Natuzzi looks to revival plan
Italian upholstery producer Natuzzi has set out its plans to restore profitability by concentrating on trade sales, own-label production and the Revive recliner. It says it will end losses by the end of the year and make a profit margin of 3.9% in 2016.
The company says its will reorganise its Italian production, boost efficiency by adopting '24 industrial product platforms, which are the result of the re-engineering of existing models and the design of new models according to the new moving-line production process', cut stock levels, reorganise logistics and close 13 unprofitable stores, including some in the UK.
It will focus on the Natuzzi brand as it 'remained the brand with the highest level of awareness in its sector among consumers of luxury goods,' in 2013; look to expand wholesale distribution; focus on sales in markets with high growth rates alongside mature markets where the Natuzzi brand is most recognised, as well as defending market share in Europe; and improve back office operations.
'This plan is the culmination of an enormous effort over the last three years and is being adopted in the context of greater changes that we have implemented over the last ten years. During the last decade, we managed the challenges imposed on us by globalization with consistency, investing in the Natuzzi brand, the opening and development of the retail network, the upgrading of production facilities in Italy, the opening of factories and commercial offices abroad, integrating processes with the adoption of a single management information system and the innovation of products and processes,' says Pasquale Natuzzi, Natuzzi founder and ceo.
'All of this was achieved despite a decade that was marked by an unfavourable macro-economic environment, a strong euro and a significant drop in the consumption of durable goods. Today we are the only global player in our industry that operates in over 123 countries and Natuzzi remains the most globally-recognised furniture brand among consumers of luxury goods. Starting from this background and taking inspiration from our ethical and social values, we have developed a plan that we anticipate will allow us, beginning in the fourth quarter of this year, to eliminate losses from operations and, beginning in 2015, to return to profitability. After the first two years of the plan, which will be dedicated to restructuring and implementation of the strategy, the plan anticipates an increase in sales and a return to profitability.
'Based on a recovery in the competitiveness of our production process, which we hope to achieve by executing our Italian industrial plan; ample room for growth within the recliner armchair market – which we have seized upon with the introduction of our innovative Re-vive performance recliner – and planned investments in marketing and communications, we believe that all the conditions for growth in sales exist and anticipate revenues by the end of the three-year period amounting to €611m [up from €468m in 2012]. We are aware of the great challenges that await us and are highly motivated to achieve the ambitious objectives under the plan.'