Market

Lagercrantz Group’s geographic market is mainly customers in Northern Europe. The largest volume of sales is recorded on the markets in Sweden and Denmark. The end customers for Lagercrantz Group’s products are found mainly in electric power generation and distribution, electronics, building/construction, IT, transport and telecommunication. No single customer accounts for more than approximately 5 percent of consolidated sales. On average, the ten largest customers of each of Lagercrantz Group’s subsidiaries account for approximately two thirds of the company’s sales.

Driving forces

Lagercrantz Group has a broad overall dependence on industrial production and building infrastructure in the markets where the Group is active. Some important submarkets are reported on below.

Investments in infrastructure to meet a growing global demand for electricity is a long-term growth area. Energy distributors are expanding their networks and improving the existing grid to increase capacity. Power producers are developing more efficient facilities and facilities with less environmental impact.

Growing world trade and global competition are forcing manufacturing industry to increase productivity, so focus has been directed to purchasing functions and line processes.

The increasing volume of information in fixed and wireless networks is driving the expansion of capacity and the development of new technology.

Types of business within Lagercrantz

Trading in different forms represents approximately half of the Group’s sales. Trading companies in Lagercrantz Group assume the position of an attractive partner with strong ties to both their customers and suppliers. The place in the value chain is justified by the fact that Lagercrantz Group can offer technical and commercial know-how, problem-solving, local customisation, systems, as well as training and service.

Sales of proprietary products are an increasingly prominent type of business in Lagercrantz Group. This means that the subsidiary develops, markets and sells products and also offers aftermarket services based on products that the company holds the rights to. The manufacturing of the products is conducted in-house or via partners. Within companies work within well-defined technical niches and often with export potential. Sales to foreign countries are made using own resources or via partners, such as local distributors and agents.

Other types of business within the group include niche production and system integration. Niche production means that companies manufacture special solutions on behalf of the customer. System integration entails delivering a complete solution, often including after-sale service.

Competition

There are many alternative products and players in each market in the field of technology trading. Small local players representing foreign manufacturers are dominant in the Nordic markets. They add value by working the market actively and by creating demand with a high level of knowledge about their products, businessmanship and a high degree of flexibility and customer customisation. Several of the global manufacturers also have their own sales organisations in the Nordic region and can offer good service and technical expertise. There are also a number of wholesale companies which carry a broad range of products and distribute large volumes. The specialist knowledge about individual products is not as pronounced among these companies.

In technology trade Lagercrantz Group’s subsidiaries act as smaller distributors, but with the advantage of being a part of a strong group. Subsidiaries are active in creating sales and a high degree of customisation, and they are individually focused on building a strong market position in a niche. By being a strong player in a niche, the largest customers are attracted, as well as the best suppliers and the most competent personnel.

For proprietary products and system integration, the competition is determined by technical performance, supplementary services and your value as supplier in relation to price. The element of completely unique and customised products, as well as tailor-made solutions, means that few competitors have similar offers.

In proprietary products and system integration Lagercrantz Group subsidiaries compete with its unique products and services. Here again, the aim is to create a strong market position in a niche and Lagercrantz Group looks primarily for companies with products with long product life cycles. Several of the companies acquired by Lagercrantz Group have a strong position in a specific domestic market and are seeking to expand by growing their export business.