As of January 2017, the business area name is Home Care & SDA.
Electrolux is one of the world’s largest vacuum-cleaner manufacturers and the only global company in the industry. In 2016, extensive measures were taken to improve the competitiveness of the business area. This included focusing strongly on the most profitable categories and exiting from unprofitable business segments.
Ola Nilsson, Head of Small Appliances
In the vacuum-cleaner segment, the Group holds leading positions in the largest markets, and has a strong presence in the premium segment of both corded and cordless vacuum-cleaners. Product development is focused on innovative and energy-efficient vacuum cleaners in the upper-price segments. A global range of premium small domestic appliances has been developed and launched, and product development is focused on innovative, high performance kitchen appliances.
In Europe, most products are sold under the Electrolux brand, which is complemented with the AEG brand. In North America, Electrolux has divested its vacuum cleaner brand Eureka. This is part of the process to improve the global competitiveness of the business area. Sales in North America are also under the Electrolux brand in the more premium segments. Sales in Latin America and Asia are predominantly under the Electrolux brand.
Market demand for corded vacuum cleaners in Europe declined while
demand for cordless vacuum cleaners increased significantly. Demand for corded vacuum cleaners in North America also increased.
Organic sales declined by 8.2%. This is a result of the action program to improve profitability including reduced sales activities such as active product portfolio management and exiting unprofitable product categories and markets. The sales trend was also impacted by weak markets.
However, sales increased in Europe and Asia/Pacific. Marketing activities focused primarily on a number of premium products such as the UltraOne, UltraSilencer Zen, UltraFlex and Ergorapido vacuum cleaners. UltraSilencer Zen is one of the market’s quietest vacuum cleaner. The premium products UltraFlex and Ergorapido were launched in South Korea with great success.
As of 2017, the business area has the global responsibility to develop
the Electrolux offering around — healthy wellbeing in your home — to create best-in-class consumer experience in wellbeing, and grow the Electrolux presence in floor care, air care and water care. Accordingly, the business area’s name has changed to Home Care & SDA.
During the year a new and focused strategy were introduced to improve the customer offering with a clear focus on quality. Another key area during the year was reducing complexity and concentrating operations on the most profitable product categories.
For the third consecutive year, capacity was increased at the manufacturing unit in Jászberény in Hungary to meet increased demand for vacuum cleaners in Europe, Middle East and Africa. The plant produced over 3 million vacuum cleaners in 2016. Over the last three years, volumes have grown by more than 40%.
7%
-8.2%
| 12 | 13 | 14 | 15 | 16 | |
| Net sales | 9011 | 8952 | 8678 | 8958 | 8183 |
| Operating margin | 5.1 | 3.5 | 2.3 | -0.7 | 2.9 |
Electrolux organic sales declined by 8.2% as a result of active product portfolio management and exiting unprofitable product categories and markets.
Operating income clearly improved. The program to restore profitability intensified during the year. A positive price/mix trend impacted earnings, mainly due to a favorable sales trend in the premium segment in Europe.
2,348
UltraSilencer Zen is one of the most silent vacuum cleaner on the market. This vacuum cleaner is as powerful as previous ranges and has the same energy and dust pick-up grades and even better dust reemission. The UltraSilencer Zen is produced at the Group’s factory in Hungary.
Small Domestic Appliances, such as coffee makers, espresso machines, blenders, irons, toasters, kettles and food processors, is a growing global market segment. Electrolux continues to develop products in these categories, for example, the Electrolux Masterpiece Collection, an exclusive range that use technology from the Group’s Professional operations.
Since the launch of Ergorapido in 2004, more than 10 million units have been sold globally, making it the Group’s best-selling vacuum-cleaner platform ever. This cordless vacuum cleaner has made great success in Asian markets like South Korea.