Dowty Group Plc’s Case Communications Ltd is abandoning its direct sales operations in France and Sweden, due to a combination of economic pressure and, in the French case, regulatory problems. In July the Dowty Group bowed in the face of falling profits and announced work-force cuts of around 2,300 saying that UK and US markets were particularly badly hit. But disappointing European sales have forced the latest move from direct support to distributors. The company has also been hit by French legal requirements which prevent a company operating a direct sales force and a distributor in parallel according to Dowty Case spokesman Tony Richards. He claimed that ideally, the company would have liked to keep a direct sales team for its more complex, high-end goods, while establishing a number of distributors or OEM customers for its simpler boxes; an arrangement that would have mirrored the company’s Spanish set-up. Richards would not name the new French distributor, pending contracts being signed, but confirmed that the current 11-strong sales force would be reduced to three, transferred to the UK pay-roll, who will work in an advisory capaci ty. Meanwhile in Sweden, where there are no legal restrictions the company is also abandoning an oper ation that it started only in 1989 when the company bought long standing Case distributor Dextraferm AB. The company had hoped that a direct presence would help sales to the Swedish PTT, an expectation that simply has not panned out. As with the French oper ation, Dowty is about to sign a new distributor agreement, but has yet to announce who it will be.
