Business area Corporate Promo is New Wave Group’s largest business area and the brand is divided into three segments, namely promowear, workwear and promotional gifts. Business is conducted with 24 brands in a total of 19 countries on three continents. The business area’s domestic market is the Nordic countries which also answer for most of the sales at 46% of the Group’s sales in 2009 and SEK 168.5 million of the Group’s profits (EBITDA). The brands in the Corporate Promo business area are sold primarily in the corporate promo segment, but some brands are also sold in the retail segment.

The market
The promo market showed a decline of about 25% in 2009 and this was of course reflected in the Corporate Promo business area. The distinct decline as a result of the global economic situation concerns the Nordic market as well as the rest of Europe and the USA. There has been some elimination in terms of both wholesalers and retailers.

In Europe, estimates indicate sales of about SEK 92 billion for promowear and promotional gifts at wholesaler level after the decline. In Sweden, the two product segments generate about the same share of sales. In total, sales in the European market at wholesaler level are estimated at about SEK 35 billion for promowear and SEK 57 billion for promotional gifts. The North American corporate promo market generates sales of about USD 11 billion at wholesaler level, of which about USD 3 billion stems from promowear and USD 8 billion from promotional gifts. The market for workwear has for many years expanded, but now faces a weakening.

The Swedish corporate promo market is considered to be the largest in Europe in relation to population and is very well established. New Wave Group holds the largest market share in markets where it has done business the longest – Sweden, Norway and Finland. New Wave Group achieved the position of market leader through its broad range of products, excellent service and delivery accuracy, strong customer focus within the entire organisation, and by offering differentiated concepts complete with marketing kits, IT solutions, etc. New Wave Group is also the only supplier that can cover the retailers’ needs in all three corporate promo segments.

The future
New Wave Group predicts the greatest growth potential for the Corporate Promo is in non-Nordic countries. The market situation in the Nordic countries mandates continuously better market concepts for the retailers. This gives the company a competitive advantage in the rest of Europe where the concept is not as well developed and the collections that are marketed are often narrower and less thoroughly designed. In times of financial difficulties, business companies and organisations are more prone to foster customer relations through relationship and loyalty-promoting media like promotional products, and to cut back on larger investments like mass media campaigns. This means potential advantages for the promotional market.

Our offer
Corporate Promo’s segments – promowear, promotional gifts and workwear – consist of products that cover all price levels and qualities. Promowear and promotional gifts have similar application areas (to promote and market the brand) and are marketed by the same type of retailer. Workwear is primarily used when functional, durable work clothes are needed in many professions.

Within the promowear segment, New Wave Group offers clothes adapted for printing and embroidery which, in addition to price and quality, also cover all application areas and sizes – from favourably priced basic garments to detailed garments made of exclusive textiles, leisure, work and sports clothes, clothes in classic and trend colours, in sizes from XS to XXXL. New Wave Group’s promowear brands are divided into three concepts that include such brands as DAD Sportswear, New Wave and James Harvest Sportswear.

The promotional gift concept is broad and the segment covers a multitude of products and price classes. New Wave Group can through its concept, which includes such brands as Toppoint, d-vice and Queen Anne, offer everything from pens, USB flash drives and digital picture frames to handbags, bed linens and towels.

The final piece of the Corporate Promo puzzle is workwear. In Sweden, there is a vast need for and expertise in personal protection and the issue is intensely promoted by trade unions and employers. New Wave Group can through the two brands, Jobman and ProJob, offer work clothes for such professional categories as construction and installation, painters and plasterers, transport and service, as well as hotel and restaurant. The collection is all-inclusive, ranging from underwear to outer garments for all seasons and weather conditions, reflective clothing, shoes, gloves, carrying systems and accessories. All garments and products are ergonomic and durable, and come in sizes for both women and men.

Sales channels
The Nordic promowear and promotional gifts market is distinguished by a clear distribution chain: manufacturer – wholesaler – retailer – end customer. The distribution chain is not as well organised in South and Central Europe. Distributors who market brands that they do not themselves own often have substantial influence in the market. The North American market is much more advanced and the distribution chain resembles the Nordic market.

In Sweden, there are about 2,500 retailers of promowear and promotional gifts, a high figure per capita compared with the rest of Europe and the North American market. There is a wide variety of retailers, ranging from simple sole proprietorships to large companies with high-end displays and a travelling sales force. Some retailers target one of the three segments, while others work all three. Most are pure sales companies, but it is equally common that retailers also print, embroider, and engrave in order to offer a more complete alternative.

Workwear has traditionally been sold via special retailers for construction and industry, paints, etc. but today more and more channels include workwear by either collaborating with already established brands or by designing their own brands and collections. The reason for this is that the sector has been in a growth stage for many years but is also attributed to a greater interest in the domestic market spurred by the many DIY and home decorating television programmes. In the future, distribution will probably by even more differentiated as more players in Sweden and Europe try to establish themselves on the workwear market.

Capital tied up
A company that orders promowear in corporate colours for its employees or customers relies on the supplier being able to deliver a full range of sizes and the right colours. For instance, if New Wave Group cannot deliver products in a medium size or in the end customer’s corporate colours, the customer will turn to a different supplier. The Group’s ambition is to deliver 98% of the Group’s products within 24 hours. The risk of obsolescence is low since most of the collection comprises timeless base products for which there is a demand season after season. Adjustments for changes in purchasing prices are made continuously since sales are instant which limits the foreign exchange risk. Sales are made to selected retailers and credit losses are relatively low. In 2009, confirmed bad debt losses in the promo business area made up 0.38% of sales. Many of the products are the same for both corporate promo and retail, which provides a significant spread of risk. Moreover, the two sales channels can use the same catalogues.