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The Black & Decker Corporation

The Black & Decker Corporation

701 East Joppa Road
Towson, Maryland 21286-5559
U.S.A.

Telephone: (410) 716-3900
Fax: (410) 716-2933
Web site: http://www.bdk.com

Public Company
Incorporated:
1910 as The Black & Decker Manufacturing Company
Employees: 22,100
Sales: $4.48 billion (2003)
Stock Exchanges: New York Pacific
Ticker Symbol: BDK
NAIC: 326191 Plastics Plumbing Fixture Manufacturing; 332212 Hand and Edge Tool Manufacturing; 332213 Saw Blade and Handsaw Manufacturing; 332510 Hardware Manufacturing; 332913 Plumbing Fixture Fitting and Trim Manufacturing; 333112 Lawn and Garden Tractor and Home Lawn and Garden Equipment Manufacturing; 333319 Other Commercial and Service Industry Machinery Manufacturing; 333515 Cutting Tool and Machine Tool Accessory Manufacturing; 333912 Air and Gas Compressor Manufacturing; 333991 Power-Driven Handtool Manufacturing; 335129 Other Lighting Equipment Manufacturing; 335212 Household Vacuum Cleaner Manufacturing

The Black & Decker Corporation is the leading maker of power tools and accessories in the United Statesand is the firm most responsible for the creation of the post-World War II consumer market for power tools. The firm's key power tool brands are Black & Decker and DeWalt. Black & Decker (B&D) is also a leading producer of electric lawn and garden tools, security hardware (locks and locksets under the Kwikset, Baldwin, and Weiser brands), general and decorative hardware products (Baldwin), plumbing products (Price Pfister), and specialty fastening and assembly systems (Emhart). B&D products are sold in more than 100 countries and are manufactured at 36 plants, 18 in the United States and 18 abroad, located in Brazil, China, the Czech Republic, Germany, Italy, Japan, Mexico, and the United Kingdom.


Early History

Alonzo G. Decker and S. Duncan Black, two industrial tool designers and engineers, formed The Black & Decker Manufacturing Company in September 1910. With $600 from the sale of Black's second-hand car and a loan of $1,200, they set up a machine shop in a rented warehouse in Baltimore, Maryland. Black was the president of the company. In their first years the partners contracted to manufacture industrial products invented and sold by others, such as a milk bottle cap machine, a cotton picker, candy dippers, and machinery for the U.S. Mint.

In 1916 Black and Decker began to design and manufacture their own electric-powered tools. The German-made electric tools then available were heavy and difficult to operate, and, as a result, had not been commercially successful. Black and Decker designed a universal motorthe first for electric-tool usewhich employed either alternating or direct current, and a trigger switch modeled after the mechanism in the Colt revolver. The first tool incorporating these innovative elements was a½-inch portable drill with the innovative "pistol grip and trigger switch" that have remained standard for electric drills ever since. The drill was comparatively light at 21½ pounds, and it was considered inexpensive at $230.

B&D grew consistently during the 1920s, as businesses bought labor-saving devices to deal with rising labor costs. In 1917 the company was awarded patents for its pistol grip and trigger switch and constructed a factory on the outskirts of Towson, Maryland. By 1918 sales surpassed $1 million. Immediately after World War I, more portable electric tools were introduced, including a 38-inch drill, a grinder, and a screwdriver. To accommodate demand the Towson plant was expanded three times by 1927. A Towson headquarters building was also constructed in 1924.

Black & Decker used aggressive salesmanship and product services to build its client base. The company's first service centers were opened in Boston and New York in 1918. B&D also organized clinics to teach distributors how to use and sell the tools; demonstrators toured the country in two buses. At the end of the 1920s the company even outfitted a monoplane to showcase its tools. In addition, the firm began its first mass-media campaign in the Saturday Evening Post in 1921.


With its initial success The Black & Decker Manufacturing Company expanded outside the United States, marking the beginning of its development into a global business. During the last year of World War I, burgeoning overseas sales led the company to establish representatives in Canada, Great Britain, the Soviet Union, Australia, and Japan. Canada was the site of B&D's first foreign subsidiary, started in 1922. Three years later a London sales and service subsidiary was formed. In 1928 the British company began manufacturing operations at a leased facility in Slough, outside London. The British company eventually built its own plant at Harmondsworth, Middlesex, in 1939. In 1929 an Australian subsidiary was established in Sydney. Until the 1950s the British subsidiary remained Black & Decker's only foreign manufacturing operation. It was the most important of B&D's many foreign operations after World War II.


In the latter half of the 1920s Black & Decker expanded its U.S. operations through several acquisitions. In 1926 the Marschke Manufacturing Company of Indianapolis, Indiana, a maker of grinders, was purchased. Two years later the Van Dorn Electric Tool Company of Cleveland, Ohio, was acquired. In 1929 B&D purchased the Fleming Machine Company of Worcester, Massachusetts, and the Domestic Electric Company of Cleveland. Fleming Machine made wire brushes, saws, and grinding stones, and Domestic Electric was a major producer of electric motors. In addition Black & Decker acquired the Loadometer Company, from which it previously had bought the rights to a portable truckweighing scale. Meantime, in 1927, the company's shares traded publicly for the first time in 1927; Black & Decker gained a listing on the New York Stock Exchange in 1936.


Like other businesses, The Black & Decker Manufacturing Company experienced great difficulties during the Great Depression. Despite huge layoffs, including Alonzo Decker's son, the company nearly went bankrupt. Employee loyaltysome workers continued to work although the company could not pay themand a large influx of capital from outside investors kept Black & Decker afloat. The Marschke Manufacturing Company acquisition did not prove successful, and that company was sold in 1932. Black & Decker continued to develop new products. In 1930 and 1931 the firm marketed a portable circular saw, an adjustable-clutch electric screwdriver, and a new, streamlined housing for its drills. A line of power tools using the new induction motors, the High Cycle line, was introduced in 1935. As the decade ended there was a cascade of new B&D products, including an electric hammer, an industrial vacuum cleaner, a portable metal cutter, a portable trim saw, and the Shorty series of drills.

Successful Marketing to Postwar Consumers

When the United States entered World War II Black & Decker switched to the production of fuses, shells, and other products to contribute to the war effort. Alonzo Decker and S. Duncan Black were determined to avoid the problems that had followed World War I. They believed that the key would be postwar consumers. Although the company had developed an inexpensive ½-inch drill in 1923, and introduced the Cinderella washing machine in 1930, its forays into the consumer market had not been successful. In 1942 the Black & Decker Post-War Planning Committee was established. This group developed plans for Black & Decker to manufacture power tools for do-it-yourselfers and homeowners. The committee believed B&D could provide cheaper tools using new, less-expensive plastic housings to tap this unexplored market.


In 1946 The Black & Decker Manufacturing Company introduced the world's first power tools for the consumer market, the inexpensive Home Utility line of ¼-inch and ½-inch drills and accessories. In the first five years, one million ¼-inch drills were produced. This success led to the addition of other products to the Home Utility line. A set of circular saws was introduced in 1949, and a finishing sander and jigsaw in 1953. Black & Decker also continued to market new tools for professional users, including an impact socket wrench introduced in 1949 and two heavy-duty routers introduced in 1957. As a result of great demand, the company began construction of a large new plant in Hampstead, Maryland, in 1951; by 1955 this facility had been expanded to more than four times its original size. The old Towson plant ceased production in 1965, although the site remained Black & Decker's headquarters.

In the 1950s and 1960s B&D resumed the overseas expansion begun in the 1920s. Manufacturing operations were organized in Australia and South Africa in 1956. During the 1960s production facilities were built or acquired in West Germany, France, Italy, Spain, Canada, and Mexico. In addition, sales and service subsidiaries were established in many other countries. The U.K. subsidiary successfully expanded into other European markets, and, as a result, a new plant was built at Maidenhead in 1962. Three years later this factory was expanded, and another plant was opened in Spennymoor, Durham. By 1969, 43 percent of B&D's sales and earnings came from its foreign operations.

Company Perspectives:

Black & Decker's objective is to establish itself as the preeminent global manufacturer and marketer of power tools and accessories, hardware and home improvement products, and technology-based fastening systems.

Despite personnel changes, The Black & Decker Manufacturing Company remained under the leadership of the Black and Decker families during the 1950s and 1960s. In 1951 president and cofounder S. Duncan Black died at age 67. Black was succeeded as president by his partner, Alonzo G. Decker, who also took on the new post of chairman in 1954. Two years later, however, Decker died at age 72. Robert D. Black, S. Duncan Black's brother, succeeded Decker. In 1960 Decker's son, Alonzo G. Decker, Jr., was named president. The 54-year-old Alonzo Decker, Jr., had started at B&D as a floor sweeper in the early 1920s. In 1964 he replaced Black as chief executive officer.

