 2010 show are worth noting -

  • 60,129 people in attendance
  • 57% of these were from outside Dublin
  • 30,000 people spent more than four hours at the event
  • 99% of people rated the event as very worthwhile or worthwhile
  • 84% indicated that they had purchased a product or service at the event
  • 81% indicated that they would visit the event again in 2011

Commenting on the benefits of sponsoring the event, Donal Moulton, Marketing Manager Origo said: "BOSCH has been involved with Bloom since the beginning and without a doubt it is the most successful show that we participate in. Our BOSCH cooking demonstrations and BOSCH garden displays provide us with an opportunity to meet with our customers and showcase BOSCH products. We are always encouraged by the magnificent reception we receive from our customers and event organisers. We look forward to continuing our association with Bloom which is an event we cannot afford to miss".

For further information on tailoring a package to suit your business, contact Bloom's sponsorship team today garret.buckley@eventhaus.ie01 8460020 or Paul.gallagher@eventhaus.ie01 8460020.

17 Nov 2010

Westland Horticulture to hold Masterclass for Retail Garden Staff in Dublin - February 2011

Westland Horticulture’s masterclasses are aimed at garden retail staff, and experienced speakers will provide information to boost the skills and confidence of staff.

The master classes will cover the follwing categories:

  • Developments and Trends in the market place.
  • Customer engagement.
  • How to maximise sales and product knowledge
  • The Future Foundation will provide information on trends and Westland Horticulture’s technical team will provide information on specific products to enable retail staff to pass this on to their customers. Westland Horticulture head of marketing Keith Nicholson said:  "The 2011 Westland Masterclasses are a must for all garden retail staff, as one of the leading companies within this area we will be using our knowledge along with those from outside professional organisations to reinvigorate gardening within centres across the UK."

    Westland Masterclass Date - Dublin: City West Hotel – 3rd February 2011.

    The classes are free of charge and restricted to 30 delegates per course.  A refundable booking fee of £35 is required. 
    To book your place email Nicola Bacon on nbacon@westlandhorticulture.com

    6 Nov 2010

    Garden Centres and a Florist Winners in Retail Excellence Ireland Awards

    Irelands top 50 stores in 2010 include Arboretum Lifestyle & Garden Centre at number 11, Orchard Home & Garden at 13 and Lamber De Bie Flowers at 25. Both Arboretum and The Orchard were winners in the Best Superstore Category with De Bie Flowers a winner in the Best Small Store Sector. www.retailexcellence.ie
    23 Sep 2010

    Product to Shopper Experience by John Stanley

    Product to Shopper Experience
    John Stanley

    The changes in retailing seem to be happening at a faster pace than ever. Keeping up can be a real challenge. A new word seems to be creeping into the retail vocabulary: shopcentric.

    I first noticed the word in reports coming out of mainland Europe, but what is shopcentric all about?  It is about a shift in thinking processes.  It is about being less concerned about the product being sold and more concerned about providing the right experience for the consumer.

    Some organisations are using other words that mean the same thing. Shopping malls are emphasising that they are "Activity Centres" rather than places you just go to shop. Whatever word you use to describe it, the emphasis has turned to creating a shopping experience rather than just selling "stuff".

    What does this mean for retailers?   It means retailers have to focus more on the consumer and their needs and wants than in the past. Many retailers will argue that they have always focused on the consumer, but now it has become more fashionable for more retailers to do this and as a result the competition for this space has become more aggressive.
     
    What do you need to focus on to provide a point of difference?

    My first concern is that the word “experience" is now overdone. A recent launch of an American shopping centre was heralded as a "New Shopping Experience”.  The latest marketing from Jakarta in Indonesia is 'Family weekend shopping experience in Jakarta".

    The trouble is not many people believe in the headline any more.  For example, 56% of American shoppers "cross shop" on a regular basis when purchasing a product. In other words the so called experience has not bought customer loyalty.

    There are exceptions and Starbucks, Anthropologie and Abercrombie and Fitch shoppers are good examples of consumers who are true followers due to the experience they have experienced in those stores.

    Creating an experience or being shopcentric means following some specific guidelines in retailing that other retailers either do not implement or do badly or inconsistently.

    In 2004 Indiana University produced a report entitled "Creating the Ideal Shopping Experience."  They interviewed consumers to identify what they preferred. It is not the actual results that I find interesting for today's retailers, it is their approach and how that research technique can be adapted to any retail situation.
     
    The report was split into five segments:
     
    Must Have .  The first question asked of consumers was what must a retailer provide?  The answers were what you would expect. Knowledgeable staff, customer service, cash and credit card payment facilities, product availability and cashiers and people to bag your products. The challenge is if you did a similar survey in your store, what would be the MUST HAVES
     
    Should Have.  This was the second question asked of consumers and the response included promotional flyers, staff having computer access to find out information, products signed, a map of the store, products individually priced. Again this may be "common sense", but I recently worked with a retailer where computer access was banned as the owner felt that the sales team could not be trusted to use the computer professionally.
     
    Nice to Have.  This was the third part of the survey and looked at what the consumer considered to be a bit of luxury when they were shopping. It got the consumer to think about the shopping experience and this was the core of the survey. The challenge is what would the consumer feel were the nice-to-haves in your store; this would probably revolve around extra services rather than more products.
     
    Indifferent.  This part of the survey focused on what you may feel is important, but your customer felt it did not make a difference to their shopping experience.  Too often as retailers we focus on the wrong things in the customer eyes and we could be focusing on the wrong areas of developing the business.
     
    Prefer not to have.  The final question focused on the things customers would prefer not to have in their shopping experience, comments like a dirty store became one of the issues in the customers mind.

    As I mentioned, this survey was carried out six years ago and the results would not apply to retailers today. The key issue is how would your clients complete such a survey and how you manage and implement the suggestions and ideas that are offered.

    You may argue, quite rightly, that you are already providing an experience for your customer base. My challenge to you is that providing an experience has now become trendy and all sorts of retailers and shopping centres are now joining the band wagon.  This means that everyone in the experience economy needs to improve their game to ensure they impress their customers and provide a better experience than the retailer next door.

    Customers are not only comparing the experience you provide against other retailers that do what you do, but also against other retailers in other categories or industries.

    We have found this in our own town. Six months ago the experience retailers in town on a Sunday were the local garden centre and breakfast coffee shop. Both businesses have seen a drop in town once the farmers market opened during the same time period. The customers changed shopping habits for a better shopping experience even though the product sold was completely different.
     
    The Challenge
     
    The challenge for all retailers is to improve their game. This starts by asking the customer where they feel the business fits into the experience game.You need to know your strengths, weaknesses and opportunities. Once you have done that, work with the team to improve them. You will probably find that the opportunities fall into specific groups. Most retailers find they split into customer service, services offered, merchandising and display and management issues. Create some action teams to address each area and come up with a plan to truly enhance the shopping experience.
     
    If you would like more information on experience retailing and would like to keep up with what is happening around the world, John Stanley has developed a low-cost, high-value means of doing just that and training your team every month at the same time.  For AUD$45 a month you can become a member of his exclusive club and stay ahead of your competition, watch his monthly TV program online, and train your team, visit his resource site www.johnstanleyretailguru.com.au to join up and start reaping benefits today.

     

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