Damixa, the Faucet producer based on the island of Funen, is considering making 120 redundancies to ensure competitiveness. Part of the company’s production will be outsourced abroad.
“Today we have unfortunately had to announce to our employees that Damixa needs to make about 120 employees redundant in order to retain a strong position in a very sluggish market,” says Kim Kenlev, Managing Director of Damixa.The plans are to be discussed with the company’s joint consultation committee inthe near future.
Both in Denmark and globally, the industry is seeing a decline in demand of about 30%. But the redundancies are an essential and important part of the company’s overall strategy. The aim of the strategy has been to turn bad times into good times in a period with increased competition and a financial crisis to contend with.
“It is clear that Damixa is on the right track, but that doesn’t alter the fact that we now have to say goodbye to talented and loyal employees – and this is very sad. But it is quite simply essential to outsource our very labour-intensive processes – and thereby the salary-intensive part of the business. We are, for example, outsourcing production of many parts for our taps to subcontractors in the Far East, but we are keeping the assembly work here on Funen,” says Kim Kenlev.
Focus on high quality
He points out that the company’s subcontractors are fully conversant with Damixa’s high quality requirements so that aspect will not change.
“Damixa’s strength is smart Danish design, high functionality and an absolute commitment to quality. In Denmark we are world champions at design and userfriendliness, but we have to admit that there are others who can produce parts cheaper than we can,” says Kim Kenlev.
He is convinced that after this adaptation Damixa will be competitive in the current market – both nationally and internationally. The remaining assembly division has also been given state-of-the-art technology to ensure that the company achieves the required efficiency.
“We expect to make a loss in 2009, but in 2010 we anticipate modest profits which will grow as the construction industry recovers and the markets pick up”.
Kim Kenlev, who has been the company’s managing director since 2007, recently took over Damixa in partnership with Finance Director Morten Vedel Kruse and the investment company EVO Capital A/S from Masco Corp, its long-time American owner. Damixa’s history is closely associated with Funen where the company was set up in 1932. After the redundancies approx. 160 employees will remain in Denmark and in the company's sales companies around the world.
Further information can be obtained from Kim Kenlev, Managing Director of Damixa on telephone no.: +45 22 93 89 86.