Diversified Product Line in 1960s and 1970s

Although Black & Decker enjoyed healthy profits, by the late 1950s the company was not increasing beyond its 20 percent share of the U.S. market. To generate growth the company branched out into other types of labor-saving machinery. The Master Pneumatic Tool Company of Bedford, Ohio, maker of portable pneumatic tools, was acquired in 1959. Production of portable air tools was begun at a new facility in Solon, Ohio, in 1960. The Value line was introduced in 1967 to offer standardized, less-expensive models. The pneumatic tools business remained a minor part of B&D's operations, until that sector was sold in 1986.


In 1960 Black & Decker purchased DeWalt of Lancaster, Pennsylvania, makers of radial arm saws and other woodworking equipment. An improved line of radial arm saws was introduced in 1966. To expand the woodworking operations Black & Decker bought the Carbide Router Company of Moonachie, New Jersey, in 1970 and the Wisconsin Knife Works of Beloit, Wisconsin, the following year.

Black & Decker also entered the garden- and lawn-care field in the late 1950s. It introduced electric lawn edgers and hedge trimmers in 1957. The first electric lawnmowers were unveiled in 1966, and a cordless model went into production three years later. In 1973 the business was expanded by the purchase of McCulloch Corporation, a manufacturer of gasoline engines and chainsaws. During the mid-1970s production of certain outdoor-tool models was scaled back because of the unpredictable nature of their sales. Sales of outdoor tools depended upon weather conditions and seasonal buying patterns. McCulloch performed very well during the energy crisis of the early 1970s, which spurred the use of woodburning stoves, thus popularizing chainsaws, but in the early 1980s the subsidiary began losing money. In 1983 the chainsaw business was sold.


Black & Decker power tools continued to enjoy success during the 1960s and early 1970s, as prices were cut and products improved. The cost of B&D's ¼-inch drill was reduced in increments from $15.98 in 1963 to $7.99 in 1970. A research-and-development task force brought out dozens of new tools each year, maintaining Black & Decker's status as an industry innovator. The Workmate portable worktable and accessories were first marketed in England in 1973, and soon proved very successful around the world. Beginning in 1964 Black & Decker also made extensive use of television advertising. Sales surpassed $100 million in 1964, $200 million in 1969, and $500 million in 1974. To accommodate the new demand the company built two plants in North Carolina, at Fayetteville and Tarboro, in 1966 and 1970, respectively. In 1974 a plant also was constructed in Easton, Maryland.

In 1975 Decker retired as CEO, to be replaced by Francis P. Lucier who had been named president in 1970. Although Decker remained chairman, this marked the end of the founding families' executive control of the company. In 1975 B&D also experienced its first break in postwar growth, and many employees were laid off. The firm's future looked dim in the face of growing competition from Japanese and German toolmakers. Offering lower-priced, high-quality tools, the Japanese firm Makita Electric Works steadily gained on Black & Decker. By the early 1980s Makita had nearly equaled Black & Decker's 20 percent share of the world market in professional tools. High turnover among the top executives also contributed to Black & Decker's woes.

Key Dates:

1910:

Alonzo G. Decker and S. Duncan Black form The Black & Decker Manufacturing Company, based in Baltimore, Maryland, and begin making industrial products invented and sold by others.

1916:

Company begins designing and manufacturing their own electric-powered tools, including a ½-inch portable drill.

1917:

First manufacturing plant is built in Towson, Maryland.

1922:

First foreign subsidiary is established in Canada.

1924:

Headquarters are shifted to Towson.

1927:

Black & Decker's shares begin trading publicly.

1936:

Company shares are listed on the New York Stock Exchange.

1946:

Company introduces the world's first power tools for the consumer market.

1960:

DeWalt of Lancaster, Pennsylvania, is acquired.

1975:

Francis P. Lucier is named CEO, ending the founding families' executive control of the company.

1978:

Dustbuster cordless vacuum cleaner is introduced.

1984:

General Electric Company's small-appliance business is acquired.

1985:

Company changes its name to The Black & Decker Corporation.

1986:

Nolan D. Archibald is named CEO.

1989:

Emhart Corporation, a conglomerate whose holdings include Price Pfister faucets and Kwikset locks, is acquired for $2.7 billion.

1992:

Black & Decker relaunches the DeWalt line of highend power tools.

1994:

Company introduces the VersaPak interchangeable battery system and the SnakeLight flexible flashlight.

1998:

As part of a "strategic repositioning," Black & Decker divests its household appliance operations.

2003:

Baldwin Hardware Corporation and Weiser Lock Corporation are acquired from Masco Corporation.

2004:

Black & Decker buys Pentair, Inc.'s Tools Group for $775 million.

Restructurings and Major Acquisitions in the 1980s

Promoting a program of globalization, 48-year-old Laurence Farley was promoted to president and CEO in 1983. The new head of B&D was determined to develop a world market for standardized consumer goods, including housewares. He implemented a sweeping reorganization scheme, closing five plants in England, Ireland, and the United States. Two years later more plants were closed in the United States, Brazil, Mexico, and Canada. Farley also integrated the global operations of Black & Decker, in the process firing 25 European managers and closing the European headquarters in Brussels. In 1985, to help bring home the reorganization, The Black & Decker Manufacturing Company revamped its hexagonal trademark and changed its name to The Black & Decker Corporation. The name change was meant to give greater emphasis to the marketing and sales side of the company.


Black & Decker's new path under Farley grew out of the firm's earlier development of cordless technology. In 1961 Black & Decker had introduced the world's first self-contained cordless electric drill. This tool and others that soon followed were powered by nickel-cadmium batteries, which failed to deliver the necessary performance. Nevertheless, the firm developed a cordless minimum-torque-recreation tool and a lunar surface drill, both of which were used by NASA on several space missions.


Using this earlier experience, Black & Decker introduced the Dustbuster cordless vacuum cleaner in 1978. This product was an immediate success, establishing B&D as the leader in the hitherto untapped small-appliance niche market. The Dustbuster was followed by the Spotliter rechargeable light and other cordless appliances. To put Black & Decker squarely in this new business, Farley paid $300 million in 1984 for the small-appliance operations of General Electric Company (GE). By purchasing the largest U.S. producer of irons, toaster ovens, portable mixers, coffee makers, and hairdryers, Black & Decker was able to gain a large chunk of the market immediately, without risking the loss of Black & Decker hardware shelf space to its housewares. Farley also believed production costs would be lowered by integrating the research and production of power tools and housewares.


During the two years following the 1984 purchase, Black & Decker undertook a $100 million brand-transition program. Meanwhile, the company also developed its own upscale light appliances, such as the Spacemaker series, a line of under-the-cabinet kitchen appliances. Black & Decker also introduced more cordless appliances, including a mixer and an electric knife. Farley began marketing the company's small-appliance line overseas. In Britain, where B&D had long enjoyed considerable name recognition, the first Black & Decker appliances were introduced in 1985. Other markets soon followed. In addition, GE's expertise in manufacturing electric motors enabled Black & Decker to design more efficient power tools using a smaller and more powerful 47-millimeter motor.

Yet Black & Decker's sales performance remained unspectacular, and fears that Laurence Farley was not sufficiently committed to product development contributed to his replacement as president by Nolan D. Archibald. A year later Archibald also was named CEO and chairman of the board of Black & Decker. Archibald came to The Black & Decker Corporation from Beatrice Company, where he headed the consumer durables group. Bringing in his own management team, the new B&D chief cut 3,000 jobs by 1987 and spurred product development. The company's worldwide operations were restructured into product groups. In 1986 the household-products group introduced a number of successful products, including the Cup-at-A-Time coffee maker. Greater efficiency at Black & Decker led to record sales of $1.9 billion and improved profits in 1987.

Once he had returned Black & Decker to efficiency and profitability, Archibald set out to expand the company's operations through acquisition. In January 1988 he attempted to purchase American Standard to obtain its line of plumbing fixtures, but American Standard escaped through a leveraged buyout. Archibald then acquired Emhart Corporation, a conglomerate, in early 1989 for $2.7 billion. With its True Temper lawn and garden tools, Kwikset locks, GardenAmerica sprinkler systems, Price Pfister faucets, and various fastening systems, Emhart's product lineat least parts of itcomplemented Black & Decker's own products. Archibald combined the two companies' distribution and sales networks.

Plagued by Debt Burden in Early 1990s

Unfortunately, Emhart, whose $2.7 billion in revenue exceeded B&D's own $2.3 billion, turned into a bit of a nightmare after the economy moved into recession in the early 1990s and the market for asset sales dried up. B&D's debt had increased to more than $4 billion as a result of the highly leveraged acquisition and Archibald had planned to sell Emhart's numerous non-complementary operationsabout $1.8 billion worthto reduce this debt burden. With the go-go years of the 1980s over, however, Archibald ran into difficulty finding buyers and in getting the kinds of prices he needed to quickly pay down the debt. By 1991 several Emhart businesses had been sold, including Bostik chemical adhesives and Arotronics nondomestic capacitors, but only for a total of $762 million. Debt still stood at $3.2 billion and annual net interest expense was about $300 million.

