Case: Future Collection

eCommerce to Achieve Corporate Profitability

Future Collection has been a prominent brand in wholesale special occasion jewelry for the past two decades. At some point in the mid 2000's, profitability began to slide as a result of rising metals prices, pressure from low-priced imports, and end-user migration to non-traditional/online retailers. Future Collection was acquired by Exactly LLC in late 2007, returned to profitability, and sold in late 2010.

Initial Situation (2007):

• Gross Margin: 51%
• EBITDA Margin: -6%
• Percentage of revenue from internet retailers: 25%

Strategy: revamp product line to differentiate from low-cost imports, and develop services that cater specifically to Internet retailers.

Actions:

• 60% of the product line changed over 3 years to represent higher margin, more distinctive products
• Complete revamp of website to increase ease of online ordering by approved retailer accounts
• Various tools developed to automate order tracking and product updates for Internet retailers

Results (2010):

• Gross Margin: 62% (11 point improvement)
• EBITDA Margin: 17% (23 point improvement)
• Percentage of revenue from internet retailers: 45% (20 point improvement)