Swedish underwear and lifestyle brand Björn Borg has struggled in its first six months of 2014. Both its underwear sales, its core business, as its licenses dropped. New CEO Henrik Bunge has a lot of work to do.
"Difficult second quarter"
"During the second quarter we and our distributors experienced continued tough market conditions, particularly in our larger markets", Henrik Bunge said. He has been in charge since 1 August, but among others, he points to "smaller purchases of both the summer collection and the current fall/winter collection of underwear and sportswear".
Underwear sales dropped 12 % in the past six months, despite it still representing 59 % of the group's total turnover. Sportswear experienced a similar drop, while glasses and perfumes also dropped in sales. Only bags and shoes remained level. License sales dropped 8 % in total.
All things put together, the company sold 250 million Swedish krona's (27 million euro) worth of items in its second quarter, a 9 % drop compared to the same quarter last year. Six month turnover reached 632 million krona (70 million euro), 11 % lower than last year. "E-commerce, which grew steadily in the second quarter as well," was a bright spot, but no actual numbers were revealed.
Belgium up, the Netherlands down
Björn Borg is available in 30 countries, but the Netherlands and Sweden are its prime markets. The Netherlands represent 28 % of its six month turnover, a 2 % drop, while Sweden represented 24 %, also 2 % lower than the year before. Belgium managed to increase turnover 5 %, totaling 12 % of turnover, good for third place. Denmark and Norway are fourth and fifth with 9 %, Finland sixth with 8 %.
Borg is not only available in multi-brand boutiques, but also in 38 single-brand stores, 17 of which are handled by the company itself. Prior to Dutch distributor Dutch Brand Management's major restructuring, Björn Borg even had 57 of these single-brand stores.