Meanwhile the recession hit the housing market particularly hard, reducing demand for power tools among both professional builders and do-it-yourselfers. As a result company sales declined sharply in 1991 and increased only marginally in 1992. B&D's net margin was less than one-half percent in 1991, then B&D posted a loss in 1992 thanks to a $135 million restructuring charge primarily associated with its Dynapert operations. Dynapert, which made equipment used in the assembly of printed circuit boards, had been acquired with Emhart and slated for sale but a buyer had yet to be found. Clearly, Emhart was dragging Black & Decker down.


Mid-1990s Turnaround Based on Savvy Marketing and Innovative New Products

A company turnaround had its start during 1992 with the launch of the DeWalt line of high-end power tools. This was actually a relaunch since B&D took the existing line of Black & Decker brand professional power tools, improved their quality, guaranteed 48-hour service center repair, increased their price (to be slightly higher than the competing Makita brand), and resurrected the 1960-acquired DeWalt brand, which was still highly respected by contractors. The company was now able to offer the low-end Black & Decker line of power tools aimed at do-it-yourselfers and the high-end DeWalt line aimed at professional contractors. This brilliant strategyin part the brainchild of marketing whiz Joseph Galli, who soon headed B&D's entire worldwide power tool groupwas immensely successful. The company's share of the domestic professional power tool market increased from 8 percent in 1991 to more than 40 percent in 1995. Sales of the DeWalt line increased from less than $30 million during the launch year to more than $600 million by 1997. In 1993 a similar high-end/low-end strategy began to be employed in B&D's security hardware group, when the Titan line of locksets were added to complement the Kwikset line.

Increased cash flow from these introductions helped Black & Decker decrease its debt load. During the record revenue year of 1994, when sales hit $4.37 billion, total debt was reduced to $2.39 billion. Reinvigorated new product development resulted in several successful 1994 introductions, most notably the VersaPak interchangeable battery system used in a new line of consumer cordless power tools and SnakeLight, a flashlight with a flexible base which became the fastest-selling product in company history.


Meanwhile Archibald was also able to further reduce debt by belatedly selling off additional Emhart businesses. In 1993 B&D sold the Corwin Russwin Architectural Hardware unit to Williams Holdings for $80 million, and Dynapert's through-hole circuit business for $28 million. In 1995 Archibald was finally able to sell the PRC information technology and services businesses in three separate deals totaling $520.5 million.


To further strengthen its financial health, Black & Decker also closed several plants in Europe in 1994 and restructured its consumer businesses in 1996, eliminating about 1,400 jobs and incurring an after-tax charge of $74.8 million. In 1995 efforts also began to further expand Black & Decker internationally, through joint ventures in India and China and the debut of the DeWalt line in Europe and Latin America. By 1996, when sales neared the $5 billion mark and total debt was down to $1.71 billion, Black & Decker seemed back on track. Although earnings were reduced because of the restructuring charge, the net margin of 3.2 percent was a significant improvement over that of the dark days of the early 1990s.


Restructuring Again in the Late 1990s

Results were similar in 1997, a year marked by the recall of 224,000 Black & Decker under-the-cabinet Spacemaker toasters, which were found to pose a fire danger. (B&D later had to pay a $575,000 civil penalty to the Consumer Product Safety Commission for failing to report defects in the toaster quickly enough.) Early the following year, the company announced plans for another restructuring, termed a "strategic repositioning," intended to heighten the firm's focus on its core operations and improve its financial performance. Black & Decker said it would sell three of its least profitable businesses: its household appliance operations in North America, Latin America, and Australia; Emhart Glass, maker of equipment for manufacturing glass containers; and True Temper Sports, producer of steel and graphite golf-club shaftsthe latter two making up the last of the unwanted Emhart businesses. After selling the Australian household appliance business, Black & Decker sold its household appliance operations in North America and Latin America (excluding Brazil) in June 1998 to Windmere-Durable Holdings, Inc. (later renamed Applica Incorporated) for $315 million. B&D retained, however, its profitable Dustbuster and SnakeLight lines. In September the company sold Emhart Glass to Bucher Holding AG of Switzerland for $178.7 million and True Temper Sports to Cornerstone Equity Investors LLC for $177.7 million.

These divestments enabled Black & Decker to refocus on its core power tools and hardware lines, particularly the DeWalt line, which was now generating nearly $1 billion in annual revenues, or fully 20 percent of the company total. The repositioning also involved the repurchase of 10 percent of the company's stock by the end of 1999 and a restructuring of the remaining operations in order to reduce fixed costs. About 5,000 employees were laid off and several facilities were closed, including four overseas production plants. Restructuring charges of $164.7 million and a $900 million writeoff of goodwill led to a net loss for 1998 of $754.8 million. B&D returned to the black in 1999, posting profits of $300.3 million on revenues of $4.52 billion. Also that year, Galli, considered Archibald's heir apparent, left the company, when it became clear that Archibald, then 55, was not ready to retire any time soon. (Galli later became CEO of Newell Rubbermaid Inc.)

Early 2000s: Further Restructuring and a Return to the Acquisitions Arena

Black & Decker continued to churn out new products in the early 2000s, but sales and earnings growth stagnated in the sluggish economic environment. A number of cost-saving measures were enacted, including a three-year restructuring plan launched in early 2002. The key objective of this plan was to reduce manufacturing costs by shifting production from the United States and England to lower-cost facilities in Mexico, China, and the Czech Republic; and by sourcing more products from third-party manufacturers. Several U.S. plants were closed that year and the following one, including the facility in Easton, Maryland, the last of B&D's home-state plants. Restructuring charges for 2001, 2002, and 2003 totaled $99.7 million, $46.6 million, and $31.6 million, respectively. The company estimated that over the three-year period it eliminated 5,200 positions in high-cost manufacturing locations and added 4,500 replacement positions in low-cost locales. By 2003 the restructuring had already yielded $50 million in annual cost savings, and B&D expected to achieve $130 million in yearly savings by 2005.

Also during 2002 Black & Decker was forced to recall 140,000 cordless electric lawnmowers because of potential problems with overheating. During the following year the company returned to the acquisition arena, but with an eye toward smaller, product-line purchases that would complement existing operations. In September 2003 B&D acquired Baldwin Hardware Corporation and Weiser Lock Corporation from Masco Corporation for $277.6 million. Based in Reading, Pennsylvania, Baldwin was a manufacturer of high-end architectural and decorative hardware for the home. Weiser, headquartered in Tucson, Arizona, produced locksets and decorative exterior hardware. This acquisition, coupled with the existing Kwikset line, made Black & Decker the clear leader in the North American residential lockset market, with several brands at various price points sold through a variety of retail channels. Black & Decker followed up this deal by selling its European security unit to the Swedish firm Assa Abloy for $108 million in early 2004.

Black & Decker enjoyed a solid year in 2003 as revenues increased 4 percent, to $4.48 billion, while net earnings of $293 million were 27 percent higher than the previous year's total. In March 2004 the company announced that it was reorganizing its power tools and accessories business into two separate groups: Black & Decker Consumer and DeWalt Professional. In July of that year B&D reached an agreement to buy Pentair, Inc.'s Tools Group, a unit that had 2003 operating profits of $82 million on $1.08 billion in sales. The Tools Group included Porter-Cable portable power tools, Delta woodworking machinery, DeVillbiss Air Power air compressors and pressure washers, Oldham Saw saw blades and router bits, and the German-based Flex business, specializing in grinders and masonry and metalworking tools. The brands were mainly aimed at professionals, so they were a good fit with B&D's DeWalt line. Black & Decker closed the $775 million deal in October 2004.



