Case Study

Case Study: R D Textiles Limited

In 2000, R D Textiles Limited was a UK-based textiles manufacturer that manufactured and provided

finishing processes for a variety of inexpensive fabrics that were used in outerwear and home

furnishings. The company had managed to survive the internationalisation of textiles and in particular

the movement of production to developing countries by retaining a number of large domestic and

international customers; that a number of the company’s production processes were automated had

allowed it to keep production costs relatively low. However, increasing energy and utility prices,

together with comparable production companies in developing countries and the wider presence of

export processing zones had begun to have an effect on R D Textiles Limited’s margins and

competiveness. The loss of a key customer in early 2000 had a significant effect and R D Textiles

Limited suffered a significant loss; the long-term future for R D Textiles Limited looked uncertain.

Shortly after the turn of the 21st Century, R D Textiles Limited appointed a new Managing Director

(MD) who, together with a newly-assembled senior management team, undertook a thorough strategic

review of the company’s operations and customer base. The newly-appointed MD recognised the

potential of emerging niche markets in technical textiles; the decision was made to re-focus R D

Textiles Limited towards these. A convincing business case was developed and the company

attracted investment that allowed it to upgrade or replace a significant portion of its plant and

equipment; the company divested itself of plant and equipment that was redundant and reinvested the

funds generated. Natural wastage and eligibility for retirement of a number of its employees meant

that R D Textiles Limited could also reduce its personnel. R D Textiles Limited was now ready

compete in niche markets of technical textiles, focusing chiefly on high-performance textiles for use

in...