2019 is coming to an end and it is time to take stock. With some players in the household appliances sector, we retrace the highlights of this year, with some anticipation about the news for 2020.
by Elena Corti
The year that is closing has presented several challenges that companies have had to face. The duties war between the United States and China, political instability in different areas of the world, the uncertainties linked to Brexit: all these elements have led to a complex situation with which companies have had to deal. And since the end of the year is time to take stock, with some companies in the sector we have tried to take stock of the situation, highlighting the results achieved, the critical factors and the prospects for the future. What emerged – both in the field of large household appliances and in that of small ones – is that 2019 was characterized by a global context in which it was difficult to make predictions.
«The year that is closing has been – as expected – very difficult, both for the continuous international problems on duties, and for the modest growth or economic stagnation that remains in the different markets in the world – says Paolo Mainardi, Brand Manager of Fulgor Milano -. The two areas that are driving our exports are currently North America and China, with different approaches and with important goals to be achieved in North America in short times and in China in longer times (also because in this market we have been present only for a year). The other economic areas, if we exclude the Middle East, which for us continues to be a significant market, were not particularly performing in 2019 and in some cases even fell compared to past years (EU markets). As for 2020, we are organizing to recover business spaces in more complex markets such as the EU, Australia and South America.»
Maurizio Re, Sales Manager at Reber, in turn emphasizes the fact that companies increasingly have to operate in changing contexts, characterized by ups and downs: «2019 – Re declares – was a complicated year, more than anything else for the fact that by now we work almost without programming by the customers. We are therefore faced with strong ups and downs, with a very irregular trend compared to the past, despite the turnover being stable compared to the last year. For 2020 we expect growth due to the implementation of agreements stipulated with R.G.V. and to the expansion of both the product range and the foreign markets.»
To cope with a situation in which it is difficult to make long-term forecasts and maintain their own competitiveness, some players in the sector have focused on continuous improvement and specialization to offer added value and guarantee skills and higher and higher performance.
«Focus and continuous improvement – Marco Zappulla, Sales Manager of Zepa-Teka Group summarizes -: these two “drivers” could easily summarize the trend of our company. It is a process, started a few years ago, that has been consolidated over the last 24 months. Our society is part of the Teka multinational company and plays the key role of Competence Cooking Center for the whole Group. This role is particularly important for all the activities carried out there and also for our OEM customers. We are recognized in the CB World Scheme and this goal allows us to certify products internally with qualitative benefits, significantly reducing time-to-market. Once the products are tested and validated in our laboratory, we are totally sure that they will perform at their best even in the destination country. The 2019 was decisive for the specialization of all the skills, allowing our company to achieve remarkable results in several fields: both in terms of new products launched on the markets and in terms of mere routine activities aimed at optimizing all company processes. As far as commercial targets are concerned, even in this area we can be satisfied, although some regions of the world have not lived up to expectations, especially in the second half of the year. Thanks to our specific market segmentation with dedicated product lines, we were nevertheless able to maintain a positive trend with growth both in terms of turnover and profitability. With regards to 2020, our goal will be the full implementation of a process that is transversal to the whole company, called I-HOB: the innovations that will derive from it will be able to significantly change the concept of product development involving all departments.»
Comparing the opinions expressed by the companies, one aspect that is common is that the presence on foreign markets remains a key element of corporate strategies.
«Although in a global context that makes it increasingly difficult to make medium-long term forecasts, the results obtained so far seem to legitimize a moderate optimism. – Riccardo Remedi, Managing Director of Faber, says. – We always pay great attention to the new opportunities that markets can offer. This year the company presented itself in Germany to oversee the kitchen studios channel: the start of trading activities on such an important market will help to keep high prospects even in 2020.»
«The 2019 – says Lorenzo Poser, Marketing Commercial Director of Falmec – will close very positively for our company, with significant growth both in the Italian and foreign market, particularly in European countries where we have strengthened our presence. We are optimistic also for the near future: in 2020 we will open two new commercial branches to develop some strategic markets through a direct presence in the territory.»
