Compared to pre-crisis levels, the gap to be recovered for industry corresponds to at least 70 billion in turnover, 40 active businesses and 1,3 million fewer employees, a sign of how the Italian system is struggling to get back to full capacity. These are the numbers that emerge from the Industry and Supply Chain Report of Unicredit and Prometeia, presented yesterday in a closed-door meeting in Rome and of which we report the main passages.
Like Achilles chasing the turtle, Italian industry continues to experience its paradox; to see an increasingly distant recovery over time, despite numerous strengths highlighted over the last few years, especially in terms of international positioning. After two years of recovery and despite having overtaken France, Germany and the United Kingdom for growth in exports, 2012 closed again with a decline in overall turnover at current prices, bringing the gap between the industrial chains analyzed in the report back to over 5 points compared to pre-crisis levels.
Among the phases, the intermediate processing group is the one that still suffers from the greatest distance, with over 10 percentage points, while the gap between the initial processing and sourcing is more contained, the latter supported by the dynamics of the prices of raw materials in the average of the last five years. Accumulated excess production capacity, if extended over time, runs the risk of also lowering development potential, since in the long run, it deprives the country of the resources and skills necessary for growth.
THE FULL RECOVERY GOES THROUGH THE INTERNAL DEMAND
In the supply chains of the Italian industry analyzed in this report, the share of turnover attributable to sales on the domestic market is on average 73% with a peak of over 80% in the food supply chain, construction products and values around 50% in those of electromechanics and fashion such as to suggest that a full recovery of activity levels necessarily passes through a normalization of domestic demand.
The new global supply chains embrace new technologies: the scale loses importance and the Italian producers appear well positioned to gain a consistent competitive advantage. From the first objective findings in the first months of 2013, as well as from the household and business confidence indexes, it emerges that, also for the current year, the vicious circle between the absence of the market, the loss of production capacity and a climate of generalized distrust is destined to continue. The turnover of the industrial chains at the end of the year will decrease by a further percentage point at current prices. It is a level which, excluding the price effect, further lengthens recovery times, which can now be estimated at more than 15 years from the beginning of the crisis, a horizon which, given the breadth of the intervals involved, now emerges more from statistical projections than from real and own punctual forecasts.
What the industrial scenario could actually be 15 years after the great crisis is still to be defined and ultimately will depend on the choices or renunciations that individual companies and the country system will be able to make. The 2013-'15 imbalance between supply chain phases between domestic and foreign demand will help, for example, to redefine many value chains by moving centers of production, consumption and intermediate processing, but also by modifying the industrial structure, the degree of concentration of the supply chains and their role in the international division of labour. A new technological wave is now upon us and above all within the reach of small-sized companies such as the Italian ones, which will be able to take advantage of this paradigm shift in production models.
DISTRIBUTION AS A DRIVING DRIVE FOR INTERNATIONALIZATION
An internationalization made up of SMEs discounts the need for support on the front of the distribution and logistics channel. The low degree of internationalization of the national brands of large-scale distribution as well as the reduced recourse of the companies themselves to foreign direct investments aimed at strengthening the commercial presence often leaves Italian products at the mercy of local distributors; sometimes unreliable, often with greater bargaining power, generally with more references and in any case with little commitment to the product. From this point of view, Italian companies pay a difference compared to their European competitors where there are large distribution chains that are already highly internationalized and well positioned even in the new markets. The turnover achieved abroad by distribution companies reaches just 3% in Italy (moreover all confined within European countries), while it exceeds 15% in Germany and is close to 10% in France.
IN 2013 THE COMPETITIVENESS OF ALL THE SUPPLY CHAINS WORSE
FASHION IMPOVERSES, AUTOMOTIVE KEEPS
Competitiveness will be a key factor in intercepting foreign demand since companies will find themselves in markets that are certainly more dynamic, but therefore also more crowded. From the analysis of competitiveness by phase and supply chain, it emerges that mechanics continues to show the best positioning among the supply chains. In general, compared to the same index calculated at the end of 2012, a substantial stability in the ranking of the supply chains emerges in the industry, even if the financial sustainability picture appears to be worse due to excess production capacity and tensions on payment times between weaker subjects and strong players along the supply chains.
Between the phases, better results in terms of sustainable competitiveness and growth prospects seem to reward the final producers. In particular, some typical Made in Italy supply chains such as food and fashion emerge, strengthened by a qualified presence abroad which is based on patented brands and a growing market share in some of the most strategic markets such as the Chinese one. However, a progressive impoverishment of the more upstream stages emerges in fashion, where once the production of intermediate materials of the highest range has been removed, the activities that precede the final goods are strongly penalized by problems of productivity and financial sustainability which in the final analysis could also infect the stages most virtuous of the supply chain.
It is a balance that can be extended to other typical Made in Italy productions such as food and furniture where in one case the problems of the agricultural world, in the other the loss of the related artisan heritage risk having repercussions on the competitiveness of the whole supply chain. The case of household appliances and the automotive sector is different, where the so-called related industries have been able to diversify their customers over the years and today, despite lackluster results from the final producers, intermediate processing companies show good competitiveness indices.
THE DISPERSION OF RESULTS IS WIDENING
The importance of choosing the optimal direction emerges from the degree of dispersion of the results within the supply chains. By comparing the average competitiveness of the supply chain and the 20% of the best companies, it emerges that the automotive and household appliances are the supply chains where the differentials are highest. More generally, a detailed comparison of the index shows how highly differentiated results are possible even within the same supply chain and the same phase. It is an indicator that is all the higher the more complex the scenario that companies are facing because in the final analysis it expresses the prize recognized to those who make the most courageous choices. The development of the international dimension is one of these: a need that will concern on the one hand genuine new exporters, but on the other will ask many supply chains to strengthen teamwork to allow even subjects further up the value chain to benefit from foreign growth.
A EUROPEAN VISION OF THE SUPPLY CHAINS IS NECESSARY
A European meaning of the supply chain is probably the right size to imagine a comparison on an international scale. In fact, faced with players who move and invest on a regional scale, think for example of the Chinese penetration in
Africa or to American investments on the Chinese market itself, the optimal size of the supply chains can hardly be limited to national borders. If Europe has little to offer in terms of opportunities linked to the growth of the domestic market, better, but not dissimilar to what has been described for the Italian domestic one, Europe's stimulus to the supply chains could then take place indirectly, for example by bridging those gaps related to the size and supply of services that often limit the potential of Made in Italy in the world.
The diversity of specialization models between countries, if valued within a framework of European supply chains, can generate a multiplier effect on the scenario; capturing and enhancing, for example, the synergies between the large producers of intermediate goods in Northern Europe and the small mechanical assemblers of the South, between the quality of the traditional Mediterranean agri-food and precisely the potential vehicle of French large-scale distribution or German logistics operators.
