Four companies under analysis, Black and Decker, Makita, Bosch, Porter Cable, are direct competitors participating in the power tool market. Competitiveness foundations are the set of macroeconomic, policy, and infrastructure variables that determine an economy's long-term dynamic competitiveness. Economists acknowledge the critical influence of government policies on economic efficiency and growth. Black and Decker is a leading company faced by strong competition and market fluctuations. On the business level, Black and Decker has followed sourcing and acquisitions strategies which help the company to compete and grow. Black and Decker undertook three initiatives: it diversified its products, often through acquisition, into other related products and services; it diversified geographically; and it began an intensive R & D program to find a suitable raw materials to replace old technology. On the corporate level, the aims are to achieve global leadership and enter Asian markets. On the business level, Black and Decker implements inventory rightsizing strategy and specific value-chain strategic design. Innovations are the main tool used by the company to grow and penetrate new markets, primarily Asian and Latin countries. On the operational level, the company uses multi-echelon inventory optimization and improves its safety-stock levels. Economists argue that competitiveness foundations are correlated positively with economic growth. The case of Black and Decker shows that reduced inventory investment allows the company to obtain stable market position and increase productivity. On the functional level, the company created a strong brand name and customer loyalty appealing with unique value proposition to diverse customer groups (www.blackanddecer.com).
Makita, a Japanese-based company, is a leader in four segments: portable general purpose tools, woodworking tools, stationary woodworking machines, and other woodworking items. On the functional level, the company introduces products able to meet the diverse requirements of target audience. On the operational level, Makita use special scheduling and cost reduction methods which help the company to save costs and deliver products faster and easier. Makita is a low-cost producer. On the business level, Makita follows a standardized approach. It produces standardized power tools for world consumers. For an established business it is helpful to identify the stage of development that the business has reached and recognize that it is a point in the development process. Decisions can then be taken to remain at that stage (if relevant) or seek to move on. On the corporate level, Makita follows acquisition strategy as the main tool to reach global markets and penetrate European countries. For instance, strategic alliance with Nailer Business of Kanematsu-NNK