Also for Glem Gas the year that is closing has recorded good performances. «In 2019 – Marco Guerzoni, Marketing Director of the company explains – Glem Gas has undoubtedly had a positive trend, in an important year for us, being the anniversary of our 60 years. In Italy we are achieving excellent results and we are growing both in the Retail channel and in the furniture sector. As regard instead the Middle East, this market seems to have overcome the initial “shock” due to the introduction of austerity policies, finally finding more confidence and a consequent growth in consumption compared to the ups and downs of recent years. We are having different satisfactions in France too, usually a difficult market, where thanks to a push and multi-channel commercial policy we achieved revenue levels that make us hopeful for the future. The same is also true for Australia where our branch, despite an increasingly concentrated market at distribution level, presents positive results in terms of turnover and margins. We have some more uncertainty from South America: the continuous and now cyclical economic-political crisis can only hamper the growth of that area. A very different consideration must be made for North America and for Asia, where starting already from 2020 we have been aiming to concretize excellent opportunities now in definition phase. As for the next year, in general we expect it to be positive and we aim to consolidate the good results seen in 2019 (globally we estimate a consolidated 82 million euro in 2019 for the Group), increasing the trend basically thanks to 3 factors: first of all the product news that will be introduced both in the free-standing segment and in the built-in; second, the growth given by the new markets, Asia and North America; and the third is the positive trend in areas that have long seen us as protagonists.»
The key issues of today and tomorrow
Innovation, IoT, sustainability, presence on global markets and enhancement of Made-in-Italy: these are among the main issues that companies identify as strategic for the domestic appliance industry. «Despite the general situation that is not brilliant in our sector – Lorenzo Poser of Falmec explains -, I believe that there is room for growth for companies like ours, which have made differentiation and innovation a point of excellence. The challenge for the future lies in capitalizing and transferring this our belief to the market, along the value chain up to the end user.»
To meet the demands of the market and increasingly demanding customers, the concept of 360-degree efficiency becomes essential, whether we are speaking of production processes or green products.
«Our sector – Marco Zappulla of Zepa says – continues to change: smaller and smaller lots and necessary customizations, with ever more pressing requests by customers of constant innovations both aesthetically and functionally. These are obviously quite difficult challenges for manufacturers, especially when it is aimed at optimizing costs with economies of scale. And they are challenges that will be presented again in the near future and that our Group has already begun to manage efficiently. Green Economy is also increasingly important for our company. In an age where the economic crisis and the scarcity of natural resources represent the main problems of the planet, Green Economy and eco-friendly technologies propose themselves as concrete solutions. Today and more and more in the future, customers will want sustainable products by sustainable companies. Our company has been certified 14001 for a long time and currently uses electricity generated from totally renewable sources, certified with the “Guarantee of Origin” titles. Furthermore, a photovoltaic system is already planned that will allow us to become autoproducers.»
A further success factor is to combine global presence and high-tech products. «Faber -Riccardo Remedi explains – can count on a global presence able to diversify the risks and support growth: we are currently present in four continents, with plants in eight countries (Italy, Sweden, France, Argentina, India, Turkey, Russia and Mexico) and the recognized leadership in terms of know-how makes Fabriano the beating heart of a global division of 2,100 people and 340 million Swiss Francs in turnover. From the point of view of the product, I believe that the key themes of the near future will be the IoT and the ability to propose solutions able to treat the air purification of the entire domestic environment, not only of the kitchen.»
Moreover, among the strengths highlighted by Italian companies, there is Made-in-Italy, an expression of quality and an element of distinction. «The domestic appliance sector is increasingly driven by Chinese and South Korean industrial giants, also thanks to the Asian region, which today accounts for 50% of the world market – Paolo Mainardi of Fulgor Milano comments -. The space that we must cut out, as a company, is that of specialists, of real lovers of cuisine as flavors and as passion, of Made-in-Italy and industrial quality with an artisan imprint.»
