Archives for December2015

Part 1: Black & Decker and DeWalt, a Tale of Two Brands

This article is a three part series on the history of Black & Decker, their eventual acquisition of DeWalt, as well as how the company used the premium brand model in the 1980’s to refocus its product strategy. As of 2010, Black & Decker has merged with Stanley Works to form Stanley Black & Decker, Inc.

Black & Decker

Black & Decker has been making power tools for quite a long time. The company, which bears the last names of its founders was created in 1910 by Duncan Black and Alonzo Decker in Baltimore. The two men had $1,200 between the two to start the company ($600 of which was borrowed), which in 2015 would be worth about $30,000.  Duncan and Alonzo who were both in their late 20’s met at the Rowland Telegraph company, where they worked as machinists. By 1912, the company designed its first logo, that would contain the iconic elements of the hexagon, which reflected symbols of the machine tool trade. To this day, it remains a part of today’s modern Black & Decker logo. One of the key drivers of the company would be a focus on innovation. For every tool that already existed, the company founders knew that it could be improved upon by adding new product features, and that it how the very

World's First Portable Electric DrillThe Modern Power Drill is Born

The company for several years dabbled in designing and manufacturing various machines for products like milk bottle caps and candy dipping. It would take several years of innovation before they filed patents for a product that would revolutionize the power tool industry forever. In 1916 a patent was filed for a drill featuring a pistol grip and trigger switch. The world’s first 1/2″ inch portable electric drill would soon be revealed to the world. All drills at the time were stationary in nature, so providing the manufacturing industry with a portable drill that could be moved around proved revolutionary. Word got around, and tradesmen in various industries began demanding the product. Something that could be only achieved with mass production.

Mass Production & Expansion

With the patent approved, and the designs finalized, it was time to move into mass production of the product, so the company opened its first large scale 12,000 foot manufacturing facility in 1917. It was situated in Towson, Maryland, which is just north of Baltimore. The company also manufactured air compressors at this facility. Sales were phenomenal, as the company’s annual sales exceeded $1 million (about $13 million in 2015 funds) by the end of 1919.  Just before the end of the year, the company added another 20,000 square feet to its manufacturing facilities. By 1921, the company started to advertise to the masses, placing ads in various Baltimore area publications. Sales began to soar, and by 1922, the company opened a sales, service and warehouse facility in Canada. With business booming, the corporate headquarters in Towson needed to be upgraded, and the company upgraded to a two storey administration building. The company was a pioneer in employing traveling salespeople and support, and used two buses that traveled the east coast providing training for plant operators in mobile classrooms.

International Expansion

With a solid business model, the roaring 20’s provided fertile grounds for business expansion, and in 1925, the company opened up its first overseas subsidiary in London, United Kingdom. Four years later, in 1929, a location was opened in Sydney Australia. This global expansion would be stopped by the great depression, but would continue after the Second World War.

Great Depression Hits

The 30’s were a tough time for most corporations, and layoffs hit Black & Decker as most other companies. One of the first people to be laid off, was Al Decker, the John Hopkins educated son of the co-founder, Alonzo Decker, who made it very clear that he was not going to play favorites during this tumultuous time. Eventually, a recovering business allowed the company to try to find additional venture capital by going public, and it did so in 1936. With war erupting in Europe in 1939, the company joined other American industries in supporting US troops and allies abroad.

Black & Decker during the WW2 effortThe War Effort & DIY Market

As with most other manufacturers, the company contributed to the US war effort in the early 40’s. The Towson, Maryland plant manufactured fuses, gun shells, and other wartime supplies. Supervisors at the manufacturing facility started to notice that many products started to disappear from inventory. Upon further investigation, it was revealed that Black & Decker employees were taking the tools home in order to work on various home improvement project. Instead of tackling the theft issue head on, the company saw an opportunity emerge, which would form a completely new market segment for the company. This was the birth of the DIY market, and Black & Decker responded by introducing the world’s first portable electric drill for consumers. A home utility line of drills and accessories was also launched in order to meet the emerging needs of consumers tackling home renovation projects on their own. By 1951, the millionth 1/4″ inch drill had come off the assembly line, and this success led the company to add additional products into the home consumer segment. In 1951 president and co-founder S. Duncan Black died at the age of 67. Black was succeeded as president by his partner, Alonzo G. Decker, who also took on the new post of chairman in 1954. Decker died two years later at age 72.

DeWalt Acquisition

DeWalt logo 1960'sAfter the war, Black and Decker continued its global expansion in Australia, South Africa, Spain, Mexico and Canada, and one of the growth strategies for the company was the acquisition of smaller market players. By the late 60’s about 43% of revenue generated by Black & Decker worldwide came from operations outside of the domestic US market. In 1960 Black & Decker purchased DeWalt of Lancaster, Pennsylvania from American Machine & Foundry Co., Inc. DeWalt was known and well respected in the industry. They built high quality radial arm saws and other stationary woodworking equipment. In fact, they were one of the first companies to patent the radial arm saw. DeWalt at the time had a sales presence in the US and Canadian markets, but it’s sales strategy was focused on larger stationary tools that were almost never used by your average consumer.

Product Strategy Shift

In 1961, Black & Decker introduced the world’s first cordless electric drill. By the 70’s Black & Decker had an impressive array of portable power tools, both corded and cordless that could be used by the average homeowner. However, a fundamental marketing shift would occur over the next decade that led Black & Decker to change the positioning of both its own set of portable power tools, as well as the tools of its subsidiaries, such as DeWalt.

In our next part we will explore the history of DeWalt. Stay Tuned!

Sources

  1. Black & Decker Milestones
  2. Black & Decker South Africa
  3. Innovation’s Missing Link: The Secret to Effortlessly Overcoming (Google Books)
  4. Alonzo G. Decker Jr., 94; Engineer, Power Tool Innovator
  5. DeWalt Company Information
  6. DeWalt Radial Saw Patent Information