A strong product offering in both professional food-service and laundry solutions contributed to continued profitable organic growth and for the first time ever, operating income exceeded SEK 1 billion.
Alberto Zanata, Head of Professional Products
Professional Products is in the Targeted Growth phase, the third step on the path to profitable growth. The product range is innovative and market positions strong in both food-service and laundry solutions, particularly in Europe and now also in beverage in the U.S. Example of focus areas has been to develop products with best in class; water- and energy efficiency performances, usability and connected experience. From this strong base, Electrolux is leveraging and expanding selected growth areas such as food service chains, quick-service restaurants, beverage and aftermarket.
Investments in product development contributed to a positive sales trend in most markets. During the year several new unique products were launched and the organic sales growth was 5.6%. Investments in new products and technologies reached record levels, to a significant extent focusing on sustainable products and connectivity. Connected products provide
opportunities to create unique customer experiences, and also to develop new business models. Examples in 2017 was the launches of Electrolux SpeeDelight and Electrolux myPROzip washer and dryer.
Initiatives to streamline operations are ongoing with the objective to improve competitiveness and support further growth opportunities. A global customer care program to improve service levels on installed products and offer additional service solutions was rolled-out called Essentia.
Electrolux acquired, and successfully integrated, Grindmaster-Cecilware, a leading U.S. based manufacturer of hot, cold and frozen beverage dispensing equipment, including coffee machines. The acquisition is a significant addition to the business area strategy to grow in North America, add new categories and become a “one stop shop” for customers in the hospitality industry. Grindmaster-Cecilware had a positive impact of 6.6% on sales in 2017.
North America represents slightly more than 35% and Europe 25% of the global market demand for professional food and laundry products. Overall market demand for professional equipment improved across most regions in 2017.
About 65% of sales are generated in Europe and almost 14% in North America. Other key markets include Japan, China, the Middle East and Africa and Southeast Asia.
Electrolux is a full system provider in the industry with a global sales and customer care organization. Electrolux has a strong position in the European food-service market, in particular in the institutional (hospital, staff canteens, schools) and hospitality (restaurants, catering and hotels) segments. The Group is also a leading player for complete large, innovative installations in a number of growth markets under the Electrolux brand.
Examples of laundry solutions customers include hospital and hotel laundries. Electrolux also supplies products for apartment building laundries in Scandinavia and for launderettes, mainly in North America and Japan.
6%
13.7%
A strong product offering in both professional food-service and laundry solutions contributed to organic sales growth and a strong performance.
Profitability improved for both food-service and laundry equipment, while the acquired business for beverage products had a dilutive impact on operating margin.
| 13 | 14 | 15 | 16 | 17 | |
| Net sales | 5550 | 6041 | 6546 | 6865 | 7723 |
| Operating margin | 9.2 | 11.1 | 13.2 | 13.9 | 13.7 |
Continue to bring innovative solutions to customers
Leverage the Grindmaster-Cecilware acquisition to expand the beverage business
Drive aftermarket business
Strong position in Europe
Global sales and customer care organization
Growing share in emerging markets and in North America
Electrolux Green&Clean Rack Type dishwasher, one glass of water is all it takes to clean an entire rack of dirty dishes.
The Group continued to launch and develop products with strong sustainability profiles. Energy efficiency has a high priority in the development of professional equipment. Several key launches were conducted during the year.
The Electrolux Green&Clean Rack Type dishwasher was launched with the bold claim of having the lowest running costs in the industry. The ventless heat pump solution means 50% less energy usage.
The new Electrolux ecostoreHP refrigerated counters cuts electricity bills by 80%, while storing 50 liters extra and also reducing food waste.
In 2017, a new line of Molteni was launched to accompany the vintage version of the celebrated kitchen stove.
The flexible high-speed cooker Electrolux SpeeDelight picked up two prestigious Plus X awards including being named “Best product of the year”. It was recognized for its innovation, high quality, design, ease of use and functionality. SpeeDelight is Electrolux first connected professional food service product. For more information, see https://www.professional.electrolux.com
The semi-pro laundry solution Electrolux myPRO was extended – the myPROzip washer and dryer allow for connection to both Electrolux and third-party coin boxes or payment systems – a profitable solution for customers. https://www.mypro.electrolux.com