We’re tougher than the crisis
Major projects on hold. Concrete consumption down across Europe. But the Veneto-based Grigolin Group is diversifying into bio-construction. And is investing in third generation technologies
by Eleonora Vallin
A 100% family firm founded by granddad Giobatta in the wake of the Second World War, and today securely in the hands of his three sons, Roberto, Maurizio and Renato who, in turn, have already introduced their children, Francesca, Camilla and Giambattista into the company. They are the new protagonists of the Grigolin Group in Nervesa della Battaglia in the province of Treviso.
Their story began at Ponte della Priula, on the banks of the Piave River. Here, in the 1950s, Giobatta Grigolin launched his business of recycling and transporting materials, such as river stones and sawdust. His first truck was a second-hand red Bedford left by the Americans after the war and sold off at auction. But in just a few years he had a fleet of 10 trucks and began to transport goods for third parties.
Then the crisis hit in 1965 and he bought the first kiln for calcined lime production and then, in 1978, the supply chain was broadened to include the production of pre-mixed concrete and the creation of a system to process inert matter. Diversification has been a constant that has characterized the company's last thirty years and has led to the creation of specialized divisions.
But, most of all, it has allowed for the vertical growth of their business, from the quarry to installation, and with a developed local network. Plus their acquisitions: first Superbeton, Calcestruzzi Pieave and Italghiaia, then TesiSystem, Ferrobeton and Brussi Costruzioni, to name just the biggest. Today, Grigolin has 60 production units located primarily in the Northeast, but also in Piedmont, Lazio and Emilia Romagna.
Abroad, on the other hand, the Group is present in Germany with a production facility and a number of affiliates. There are eight plants that produce plaster and pre-mixes, 40 centers to mix concrete, 13 facilities for bituminous conglomerates and 14 product lines, including the Veneto-based Palladio for bio-construction and renovation that have made it possible for the company to reconstruct all the historic walls in Treviso as well as the stairways in Palazzo Ferro Fini, headquarters of the Veneto region.
Among its most important projects have been the Marco Polo Airport in Venice, the Venice-Padua high-speed train line, Canova Airport in Treviso, the Mose artificial dikes in Venice, the A27, A4 and A31bis highways, the Adria autdrome, Milan's Fiori complex, Armani Hotel Milano and the Passante tract of highway in Mestre.
All projects fairly close to company headquarters. "Tight logistics," the three brothers explain to Panorama Economy "that for concrete extends, maximum, to the Northeast and to a national level for lime and plaster, while abroad distribution involves above all special products. We are constrained by product distribution times that are dependent on distance. For example, concrete has to be poured within an hour-and-a-half, and asphalt cannot be carried for a distance longer than 80-100 kilometers. And one of the strong points of our group is our service and products delivered ready-to-use at the worksite."
Germany, where the company has an R&D division specialized in the certification of thermal cladding, not only remains its main export outlet (even if exports are small, only 5% of turnover), but it is also the land of testing and new ideas. "The Germans have always been ahead of new market trends, focusing on research and development of new technologies, and now our attention is focused on construction which in Germany has decreased by 40-50% on years past."
The future is uncertain and Roberto Grigolin reveals the figures for this sector in crisis. "In Germany today it is calculated that there is a per capita consumption of cement of 300 kilos, in France the total is 350, while in Italy we are still around 600 kilos, but this number is destined to fall." The crisis began at the end of 2008 "and we reacted by trying to cut costs and optimizing resources. The drop hit prefabricated products, but the problem today is the public sector. What's missing are projects and contracts, even for simple road maintenance."
The last tract of highway they did was the Mestre Passante in 2009. Now some life blood is being injected from the laying of the first stone of the Pedemontana Veneta and some help has also arrived from the regional housing plan. On the other hand, the heat insulation sector and steel industry for the supply of lime is doing well.
Delocalization? For now the brothers prefer to consolidate their position. There are still many areas of the market to be developed, such as bio-construction. As proof of its environmental awareness, the company was awarded the UEPG award in Brussels for having reclaimed a former powder magazine in Tauriano di Spilimbergo (province of Pordenone), turning it into a quarry. Or, for example, its Artemuri line of paints for the construction industry, its division of glues and adhesives for laying ceramic and other tiles, and the production of eco-friendly and anti-smog asphalt.
All contributing to a consolidated turnover which in 2011 was close to 450 million euros, slightly lower than the 463 million earned in 2010, with exports near 22 million. But the future calls for investment. "We are worried about credit, there are no certainties today. The system has become bogged down, costs have increased out of all proportion as well as the conditions placed on loans. There is a clear imbalance in the negotiation of new financing. Nothing is the way it was before and the rules are changed mid-game. So much for the spread," the three Grigolin brothers add in chorus. "It is a time for consolidation and reflection on the future of our company in a period when invoices are never paid within the standard 60 days and we creditors have no guarantees. There are a lot of rules needed, the first being reliability," says Robert.
What about the IRAP (local business tax)? "Serious indications of serious tax reform are what are needed, while on the other hand we ask for flexibility and reform of the workplace, streamlining of the public administration and bureaucracy, including in companies. We're late, we should have started 10 years ago," add Maurizio and Renato.
To get around this, there's always the stock market. "Actually, we thought about it a number of years ago, but now is not the right time. We have made major investment in plant and equipment and their amortization is long. What are pressing now are prices, fuel above all, which has a major impact, but electrical energy has also risen 8% and tolls 13%. The most heavily penalized sector is producers of petroleum products that has seen price rises of 25%."
But the future looks to Camilla, Francesca and Giambattista, today being put to the test. And that's because, for the moment, no managers outside the family are in sight. But they are optimistic, courageous and believe in "Made in Italy". Just like their fathers who, despite the economic crisis, are still motivated to do business and invest.
8 plants: Number of Grigolin Group factories, one of which in Germany
450 million euros: 2011 turnover of this Veneto group whose exports are 5%
600 kilos: Per capita consumption of cement by each Italian, against 300 kilos in Germany