Newell Company

The Newell Company set aggressive growth goals for itself, which were mainly accomplished through mergers and acquisitions. Newell was able to be successful at this process of mergers and acquisitions by setting and hearing too strict criteria. The first criteria involved evaluating the fit between Newell's existing businesses and that of the proposed entity. Some of the requirements for these criteria included only considering simplified product lines (lower cost) that were not subject to volatility, seasonal trends, or rapid changes. It was preferred that the product line was available for distribution through mass channels as opposed to more limited or narrow channels. The second criteria required that the proposed acquisition had an established reputation and brand awareness represented by establish shelf space within major retailers. This implied that the business held a top position in its respective market. The third criteria required that the proposed business have a long product lifecycle, and the fourth criteria required that the business have the capabilities of meeting Newell's profitability standards which included operating margins of 15% and SG&A costs at a maximum of 15%.

Newell could be sure that the acquisition and incorporation would be a success if the proposed acquisitions that these criteria. Simply stated, by avoiding companies that had complicated product lines or product line volatility Newell could count on stability and predictability within the newly acquired business. They can then apply their aggressive growth standards to the newly acquired company and be confident that those targets would be hit. Additionally by ensuring that the product is available with all major retailers and have longevity there will be no issues with marketability or sales.

Newellization allowed the Newell Company to quickly onboard its newest acquisition to ensure profit improvement and productivity enhancement. As mentioned before, Newell has extremely...