2008 Registration Document - Rexel

3. Business description− security and communication (5% of 2008 sales), whichprincipally includes voice, data and image (VDI) transmissionequipment, intruder and fire detection equipment, andmonitoring and access control equipment;− climate control (4% of 2008 sales), which includesventilation, air conditioning, heating equipment, andrenewable energy equipment;− t o o l s (2% of 2008 sales), which include hand tools,electrical tools and measuring instruments; and− white and brown products (5% of 2008 sales), whichincludes household appliances and consumer electronicsproducts.The product families and percentages above solely relateto the professional distribution of low and ultra-low voltageelectrical products. The professional distribution of lowand ultra-low voltage electrical products does not includethe activities of the Consumer Electronics and LuxuryProducts Distribution (ACE) division, which are described inparagraph 3.1.4 of this Document de Référence.In general, each of these product families has represented arelatively stable percentage of the Rexel Group’s sales overthe past three years.The Rexel Group offers a wide range of technical solutions,which allows it to adapt its offering to local consumptionhabits and applicable technical standards as well astechnological innovations. As a result, the productsportfolio may be increased, especially as part of the MRO(Maintenance, Repair and Operation) contracts. In addition,the renewal rate of listed products represents approximately20% of the range of products distributed by the Rexel Groupeach year. The Rexel Group’s product offering is generallymarketed under their brands, whose national or, dependingon the market, local reputation is a significant criterion incontractors’ purchasing decisions. Changes in the RexelGroup’s product offering are the result of a dynamic andcontinuous process that takes into account customers’expectations.In limited market segments identified as well-suited tosuch products, the Rexel Group also distributes its ownbrandproducts, on which it achieves above-averagemargins for equivalent product categories distributed undersupplier’s brands. The Rexel Group’s principal own-brandsare Newlec and Sector, for residential and commercialelectrical equipment in the United Kingdom, Gigamediafor multimedia networks and BizLine for tools. Newlecis also used in other European countries, especially forclimate control engineering, electrical control and lightingequipment.In addition, the Conectis and Citadel entities allow to betterstructure the product offering in the multimedia and securitysectors, due to the specific technical nature of the productsand the potential for growth of business in these sectors.In particular, the Rexel Group is rolling out the Conectisoffering, initially developed in France, in other Europeancountries.Product innovations developed by manufacturers in eachproduct category to respond to changes in customerneeds or applicable standards (including energy savingsand fire security) allow the Rexel Group to improve thevalue of its offering. The most significant technologicalevolutions that have occurred over the past several yearsinclude:− improvements in cabling systems to support increasesin computer networking bandwidth allowed by theintroduction of new categories of cable;− developments in Light Emitting Diode (“LED”) technologyto apply to lighting. LED technology was previously solelyused in signal systems. This change promotes energysavings, dependability and product life-span;− developments in biometric control systems in thecommunication and security sector (fingerprintrecognition, voice recognition, etc.);− migration from analogue to digital transmission, whichallows for the installation of a single cable network for allresidential needs; and− products relating to renewable energies (solar panels,heat pump, etc.)3.1.1.2 A service offering adaptedto customers’ needsTechnical solutions servicesThe Rexel Group has positioned itself as a technicalsolutions provider for its customers. The Rexel Groupenhances its product offering by providing a number ofassociated services, including with respect to logistics,technical assistance, training and assistance in projectmanagement, especially at the international level. Theseservices are provided by qualified personnel who benefitfrom continuing education, which allows them to mastertechnological developments.The Rexel Group’s services include:− Technical assistance: The Rexel Group assists itscustomers in choosing adapted product solutions amidthe large range of products offered. The Rexel Groupalso offers assistance in preparing technical bids,designing electrical installations and cabling schematicsand drafting specifications. The Rexel Group alsoprovides electrical product inventory management forcertain of its industrial and commercial customers.These services enhance the Rexel Group’s knowledgeof its customers’ businesses, notably by allowingit to anticipate their needs. The Rexel Group providesthese services through teams of experts that are basedin its branches and who help sales personnel promotehigh value-added product families (such as VDI,security, lighting and industrial automation). In somesituations, these teams work directly on the customers’premises.PAGE 22 | REXEL 2008