Core theme: Increased efficiency and flexibility

Bonava will increase cost efficiency through a flexible organisation as well as repetition in products and processes in the local market. We will ensure that our operations can be rapidly adapted to changed business volumes and that we carry out the parts of the value chain that create the most value under own management.

Flexible organisation

The market for housing construction is continually changing, and competition is fierce. To ensure long term competitiveness and profitability, Bonava’s organisation must be efficient, customer-oriented and flexible. Bonava has adopted a more flexible organisational structure, with large parts of governance being decentralised and central functions and initiatives being substantially reduced, and responsibility for operational decisions being brought closer to customers and markets while major investment decisions are taken centrally in the organisation. This provides the Group with the conditions for being able to act quickly on changing market conditions and customer needs.

Adjustment to lower business volumes

In a recession, the fixed cost base must be adjusted to the new business volumes.  Since the first signs of a weaker market in 2022, Bonava has been actively engaged in reviewing the company’s costs and implemented adjustments to align with lower business volumes. Bonava conducted a review of its selling and administrative expenses, as well as of its indirect costs   back in 2022 and continued these efforts in 2023. Moreover, Bonava decided on a restructuring programme in the autumn of 2023 that is expected to lead to savings of nearly SEK 400 M on an annual basis starting on 1 January 2025. The reduced cost base thus totals SEK 1 Bn gross (SEK 620 M net) from January 2025 compared with the annual rate in the first quarter of 2022. These measures will create a more flexible organisation where construction starts can easily be scaled up in a better market.

Increase repetition in products and processes

We create clarity and efficiency through repetitive work processes and products in the respective markets. Bonava works with standardised solutions that are continually being improved and used across several projects in order to achieve cost efficiency. These set the parameters for how we can design our homes.

Competence and efficient project governance

In the areas where there is scope for significant value creation through economies of scale and efficiency gains, Bonava is to have robust internal competence to pursue the operations itself. Internal resources facilitate a greater degree of repetition and continual improvements when we learn from our experiences. The functions to be carried out within and outside Bonava may change in pace with developments in the market, and will be routinely evaluated.