Principal Subsidiaries

Baldwin Hardware Corporation; Black & Decker (Ireland) Inc.; Black & Decker Abrasives Inc.; Black & Decker India Inc.; Kwikset Corporation; Momentum Laser, Inc.; Price Pfister, Inc.; Weiser Lock Corporation; Black & Decker Argentina S.A.; Black & Decker Werkzeuge Vertriebs-Gesellschaft M.B.H. (Austria); Black & Decker (Belgium) N.V.; Black & Decker Do Brasil Ltda. (Brazil); Refal Industria e Comercio de Rebites e Rebitadeiras Ltda. (Brazil); Black & Decker Canada Inc.; Maquinas y Herramientas Black & Decker de Chile S.A.; Black & Decker (Suzhou) Co. Ltd. (China); Black & Decker (Suzhou) Power Tools Co., Ltd. (China); Shanghai Emhart Fastening Systems Ltd. (China); Black & Decker de Colombia S.A.; Black & Decker (Czech) S.R.O. (Czech Republic); Emhart Harttung A/S (Denmark); Black & Decker de El Salvador, S.A. de C.V.; Black & Decker Oy (Finland); Black & Decker (France) S.A.S.; Emhart S.A.R.L. (France); Black & Decker G.m.b.H. (Germany); Black & Decker (Hellas) S.A. (Greece); Black & Decker Hong Kong Limited; Black & Decker (Ireland); Chesapeake Factoring Company (Ireland); Black & Decker Italia S.P.A. (Italy); Fasteners & Tools, Ltd. (Japan); Nippon Pop Rivets & Fasteners Ltd. (Japan); Black & Decker (Overseas) A.G. (Liechtenstein); Black & Decker Luxembourg S.A.; Black & Decker Macao; Black & Decker (Malaysia) Sdn. Bhd.; Black & Decker Asia Pacific (Malaysia) Sdn. Bhd.; BD Power Tools Mexicana, S. de R.L. de C.V. (Mexico); Black & Decker de Reynosa S. de R.L. de C.V. (Mexico); Black & Decker, S.A. de C.V. (Mexico); DeWalt Industrial Tools, S.A. de C.V. (Mexico); Price-Pfister de Mexico, S. de R.L. de C.V.; Technolock, S. de R.L. de C.V. (Mexico); Weiser Lock Mexico, S.A. De C.V.; Black & Decker (Nederland) B.V. (Netherlands); Black & Decker (New Zealand) Limited; Black & Decker (Norge) A/S (Norway); Black & Decker de Panama, S.A.; Black & Decker Del Peru S.A.; Black & Decker Asia Pacific Pte. Ltd. (Singapore); Black & Decker (South Africa) Pty. Ltd.; Emhart Fastening Teknologies Korea, Inc. (South Korea); Black & Decker Iberica S.Com por A. (Spain); Black & Decker Aktiebolag (Sweden); Black & Decker (Switzerland) S.A.; Black & Decker (Thailand) Limited; Aven Tools Limited (U.K.); Bandhart (U.K.); Black & Decker (U.K.); Black & Decker Europe (U.K.); Black & Decker International (U.K.); Emhart International Limited (U.K.); Tucker Fasteners Limited (U.K.); Weiser Lock Limited (U.K.); Black & Decker de Venezuela, C.A.

Principal Operating Units

Black & Decker Consumer Group; DeWalt Professional Group; Hardware and Home Improvement Group; Fastening and Assembly Systems Group.


Principal Competitors

Makita Corporation; The Stanley Works; Danaher Corporation; American Standard Companies Inc.; Kohler Co.; Snap-on Incorporated.


Further Reading

"A.G. Decker of Black & Decker," Nation's Business, December 1969.

Anderson, Lauren Bayne, "Black & Decker Buying Pentair's Tool Division," Washington Post, July 20, 2004, p. E2.

Barrett, Amy, and Gail DeGeorge, "Home Improvement at Black & Decker," Business Week, May 11, 1998, pp. 54, 56.

Berselli, Beth, "Retooling at Black & Decker: In a Return to Core Products, the Home Appliance Line Will Go," Washington Post, February 9, 1998, p. F10.

Brown, Warren, and Sandra Sugawara, "Wall Street Worries over Black & Decker: Buying Emhart Corp. Caused Debt Difficulties," Washington Post, February 5, 1990, p. WB5.

Defotis, Dimitra, "Cool Tools: Renovations to Power Black & Decker," Barron's, January 29, 2001, p. 43.

Flack, Stuart, "All Leverage Is Not Created Equal," Forbes, March 19, 1990, p. 39.

Highlights of Progress, Towson, Md.: The Black & Decker Corporation, 1987.

Hamilton, Martha McNeil, "Black & Decker to Shut Plants: Local Jobs Are Among 2,400 Moving to Lower-Wage Countries," Washington Post, January 30, 2002, p. E1.

Huey, John, "The New Power in Black & Decker," Fortune, January 2, 1989, p. 89.

Mirabella, Lorraine, "Black & Decker Buys Minnesota-Based Tool Business for $775 Million," Baltimore Sun, July 20, 2004.

Schifrin, Matthew, "Cut-and-Build Archibald," Forbes, September 23, 1996, pp. 4448.

Sellers, Patricia, "New Selling Tool: The Acura Concept," Fortune, February 24, 1992, pp. 8889.

Sentementes, Gus G., "Black & Decker to Purchase Hardware, Lock Divisions from Michigan Manufacturer," Baltimore Sun, July 2, 2003.

Weber, Joseph, and Brian Bremner, "The Screws Are Tightening at Black & Decker," Business Week, September 23, 1991, pp. 61, 64.

Welsh, Jonathan, "Black & Decker to Shed Some Lines and Focus on Tools," Wall Street Journal, January 28, 1998, p. A6.


Neal R. McCrillis
update: David E. Salamie

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The Black & Decker Corporation

The Black & Decker Corporation

701 East Joppa Road
Towson, Maryland 21286
U.S.A.
(410) 716-3900
Fax: (410) 716-3318
web site: http://www.blackanddecker.com

Public Company
Incorporated: 1910 as The Black & Decker
Manufacturing Company
Employees: 29,200
Sales: $4.91 billion (1996)
Stock Exchanges: New York Pacific London Frankfurt
Zurich Basel
SICs: 3423 Hand & Edge Tools, Except Machine Tools &Hand Saws; 3425 Hand Saws & Blades; 3429 Hardware, Not Elsewhere Classified; 3432 Plumbing Fixture Fittings & Trim; 3452 Bolts, Nuts, Screws,Rivets & Washers; 3524 Lawn & Garden Tractors,Home Lawn & Garden Equipment; 3545 Cutting Tools, Machine Tool Accessories & Machinists Precision Measuring Devices; 3546 Power Driven Hand Tools; 3553 Woodworking Machinery; 3559 Special Industry Machinery, Not Elsewhere Classified; 3634 Electric Housewares & Fans; 3635 Household Vacuum Cleaners

The Black & Decker Corporation is the worlds leading maker of power tools and accessoriesand is the firm most responsible for the creation of the post-World War II consumer market for power tools. Black & Decker (B&D) also leads the world in the production of electric lawn and garden tools, specialty fastening systems, glass container-making equipment, steel golf club shafts, and security hardware (locks and locksets). The company is also the largest full-line supplier of small household appliances in North America. B&D products are sold in more than 100 countries and are manufactured in plants located in 14 countries.

Early History

Alonzo G. Decker and S. Duncan Black, two industrial tool designers and engineers, formed The Black & Decker Manufacturing Company in September 1910. With $600 from the sale of Blacks second-hand car and a loan of $1,200, they set up a machine shop in a rented warehouse in Baltimore, Maryland. Black was the president of the company. In their first years the partners contracted to manufacture industrial products invented and sold by others, such as a milk bottle cap machine, a cotton picker, and machinery for the U.S. Mint.

In 1916 Black and Decker began to design and manufacture their own electric-powered tools. The German-made electric tools then available were heavy and difficult to operate, and, as a result, had not been commercially successful. Black and Decker designed a universal motorthe first for electric-tool usewhich employed either alternating or direct current, and a trigger switch modeled after the mechanism in the Colt revolver. The first tool incorporating these innovative elements was a ½-inch portable drill with the innovative pistol grip and trigger switch that have remained standard for electric drills ever since. The drill was comparatively light at 21 ½ pounds, and it was considered inexpensive at $230.

B&D grew consistently during the 1920s, as businesses bought labor-saving devices to deal with rising labor costs. In 1917 the company was awarded patents for its pistol grip and trigger switch and constructed a factory on the outskirts of Towson, Maryland. By 1918 sales surpassed $1 million. Immediately after World War I, more portable electric tools were introduced, including a 3/8-inch drill, a grinder, and a screwdriver. To accommodate demand the Towson plant was expanded three times by 1927. A Towson headquarters building was also constructed in 1924.

Black & Decker used aggressive salesmanship and product services to build its client base. The companys first service centers were opened in Boston and New York in 1918. B&D also organized clinics to teach distributors how to use and sell the tools; demonstrators toured the country in two buses. At the end of the 1920s the company even outfitted a monoplane to showcase its tools. In addition, the firm began its first mass-media campaign in the Saturday Evening Post in 1921.

With its initial success The Black & Decker Manufacturing Company expanded outside the United States, marking the beginning of its development into a global business. During the last year of World War I, burgeoning overseas sales led the company to establish representatives in Canada, Great Britain, the Soviet Union, Australia, and Japan. Canada was the site of B&Ds first foreign subsidiary, started in 1922. Three years later a London sales and service subsidiary was formed. In 1928 the British company began manufacturing operations at a leased facility in Slough, outside London. The British company eventually built its own plant at Harmondsworth, Middlesex, in 1939. In 1929 an Australian subsidiary was established in Sydney. Until the 1950s the British subsidiary remained Black & Deckers only foreign manufacturing operation. It was the most important of B&Ds many foreign operations after World War II.

