Business News

Flexibility Crucial to Overcoming Crisis, Textile Executive Says (interview)

Nova Gorica, 29 March (STA) - The competitive advantage of Tekstilna tovarna Okroglica is great flexibility of its employees, CEO Evgen Kete told an interview with the STA as he spoke about his textile company, which thrives despite recession.

Kete spoke to the STA after he was selected one of five most successful business executives of the western region of Primorsko by the local radio station Radio Koper Capodistria and newspaper Primorske novice.

Okroglica, based in a small village in the municipality of Nova Gorica and employing some 100 people, has enhanced its business during the crisis, which has especially hit the textile industry in Slovenia.

"Our textile production is not typical, we're not making classic textile products. We're mostly manufacturing technical textile, which is more interesting as a branch. We've also selected such niche markets which have recorded a relatively decent growth lately and where we can increase our market share."

Okroglica has a 15% market share in textile manufacturing for the car industry in Europe and plans to increase it further, said Kete, who has headed the company for 17 years. He said that one in seven cars made in Europe was equipped with its products.

In the range of products for the cable industry, the company holds a 9% market share, which Kate says is a substantial increase compared to the last two, three years. Even though the crisis has hit the car industry hard, Okrolglica increased revenues by 40% in 2010, exceeding its target.

"We were affected by the economic crisis already in the second half of 2008 and responded quickly by introducing numerous measures, most of which were designed to cut costs."

Among the measures were lay-offs and switching to supply from low-cost countries. On the income-side, efforts were made for new deals which bring results fast, while a long-term measure was a search for new product ranges and markets, Kete said.

Kete said the company planed to further increase sales as demand in the car and cable industries is growing and since the company had increased competitiveness by moving part of production to China.

He explained the move claimed no jobs in Slovenia, what is more, the company even got some new deals as a result and employed another 20 workers here.

Kete believes the secret of Okroglica's success is the extreme flexibility of its employees. "In the last 20 years we have changed all product ranges, manufacturing technologies and buyers, which means that we had to find new product ranges, markets and buyers".

The problem of Slovenian businesses is that they mostly operate on the domestic market, which has made them uncompetitive and unfit to enter foreign markets, Kete believes. He finds it shocking that Slovenian companies make as many as 70% of their business at home.

Commenting on late payment, which businesses say is a crucial problem, Kete said this showed how far Slovenia was from market economy. He sees a solution in generating profit, money flow and new sources of financing and fresh capital rather than in a stricter law.

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