jump to navigation

Newell Rubbermaid Destroys a Growth Mode – Case Summary November 2, 2006

Posted by Laxmi Goutham Vulpala in case studies, Uncategorized.


Newell Rubbermaid was formed in 1999 when Newell acquired Rubbermaid, a competitor for $6.3 billion. Prior to the acquisition until the 1990’s Rubbermaid was growing very strongly with the stock routinely returning 25% annually, but it began faltering in mid 1990’s partly because of its inability to meet the service demands from Wal-Mart its major customer. Newell specialized in buying small marginal firms and improving their operations, it focused on buying firms that had a strong brand name but mediocre customer service.

Newell’s assessment was that Rubbermaid was a troubled company and by improving its operations and customer service up to Newell’s performance standards they could enhance the profitability and deliver value to the shareholders. Newell’s plans never materialized after the acquisition as it could not turn around quickly which led to the tanking of stock price leading to a loss of around 50% of the company’s value.

Newell underestimated the problems at Rubbermaid prior to the acquisition, though they used a similar strategy of acquisitions earlier, the size of these firms was small compared to the size of Rubbermaid. Rubbermaid’s on time delivery problems to their biggest customer Wal-Mart surfaced in 1995, in spite of spending around $62 million in technology they could not appreciable improve their delivery provides the most damning indictment of its operations. Newell’s eagerness to acquire a strong brand caused them to overlook the deficiencies at Rubbermaid and overestimating Rubbermaid’s value and synergies the merger would offer.
Lessons Learnt

Rubbermaid did not provide adequate service to its biggest customer Wal-Mart and took too long to correct the situation. When dealing with big retailers Brand Name only goes so far, meeting their service and delivery standards is absolutely essential for the success for a manufacturing company.

Big acquisitions should not be done in haste; enough research needs to be done about the state of the company being acquired and the potential savings and synergies that will result from the acquisition.

Once the firm retracts from growth mode it is difficult to get back on track as it is evident from Newell Rubbermaid, which even after the hiring a high-profile marketing CEO could not turn around the company.
Case Source (Marketing Mistakes and Sucesses Hartley)



1. Duane Burger - October 11, 2007

Newell Rubbermaid’s customer service is based on a confrontational approach to dissatisfied customers by CSR’s working from a script and not thinking about what they are saying. When these CSR’s are frustrated, even supervisors, the customer is targeted with hostile interrogation and asked to answer several times questions which have already been posed. Makes it very hard to be loyal to this brand.

2. Sertvfdnhgjk - April 3, 2008

Приветствую всех!
У меня такой вопрос,кто что интересное подскажет буду признателен.
Мы с друзьями собираемся поехать в круиз по просторам России и ближнего зарубежья месяца на два на своих машинах,но не как не можем согласовать маршрут,если у кого уже был опыт такого путешествия,может,что посоветуете.Девчонок с собой не берем,думаем,что во все городах России с этим не будет проблем,если у кого будут рекомендации и в вопросе отдыха с девушками тоже буду признателен.

С уважением Сеньчик

3. Nelmagomteali - October 18, 2008

side survey leaf [url=http://www.oneview.de/url/details.jsf?urlId=53432589]viagra[/url] pick tie-up without

4. frenky - May 8, 2011
5. seethat.Tv - April 12, 2013

I’m not sure exactly why but this site is loading incredibly slow for me. Is anyone else having this problem or is it a problem on my end? I’ll check back later on and
see if the problem still exists.

6. link shortner - May 21, 2013

First of all I would like to say awesome blog! I had
a quick question which I’d like to ask if you don’t mind.
I was curious to find out how you center yourself and clear your
mind before writing. I have had a tough time clearing my mind in getting my thoughts out there.
I truly do take pleasure in writing however it just seems like the first 10 to 15 minutes are generally
lost just trying to figure out how to begin. Any suggestions or tips?

7. website traffic - June 22, 2013

What a information of un-ambiguity and preserveness of precious familiarity on the topic of
unpredicted emotions.

8. homepage - July 20, 2013

It’s perfect time to make some plans for the future and it’s time
to be happy. I’ve read this post and if I could I wish to suggest you some interesting things or suggestions. Maybe you can write next articles referring to this article. I want to read more things about it!

9. read forex chart - August 6, 2013

I’m curious to find out what blog system you happen to be utilizing? I’m experiencing some minor security
issues with my latest website and I would like to find something more safeguarded.
Do you have any suggestions?

10. stairlifts - October 2, 2013

These are to a sizable degree redundant because the brakes would normally suffice.

Nevertheless, an extra pack of brakes adds another layer of

In the event you face problem in moving up and down through stairway or face
other accessibility issues afterward Acorn supplies you an affordable solution
to such issues.

11. justhost web hosting - November 28, 2013

Excellent post. Keep writing such kind of info on your page.
Im really impressed by it.
Hello there, You’ve performed a great job. I’ll certainly digg it and in my
opinion recommend to my friends. I’m confident they’ll be benefited from this web site.

12. begawan giri - January 15, 2014

I do not know if it’s just me or if perhaps
everyone else encountering problems with your website.
It appears as if some of the written text on your posts are running off the screen.
Can somebody else please provide feedback and let me
know if this is happening to them as well? This could be a problem with
my browser because I’ve had this happen previously.
Many thanks

13. buy followers instagram - March 6, 2014

It’s remarkable to visit this website and reading the views of all friends on the topic of
this paragraph, while I am also eager of getting experience.
buy followers instagram Cheap in addition to Safe
to get instagram accounts.
A great way to buy followers on instagram is always to have
celebrities recruit any posting for yourself.

14. cuanto Cuesta reformar una cocina - March 28, 2014

Write more, thats all I have to say. Literally, it seens as though yoou relied on the video to make your point.
You definitely know whast youre talking about, why waste your
intelligence onn just posting videos to yourr blog when you
could be giving us somnething enlightening tto read?

15. cheap web hosting with free domain - April 26, 2014

First of all I would like to say wonderful blog! I had a quick question which I’d like to ask if you
do not mind. I was interested to know how you center yourself and clear your mind before writing.
I’ve had trouble clearing my mind in getting my thoughts out.

I do enjoy writing but it just seems like the first 10 to 15 minutes are lost
just trying to figure out how to begin. Any recommendations or hints?

16. music marketing strategy tips - May 5, 2014

Hello this is kind of of off topic but I was wondering if blogs
use WYSIWYG editors or if you have to manually code with HTML.

I’m starting a blog soon but have no coding skills so I wanted to get
advice from someone with experience. Any help would be enormously appreciated!

17. story apartment - August 26, 2018

New Lift

Newell Rubbermaid Destroys a Growth Mode

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: