“Italian manufacturing companies that are not very or hyper competitive: it seems that there is no middle ground in the judgments. In reality, the generalizations are all wrong because the business world is a world of heterogeneity" - this is what we read in the scenario analysis by Sergio de Nardis chief economist of Nomisma published in the July issue of the newsletter.
The "manufacturing company" is not given in nature, there is no homogeneous entrepreneurial entity to which one can attribute a vote; however, there are individual production realities, each with its own specific characteristics of efficiency, management, organization and innovative capacity. Small businesses are not all the same, nor are big ones. In each size range there are more or less efficient firms. How to distinguish them? The litmus test is the commitment or not in export business. Selling on the international market is, in fact, more difficult and expensive than producing for the domestic one; only the best companies can do it profitably. And the presence of these best companies can be identified in all size classes. Exporters are on average larger, more productive, pay higher wages, make more investments, have higher profit margins than non-exporters. These "premiums" for exporters are systematically found in each size range.
How many are the best companies in Italy and how much do they weigh in the Italian manufacturing system? Selling abroad is a relatively rare phenomenon, precisely because not everyone is in a position to do so, not all companies can bear the higher costs that must be faced to engage in an international business. In Italy, only 20 manufacturing companies out of 100 export, in Germany 26 out of 100, in France 12. For Italy, these are around 88.000 manufacturing exporters out of a total of 425.000 producers. An extremely high number, higher than that of Germany (55.000) and France (26.000), but which is reduced in proportion to the total of producers due to the extreme diffusion of entrepreneurship that characterizes our country (double in number compared to Germany and France); however, most of them are very small (less than 10 employees) and aimed at the internal market. What matters most is that those 88.000 exporters are the ones who determine the trend of the entire manufacturing sector, producing over 80% of the added value and total turnover.
In the last two years, this minority segment of "best" producers has suffered the effects of the drastic contraction in domestic demand. In fact, they are certainly exporters, but they also sell a lot on the national market: on average, over 60% of their turnover is made in Italy and this occurs both for large and small exporting companies. Their competitiveness was, therefore, inevitably penalized by the unprecedented drop in domestic demand and the resulting credit crunch: our exporters had to face competition from foreign companies not weighed down by the recession of their economies and, above all, not penalized by comparatively more expensive and scarcely accessible credit. The manufacturing that emerges from the recession has therefore significantly slimmed down, in terms of number of operators and production intensity. To safeguard the manufacturing capacity of the Italian economy, it is absolutely necessary that a recovery worthy of the name be launched as soon as possible.
The full text of the analysis is available on the site http://www.nomisma.it/index.php/it/newsletter in the "scenario" area.
