NICHE MARKET SUCCESS A niche market focus and post buy-out management agility have given a competitive edge to Advansa, leading supplier of polyester fibre, filament and specialities. “We are not swimming with all the fishes,” says managing director Dr Heinz Meierkord in a conversation with Colin Chinery.
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the ultra competitive polyester fibre industry, specialisation has made the German/Dutch Advansa a global niche leader. With a manufacturing plant at Hamm in Germany, Advansa is a leading supplier of polyester fibre, filament and specialities, with annual revenues in excess of €150 million. With its main marketing and logistics operations in Europe, the USA and Asia, Advansa’s business portfolio extends across three main categories – two with a high focus in branding and marketing: fibre fill for pillows, quilts, mattresses and furniture; performance fabrics used mainly in sportswear and related items; and highly specific polyester fibre for technical end uses in industries as diverse as automotive, construction, medical and packaging.
Niche definition “We have very clearly decisive niches in the polyester fibre business which is otherwise a huge global ocean in which you swim. So we are not swimming with all the fishes,” says managing director Dr Heinz Meierkord. “In these niches we have very decided, partly visible, partly invisible competitive advantages, and at least in Europe if not to an extent on a global scale, we are the market leader.” This former Du Pont business was acquired from Sabanci, Turkey’s leading industrial and financial conglomerate, two years ago by a group of investors including the senior management of Advansa. The buy-out has brought the company great agility, says Dr Meierkord. “The changes are those that occur when you get out of
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a big industrial conglomerate that has a number of structures and processes going through several layers of management and decision-making. “Compared with the past, decisions are now taken extremely quickly, largely independently, based on pure data and – in most cases – the experience of a single decision maker. Our levels of flexibility and initiative have increased enormously, which is hugely important in this very competitive and daily changing business environment we are working in.” At the same time Advansa is able to draw on its 50-year Du Pont heritage, with full rights to the former DuPont polyester technology as well as access to the experience associated with its continual development. And there is another major legacy – its people. “Our company has emerged from a big conglomerate into the mid size structure. So we have people with a much broader background, colleagues in the shareholder team coming back from ICI times who later joined Du Pont, and those like myself who started purely in Du Pont. “And because of this we have an international team, notably in the marketing organisation where we have ten different nationalities with 14 active spoken native languages. If we had started purely as a small Westphalian company in Hamm, it would have been very unlikely that after 20 years we would have had a team like that.” Another of the company’s strengths is the close relationships it maintains with its key suppliers: “Pulcra Chemicals in particular is a very important supplier to ADVANSA. Pulcra
Chemicals, B-Plast 2000 and Anton Uhlenbrock are all long term and good partners of ADVANSA. They achieve good ratings as suppliers in our quality management systems. Our priorities for key suppliers are: good value for money, suppliers with a service orientation and we prefer to establish long term partnerships.”
Focused R&D Advansa’s ability to continually develop and commercialise innovative polyester products while remaining competitive, is one of the company’s critical success factors. And here the key driver is its state-of-the-art R&D multinational research project leaders and operational teams. But in an industry with tight profit margins, R&D must be strictly monitored and end-user focused, says Dr Meierkord. “Many traditional approaches have a management philosophy that R&D by its nature has a poor yield and many failures. But this means you waste a lot of money, and the margins in this business are not so high that you can afford significant mistakes. “And if you look to the financial strengths of your company, one point where you can improve your financial and commercial strength is to reduce waste – not only in production but also, for example, R&D. So you must strive for a higher percentage of probability – easy to say but on a daily business basis difficult to carry out.” In general the overall man made fibres sector that has seen significant developments over the past decade, the current hot spot is carbon fibres, says Dr Meierkord.
