Falling consumption and tension on raw material prices: these are the dangers looming over successful medium-sized companies, branded Italy, such as Candy, the Brianza group that has been churning out washing machines for 66 years. The specter of recession is hovering in Europe, but China is also beginning to show signs of slowing down and inflation is keeping households from making purchases.
“We will begin work on the new factory in China within days – says Beppe Fumagalli, director of the washing sector and member of the family who owns the company – because in any case it is a market with 20 million washing machines and an economy which is growing at the rate of 5-10% per year. One of the largest local household appliance distributors has reported this concern to us, due to the fact that people who have just entered the world of well-being are already starting to pull the oars due to the reduction in purchasing power due to accelerating inflation . The biggest problem, however, is in Europe. Germany has sounded a new alarm bell and the other countries are doing worse”. To navigate in this context, Candy has chosen to focus on increasingly innovative products and has put the rudder on investments in research and development: 40 million euros, spread across all products (from washing machines to dishwashers, from refrigerators to vacuum cleaners ), but concentrated mainly on the washing sector, the most important.
“In a couple of years we intend to renew the entire proposal - says Fumagalli - and in recent days we have launched the washing machine with a 20-degree program on the market, which guarantees 60% electricity savings and better fabric care, also offering the possibility of washing different colors together. The advertising campaign will start at the end of August and will last until October”. Who knows if the housewives will still say "thank you Candy" or if the current situation will induce them to use the old washing machine: "We believe a lot in this project - says Fumagalli - and even if the climate of uncertainty and the financial , we plan to make up for it elsewhere”.
Candy Group is in fact a pocket-sized multinational with an export share of 80% of its turnover and various production sites around the world. In 2010, the group experienced a good recovery: turnover reached 955 million euros (+4% compared to 2009) and profitability almost doubled, going from 12 to 23 million euros. Even in 2011 Candy's accounts seem to be returning: ” in the first six months – says Fumagalli – we grew by about 2% and we plan to close the year in line with the previous one. Instead, we will record a drop in profitability due largely to these tensions on raw material prices. This is financial speculation against which action should be taken, as President Berlusconi promised a few years ago. In Italy we are also discounting another negative figure, in retail. Large-scale distribution wants to offer the public ever more amazing discounts. The result will be that in October all the companies in the sector will increase their prices”. In the rest of the world, Candy and the other brands with which the group operates (from Hoover to Zerowatt, from Iberna to Jinling, from Vyatka to Rosieres to Susler) are trying to conquer ever greater market shares. “In Argentina – says Fumagalli – we have entered into an industrial agreement to produce washing machines in a branch of a large local company. We are market leaders in that country and from there we want to move towards Chile”.
No interest for now in Brazil and India, while the major relocation to China is upon us. The 70 m2012 industrial site in Guangdong should see the light of day in July 31. The investment is 2 million euros and 60 million will be the washing machines produced every year, 2007% under the Candy brand, the rest under the JinLing brand. the Chinese one acquired by the Italian group in XNUMX. “Relocation is an indispensable tool – observes Fumagalli – which allows us to remain and produce in Italy as well. We always move with the intention of also conquering the market in which we are rooted. We did this in Russia, Scandinavia and Türkiye, where we bought some companies”.
Four companies have been acquired in the last 5 years and Fumagalli does not rule out the possibility that new opportunities may emerge to be seized. “Not big companies – he observes – but some small companies could also be of interest to us”. In short, Candy wants to continue growing without looking for capital on the stock exchange (in these times it would not be advisable), “even if – says the entrepreneur – our competitors are much bigger than us. But we've been doing well for 50 years, why not continue?”. The story of Candy is a real post-war fairy tale, one of those well represented by the spirit of Carosello: the protagonists are three young brothers in 1945, one a former prisoner in America where he had seen the first washing machines, the other a genius of technology and a third skilled administrator. From this mix was born the first Italian washing machine and the group that is still alive today. An unrepeatable story? “I don't think – affirms Fumagalli – basically my father and our uncles left us a European company and we have made it a global group. There is still room for initiative. Italian entrepreneurs would perhaps like a country capable of being closer to them, with a little flexibility in work, stable legislation and forward-looking projects. I believe that Berlusconi has tried to change something. Italy, however, is probably ungovernable. I don't think there is anyone with a magic wand, only Europe can force us to make some difficult and unpopular choices. The financial? It still penalizes the middle class and for consumption it is not encouraging. On the other hand, there is no need to invite the Government to tax large estates, I am convinced that it will do it anyway”.
The Fumagalli heritage also includes Puntaldia, a splendid tourist settlement in Sardinia, a few kilometers south of the Costa Smeralda. For years there has been talk of a growth of the site: doubling of the golf course (today with 9 holes), a second hotel and other houses. Is there any news? “Not at the moment – replies the entrepreneur -. We are still waiting to understand what we can do and where. We have an approved development plan, but regulations change every year and construction shifts from one location to another. This is exactly what I mean by legislative stability. Knowing what can be done and in what times”.
