Loath to be stuck on one thing, 3M makes everything from tape to
high-tech security gear. The diversified company makes products
through five operating segments: Industrial; Safety and Graphics;
Electronics and Energy; Health Care; and Consumer. Well-known
brands include Post-it notes, Scotch tapes, Scotchgard fabric
protectors, Scotch-Brite scouring pads, and Filtrete home air
filters. 3M sells products directly to users and through
numerous wholesalers, retailers, distributors, and dealers
worldwide. Industrial, its largest segment, accounted for about 34%
of 3M's total revenues in 2014.
The company has 88 manufacturing plants in 30 US states and
operates 127 manufacturing and converting facilities in about 40
other countries in Asia Pacific; Europe; Middle East and Africa;
Latin America; and elsewhere in North America. Overall, 3M has
operations in more than 70 countries.
In 2014 3M generated about 37% of its revenue from the US; 23%
from Europe, the Middle East and Africa; 10% from Latin America and
Canada; and 30% from the Asia/Pacific region.
In 2013 the company realigned its business segments to better
serve its customers and now operates five business segments:
Industrial; Safety and Graphics; Electronics and Energy; Health
Care; and Consumer.
The Industrial segment serves a broad range of markets, such as
automotive OEM and aftermarket, electronics, appliance, paper and
printing, packaging, food and beverage, and construction. Products
include vinyl, polyester, foil and specialty industrial tapes and
The Safety and Graphics segment includes architectural, building
and commercial services, commercial graphics, industrial minerals,
personal safety, and traffic safety and security. Major products
offerings include architectural surface and lighting solutions;
personal protection products; traffic safety and security products;
commercial graphics sheeting and systems.
The Electronics and Energy segment includes communication,
electrical, electronics materials, electronics, infrastructure
protection, optical systems, renewable energy, and 3M Touch
Systems. Its products include electrical, telecommunications,
renewable energy, and infrastructure protection goods and
The Health Care segment serves medical clinics and hospitals,
pharmaceuticals, dental and orthodontic practitioners, health
information systems, and others. Its products and services include
medical and surgical supplies, skin health and infection prevention
products, inhalation and transdermal drug delivery systems, and
oral care products.
The Consumer segment includes consumer retail, office retail, home
improvement, building maintenance and other markets. Major consumer
products include Scotch® brand products; construction and home
improvement products, include surface-preparation and
wood-finishing materials, and filters for furnaces and air
conditioners; home care products include Scotch-Brite pads and
Sales and Marketing
3M sells its products globally though a wide range of
distribution channels, including directly to users and through
numerous wholesalers, retailers, jobbers, distributors, and
The company has seen stable growth in its revenues since 2011,
in 2013 3M's revenue increased by 3% due to higher sales from all
segments (driven by stronger local-currency sales, higher prices,
and acquisitions). Organic local-currency sales grew 5%, with
increases of 6% in Asia Pacific, 5% in the US, 5% in Latin
America/Canada, and 3% in Europe, the Middle East, and Africa.
Industrial segment revenues increased in 2014, led by aerospace
and commercial transportation, automotive OEM, 3M Purification
Inc., advanced materials, and abrasive systems.
Safety and Graphics sales increased, led by personal safety. 3M
also saw positive organic local-currency sales growth in commercial
solutions, and traffic safety and security systems. However, sales
in the roofing granules business declined that year.
Electronics and Energy sales growth was led by display materials
and systems. In 3M's energy-related businesses, organic
local-currency sales increased by 1%, led by electrical markets and
telecommunications, partially offset by reductions in renewable
Health Care saw sales growth in health information systems, drug
delivery systems, food safety, critical and chronic care, and
infection prevention. (It also saw Acquisition sales growth related
to the 2014 purchase of Treo Solutions LLC).
The Consumer segment reported sales growth in construction and
home improvement, and in its consumer health care and home care
businesses. Sales in the stationery and office supplies business
In 2014 3M's net income increased by 6% due to higher revenues
and operating income.
That year the company's operating cash inflow increased by 14% due
to a growth in net income and a change in working capital.
As a technology-driven company, 3M continues to make
research and development a top priority, investing heftily in
new product development efforts. Through significant
investments in R&D, sales, and manufacturing, the company ranks
among the most innovative companies in the world. It also
competes on a global scale and likes to develop, manufacture, hire,
and purchase locally in whatever region it is in to get close to
its customers. In 2014 the company invested $2 billion in R&D
Its 3M New Ventures unit seeks game-changing opportunities,
cutting-edge platform technologies, outstanding entrepreneurs and
strong intellectual property positions in high-growth markets that
are strategically important to 3M. With minority investments in
start-up companies, 3M New Ventures creates not only financial
value but strategic synergies between 3M and new ventures.
In 2015 3M invested in Nanoscale Components to expand the
adoption of 3M's unique silicon alloy anode into lithium-ion
It also continues to see emerging markets like China and other
developing countries as promising avenues for growth. Although
China has made recent moves to curb inflation, 3M believes that
China holds great potential for the company's growth in the
In 2014 3M formed partnership with US-China Clean Energy
Research Center Building Energy Efficiency Consortium, under which
3M participates in research on building efficiency strategies,
tools, and practices in areas such as building envelope
technologies and integration of new construction materials for
increasing energy efficiency.
In a move aimed at bringing greater economic efficiencies to
Premier's more than 100,000 health care provider members, in 2014
the company reached a group purchasing agreement with health care
alliance company Premier, Inc. for multiple catheter securement and
stability products. The new agreement allows them to take advantage
of special pricing and terms pre-negotiated by Premier.
In 2013, the company and China-based Hunan Reshine New Material
Company signed a patent license agreement to expand the use of
nickel, manganese and cobalt in lithium ion batteries (in growing
demand in consumer electronics, automotive, and other markets).
That year, in order to expand its manufacturing assets in Asia,
3M Company invested in plants in China and Singapore to support the
growing window film business.
It also signed a patent license agreement with Korea-based
ECOPRO to further expand the use of nickel-manganese-cobalt (NMC)
cathode materials in lithium ion batteries.
Mergers and Acquisitions
3M also grows through acquisitions. In 2014 it acquired Treo
Solutions, a leading provider of data analytics and business
intelligence to healthcare payers and providers. This deal makes it
possible to extend real-time data analytics and payment redesign
worldwide, jumpstarting the many provider organizations that have
adopted the 3M 360 Encompass System for computer-assisted coding in
their transition to population health management.