OUR BUSINESS MODEL IS GEARED SO THAT WE CAN FOCUS ON THE TWO MOST VALUE CREATING DISCIPLINES: INNOVATION AND MARKETING
We have a plan for how to deliver strong results in the future.The plan includes:
- Driving Growth Internationally
- Building Market Leadership
- Growing Profitability
The plan goes on to define how we will connect our brand to the consumers and make them loyal. The plan is based on the following steps:
- offer the most effective products and the best product experience at the right price
- continue high focus on marketing
- engage further with national and international retailers both online and offline
Our financial strategy is simple.
- Keep high gross margin
At New Nordic will strive to defend our high gross margin through product innovations, improved sourcing and increased economy of scale, which will reduce cost of goods. Simultaneously we will ensure to increase pricing without jeaopardising the price-value advantage.
- Overheads down
Economy of scale and a focus of simplifying procedures will bring our overheads down. Overheads will be kept stable with growing sales which will bring overhead expense per cent down. Additionally the employ- ees are encouraged to save costs where possible.
- Marketing investments
We will continue to invest the current percentage of sales in advertising and other marketing activities. The most awarding way for both the company and its retail partners is to allocate spendings as much as possible to direct end consumer advertising and only a smaller part to trade advertising. This increase brand awareness, increase category news and increase traffic in store.
Managing these means will result in an increased operating profit and generate funds to invest in further business growth.
To demonstrate how we manage our business and which financial guidelines we use, we can introduce you to the essentials we value highly in our New Nordic business:
- HIGHLY PROFITABLE BUSINESS. The gross margin shall maintain high with a goal of exceeding 70%, the return after tax shall be higher than that of the average return of listed companies and so shall the return on equity and capital.
- GOOD LONG TERM ORGANIC GROWTH PERSPECTIVES. Both in sales and earnings per share. The goal is to grow higher than the average global consumer health and beauty market.
- FOCUSED MANAGEMENT TEAM. Management must have a clear understanding of our consumers and our business and a clear vision on how to further build the value of our brand.
- DURABLE INTERNATIONAL CONSUMER BRAND. The New Nordic brand that the company owns is already an international brand and we must focus to develop this world-class brand with the ultimate aim of becoming world-leading in the two categories; natural Beauty In & Out™ and herbal food supplement categories.
- ASSET LIGHT BUSINESS MODEL. The company can grow without heavy investment in assets.
- NO - OR LITTLE DEBT. The company ”travel lightly” without any debt burdens.
- MANAGEMENT WITH HIGH INTEGRITY. The management is honest and direct in management behaviour and reporting to shareholders.
- HIGH RETURN OF EQUITY AND DIVIDEND PAYMENT. The company does not ”Sit on the money” but payout dividend in order for shareholders to allocate money for more investments.
- FOCUS ON GROWING EARNINGS. The management understands and honours the shareholder's interest in growing earnings per share.