Emergo Textile Projects, founded in 1995 as a subsidiary of McGregor Fashion Group, is a B2B company specialized in designing, manufacturing and servicing exclusive corporate uniforms projects. It aims to offer customers creative concepts and quality products at competitive prices, and to build a long and fruitful business partnership.
Divisional structure is used within ETP to carry out business plans. Typically, ETP organizes work by dividing them into project groups. Everyone communicates with each other regardless of their hierarchical positions, due to the small size of ETP. Barbara Schothorst is the managing director responsible for leading the company on a commercial and financial level, while the division coordinators are responsible for coordinating everything concerning the product as well as all internal processes. We have conducted a semi-structured interview with Ms. Schothorst to look into ETP’s business model.
Firstly, product and service customization is ETP’s value proposition as ETP takes care of everything for customers. ETP’s customer journey usually takes one year. Customers are well informed of how every step in the process and the planning will proceed, when crucial decisions need to be made and where milestones occur. The financial impact is made clear to customer right from the start. Secondly, ETP uses sales revenue model. The annual revenue depends on the amount of production/sales of each project and the amount of project per year. Most customers have contracts while some buy on an ad hoc basis. The annual revenues vary from Euro 100,000 to Euro 2,000,000. Gross margins vary from 32% to 60%. Given the cyclic nature of the projects, revenues per customer also vary strongly each year depending on the phase of the project.
Currently ETP’s superior product at competitive price makes it No.1 for corporate wear, while ETP still faces direct competitors like Oger, Kroll & de Vries and Kwintet Solutions as well as indirect competition from casual collections.
ETP’s market strategy is mainly product differentiation with competitive price. Besides, ETP seeks opportunities for expanding its market share by:
• Entering new segments within the market of corporate wear, with a 2 million euros increase in annual revenue
• Expanding internationally, with a 1 million euros increase in annual revenue
As the business expands, the management team is required to have project management or design-specific knowledge. Moreover, ETP should hire more specialists rather than generalists to better service their key stakeholders, including consumers, suppliers, employees and logistics.
Currently IT plays a supporting role in ETP’s business and several problems have been discovered: long communication process between leads and customers due to the old IT systems, double work for ERP and webshop, and the sales efficiency of webshop is not high. After the following SWOT analysis, we find that applying integrated ERP e-commerce could be an opportunity to transfer ETP.
Strengths
• Creative design
• Quality product
• Competitive price
• Good reputation
Weaknesses
• Low efficiency of working/communication process (old IT system)
• Lack of specific information strategy
Opportunities
• Improving IT system
• Trend of B2B e-commerce
Threats
• Changing technology
• Fast development of competitors
