Page 7 - Hedengren_annual_review_2019_final_EN

Hedengren Direct business review

"As planned, we will invest in the consumer direct sales of LUX brands of
which main products are air purifiers, vacuum cleaners and their accesso-

ries. In certain respects, we are returning to our roots."

Hedengren Direct's operating year was challenging and The greatest risk and challenge of the direct sales model con-
eventful. The B2B business that was started in 2018 never cerned the availability of employees. The Lux Business School
achieved its target level of profitability, and it did not bring model was excellent, and we are good at sales knowledge train-
Direct's business the stimulation that we had hoped for. The ing. However, the number of those interested in the field is very
investments made to improve the business did not generate low, and it is challenging to find new people to train. In the new
the desired outcome either, and the business as a whole con- concept, we have changed the recruitment model, and we hope
tinued to be loss-making. that it will improve our chances of finding new salespeople for
As a result, in the late summer of 2019 we started coopera- our company. We have also signed more contracts with directs
tion consultations with the purpose of finding a comprehen- sales contractors, as we believe that the number of partners will
sive plan to make the business profitable. As a conclusion of increase in future, and in this way, we can make the capacity of
the cooperation consultations, we decided to abandon B2B our sales organization meet our sales targets.
sales and reform the consumer organization. This led to four As planned, we will invest in the consumer direct sales of LUX
employees being laid off, and in conjunction with this it was brands of which main products are air purifiers, vacuum clean-
agreed that the CEO of Hedengren Direct would terminate ers, and their accessories. In certain respects, we are returning to
his duties. Timo Lehtonen was appointed as Commercial our roots. Our products, solutions and salespeople continue to
Sales Manager who reports operationally to group CEO. The be the best in their field, and we believe that with a more stream-
Chairperson of the Board of Directors manages the statutory lined operating model and a lower cost level, we will be able to
responsibilities. The one-off costs resulting from the cooper- get profitability back to the level we require.
ation consultations were recorded in full for 2019, thus the Marek Hintze
result was weak.

Turnover by area

Turnover 1 000 Operating profit 26%
800 Custom-made
€1000 600 €1000 products
400 4% 63%
6 000 200 2015 2016 2017 2018 Financial B2C
5 000 0
4 000 -200 7revenues %
3 000 -400 B2B
2 000 -600
1 000 -800

0 -1 000
2014 2015 2016 2017 2018 2019 BU2020 -1 200

7 OY HEDENGREN AB I ANNUAL REVIEW 2019 2014 2019 BU2020