In the latter half of the 1920s Black & Decker expanded its U.S. operations through several acquisitions. In 1926 the Marschke Manufacturing Company of Indianapolis, Indiana, a maker of grinders, was purchased. Two years later the Van Dorn Electric Tool Company of Cleveland, Ohio, was acquired. In 1929 B&D purchased the Fleming Machine Company of Worcester, Massachusetts, and the Domestic Electric Company of Cleveland. Fleming Machine made wire brushes, saws, and grinding stones, and Domestic Electric was a major producer of electric motors. In addition Black & Decker acquired the Loadometer Company, from which it previously had bought the rights to a portable truckweighing scale.

Like other businesses, The Black & Decker Manufacturing Company experienced great difficulties during the Great Depression. Despite huge layoffs, including Alonzo Deckers son, the company nearly went bankrupt. Employee loyaltysome workers continued to work although the company could not pay themand a large influx of capital from outside investors kept Black & Decker afloat. The Marschke Manufacturing Company acquisition did not prove successful, and that company was sold in 1932. Black & Decker continued to develop new products. In 1930 and 1931 the firm marketed a portable circular saw, an adjustable-clutch electric screwdriver, and a new, streamlined housing for its drills. A line of power tools using the new induction motors, the High Cycle line, was introduced in 1935. As the decade ended there was a cascade of new B&D products, including an electric hammer, an industrial vacuum cleaner, a portable metal cutter, a portable trim saw, and the Shorty series of drills.

Successful Marketing to Postwar Consumers

When the United States entered World War II Black & Decker switched to the production of fuses, shells, and other products to contribute to the war effort. Alonzo Decker and S. Duncan Black were determined to avoid the problems that had followed World War I. They believed that the key would be postwar consumers. Although the company had developed an inexpensive ½-inch drill in 1923, and introduced the Cinderella washing machine in 1930, its forays into the consumer market had not been successful. In 1942 the Black & Decker Post-War Planning Committee was established. This group developed plans for Black & Decker to manufacture power tools for do-it-yourselfers and homeowners. The committee believed B&D could provide cheaper tools using new, less-expensive plastic housings to tap this unexplored market.

In 1946 The Black & Decker Manufacturing Company introduced the worlds first power tools for the consumer market, the inexpensive Home Utility line of ¼-inch and ½-inch drills and accessories. In the first five years, one million ¼-inch drills were produced. This success led to the addition of other products to the Home Utility line. A set of circular saws was introduced in 1949, and a finishing sander and jigsaw in 1953. Black & Decker also continued to market new tools for professional users, including an impact socket wrench introduced in 1949 and two heavy-duty routers introduced in 1957. As a result of great demand, the company began construction of a large new plant in Hampstead, Maryland, in 1951; by 1955 this facility had been expanded to more than four times its original size. The old Towson plant ceased production in 1965, although the site remained Black & Deckers headquarters.

In the 1950s and 1960s B&D resumed the overseas expansion begun in the 1920s. Manufacturing operations were organized in Australia and South Africa in 1956. During the 1960s production facilities were built or acquired in West Germany, France, Italy, Spain, Canada, and Mexico. In addition, sales and service subsidiaries were established in many other countries. The U.K. subsidiary successfully expanded into other European markets, and, as a result, a new plant was built at Maidenhead in 1962. Three years later this factory was expanded, and another plant was opened in Spennymoor, Durham. By 1969 43 percent of B&Ds sales and earnings came from its foreign operations.

Company Perspectives:

We are the worlds largest producer of portable electric power tools, residential security hardware, and electric lawn and garden tools. We are the worlds largest supplier of power tool accessories and specialized, engineered fastening and assembly systems in the markets that we serve. Our household products business is the leader in North America and a major global competitor in the small electric appliance and premium portable lighting industries. Our plumbing products business is the third-largest faucet manufacturer in North America, and we are the worldwide leader in golf club shafts and glass container-forming and inspection equipment.

Despite personnel changes, The Black & Decker Manufacturing Company remained under the leadership of the Black and Decker families during the 1950s and 1960s. In 1951 president and cofounder S. Duncan Black died at age 67. Black was succeeded as president by his partner, Alonzo G. Decker, who also took on the new post of chairman in 1954. Two years later, however, Decker died at age 72. Robert D. Black, S. Duncan Blacks brother, succeeded Decker. In 1960 Deckers son, Alonzo G. Decker Jr., was named president. The 54-year-old Alonzo Decker Jr. had started at B&D as a floor sweeper in the early 1920s. In 1964 he replaced Black as chief executive officer.

Diversified Product Line in 1960s and 1970s

Although Black & Decker enjoyed healthy profits, by the late 1950s the company was not increasing beyond its 20 percent share of the U.S. market. To generate growth the company branched out into other types of labor-saving machinery. The Master Pneumatic Tool Company of Bedford, Ohio, maker of portable pneumatic tools, was acquired in 1959. Production of portable air tools was begun at a new facility in Solon, Ohio, in 1960. The Value line was introduced in 1967 to offer standardized, less-expensive models. The pneumatic tools business remained a minor part of B&Ds operations, until that sector was sold in 1986.

In 1960 Black & Decker purchased DeWalt of Lancaster, Pennsylvania, makers of radial arm saws and other woodworking equipment. An improved line of radial arm saws was introduced in 1966. To expand the woodworking operations Black & Decker bought the Carbide Router Company of Moonachie, New Jersey, in 1970 and the Wisconsin Knife Works of Beloit, Wisconsin, the following year.

Black & Decker also entered the garden- and lawn-care field in the late 1950s. It introduced electric lawn edgers and hedge trimmers in 1957. The first electric lawn mowers were unveiled in 1966, and a cordless model went into production three years later. In 1973 the business was expanded by the purchase of McCulloch Corporation, a manufacturer of gasoline engines and chain saws. During the mid-1970s production of certain outdoor-tool models was scaled back because of the unpredictable nature of their sales. Sales of outdoor tools depended upon weather conditions and seasonal buying patterns. McCulloch performed very well during the energy crisis of the early 1970s, which spurred the use of woodburning stoves, thus popularizing chain saws, but in the early 1980s the subsidiary began losing money. In 1983 the chain-saw business was sold.

Black & Decker power tools continued to enjoy success during the 1960s and early 1970s, as prices were cut and products improved. The cost of B&Ds /4-inch drill was reduced in increments from $15.98 in 1963 to $7.99 in 1970. A research-and-development task force brought out dozens of new tools each year, maintaining Black & Deckers status as an industry innovator. The Workmate portable worktable and accessories were first marketed in England in 1973, and soon proved very successful around the world. Beginning in 1964 Black & Decker also made extensive use of television advertising. Sales surpassed $100 million in 1964, $200 million in 1969, and $500 million in 1974. To accommodate the new demand the company built two plants in North Carolina, at Fayetteville and Tarboro, in 1966 and 1970, respectively. In 1974 a plant also was constructed in Easton, Maryland.

In 1975 Decker retired as chief executive officer, to be replaced by Francis P. Lucier who had been named president in 1970. Although Decker remained chairman, this marked the end of the founding families executive control of the company. In 1975 B&D also experienced its first break in postwar growth, and many employees were laid off. The firms future looked dim in the face of growing competition from Japanese and German toolmakers. Offering lower-priced, high-quality tools, the Japanese firm Makita Electric Works steadily gained on Black & Decker. By the early 1980s Makita had nearly equaled Black & Deckers 20 percent share of the world market in professional tools. High turnover among the top executives also contributed to Black & Deckers woes.

Restructurings and Major Acquisitions Highlighted 1980s

Promoting a program of globalization, 48-year-old Laurence Farley was promoted to president and chief executive officer in 1983. The new head of B&D was determined to develop a world market for standardized consumer goods, including house-wares. He implemented a sweeping reorganization scheme, closing five plants in England, Ireland, and the United States. Two years later more plants were closed in the United States, Brazil, Mexico, and Canada. Farley also integrated the global operations of Black & Decker, in the process firing 25 European managers and closing the European headquarters in Brussels. In 1985, to help bring home the reorganization, The Black & Decker Manufacturing Company revamped its hexagonal trademark and changed its name to The Black & Decker Corporation. The name change was meant to give greater emphasis to the marketing and sales side of the company.

Black & Deckers new path under Farley grew out of the firms earlier development of cordless technology. In 1961 Black & Decker had introduced the worlds first self-contained cordless electric drill. This tool and others that soon followed were powered by nickel-cadmium batteries, which failed to deliver the necessary performance. Nevertheless, the firm developed a cordless minimum-torque-recreation tool and a lunar surface drill, both of which were used by NASA on several space missions.

