– Does not have growth ambitions in Norway – E24
The hiking equipment giant Norrøna is becoming less dependent on Norway, and is aiming for the USA. At the same time as the retail trade is experiencing declining sales, the company is investing heavily in its own retail business, and is breaking with Sport 1.
– Nothing flies into the sky, and now it has calmed down in Norway. This year, the USA is our largest export market, says Norrøna top and owner, Jørgen Jørgensen.
He talks about that sales in Norway this summer have slowed down a bit, but that growth is still good abroad.
Sky-high inflation threatens Norwegian business and industry, and trade in goods in particular is exposed. The Norrøna management probably thinks the industry will feel the effect of persistently high electricity prices, tenants and general price increases in the future, but believes the company has more solid legs to stand on.
– The Norwegian market is important, but we do not have any growth ambitions here (Norway, editor’s note), the growth will come from exports, especially from the USA, says marketing manager Martin Lien.
– So you are not so worried about the future?
– It is never cool when the numbers are not as good as you think it will be, says Jørgensen, and is supported by marketing manager Lien.
– If everyone marked had been like Norway, we would have been worried
Turnover record
At the same time as dark clouds make the trading industry truer, Jørgensen is satisfied with the accounting figures which show that Norrøna Sport had sales of NOK 613 million, an increase of almost three per cent from the record year 2020.
The company Norrøna Retail, which is for sale through its own stores, had sales of NOK 247 million, an increase of 6.5 per cent from the previous year.
– We are very pleased with last year’s result. It was well above what we envisioned in advance.
Norrøna Sport, which sells equipment to both own and external stores, had an annual profit before tax of NOK 153 million, the highest number up to 29 per cent from the previous year.
Jørgensen is particularly pleased with its own stores, which delivered a profit of NOK 19.5 million. This is a decrease of 2.5 million from the previous year, but the color of the stores was closed for three months, and investments were made in new stores.
Cut out Sport 1
The fact that Norrøna is investing in its own stores also has consequences for one of the giants in the Norwegian sports industry, the Gjelsten-dominated Sport 1 chain.
Norrøna has in fact ended the collaboration with the chain after a number of years.
Jørgensen says that Sport 1 was one of their biggest customers.
He further explains that as a brand you have to accept a number of requirements from chains that you are no longer willing to agree to. Norrøna still sells to several Sport 1 stores, but not to the chain.
– Was it a difficult decision to cut Sport 1?
– We think we had a very good collaboration, but it was in principle from both sides.
E24 has asked Sport 1 top Ole-Henrik Skirstad about the break-up and Jørgensen’s considerations about it, but he will not go into the background, at the same time as he confirms that the collaboration was good.
Climate quotas are cheating
The Norrøna tops point out that the biggest investments they make in the future are about sustainability.
The clothing industry stands for around 10 percent of the world’s greenhouse gas emissionsand in Norway, huge quantities of textiles are sent out of the country.
Jørgensen believes that very few Norrøna products are discarded, and points out that the products hold up well in price in the second-hand market, and that they make thousands of annual repairs – last year the number was 14,000.
– Do you feel an extra responsibility when you are part of the textile industry?
– If we had been doing one or the other, we would like to find solutions to the climate challenges, because the alternative is not very pleasant.
The Norrøna owner, who himself sells clothes in the higher price range, has been a driving force behind the fact that clothes are too cheap, and that people should buy smaller clothes, but of higher quality.
– If people had had the buying pattern you envision, then perhaps you would not have had the growth you can point to?
– I actually think our customers use the products until they are worn out, there are no other brands where you see as many old products out in the mountains as Norrøna, Jørgensen claims.
The goal for the company is to have no footprint by the end of 2029. And that without buying allowances.
– We do not have the full solution on how to get there now, but will work methodically with footprint reductions every year, that is how we approach all innovation.
– What’s wrong with quotas?
– It’s cheating.
Fighter with Gucci
The company will continue to open its own stores in 2022, most recently in Munich, and has plans for six new stores in the United States.
– It is a milestone for us that we will have over 50 percent export share this year, says Jørgensen who is the fourth generation Norrøna owner.
By the end of 2022, the company will have around 40 own stores.
He explains that although it is easier to find good premises today than a few years ago, there is a fierce battle for the best locations, also abroad.
– We’re fighting with Gucci for premises. These are pretty cool international brand names we knife about locations with.
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