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REMARKABLE BRAND LOYALTY FROM UNION

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NIEUWLEUSEN, Netherlands (16 january) – Though Dutch Union bicycles (65.000 units) may seem no more than a crumb on world scale, the restart after bancruptcy offers some interesting views. Buyer of the Union assets is Larcom, a private enterprise for social security employment. 75 (out of 1300) Larcom employees had already been working in the […]

NIEUWLEUSEN, Netherlands (16 january) – Though Dutch Union bicycles (65.000 units) may seem no more than a crumb on world scale, the restart after bancruptcy offers some interesting views. Buyer of the Union assets is Larcom, a private enterprise for social security employment. 75 (out of 1300) Larcom employees had already been working in the assembly of bicycles marketed by Union. The idea is that Larcom will set up a completely new plant within 10 miles of the present Union premises to ensure employment for the present crew (75 Larcom plus 40 ex-Union) and maybe more. The confidence for this setup is derived, among others, from the fact that 90% of the 400 Dutch Union dealers were willing to re-place their seasonal orders from last fall. (These orders had been cancelled by the receiver). According to interim manager Harry Wierbos, this remarkable brand loyalty of the dealers has surprised Larcom. Many dealers have two or three brands which constitute the basis of their business, and they could easily have switched (some actually did so and put their winter money in stocks of other brands), but apparently most had hoped for the revival of their trusted brand. In the meantime, Larcom is working frantically to resume production. Main strategy is to invest (still more) in strong dealer relationships in Holland and Belgium. Total re-organization will take one season, Wierbos expects, and during this period a new Union management will be sought to take over the overall responsibility. (OB)

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