Using this earlier experience, Black & Decker introduced the Dustbuster cordless vacuum cleaner in 1978. This product was an immediate success, establishing B&D as the leader in the hitherto untapped small-appliance niche market. The Dustbuster was followed by the Spotliter rechargeable light and other cordless appliances. To put Black & Decker squarely in this new business, Farley paid $300 million in 1984 for the small-appliance operations of General Electric (GE). By purchasing the largest U.S. producer of irons, toaster ovens, portable mixers, coffee makers, and hairdryers, Black & Decker was able to gain a large chunk of the market immediately, without risking the loss of Black & Decker hardware shelf space to its housewares. Farley also believed production costs would be lowered by integrating the research and production of power tools and housewares.

During the two years following the 1984 purchase, Black & Decker undertook a $100 million brand-transition program. Meanwhile, the company also developed its own upscale light appliances, such as the Spacemaker series, a line of under-the-cabinet kitchen appliances. Black & Decker also introduced more cordless appliances, including a mixer and an electric knife. Farley began marketing the companys small-appliance line overseas. In Britain, where B&D had long enjoyed considerable name recognition, the first Black & Decker appliances were introduced in 1985. Other markets soon followed. In addition, GEs expertise in manufacturing electric motors enabled Black & Decker to design more efficient power tools using a smaller and more powerful 47-millimeter motor.

Yet Black & Deckers sales performance remained unspectacular, and fears that Laurence Farley was not sufficiently committed to product development, contributed to his replacement as president by Nolan D. Archibald. A year later Archibald also was named chief executive officer and chairman of the board of Black & Decker. Archibald came to The Black & Decker Corporation from Beatrice Company, where he headed the consumer durables group. Bringing in his own management team, the new B&D chief cut 3,000 jobs by 1987 and spurred product development. The companys worldwide operations were restructured into product groups. In 1986 the household-products group introduced a number of successful products, including the Cup-at-A-Time coffee maker. Greater efficiency at Black & Decker led to record sales of $1.9 million and improved profits in 1987.

Once he had returned Black & Decker to efficiency and profitability, Archibald set out to expand the companys operations through acquisition. In January 1988 he attempted to purchase American Standard to obtain its line of plumbing fixtures, but American Standard escaped through a leveraged buyout. Archibald then acquired Emhart Corporation, a conglomerate, in early 1989 for $2.7 billion. With its True Temper lawn and garden tools, Kwikset locks, GardenAmerica sprinkler systems, Price Pfister faucets, and various fastening systems, Emharts product lineat least parts of itcomplemented Black & Deckers own products. Archibald combined the two companies distribution and sales networks.

Debt Burden Plagued Early 1990s

Unfortunately, Emhart, whose $2.7 billion in revenue exceeded B&Ds own $2.3 billion, turned into a bit of a nightmare after the economy moved into recession in the early 1990s and the market for asset sales dried up. B&Ds debt had increased to more than $4 billion as a result of the highly leveraged acquisition and Archibald had planned to sell Emharts numerous noncomplementary operationsabout $1.8 billion worthto reduce this debt burden. With the go-go years of the 1980s over, however, Archibald ran into difficulty finding buyers and in getting the kinds of prices he needed to quickly pay down the debt. By 1991 several Emhart businesses had been sold, including Bostik chemical adhesives and Arotronics nondomestic capacitors, but only for a total of $762 million. Debt still stood at $3.2 billion and annual net interest expense was about $300 million.

Meanwhile the recession hit the housing market particularly hard, reducing demand for power tools among both professional builders and do-it-yourselfers. As a result company sales declined sharply in 1991 and increased only marginally in 1992. B&Ds net margin was less than one-half percent in 1991, then B&D posted a loss in 1992 thanks to a $135 million restructuring charge primarily associated with its Dynapert operations. Dynapert, which made equipment used in the assembly of printed circuit boards, had been acquired with Emhart and slated for sale but a buyer had yet to be found. Clearly, Emhart was dragging Black & Decker down.

Savvy Marketing and Innovative New Products Spark Mid-1990s Turnaround

A company turnaround had its start during 1992 with the launch of the DeWalt line of high-end power tools. This was actually a relaunch since B&D took the existing line of Black & Decker brand professional power tools, improved their quality, guaranteed 48-hour service center repair, increased their price (to be slightly higher than the competing Makita brand), and resurrected the 1960-acquired DeWalt brand, which was still highly respected by contractors. The company was now able to offer the low-end Black & Decker line of power tools aimed at do-it-yourselfers and the high-end DeWalt line aimed at professional contractors. This brilliant strategyin part the brainchild of marketing whiz Joseph Galli, who soon headed B&Ds entire worldwide power tool groupwas immensely successful. The companys share of the domestic professional power tool market increased from 8 percent in 1991 to more than 40 percent in 1995. Sales of the DeWalt line increased from less than $30 million during the launch year to more than $600 million by 1997. In 1993 a similar high-end/low-end strategy began to be employed in B&Ds security hardware group, when the Titan line of locksets were added to complement the Kwikset line.

Increased cash flow from these introductions helped Black & Decker decrease its debt load. During the record revenue year of 1994, when sales hit $4.37 billion, total debt was reduced to $2.39 billion. Reinvigorated new product development resulted in several successful 1994 introductions, most notably the VersaPak interchangeable battery system used in a new line of consumer cordless power tools and SnakeLight, a flashlight with a flexible base which became the fastest-selling product in company history.

Meanwhile Archibald was also able to further reduce debt by belatedly selling off additional Emhart businesses. In 1993 B&D sold the Corwin Russwin Architectural Hardware unit to Williams Holdings for $80 million, and Dynaperts through-hole circuit business for $28 million. In 1995 Archibald was finally able to sell the PRC information technology and services businesses in three separate deals totaling $520.5 million.

To further strengthen its financial health, Black & Decker also closed several plants in Europe in 1994 and restructured its consumer businesses in 1996, eliminating about 1,400 jobs and incurring an after-tax charge of $74.8 million. In 1995 efforts also began to further expand Black & Decker internationally, through joint ventures in India and China and the debut of the DeWalt line in Europe and Latin America.

Black & Decker seemed back on track heading into a new century. By 1996 sales neared the $5 billion mark and total debt was down to $1.71 billion. Although earnings were reduced because of the restructuring charge, the net margin of 3.2 percent was a significant improvement over that of the dark days of the early 1990s. Although there remained some Emhart operations to divest, notably True Temper recreational products, Black & Decker had revitalized itself through the development of innovative new products and the savvy and aggressive marketing of those products.

Principal Subsidiaries

Black & Decker Inc.; Black & Decker (U.S.) Inc.; Black & Decker Funding Corporation; Black & Decker Group Inc.; Black & Decker Holdings Inc.; Black & Decker Investment Company; Black & Decker (Ireland) Inc.; Black & Decker India Inc.; Black & Decker Investments (Australia) Limited; Black & Decker (Puerto Rico) Inc.; Corbin Co.; Emhart Corporation; Emhart Credit Corporation; Emhart Far East Corporation; Em-hart Glass Machinery Investments Inc.; Emhart Glass Machinery (U.S.) Inc.; Emhart Glass Research, Inc.; Emhart Inc.; Emhart Industries, Inc.; Kwikset Corporation; Price Pfister, Inc.; Shenandoah Insurance, Inc.; True Temper Sports, Inc.; Black & Decker Argentina S.A.; Black & Decker (Australasia) Pty. Ltd. (Australia); Black & Decker Distribution Pty. Ltd. (Australia); Black & Decker Finance (Australia) Ltd.; Black & Decker (Malaysia) Sdn. Bhd.; Black & Decker, S.A. de C.V. (Mexico); Price-Pfister de Mexico, S.A. de C.V.; BD Power Tools Mexicana S.A. de C.V. (Mexico); TECHNOLOCK, S.A. de C.V. (Mexico); Nemef B.V. (Netherlands); Black & Decker (Nederland) B.V. (Netherlands); Black & Decker International Holdings B.V. (Netherlands); Black & Decker (New Zealand) Limited; Black & Decker (Norge) A/S (Norway); Sjong Fasteners A/S (Norway); Black & Decker de Panama, S.A.; Black & Decker International Corporation (Panama); Black & Decker Asia Pacific Pte. Ltd. (Singapore); Emhart Fastening Teknologies Korea, Inc. (South Korea); Black & Decker Ibérica S.C.A. (Spain); Aktiebolaget Sundsvalls Verkstader (Sweden); Black & Decker AB (Sweden); Emhart Sweden AB; Emhart Sweden Holdings AB; Emhart Teknik AB (Sweden); DOM AG Sicherheitstechnik (Switzerland); Black & Decker (Switzerland) S.A.; Emhart Glass SA (Switzerland); Black & Decker (Thailand) Limited; Black & Decker ITHALAT Limited SIRKETI (Turkey); Aven Tools Limited (U.K.); Bandhart (U.K.); Bandhart Overseas (U.K.); Black & Decker Finance (U.K.); Black & Decker International (U.K.); Black & Decker (U.K.); Black & Decker Europe (U.K.); Emhart (Colchester) Limited (U.K.); Emhart International Limited (U.K.); Emhart (U.K.) Limited; Tucker Fasteners Limited (U.K.); United Marketing (Leicester) (U.K.); Black & Decker de Venezuela, C.A.; Black & Decker Holdings de Venezuela; Emhart Foreign Sales Corporation (U.S. Virgin Islands).

