Dean Petruzzi, president, CEO and co-founder of Technuity Inc., and a veteran of several ventures in the battery business, saw a lucrative opportunity for a company that could come up with battery products for the fast-growing number of devices that require them, from laptops to digital cameras and cell phones. To maximize that opportunity, Petruzzi struck a deal with Energizer Corp. which wanted to exit the rechargeable battery segment to use its brand on battery products that Technuity procures from offshore manufacturers, then sells to its wholesale and retail customers.
Wrapping a recognizable brand around its products is one way to maximize its chances for success, but Technuity has gone even further. It offers retailers back-end solutions for their Internet sites, freeing them from having to sort out the dizzying assortment of batteries required for a nearly endless number of applications. The service transparently links orders placed on a retailer’s site to Technuity for fulfillment and distribution.
Petruzzi says that Technuity’s revenue grew between 20 percent and 30 percent a year from 2002 to 2005, and he anticipates growth in the 20 percent range for 2006.
Petruzzi spoke with Smart Business about how he deals with the challenges and opportunities of building a business in a growing industry.
How did you persuade Energizer to partner with Technuity?
We were at the right place at the right time, we had relationships with the management of Energizer through previous businesses and we knew that they were looking for a different solution for their rechargeable pack business. We described ourselves as being entrepreneurs with other battery companies and we walked with them a little bit.
We set up a program where, at first, we weren’t selling to Energizer’s customers, we were just sourcing the product for them. Once we proved ourselves, that turned into, ‘Why don’t you guys go and do the whole nine yards, you source it, sell it, you own the customers and those kinds of things.’
How are you growing the business?
One, we want to make sure we are always doing our homework to make sure we’re providing the new battery products that the consumer is going to want when they want them. We have a lot of growth in North America yet to do.
We sell a lot of battery products to a lot of bigger retailers, but we don’t sell all of their battery pack needs to any of them. So our biggest customers, we may be only supplying 30 percent, 40 percent, 50 percent of their battery pack needs. There are other areas that we haven’t penetrated yet that we have a full line of Energizer products for.
It’s just a matter of continuing to work those accounts and continuing to show them our quality and our sophistication and hoping at some time they’ll give us a shot at the business we don’t have. That’s a huge opportunity for growth, farming those accounts.
The other area that we’re going to get into in 2006 ... selling our products overseas. We are currently looking at opportunities in Australia and in South America.
How do you protect your position in the market?
We have a three-pronged approach when we go to a retailer, and some retailers utilize this approach and some don’t. We provide them with one of the best battery brands in the world, and they understand that quality that’s associated with that and the name brand recognition.
But there are other people who can do that with different brands, so it doesn’t make us that unique. What we also provide them with are back-end solutions for their Internet sites. We do all the heavy lifting when it comes to cross-referencing these battery packs to the devices.
There may be one battery that fits 10 different model numbers of camcorders, and without doing all the research (to figure out which model numbers a particular battery fits) it becomes virtually impossible to sell products over the Internet. We provide all the cross-referencing upon request to our retailers so they can sell our battery products over the Internet.
We provide them with the distribution of those products so they do not have to handle the inventory, so you can go to a site of theirs and buy the product, and we’ll at times ship out of our facility to the customer.
We touch their customer in three different ways, through the store, through the Internet and third, through a phone system.
How do you evaluate growth opportunities?
We look to see if there is a market leader that sells that product. A lot of times, they may not sell that product, even through they’re in that area.
We’re at a point now where we think we can hit the doubles and triples ... with that unique item. One of the electronics giants will bring out a product and we’re really in the accessory market and there’s not an accessory that’s hit the market to go with that product. So we say, ‘Can we get that accessory or that piece out before anyone else?’
We have kind of switched our focus to say, ‘Let’s not try to compete with the guys that are well-entrenched with products that have been on the market for years. We are now saying, ‘Let’s look at products that are not on the market that we think are going to be hot in the next 12 months and see if we can beat our competitors to the market.’
HOW TO REACH: Technuity, www.technuity.com