[00:00:05] Speaker A: Newell is a jewel. And here we are.
[00:00:08] Speaker B: Harry, welcome to Distribution Unpacked, our brand new podcast under the SVR Studio. So excited to have you here.
[00:00:15] Speaker A: It’s an honor to be invited.
[00:00:18] Speaker B: What’s happening with Newell? What’s new and exciting?
[00:00:21] Speaker A: Well, Newell has been going through kind of a transition within the writing category, focusing more on new occasions with a lot of creative space. And so as we look at education as example, we’ve seen a lot of research come out recently that says writing is more beneficial to a student than actually using technology in the classroom, that there’s different things that are used in terms of the memory, your ability to comprehend. In fact, three states just reinstituted cursive writing. Really. And so we believe that’s going to be a trend and writing is going to make a break, is coming back.
[00:00:55] Speaker B: Do you have any idea how bad I was at that?
[00:00:58] Speaker A: Well, one of the benefits is fine motor skills. Right. So writing becomes very important for that. Also, when you’re writing in cursive, you actually find yourself sounding out the word, and then it activates the left side of the brain, which is more artistic in drawing, because cursive, it’s a lot like making a painting. Right. You got to figure out your strokes in advance. And so it’s just one element of how we’re looking for new ways to reintroduce writing. So, like the creative marker, which has been doing very well in the market. Lots of new tip sizes, lots of new colors. You know, we’re trying to let people find an outlet through writing to express themselves. And it’s starting in education now as well.
[00:01:32] Speaker B: Do you remember what are those three states? So I never have to move there.
[00:01:36] Speaker A: Interestingly enough, it’s Jersey, California, and New York.
[00:01:40] Speaker B: Really?
[00:01:41] Speaker A: So some of your bluest states kind of stepping away from Common Core.
[00:01:46] Speaker B: That’s fascinating. I mean, I just. Yeah, yeah. I’m just. Sorry. I think I remember how to do the A and the D, and then you had to, like, couldn’t lift up the pen or the pencil. That’s.
[00:01:53] Speaker A: So it’s been out of the curriculum since 2010. So you actually now have adults in the workforce that cannot read cursive. So just wrap your head around that for a little bit.
[00:02:03] Speaker B: Wow.
[00:02:03] Speaker A: So we’re so. We’re excited. So writing is seeing a little bit of a resurgence.
[00:02:06] Speaker B: Sure.
[00:02:07] Speaker A: And then we’ve launched a lot of products that are meant more to let people express themselves and enjoy their time away from technology. So it’s. It’s been good for us.
[00:02:16] Speaker B: So you guys have Always been leaders in kind of looking at what’s going on globally, whether it’s fashion trends or movies and stuff like that. What are you guys kind of seeing as you roll? I mean you guys created the whole year of creativity and it was such cool stuff. And you guys, you know, the S gel is now in different colors for the barrel and different things that I think Paper Mate has some new colors. Is that from ink tones and stuff like that? What are we seeing upcoming?
[00:02:36] Speaker A: Well, the colors are still huge. We’re going to launch two new colors this September. We just launched two in January. Seafoam and Midnight.
Midnight Moon and Seafoam, which is a mouthful for sure. I don’t know who names the colors, but they use AI to figure out what’s going to be on trend and in fashion and they, they bring out those colors and so far they’ve been hitting home runs. So we’ve seen people wanting to express themselves. This whole personalization piece, those fashion barrels play into that very nicely.
[00:03:06] Speaker B: That’s so cool. Yeah, that’s awesome. You know, we talked about education. One of the things SP is looking at is, is vertical markets and how do we support our joint distribution and dealer community. So obviously it’s, you know, whether it’s the Fed Gov space or education, K12 or higher ed, you know, the med surge base from a healthcare perspective, acute and non acute enterprise, whether that’s your offices and stuff of that nature.
Where are you guys starting to see some growth? Obviously education is a big one, but where else are you starting to see the portfolio of the larger.
[00:03:35] Speaker A: So as we look at kind of like we’ll call it three of the bigger verticals, right? You got education, health care and then you have manufacturing.
[00:03:42] Speaker B: Okay.
[00:03:43] Speaker A: Education is by far the largest vertical for us. The writing instrument category is almost $150 million a year annually. And that’s just, you know, your pencils, markers, pens and we see that spend being pretty steady.
Healthcare however, we see is one of the fastest growing verticals in part because we are, I mean you’re not obviously, but aging most of us. And so I think Harry, you’re not aging.
[00:04:07] Speaker B: I, I, I’ve seen you on that peloton, you kill it skillet.
[00:04:11] Speaker A: And I’m always thinking about writing on the peloton. So with healthcare we’re seeing double digit growth in part because of the need, right. With the population aging, but like urgent care facilities. So think about how much we like to have cost savings and convenience. Urgent care facilities have doubled since 2014. There are now 14,000 urgent care centers. It’s growing at about a 7% clip a year. And so as all of those new facilities go up, they need, you know, there’s more spend as people kind of transition over to urgent care. The other thing we’re seeing is the assisted living facilities. Right. There’s only 1.2 million beds in those facilities right now. So as you think about an aging population and the need for more beds, the need to build additional facilities in healthcare and that type of thing is going to become enormous. And it’s a three year build. So we’re, you know, so we’re excited by all of the healthcare spend that we think is going to be coming, especially with patient care. Part of managing that is with the dry erase boards inside of the patient room and doctors and nurses using markers and pens and such. So we’re kind of excited by that.