Further Reading

A.G. Decker of Black & Decker, Nations Business, December 1969.

Brown, Warren, and Sandra Sugawara, Wall Street Worries over Black & Decker: Buying Emhart Corp. Caused Debt Difficulties, Washington Post, February 5, 1990, p. WB5.

Flack, Stuart, All Leverage Is Not Created Equal, Forbes, March 19, 1990, p. 39.

Highlights of Progress, Towson, Maryland: The Black & Decker Corporation, 1987.

Huey, John, The New Power in Black & Decker, Fortune, January 2, 1989, p. 89.

Schifrin, Matthew, Cut-and-Build Archibald, Forbes, September 23, 1996, pp. 44-48.

Sellers, Patricia, New Selling Tool: The Acura Concept, Fortune, February 24, 1992, pp. 88-89.

Weber, Joseph, and Brian Bremner, The Screws Are Tightening at Black & Decker, Business Week, September 23, 1991, pp. 61, 64.

Neal R. McCrillis

updated by David E. Salamie

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"The Black & Decker Corporation." International Directory of Company Histories. . Encyclopedia.com. 19 Aug. 2017 <http://www.encyclopedia.com>.

"The Black & Decker Corporation." International Directory of Company Histories. . Encyclopedia.com. (August 19, 2017). http://www.encyclopedia.com/books/politics-and-business-magazines/black-decker-corporation-0

"The Black & Decker Corporation." International Directory of Company Histories. . Retrieved August 19, 2017 from Encyclopedia.com: http://www.encyclopedia.com/books/politics-and-business-magazines/black-decker-corporation-0

The Black & Decker Corporation

The Black & Decker Corporation

701 East Joppa Road
Towson, Maryland 21204
U.S.A.
(301) 583-3900
Fax: (301) 583-3318

Public Company
Incorporated: 1910 as The Black & Decker Manufacturing Company
Employees: 38,600
Sales: $3.19 billion
Stock Exchanges: New York Pacific London Frankfurt Zürich Basel

The Black & Decker Corporation principally sells industrial and consumer portable electric tools. More than any other firm, Black & Decker (B&D) created the post-World War II consumer market for power tools. During the 1960s Black & Decker branched into several new endeavors, including garden and lawn equipment, yet it remained a fairly small company with just over $1 billion in sales at the end of the 1970s. At that time it dominated the world market in power tools, but foreign and domestic competitors threatened its position. During the 1980s, however, Black & Decker rationalized its operations and diversified its markets through two major acquisitions. As a result, The Black & Decker Corporation is a producer of a wide line of do-it-yourself and professional hardware and housewares.

Alonzo G. Decker and S. Duncan Black, two industrial tool designers and engineers, formed The Black & Decker Manufacturing Company in September 1910. With $600 from the sale of Blacks second-hand car and a loan of $1,200, they set up a machine shop in a rented warehouse in Baltimore, Maryland. Black was the president of the company. In their first years the partners contracted to manufacture industrial products invented and sold by others.

In 1916 Black and Decker began to design and manufacture their own electric-powered tools. The German-made electric tools then available were heavy and difficult to operate, and, as a result, had not been commercially successful. Black and Decker designed a universal motorthe first for electric-tool usewhich used either alternating or direct current, and trigger switch modeled after the mechanism in the Colt revolver. The first tool incorporating these innovative elements was a 1/2-inch portable drill with the innovative pistol grip and trigger switch that have remained standard for electric drills ever since. The drill was comparatively light at 21/2 pounds, and it was considered inexpensive at $230.

B&D grew consistently during the 1920s, as businesses bought labor-saving devices to deal with rising labor costs. In 1917 the company was awarded patents for its pistol grip and trigger switch and constructed a factory on the outskirts of Towson, Maryland. By 1918 sales surpassed $1 million. Immediately after World War I, more portable electric tools were introduced including a 3/8-inch drill, a grinder, and a screwdriver. To accommodate demand the Towson plant was expanded three times by 1927. A Towson headquarters building was also constructed in 1924.

Black & Decker used aggressive salesmanship and product services to build its client base. The companys first service centers were opened in Boston and New York in 1918. B&D also organized clinics to teach distributors how to use and sell the tools; demonstrators toured the country in two buses. At the end of the 1920s the company even outfitted a monoplane to showcase its tools. In addition, the firm began its first mass-media campaign in the Saturday Evening Post in 1921.

With its initial success The Black & Decker Manufacturing Company expanded outside the United States, marking the beginning of its development into a global business. During the last year of World War I, burgeoning overseas sales led the company to establish representatives in Canada, Great Britain, the Soviet Union, Australia, and Japan. Canada was the site of B&Ds first foreign subsidiary, started in 1921. Four years later a London sales and service subsidiary was formed. In 1928 the British company began manufacturing operations at a leased facility in Slough, outside London. The British company eventually built its own plant at Harmondsworth, Middlesex, in 1939. In 1929 an Australian subsidiary was established in Sydney. Until the 1950s the British subsidiary remained Black & Deckers only foreign manufacturing operation. It was the most important of B&Ds many foreign operations after World War II.

In the latter half of the 1920s Black & Decker expanded its U.S. operations by several acquisitions. In 1926 the Marschke Manufacturing Company of Indianapolis, Indiana, a maker of grinders, was purchased. Two years later the Van Dorn Electric Tool Company of Cleveland, Ohio, was acquired. In 1929 B&D purchased the Fleming Machine Company of Worcester, Massachusetts, and the Domestic Electric Company of Cleveland. Fleming Machine made wire brushes, saws, and grinding stones, and Domestic Electric was a major producer of electric motors. In addition Black & Decker acquired the Loadometer Company, from which it previously had bought the rights to a portable truckweighing scale.

Like other businesses, The Black & Decker Manufacturing Company experienced great difficulties during the Depression. Despite huge layoffs, including Alonzo Deckers son, the company nearly went bankrupt. Employee loyaltysome workers continued to work although the company could not pay themand a large influx of capital from outside investors kept Black & Decker afloat. The Marschke Manufacturing Company acquisition did not prove successful, and that company was sold in 1932. Black & Decker continued to develop new products. In 1930 and 1931 the firm marketed a portable circular saw, an adjustable-clutch electric screwdriver, and a new, streamlined housing for its drills. A line of power tools using the new induction motors, the High Cycle line, was introduced in 1935. As the decade ended there was a cascade of new B&D products, including an electric hammer, an industrial vacuum cleaner, a portable metal cutter, a portable trim saw, and the Shorty series of drills.

When the United States entered World War II Black & Decker switched to the production of fuses, shells, and other products to contribute to the war effort. Alonzo Decker and S. Duncan Black were determined to avoid the problems which had followed World War I. They believed that the key would be postwar consumers. Although the company had developed an inexpensive 1/2-inch drill in 1923, and introduced the Cinderella washing machine in 1930, its forays into the consumer market had not been successful. In 1942 the Black & Decker Post-War Planning Committee was established. This group developed plans for Black & Decker to manufacture power tools for do-it-yourselfers and homeowners. The committee believed B&D could provide cheaper tools using new, less-expensive plastic housings to tap this unexplored market.

In 1946 The Black & Decker Manufacturing Company introduced the worlds first power tools for the consumer market, the inexpensive Home Utility line of 1/4-inch and 1/2-inch drills and accessories. In the first five years, one million 1/4-inch drills were produced. This success led to the addition of other products to the Home Utility line. A set of circular saws was introduced in 1949, and a finishing sander and jigsaw in 1953. Black & Decker also continued to market new tools for professional users, including an impact socket wrench introduced in 1949 and two heavy-duty routers introduced in 1957. As a result of great demand, the company began construction of a large new plant in Hampstead, Maryland, in 1951; by 1955 this facility had been expanded to more than four times its original size. The old Towson plant ceased production in 1965, although the site remained Black & Deckers headquarters.

In the 1950s and 1960s B&D resumed the overseas expansion begun in the 1920s. Manufacturing operations were organized in Australia in 1956. During the 1960s production facilities were built or acquired in West Germany, France, Italy, Spain, Canada, and Mexico. In addition, sales and service subsidiaries were established in many other countries. The U.K. subsidiary successfully expanded into other European markets, and, as a result, a new plant was built at Maidenhead in 1962. Three years later this factory was expanded, and another plant was opened in Spennymoor, Durham. By 1969 43% of B&Ds sales and earnings came from its foreign operations.

