Alfa, the Norwegian outdoor footwear company, has embarked on an ambitious five-year strategic plan after Pål Olimb became its chief executive and shareholder in April, replacing Børre Langum, who left the company. Alfa wants to roughly double its turnover, through increased international sales as well as forays into new product categories.
Olimb was the manager of Alfa's sports division until 2006, when he obtained a license to sell Alfa cross-country ski boots through his own company, A-Sport. However, as part of Olimb's return to Alfa, his company and its Alfa-branded cross-country ski boots business were folded back into Alfa.
Olimb obtained a stake of 25 percent in Alfa, while the remaining shares are in the hand of Katalysator, the investment company of the Møller family, which bought Alfa from Haglöfs in 2007. Katalysator has since divested holdings in several other sports companies, particularly Rottefella, Hamax and most recently Bjørn Dæhlie, which was sold to Active Brands, but it wants to remain involved in the sports business.
A-Sport had been growing rapidly in the last years, from sales of fewer than 6,000 pairs of Alfa ski footwear and a turnover of 3 million Norwegian kroner (€0.4m-$0.5m) in 2006, to sales of about 50,000 pairs and a turnover of NOK 16 million (€2.1m-$3.0m) in 2010 – admittedly a favorable year due to the cold weather.
The brand's outdoor footwear business was roughly flat last year, combining a decline in military orders with a sales increase of about 8 percent in the sports market.
Sales in sports and outdoor stores make up about 60 percent of Alfa's footwear sales in Norway, focusing on trekking and hunting boots.
For the coming years, Olimb intends to invest more in product development and to add some marketing zest to the Alfa brand, which already enjoys a very strong reputation among Norwegian consumers. Another part of the strategy is to move into more product segments, starting with accessories such as socks and footbeds.
At the same time, the chief executive wants to raise the share of Alfa's exports from about 10 percent this year to some 25 percent in five years. For the time being, Alfa products are sold to Sweden, Denmark, German-speaking countries and France, through a mix of distributors and direct sales.
The company wants to move into more countries and to open its own business in Sweden and Denmark. Alfa will also explore its potential farther afield, particularly in the American market for cross-country skiing footwear.
The return of ski boots into Alfa's fold should also have an impact on its profitability – adding NOK 18 million (€2.33m-$3.21m) in sales without any extra overheads. Only Olimb and a key account manager were transferred from A-Sport, and both of them filled vacant positions.