And manufacturing, no matter where you sit on the political spectrum, there’s a lot of manufacturing that’s coming back with the reshoring. And in 25, for instance, there was $86 million invested in new construction for manufacturing facilities.
That’s expected to be a little bit over 100 million this year. And so GM recently made a commitment they would be back into the US by 2028. So you think about all of those jobs, but more importantly, think about all of the markers. And so we’re starting to like with your teams. This week we talked about all of our industrial markers that can be used in those types of settings. Sure. And also reminding them that every building has got industrial to some degree.
[00:05:56] Speaker B: Right.
[00:05:57] Speaker A: Every education facility has some sort of department that’s responsible for keeping the building safe and clean and manufacturing application writing instruments, that sort of thing work in that environment as well. So we’re seeing a little bit of growth in our more industrial oriented marker set.
[00:06:11] Speaker B: You know, it’s funny you said that about healthcare. I’ve been watching the Pit on hbo. It’s a, you know, kind of a new fun show. And it’s funny. They have. Obviously it’s an emergency room and what they’re.
[00:06:20] Speaker A: Noah’s back.
[00:06:21] Speaker B: He is.
But you’re right, I mean, they’re running around and they’re writing out all the whiteboards. I mean, it’s an er, so clearly people are in and out quickly. But you’re 100% right. You know, you kind of take a step back.
The products are everywhere and it’s kind of a fun space. How can customers succeed? When we think about our joint customers, what are some of the ways that they can succeed with the solutions you guys provide, whether that’s with their end users or different markets. And how do they work that way to be successful?
[00:06:47] Speaker A: Well, we have found that the dealers that have kind of embraced technology, the E Comm, the omnichannel approach, have done a lot better. So making sure their content is up to date, making sure that they’ve got all of the access to the marketing materials that we’re developing and your other manufacturer partners are developing that they can have those conversations about the solution. So the ones who embrace that and have pretty good web experiences for their customers have done well.
We still see the traditional sales route working with larger scale projects and such. But for small business, those that have embraced Omni marketing and kind of an omni sales piece have been more successful in part because E Comm is a much more. It’s a much lower cost delivery model.
[00:07:27] Speaker B: We love omnichannel. So it’s always a fun one of those. Because it’s a marketing term.
[00:07:30] Speaker A: It’s a marketing term, but at the
[00:07:31] Speaker B: end of the day, it’s true. What works online needs to work offline. And when you’re kind of telling the story in both ways, you win. So you guys have done a wonderful job with that.
When we think about simplifying complexity, that’s a big focus for us. As 26 rolls around and we move into the new year, how do we work better together to simplify complexity for our customers? Onward to the end user.
[00:07:54] Speaker A: So the biggest complexity our company faces and when we’re trying to engage your sales teams is just the sheer Number of SKUs that we have.
[00:08:02] Speaker B: Sure.
[00:08:03] Speaker A: And one of the things that even came out today is, well, when do I use this marker? When would I use the mean streak, et cetera. And it occurred to me, and then Jason made a point of asking a question when he was in our session. How do we help people navigate that? Right. And so we’re going to. We’re in the process. Like we have an industrial flyer that kind of goes through some of the uses for some of our industrial markers, but we probably need to do a better job of that and help people understand the specific applications of our product and be better at that. And that’s kind of how. Because it’s just overwhelming the sheer Number of SKUs we have. And so we’re trying to make all of it simple and show people how that’s being used.
[00:08:39] Speaker B: And as you’ve told me, markers are not all created equally. They are not, you know, the tips mean different things. When you would Use it for different stuff.
[00:08:45] Speaker A: Right. So you’re writing a fine tip if you’re trying to mark something, maybe a chisel tip if you’re writing in a messy surface, maybe a mean streak or the Sharpie Pro. And it’s trying to help people understand all of that. Yeah. And also, you know, because this, the landscape’s changed and we’re trying to focus more on large scale innovation as opposed to trying to fit every niche need and making sure we’re making good decisions with SKU rationalization, trying to keep that easy for everyone.
[00:09:11] Speaker B: So Harry, how long have you been at Newell now?
[00:09:12] Speaker A: I’ve been about eight years.
[00:09:14] Speaker B: So fun fact, something that we wouldn’t know that, you know, working at Newell, like something interesting or kind of a random fun factor at the Newell.
[00:09:21] Speaker A: For Newell.
[00:09:22] Speaker B: Yeah. Or the products or something of that nature.
[00:09:26] Speaker A: Wow.
[00:09:27] Speaker B: Yeah.
[00:09:28] Speaker A: Fun fact at Newell. Newell doesn’t sell any Newells anymore.
But no, I think it’s just the breadth of the brands. A lot of people don’t realize that we own Yankee Candle, we have Crock Pot, we have Food Saver.
So there’s the amount of brands and the amount of products that we have that can help customers be successful in the markets.
Pretty overwhelming. It’s over 35 brands.
[00:09:52] Speaker B: That’s awesome.
SGL is still winning in the market.
[00:09:56] Speaker A: SGL is still winning. Fastest growing pen in the market. Also a lot of new claims about being bolder, about drying more quickly, about being less, being more smooth. Literally these guys went and said, well, it’s the coefficient of friction and so there’s a scientific measure of being more smooth and we won.
[00:10:12] Speaker B: I don’t think we’re going to get into the scientific match. That’s not where you and I win. But no, we’ll leave it to the professionals. Awesome. Harry, thanks for joining us.
[00:10:20] Speaker A: No, thank you.
[00:10:20] Speaker B: It’s a pleasure.
Sam.
