From Home Furnishing Business
Natuzzi Sets Roadmap to Profitability
2014 by in Business Strategy, Industry, Leather Upholstery, Product
Italian home furnishings supplier Natuzzi (NYSE: NTZ) has established a two-year business plan that sets objectives to regain market share, eliminate losses by the 2014 fourth quarter and return to profitability in 2015.
The company's board of directors approved the plan and outlines Natuzzi's restructuring plan.
In a release, the company said it will recover the "competitiveness of its Italian operations" by working in conjunction with the unions, government and Italian regions of Puglia and Basilicata. The company plans to make investments and a reduction in production costs.
The company is looking to improve its efficiency throughout its factories in Itlay, China, Romania and Russia by implementing a moving-line production process.
Cost-cutting measures will include moving to a centralized shared service structure, as well as a reduction in inventory levels, and a new logistics plan. Thirteen underperforming Natuzzi stores will be shuttered.
In 2015, the company expects to see a growth in revenues and a return to operating profit by implementing a marketing and distribution strategy that will build the Natuzzi brand; creating a commercial strategy focused on increasing sales in markets with high brand recognition; and, strengthen marketing and communications.
“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 10 years," said Pasquale Natuzzi, president and CEO. "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 (SAP) and the innovation of products and processes.”
Natuzzi said the plan's foundation will allow the company to stop its losses and return to profitability after two years.