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AWI streamlines business to maximise value for woolgrowers
28
Jul '08
Australian Wool Innovation Ltd (AWI) announced a realignment of resources following an extensive review of the operations based in Melbourne, Ilkley in the United Kingdom and Lisbon in Portugal.

As a result AWI has taken the business decision to transfer functions to India and Sydney resulting in a significant cost saving, and to transfer the Portugese operation to Spain.

According to the Chief Executive of AWI Craig Welsh the decision is good business and continues the evolution of AWI into a world class operation.

“Our decision to relocate the Interior Textiles operation to India will effectively bring this function closer to where the carpet is manufactured,” he said.

“This is about working smarter to give wool growers maximum value for their investment by reducing overheads.

“Restructuring to date has eliminated Woolmark inefficiencies and saved woolgrowers in the order of $5 million per year.

“These savings will be put to use growing longer term demand as part of a new business model.

“Between 85% and 90% of woolgrowers' levies are attributable to Merino wool production for the apparel sector.

“So while AWI is still in the interior textiles business, it's smart to be closer to the manufacturing base to ensure resources are maximised for this sector.”

Mr Welsh said the decision was made with full consultation with the managers of the areas concerned … Interior Textiles, Market Intelligence and the Woolmark Licensing/Administration.

He said it made sound business sense to locate the Market Intelligence function in Sydney which will ensure that it's fully integrated with the company and continues to provide valuable information for Australian woolgrowers.

The transfer of the Woolmark licensing and administration functions to Sydney will result in better communication and execution of AWI's business model.

“With the imminent roll-out of the new marketing and branding strategies, it is imperative that the various functional areas responsible, work cooperatively and closely,” Mr Welsh said.

Consultation has commenced with nine staff members in Ilkey affected by the decision.

The Melbourne and Ilkley offices will close by 30 November 2008.

In line with the new strategic direction of AWI, it was also decided to transfer the representative office in Lisbon Portugal to Barcelona in Spain.

Mr Welsh said a new global retail business had emerged in Spain and AWI needed to work more closely with key accounts in retail in that country.

The Lisbon office will cease operations at the end of August.

The changes have affected 17 staff, five of them in Australia which is in addition to the earlier redundancies from the Woolmark business of 30 employees around the world.

Australian Wool Innovation Limited

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