«The situation is certainly challenging – Marco Guerzoni of Glem Gas adds in turn -. On the one hand the strong aggregation of the big of the market and, on the other, the new “fierce” competitors outline an extremely aggressive context that pushes us more and more towards the differentiation based on our brand identity: to be “Specialisti in Cottura” (Specialists in Cooking), to be Italian and Emiliani (from Emilia Romagna region), to be Glem Gas. For us the future passes mainly from all this. With regard to the key themes of the coming years, the exogenous factors given by the market will obviously be elements with which we will have to deal and compare ourselves. I refer to the evolution of competitors, to the Italian system for years unfavorable to the manufacturing world, to a very complex, demanding distribution, sometimes caught by identity crises, up to the new energy challenges.
However, I have the presumption to affirm that the real challenge will be ours, in the sense that our future will be that which we will be able to create for ourselves and the challenge will remain that of continuing to invest in time and resources, not just monetary. For years, we have built a heritage of people, culture and professionalism that distinguish us, on which we focus and will continue to focus. Our wealth of experience has an immense and priceless value for us that should not be lost but cultivated. All this to ensure that our brand and our offer find consensus and space in an increasingly complex market.»
Finally, in the small appliances area, one of the aspects highlighted by companies is the fact of having to compare themselves with a scenario that is constantly changing and that will see factors such as value for money and design as key issues. Regarding the sector of slicers and more generally of SDA, Marco Di Leo, CEO of R.G.V., speaks of «a market in continuous change, with sudden upheavals difficult to face on the spot; and sometimes even medium-long term strategies find little response. The most complex issues to be faced will be the value for money and the cleanliness and appealing-emotional design.»
Furthermore, Maurizio Re of Reber underlines how the professional channel can be a good opportunity for growth compared to the prospects offered by the domestic market. «The latter – he comments – is now a purely replacement market, where it’s hard to find real news or missing products in the houses. The situation is different for the professional sector, towards which we are moving, and that instead offers much more interesting perspectives. Obviously we are facing strong competition on cheap products, to which we must respond with quality content, aesthetics and innovation, to continue to be attractive.»
The flagship products of 2019 and the previews for 2020
More than single top products, for 2019 we should talk about ranges that include different types of appliances that stand out for technological innovation and aesthetic refinement. «This year – explains Paolo Mainardi of Fulgor Milano – has seen us engaged in the realization of the new Cluster Concept series which includes horizontal cooking (both gas and induction) and vertical, with ovens of different sizes and with types of cooking integrated with appliances for storage and vacuum. 2020 will see the launch of a new series called Urbantech, which will make of its aesthetic definition the main focus».
«By philosophy – Marco Guerzoni adds regarding Glem Gas – we do not focus on a single product but always on different lines. Both in the free-standing and built-in areas, our width and depth of offer allowed us to collect spaces that others have left vacant and/or with a bit of luck we managed to guess what the market needed. I personally think that our free-standing 90 cm wide cookers with a semi-professional look, Matrix and Unica, as well as Magnifica, a 120 cm free-standing cooker, are the lines that give us the most satisfaction at the moment … As built-in, the original and modern GFE and GFP models are offering us excellent results. Last but not least, in the Italian furniture channel, we must underline the excellent performance of granite sinks. Regarding the news for next year, they will cover the built-in and free-standing product categories. Both will see a review of the platform with projects that, in addition to renewing the aesthetics, will totally improve the product. A great effort, fingers crossed. I anticipate a name: Specialista, #LaBuonaCucinaItaliana.»
As for Zepa, the flagship products offered by the company in 2019 concerned gas cooking. «We have launched a new range of hobs on vitroceramic signed by Teka brand – states Marco Zappulla of Zepa -. These are products that present innovative features both aesthetically and functionally. Their success on the market has been important and has allowed Teka to obtain awards and recognitions in various countries around the world. As for 2020, we are developing three new lines, one of which in particular will enter a semi-professional sector with a look and performance decidedly impactful». The segment of Cooking also sees more and more companies producing hoods thanks to an innovation like the suction hob. «We have grown a lot in the Cooking category – Lorenzo Poser of Falmec explains – thanks to the introduction of a complete range of cooking systems that integrate suction. Also in this case we have been able to catch a market trend, offering unique and distinctive products that bring advantages in the daily use of the appliance and this is certainly rewarding us. Now we are working for Eurocucina-FTK, where, as Falmec tradition, we will bring important innovations and innovative concepts, which we cannot yet reveal.»
