3M 2005 Annual Report Download - page 31

5
Electro and Communications Business: The Electro and Communications segment serves the electrical, electronics
and communications industries, including electrical utilities; electrical construction, maintenance and repair; OEM
electrical and electronics; computers and peripherals; consumer electronics; telecommunications central office,
outside plant and enterprise; as well as aerospace, military, automotive and medical markets; with products that
enable the efficient transmission of electrical power and speed the delivery of information and ideas. Products include
electronic and interconnect solutions, microinterconnect systems, high-performance fluids, high-temperature and
display tapes, telecommunications products and electrical products.
Major electronic and electrical products include packaging and interconnection devices; high-performance fluids used
in the manufacture of computer chips, and for electronics cooling and lubricating of computer hard disk drives; high-
temperature and display tapes; insulating materials, including pressure-sensitive tapes and resins; and related items.
3M™ Flexible Circuits use electronic packaging and interconnection technology, providing more connections in less
space, and are used in ink-jet print cartridges, cell phones and electronic devices. This segment serves the world’s
telecommunications companies with a wide array of products for fiber-optic and copper-based telecommunications
systems.
Safety, Security and Protection Services Business: The Safety, Security and Protection Services segment serves a
broad range of markets that strive to increase the safety, security and productivity of workers, facilities and systems.
Major product offerings include personal protection products, safety and security products, energy control products,
cleaning and protection products for commercial establishments, and roofing granules for asphalt shingles.
This segment’s products include maintenance-free and reusable respirators, electronic surveillance products, films
that protect against counterfeiting, and reflective materials that are widely used on apparel, footwear and accessories,
enhancing visibility in low-light situations. Other products include theft protection systems for libraries and library
patron self-checkout systems; spill-control sorbents; Thinsulate™ Insulation and Thinsulate™ Lite Loft™ Insulation;
3M™ Scotchtint™ Window Film for buildings; 3M™ Scotchshield™ Ultra Safety and Security Film for property;
nonwoven abrasive materials for floor maintenance and commercial cleaning; floor matting; and natural and color-
coated mineral granules for asphalt shingles. In March 2004, 3M completed the acquisition of Hornell Holding AB, a
global supplier of personal protective equipment.
Transportation Business: The Transportation segment serves markets that include automotive, automotive
aftermarket, marine, aerospace and specialty vehicle markets. This segment provides components and products
that are used in the manufacture, repair and maintenance of automotive, marine, aircraft and specialty vehicles.
Major product categories include insulation components, including components for catalytic converters; functional
and decorative graphics; abrasion-resistant films; masking tapes; fasteners and tapes for attaching nameplates, trim,
moldings, interior panels and carpeting; coated, nonwoven and microstructured finishing and grinding abrasives;
structural adhesives; and other specialty materials. This segment also provides paint finishing and detailing products,
including a complete system of cleaners, dressings, polishes, waxes and other products.
Distribution
3M products are sold through numerous distribution channels. Products are sold directly to users and through
numerous wholesalers, retailers, jobbers, distributors and dealers in a wide variety of trades in many countries
around the world. Management believes the confidence of wholesalers, retailers, jobbers, distributors and dealers in
3M and its products, developed through long association with skilled marketing and sales representatives, has
contributed significantly to 3M’s position in the marketplace and to its growth. 3M has 188 sales offices worldwide,
with 15 in the United States and 173 internationally.
Research and Patents
Research and product development constitute an important part of 3M’s activities. Products resulting from research
and development have been a major driver of 3M’s growth. Research, development and related expenses totaled
$1.242 billion in 2005, $1.194 billion in 2004 and $1.147 billion in 2003. Research and development, covering basic
scientific research and the application of scientific advances to the development of new and improved products and
their uses, totaled $798 million in 2005, $759 million in 2004 and $749 million in 2003. Related expenses primarily
include technical support provided to customers for existing products by 3M laboratories and costs of internally
developed patents.
The Company’s products are sold around the world under various trademarks that are important to the Company.
The Company also owns, or holds licenses to use, numerous U.S. and foreign patents. The Company’s research and
development activities continuously generate inventions that are covered by new patents. Patents applicable to