Poliblend is targeting growth on the Spanish market with network of strengthened sales, new strategic collaborations, and the intention of consolidating its presence in automotive, the true strength for the plastic industry in the Country. We talked about this with Alan Catturini, Area Sales Manager for the Itallian company whom coordinates the work of the sales network in Italy and Spain
by Emiliano Raccagni
Can you describe to us your presence in Spain?
We started in 2014, literally from nothing, concentrating from the beginning on organizing the best possible structure, which sets us up to work in ideal conditions on a complex, diversified market. Our strength has been to establish a team of qualified professionals, with an in-depth knowledge of the Spanish market, gained through a long-term collaboration with a leading Italian producer of polyamides. Pulling together a team of people who not only speak the language fluently, but also fully understand the dynamics of the sector, has been decisive for supporting our growth, which has remained constant. Today, Poliblend Asociados Espana, with headquarters in Saragozza and offices in Barcelona, has a manager who coordinates a number of officers directly, concentrating on strategic areas of Spain and operators also in Alicante, as well as in Catalonia and Madrid. The heart and brains of the branch is Fancisco Jose Pérez Samper, partner of Giancarlo D’Ottavio, president of the D’Ottavio Group (Mozzate, Como).
After almost fifteen years, what objectives have you achieved?
We consider the experience we have had to be very positive. We have reached a good percentage of market penetration, which continues to grow, and which currently is approximately 2,500 tons a year of products sold. We have structured a program to further fuel growth, which will focus primarily on diversification of application sectors. After having established our historic key products, now we are primarily working to develop certifications for the automotive industry, following a strategy which, physiologically for this sector, requires medium- and long-term planning.
What are the main similarities to and differences from the Italian market?
From a structural standpoint, the geographic dynamics of the Spanish industry are similar to those in Italy: in the south, the market is sparser than in Catalonia and the north, particularly in the Basque region, where the industrial sector is strong and dynamic. In terms of volumes of plastic materials, the differences from Italy are radical. Global consumption of polyamides in Spain are estimated to be about 45,000 tons a year, in practice the value of Lombardy and much lower than Italy’s 120-130,000 tons. As regards to applications, the Spanish market can be divided into two major areas. The first, driven by the car industry, which thanks to past policies of fiscal incentives has seen major multinationals establish their presence in the country, generating a sizeable turnover. The second, on the other hand, is a manufacturing network, made up of small and medium processors, very similar to the one in Italy. In addition, there is a good presence of French companies and, particularly in the south, various activities linked to the extrusion and processing of engineering plastics. Basically, the Spanish market is very interesting and deserves attention, as long as you know how to offer the market a quality product and do it through a staff who know the reality of the market and who are native speakers or at least speak Castilian fluently and – in Catalonia – Catalan also. Here, too, is an important similarity with Italy: even for major groups, the local language is considered to be essential for negotiations, as is the capacity to understand the political and social situations that characterize the Country, with macro-regions that strongly influence the local culture and, consequently, also the work approach.
What is the situation on the local compound market and, consequently, how do you approach competition?
There is no doubt that the automotive market is by far the leading consumer of engineering plastics. There are few local compounders and various distributors in the country, who operate within an industrial network made up substantially of small and medium enterprises. The 2008 crisis profoundly changed the geography of the Spanish plastics industry, mainly weeding out medium compounders, who focused on specialisations, for example engineering plastics or thermoplastic rubber. Some work exclusively for the auto sector, while others focus on greater versatility. Certainly, they are all very well established and well known, but I am convinced that there is no lack of opportunity also for foreign companies which, like ours, have chosen to approach the market with an offering of special products that are certainly appreciated. I am referring to a good technical-commercial organization in the country, with a warehouse with the capacity to ensure the availability of 300-400 tons of standard or custom-made products.
Do you have short-medium term projects to support your path of growth?
In the last months of 2018, we launched a collaboration with the Ambra Polymers Group, which became the sole distributor of Poliblend in Spain. Our decision was based on the reciprocal need to grow, streamlining our joint expertise and commercial networks. Another strength of this alliance is the presence, in the Spanish branch of Ambra Polimeros, of a very well-known and respected local professional from the automotive sector, the sector we are interested in.
What results do you expect to see in the coming months?
Certainly, we hope to see further growth, with a primary medium-term sales target of approximately 4,000 tons a year of polyamide. In these years, we have been able to acquire shares on the Spanish plastics market which has not grown. That said, our future programs are based on a strategy of increasing quality, to be followed as already mentioned through certifications for the auto sector, which will enable us to enter a sector that has had little oversight to date. To place us in the conditions to achieve our objective, we have organized capillary coverage of the territory, taking into account the scope and costs of transportation. In Spain, in fact, logistics considerations are a very important factor for any business.
How can you optimize the logistics aspect?
Being able to count on a warehouse in the Country is a primary advantage. The next step is to optimize the transportation system between Italy and Spain, which is not easy because of some structural difficulties. A primary obstacle lies in the type of commercial trade: in fact, fruit and vegetable products often tend to monopolize road transportation. The shipping of these goods requires the use of refrigerated lorries which, returning to Italy with other types of loads, make loading problematic. Our warehouse is perfectly equipped to respond to this need, and this clearly represents another advantage. The situation is more challenging in certain months, in summer and in holiday periods especially, when more people travel between Italy and Spain reducing the availability of transportation means. This means proper route planning is fundamental, particularly when small batches are needed urgently: the risk, in fact, is having to incur into doubled costs. That said, it is clear how strategic it is to well plan the stocks in the warehouse.
In addition to automotive, what other markets are you interested in?
The Spanish market offers good opportunities for polyamides also in the electrical segment and in the production of injection moulded technical parts, ranging from sports articles through to do-it-yourself. Despite the serious crisis after an extraordinary boom, the construction industry is also promising, and we are seeing excellent results. We are striving, in substance, for 360-degree operations, but without ignoring the fact that currently, while primarily representing the Spanish plastics market, automotive represents 10% of our local revenues. Being less involved with the segment is the result of clear decisions we made at the beginning. Today we are more solid, better organized, and therefore ready to work to grow.
The price and availability of polyamides have strongly influenced the industry in recent months. What is the current situation?
In the last half of 2018, compared to the same period in the past two or three years, we saw a reduction in demand, creating a slight imbalance among industry operators on a global scale. On a positive note, there is a greater availability of raw materials, a situation that some final users are trying to use to their advantage.
Talking of price, which is the situation for polyamides 6 and 66?
In regard to nylon 66, greater availability of the product – though slight – has not gone hand in hand with a significant reduction in price, which remains quite high. The cost of nylon 6, on the other hand, is proving every forecast to be wrong, and has fallen by a few cents, generating an additional increase in the daily difference between the two materials, that today have reached its historical maximum. Considering the higher income from nylon 6, compounders hope the industry continues along the trend of processing solutions to replace polyamides 66, starting with the auto sector which, despite a moment of calm in Europe, continues to drive consumption.
In your opinion, how far do you think replacement of polyamide 66 can go?
I believe that applications for which nylon 6 cannot represent, because of technical characteristics, a valid alternative to the 66 grade, correspond to at most 40% of cases. There is therefore a very wide margin to work with and, although timeframes for the new certifications are not very tight, they will be increasingly numerous in the automotive as well as electrical and electronic sectors. And beyond. A significant difference in price per kilo between the two materials could make the replacement of polyamide 66 in other segments very interesting in economic terms. I am convinced that, if the price trend continues, the switch from one material to the other will be increasingly widespread across Europe.