Despite personnel changes, The Black & Decker Manufacturing Company remained under the leadership of the Black and Decker families during the 1950s and 1960s. In 1951 president and co-founder S. Duncan Black died at age 67. Black was succeeded as president by his partner, Alonzo G. Decker, who also took on the new post of chairman in 1954. The following year, however, Decker died. Robert D. Black, S. Duncan Blacks brother, succeeded Decker. In 1960 Deckers son, Alonzo G. Decker Jr., was named president. The 54-year-old Alonzo Decker Jr. had started B&D as a floor sweeper in the early 1920s. In 1964 he replaced Black as chief executive officer.

Although Black & Decker enjoyed healthy profits, by the late 1950s the company was not increasing beyond its 20% share of the U.S. market. To generate growth the company branched out into other types of labor-saving machinery. The Master Pneumatic Tool Company of Bedford, Ohio, maker of portable pneumatic tools, was acquired in 1959. Production of portable air tools was begun at a new facility in Solon, Ohio, in 1960. The Value line was introduced in 1967 to offer standardized, less-expensive models. The pneumatic tools business remained a minor part of B&Ds operations, until that sector was sold in 1986.

In 1960 Black & Decker purchased De Walt of Lancaster, Pennsylvania, makers of radial arm saws and other woodworking equipment. An improved line of radial arm saws was introduced in 1966. To expand the woodworking operations Black & Decker bought the Carbide Router Company of Moonachie, New Jersey, in 1970 and the Wisconsin Knife Works of Beloit, Wisconsin, the following year.

Black & Decker also entered the garden- and lawn-care field in the late 1950s. It introduced electric lawn edgers and hedge trimmers in 1957. The first electric lawn mowers were unveiled in 1966, and a cordless model went into production three years later. In 1973 the business was expanded by the purchase of McCulloch Corporation, a manufacturer of gasoline engines and chain saws. During the mid-1970s production of certain outdoor-tool models was scaled back because of the unpredictable nature of their sales. Sales of outdoor tools depended upon weather conditions and seasonal buying patterns. McCulloch performed very well during the energy crisis of the early 1970s, which spurred the use of woodburning stoves, thus popularizing chain saws, but in the early 1980s the subsidiary began losing money. In 1983 the chainsaw business was sold.

Black & Decker power tools continued to enjoy success during the 1960s and early 1970s, as prices were cut and products improved. The cost of B&Ds 1/4-inch drill was reduced in increments from $15.98 in 1963 to $7.99 in 1970. A research-and-development task force brought out dozens of new tools each year, maintaining Black & Deckers status as an industry innovator. The Workmate portable worktable and accessories were first marketed in England in 1973, and soon proved very successful around the world. Beginning in 1964 Black & Decker also made extensive use of television advertising. Sales surpassed $100 million in 1964, $200 million in 1969, and $500 million in 1974. To accommodate the new demand the company built two plants in North Carolina, at Fayetteville and Tarboro, in 1966 and 1970, respectively. In 1974 a plant also was constructed in Easton, Maryland.

In 1975 Decker retired as chief executive officer, to be replaced by Francis P. Lucier who had been named president in 1970. Although Decker remained chairman, this marked the end of the founding families executive control of the company. In 1975 B&D also experienced its first break in postwar growth, and many employees were laid off. The firms future looked dim in the face of growing competition from Japanese and German toolmakers. Offering lower-priced, high-quality tools, the Japanese firm Makita Electric Works steadily gained on Black & Decker. By the early 1980s Makita had nearly equaled Black & Deckers 20% share of the world market in professional tools. High turnover among the top executives also contributed to Black & Deckers woes.

Promoting a program of globalization, 48-year-old Laurence Farley was promoted to president and chief executive officer in 1983. The new head of B&D was determined to develop a world market for standardized consumer goods, including housewares. He implemented a sweeping reorganization scheme, closing five plants in England, Ireland, and the United States. Two years later more plants were closed in the United States, Brazil, Mexico, and Canada. Farley also integrated the global operations of Black & Decker, in the process firing 25 European managers and closing the European headquarters in Brussels. In 1985, to help bring home the reorganization, The Black & Decker Manufacturing Company revamped its hexagonal trademark and changed its name to The Black & Decker Corporation. The name change was meant to give greater emphasis to the marketing and sales side of the company.

Black & Deckers new path under Farley grew out of the firms earlier development of cordless technology. In 1961 Black & Decker had introduced the worlds first self-contained cordless electric drill. This tool and others that soon followed were powered by nickel-cadmium batteries, that failed to deliver the necessary performance. Nevertheless, the firm developed a cordless minimum-torque-recreation tool and a lunar surface drill, both of which were used by NASA on several space missions.

Using this earlier experience, Black & Decker introduced the Dustbuster cordless vacuum cleaner in 1979. This product was an immediate success, establishing B&D as the leader in the hitherto untapped small-appliance niche market, the Dust-buster was followed by the Spotliter rechargeable light and other cordless appliances. To put Black & Decker squarely in this new business, Farley paid $300 million in 1984 for the small-appliance operations of General Electric (GE). By purchasing the largest U.S. producer of irons, toaster ovens, portable mixers, coffee makers, and hairdryers, Black & Decker was able to gain a large chunk of the market immediately, without risking the loss of Black & Decker hardware shelf space to its housewares. Farley also believed production costs would be lowered by integrating the research and production of power tools and housewares.

During the two years following the 1984 purchase, Black & Decker undertook a $100 million brand-transition program. Meanwhile, the company also developed its own upscale light appliances, such as the Spacemaker series. Black & Decker also introduced more cordless appliances, including a mixer and an electric knife. Farley began marketing the companys small-appliance line overseas. In Britain, where B&D has long enjoyed considerable name recognition, the first Black & Decker appliances were introduced in 1985. Other markets soon followed. In addition, GEs expertise in manufacturing electric motors enabled Black & Decker to design more efficient power tools using a smaller and more powerful 47-millimeter motor.

Yet Black & Deckers sales performance remained unspectacular, and fears that Laurence Farley was not sufficiently committed to product development, contributed to his replacement as president by Nolan D. Archibald. A year later Archibald also was named chief executive officer and chairman of the board of Black & Decker. Archibald came to The Black & Decker Corporation from Beatrice Company, where he headed the consumer durables group. Bringing in his own management team, the new B&D chief cut 3,000 jobs by 1987 and spurred product development. The companys worldwide operations were restructured into product groups. In 1986 the household-products group introduced a number of successful products, including the Cup-at-A-Time coffeemaker. Greater efficiency at Black & Decker led to record sales of $1.9 million and improved profits in 1987.

Once he had returned Black & Decker to efficiency and profitability, Archibald set out to expand the companys operations through acquisition. In January 1988 he attempted to purchase American Standard to obtain its line of plumbing fixtures, but American Standard escaped through a leveraged buyout. Archibald acquired Emhart Corporation in early 1989 for $2.8 billion. With its True Temper lawn and garden tools, Kwikset locks, Garden America sprinkler systems, Price Pfister faucets, and various fastening systems. Emharts product line complemented Black & Deckers own products. Archibald combined the two companies distribution and sales networks.

As a result of the acquisition, Black & Decker assumed a $4 billion debt. In order to reduce debt, Black & Decker planned to sell Emharts non-complementary operations and cut staff.

The Black & Decker Corporation has regained its world dominance in manufacturing inexpensive, quality hardware goods and power tools. B&Ds purchases of Emhart Corporation and the General Electric small-appliance division appear to have been successful. The wider range of doit-yourself products and an attractive line of upscale small appliances add to Black & Deckers potential for future growth. Black & Decker has succeeded because of attention to consumer needs, high production standards, and savvy marketing.

Principal Subsidiaries

Advanced Technology Inc. of Delaware; Black & Decker (U.K.); Black & Decker Canada Inc.; Black & Decker Eletrodomesticos Ltda. (Brazil); Black & Decker G.m.b.H. (Germany); Black & Decker Housewares Ltd. (Singapore); Black & Decker Inc.; Black & Decker (U.S.Pte.) Inc.; Black & Decker Italia S.p.A. (Italy); Black & Decker (Australasia) Pty. Ltd. (Australia); Black & Decker (Belgium) S.A.; Black & Decker, S.A. de C.V. (Mexico); Black & Decker (France) S.A.R.L.; Emhart Corporation; Emhart Deutschland G.m.b.H. (Germany); Emhart Industries, Inc.; Emhart International Ltd. (U.K.); Emhart Scandia AB (Sweden); Planning Research Corporation; PRC Business Information Systems, Inc.

Further Reading

A.G. Decker of Black & Decker, Nations Business, December 1969; Highlights of Progress, Towson, Maryland, The Black & Decker Corporation, 1987.

Neal R. McCrillis

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