29 Sep Interview with Manuel Pizarro Simancas, Alvic Group manager. Integral Kitchen Magazine
“We are growing at 40% annually in the international market”
Alvic Group means strength, quality and innovation. Since its founding in 1972, this business group dedicated to the production of components for kitchen furniture, bathroom, office and home, has grown considerably thanks to a strong industrial, technological and commercial development. Currently, they are working in over 60 countries worldwide, with growth rates of 40%. A success that has made them the undisputed leader in its sector. We spoke with Manuel Pizarro Simancas, manager of Alvic Group, about this business growth in times of crisis and its differentiation in the market, and about revealing some of the innovations of the company for the future.
How have you managed to deal with the crisis in the furniture industry? What was the strategy that has allowed the company not only to face this crisis, but emerge stronger?
The Alvic Group has also suffered the crisis that has affected so deeply the furniture sector and hence the manufacturing of components for furniture which is our main activity.
Thanks to our innovative personality we have developed products that have achieved, with great effort, investment and time, to position ourselves in the international markets in this way, to offset the fall in sales we’ve had in the domestic market.
“In Spain, there is a lack of orientation towards international markets. We try to export when the domestic demand falls, but this is not improvised”
What results have been achieved in recent years?
We have grown by 12% overall. However, this growth has been much higher in export markets where we achieved growth rates above 30%.
What do you think makes them different?
Earlier, I referred to our innovativeness. This is what differentiates us in the market, along with our commitment to quality and continuous improvement.
What problem does the domestic manufacturer face?
The national manufacturer has faced an internal market where consumption has fallen in the past seven years, about 60%. This domestic market depended on a high percentage of sales. He has had to adapt his workforce and his cost structure to the new situation and start looking for alternative markets, but of course this cannot be improvised.
How do they maintain their market position against international competition?
Only you can keep afloat in a market if you have a good product, you are also competitive and efficient from a commercial point of view.
Is it still difficult to export in Spain? Is it our Achilles heel?
In our sector I would say that, indeed, this is one of our main problems, our lack of orientation towards international markets. We try to export when domestic demand falls, but this is not improvised, an organization with clear exporting vocation, a competitive product and perseverance is necessary.
On the other hand, it is exporting the solution to all our problems?
In my opinion, having at least 30% or 40% of your sales in international markets is very positive since it not only diversifies your business risk, but also when adapting to generally more demanding markets, improves the efficiency of your organization.
What global presence currently holds the Group?
Our Group is present in more than 60 countries, naturally, at different stages of business development.
In this direction, what growth forecast do you have at a short and medium term?
In the international market we are growing at a rate of 40% annually. It will be difficult to maintain this level of growth, but we expect to be around 15 or 20% in the coming years.
Innovation has been a key factor in the success of Alvic Group, what is the role of new technologies in the company?
Technology and innovation go hand in hand. Our Group invests 60% of its profits in the acquisition of technology, the development of new products, the improvement of our industrial processes and the training of our employees.
“Innovation, our commitment to quality and continuous improvement, are the aspects that differentiate us in the market”
What new products are you working on? What does the new catalogue ‘Luxe by Alvic’ offer?
We are developing new surface finishes that complement the Luxe range, we hope to bring them to market in early 2015. We are also working on new designs with registration finishes, which we hope to have available at the end of the first half of next year.
They say that the future belongs to the brave, in your opinion, what qualities should the company have to succeed in the market in the coming years?
Above all, innovative capacity, but also it must understand that the socio-economic environment in which it will develop its activities will be completely different from the current one. It will have to discover and harness the talent of the people within the organization and will have to use new information technologies and communication, as they are key to an efficient management and in line with new expectations and market requirements.