Faber also considers the Milanese trade fair an essential appointment to present the new products. «Traditionally the year between two editions of Eurocucina is considered transitional – Riccardo Remedi underlines -. However, it is a year in which we have been intensely engaged in the development of new products and projects. We remember that Faber invests about 5% of its turnover in R&D, and will maintain the same investment also in 2020. As regards next year, we can only anticipate that Eurocucina will be rich in novelty.»
Finally, as regards small appliances, the products proposed during the year were characterized not only by attention to functionality but also more and more by the attention to aesthetic details. «Also for 2019 – Marco Di Leo of R.G.V. claims – our leading products were the slicers on which we introduced the easy clean system for easier cleaning of the plate, in the area below and behind the blade. As for the news for next year, they are usually top-secret but at the latest edition of Host we presented trendy slicers with an attractive design that have interested and make curious thousands of visitors. This is a project that we will try to implement in 2020» .
In addition to functionality and design, another increasingly important element in the SDA sector is energy saving, and the latter is just one of the factors on which Reber is focusing on. «Vacuum machines and meat mincers – Maurizio Re declares – are the most important products for Reber on the international market, as well as some niche products, such as vacuum cooking, about which we think there will be an important development in the coming years. During 2019 we completed the transformation of almost all our products into the new energy-saving versions. The vacuum line has already completed this step, while in 2020 we will continue the transformation also with regard to the more traditional sectors, realizing a new range of professional meat mincers that will have a very low energy consumption compared to the past, with a rather significant economic benefit also for the user, which is not irrelevant for professional operators, who use the devices for long periods of time.»
Not just product news
During 2019, the household appliance companies not only proposed new products to the market but also implemented a series of initiatives aimed at improving processes, company organization, training of human resources and marketing and communication activities. «A leader reality like Faber is obviously always committed to improving its offer, but also its organization and processes – Riccardo Remedi explains -. Among the significant steps taken in 2019, we can mention the development of initiatives such as Game Challenge, conceived with the aim of increasing the managerial skills of internal resources and stimulating increasingly multinational spirit and approach, and the launch of the e-commerce website with a view to progressive digitalization.»
«This year – Paolo Mainardi of Fulgor Milano says in turn – our company provided to make efficient the production lines of free-standing appliances dedicated mainly to the North American market, as well as it provided to make a restructuring in the industrial layout, placing the production of products with our Fulgor Milano brand in the “core” of the structure itself. But above all, on a communicative level, we wanted to concentrate our efforts and resources during the week from September 23rd to 27th in which we hosted our customers from all the markets in which we are operating to celebrate the 70th anniversary of the Fulgor Milano brand activity, with dedicated events and a gala dinner that gathered us to give greater impetus to that “Italian passion” that has always animated us.» Regarding Falmec, the company focused on the new production plant. «We have brought a new production plant at full capacity alongside the current headquarters, at Vittorio Veneto – Lorenzo Poser declares -. It is a highly automated and state-of-the-art plant, to cope with the double need to increase production capacity and maintain high quality standards.» Finally, Zepa has launched a series of initiatives in various fields. «At the production level we have introduced the Lean Manufacturing method in an increasingly efficient and performant way, and the results are already visible – Marco Zappulla explains -. Regarding the commercial organization, on the other hand, separate “management” activities have been started for the various distribution channels, as well as a specialization for the main ones which are the OEM and the Group’s brands. The aim is to manage specific needs with dedicated groups, all with the target of providing precise answers and constant proactivity. Moreover, with reference to marketing and communication, we will develop a new and much more complete website, able to offer an active support in managing the needs of our customers in the various countries of the world.»