The Company was locked into a “no growth” global revenue position in which, revenue was stagnant and margins were declining due to 1) high pricing, 2) spotty distribution, 3) growing transportation costs, 4) increased good quality competition, and 5) a lack of brand support spending.
There had been little or no innovation in the product line, but nevertheless over the prior decade the brand had held on to a leadership position precariously and without any investment. The product line’s overall image had become dated and consumer research indicated that it was losing its appeal across all age brackets, and across all socioeconomic levels.
A long term Global Strategic Plan that included a total reorganization of the company’s US and global businesses was developed and implemented. This included the development of a revamped Export Division, based on a Regional/Product structure, by product line, channel and geographic area. In addition, certain high potential markets (China & Middle East), were targeted for “Greenfield” development or third party ventures which became fully functional within three years. As a result revenues doubled and EBITDA increased by 30% on a percentage basis. Key activities included a total revamping of the worldwide Distributor Network in Latin America, the Middle East/Africa and the Asia/Pacific Regions, and the launch of two new product lines. In China meanwhile, two new ISO qualified sourcing points for Asia and the Middle East were developed, in parallel with a wholly owned, profitable stand alone Greenfield subsidiary to service that country’s rapidly expanding domestic market. In the Middle East an entirely new third party distribution/production agreement was developed to markedly increase distribution, market penetration, and consumer purchase levels as measured by an independent external market share data company.