Acquiring markets
When barriers to entry were too great, Ridge looked to acquisitions to generate growth.
“In Spain and France, 3-IN-ONE Oil was a competitor to WD-40 with a strong market share,” says Ridge. “In this case, we bought versus fought. This gave us the opportunity to buy the culture and the market share.”
That 1995 acquisition increased distribution in 17 countries. Ridge says the key to successful acquisitions is following a set of beliefs and practices.
“I believe that we are in the squeak, smell and dirt business,” he says. “I don’t make acquisitions unless they eliminate a squeak, a smell or dirt.”
When it comes to new product acquisition, Ridge looks for products with strong brand dominance that complement the company’s existing suite of offerings and then evaluates the product’s channel gaps.
“I look for brands that offer us the opportunity to expand the channel for that brand and our other products,” says Ridge. “If they have underrepresented channels, then we will make that acquisition.”
Such was the case in 1999, when WD-40 acquired Spot Shot, a brand of instant carpet stain remover. The product was mainly sold in supermarkets and drugstores. Ridge expanded into hardware, automotive and club stores, increasing sales of the product to a new customer base.