Polaris - Six Steps to Heaven
No self-respecting corporation is complete these days without its strategic plan and five-year targets, and powersports industry market leader Polaris took the opportunity of a recent Las Vegas 'Analyst and Investor Day' to outline its "six strategic objectives" …
Long-term growth and profitability are at the heart of Polaris Industries' six strategic objectives that are "focused on delivering a sustained competitive advantage as the global leader in powersports."
Its long-term strategy for "achieving accelerated growth, driving profitability and expanding its customer base" is wrapped in a six-step mantra, with Polaris Inc. CEO Mike Speetzen quoted as saying: "We see a clear opportunity to profitably grow Polaris, demonstrating to new customers how powersports fit into their lives and connecting with current riders who already love our products - while executing on our plans to innovate with new category-defining products, expand margins and return capital to shareholders.
|Polaris CEO Mike Speetzen
"We have the best team in powersports and are well-positioned to execute on our strategy, continuing to set the bar for our industry while delivering long-term value for our customers and shareholders." The six strategic objectives revolve around …
Best Customer Experience: "Providing our current and future customers with the best possible overall experience, fueling and creating new ways to help people experience the outdoors to the fullest.
'expanding customers by 50 percent'
"This includes dealer interactions for service and delivery as well as trusted products and services. We are also expanding our new business models like Adventures and Adventures Select that encourage more diverse groups of people to experience the outdoors."
Inspirational Brands: "We will bring to life brands our owners are proud to be associated with, and excited to showcase and share with friends and family. Brands that continue to be viewed as authentic, unique, engaging, and just fun to experience and that support our Think Outside mindset.
Rider-Driven Innovation: "We listen and learn directly from our customers to deliver high-quality products, experiences and services that matter most to them. While innovation has been part of our DNA from the beginning, our electrification and connected vehicle initiatives represent an incredible opportunity to exceed customers' expectations in powersports, and the recent launch of the Ranger XP Kinetic is the first example of how we plan to lead in these areas."
Agile and Efficient Operations: "As the global leader in powersports, we take advantage of our global scale as well as lean operations and talented people to deliver the most responsive, customer-centric service levels in powersports."
Best Team, Best Culture: "Our team and culture are what makes achieving our goals possible. We focus on hiring, developing and retaining the best people, constantly challenging them with new opportunities and high expectations. Our team and culture combine to create a competitive advantage that enables us to deliver industry-leading innovation, support our customers and dealers, and drive long-term growth."
Geared for Good: "A core belief that as the global leader in powersports, we have a responsibility to be good stewards for our industry, employees, riders, communities and the outdoors. Along with our unwavering commitment to Safety and Ethics Always, we remain more committed than ever to making a positive impact by being Geared for Good."
Under the theme of "Leading from the Front", the company says that in order to "reinforce its position as the global powersports leader" it has long-term strategic targets such expanding Polaris powersports customers by 50 percent in the next ten years, deepening its customer knowledge through increased investment in insights as well as how customers interact with the Polaris brand, and increasing access to powersports through new business models and entryway experiences with Polaris Adventures and Polaris Adventures Select.
Continued investment in research and development will clearly be a priority - "to drive innovation for its riders, both within already established capabilities of ICE powertrains and drivelines, fit and finish, ride and handling, and an extensive accessories portfolio, along with emerging capabilities including making Ride Command+ connected technology available across most of its powersports models by 2026 and furthering electric vehicle options with a strategic and targeted approach that centers on the customer."
'furthering electric vehicle options'
Polaris says that it is "testing electric prototypes broadly across its product platforms, but will commercialize purposefully where electrification improves the customer experience" and that "in addition to supporting organic investment in growth opportunities, Polaris is committed to a capital allocation strategy that prioritizes organic investment, dividend growth, share repurchases and acquisitions."
Which makes it sound like the Scott Wine era of wholesale acquisitions is well and truly over for Polaris.
|The Ranger XP Kinetic - the first example of how Polaris plans to lead in the area of electrification.
With a strong focus on financial performance, the company highlighted its five-year financial targets of mid-single digit compound annual growth rate in sales, mid- to high-teens percentage EBITDA margin, return on invested capital in the mid-twenties percent, and double-digit percent compound annual growth rate in earnings per share.
Polaris reaffirmed its 2022 full-year guidance of total company sales of $9.2 to $9.5bn, up 12 to 15% compared to 2021, and adjusted earnings per share between $10.10 and $10.40, up 11 to 14% compared to last year.