Global expansion plans Pavan Group

Mr Michele Darderi, marketing manager

GLOBAL EXPANSION PLANS

Mr Michele Darderi, marketing manager of the Pavan Group SpA, spoke to Industry Europe about the group’s recent developments and achievements. Barbara Rossi reports.

The Pavan Group headquarters are based in the Padua area of north-eastern Italy. In 2010 the group, founded in 1946, achieved a turnover of €107 million and a net profit of €6 million. The group exports 90 per cent of its production to 120 countries, has five subsidiaries, one technology school and can boast six production brands.

Manufacturing of pasta production systems, with its 35 per cent share of the world market, is the core business of the group, but manufacturing of process systems for the production of other items, such as fresh and nest shaped pasta, couscous, pellets and snack 3D, breakfast cereals, flaked and shaped cereals, precooked pasta and flour are also of primary importance. In addition to this Pavan is also a supplier of turnkey systems for the packaging, transport and stocking of raw materials and final products. 76 per cent of the group turnover derives from food sector machines and systems, 10 per cent from cereal, animal feed and milling machines and systems and 3 per cent from stock systems. Alongside those, there is 10 per cent whose origin is food production and commercialisation. The competitive advantage offered by the Pavan Group is its capacity for offering turnkey systems, which as well as being highly reliable, can be adapted to different raw material processing, reducing waste and assuring very high final product quality standards. These characteristics have a strategic value, especially in those markets where raw materials often change, depending on base cereals price swings. In this last year Pavan has achieved some milestones in the food industry, such as the biggest dry pasta production lines, reaching outputs of 6000kg an hour, recently installed in the USA.

Outstanding growth

Following a growth strategy in line with the group’s recent history, in 2010 Pavan acquired Golfetto Sangati, a long-established Paduabased company and a world leader in milling and animal feed systems. Last year the Padua main site was moved and merged with the Quinto di Treviso plant. Ambitiously aiming at regaining efficiency, this plant has undergone deep restructuring, allowing it to achieve a

turnover of €11 million at the end of 2010 and fulfilling expectations.

The acquisition of Golfetto Sangati is important because it completes a vertical integration process, thanks to which the Pavan Group can present itself to its clients as the only partner able to offer comprehensive process and packaging systems for the food sector. Alongside this, there is the important activity of the Pavan R&D centre, a highly specialised group of 30 people, comprising process technologists, analysts and mechanics, who can avail themselves of three pilot lines, as well as four production lines for testing new products and processes. Another facility is a laboratory equipped for chemical, physical-chemical, rheological, nutritional and organoleptic analysis. A deep knowledge of the entire production process and study of the final product are at the root of Pavan’s capacity for achieving best performances in terms of innovation, rationalisation and reliability of production plants. The research objective is always to be able to supply a high-quality reliable product, which at the same time offers the best possible value for money.

One of Pavan’s strengths is its extensive commercial presence all over the world, in both mature and emerging markets. Currently there are two different directions towards which the group is heading: emerging economies, increasingly paying attention to the technological content of employed solutions, and the markets which have suffered the most from the recent recession and which are now showing interesting recovery signs, such as the North American one.

After past acquisitions, Pavan is now aiming at optimising group synergies, as these will allow it to increasingly act as one entity, while at the same time maintaining the specific identities of each brand. Mr Darderi points out how, however, he cannot exclude that the group may grow thanks to further acquisitions.

Quality culture

In terms of its activities, at present Pavan is focusing on organic growth, paying special attention to organisational systems, to the strengthening of the commercial network and to new product development. As early

as 2007 the Pavan Group was awarded the EFQM (European Foundation for Quality Management) “Committed to Excellence” certification, in recognition for its company model based on organisational quality culture. However, for Pavan this, instead of representing a finishing line, was a solid starting point for carrying on reshaping all company processes to continue improving quality standards.

Demand for base food products is still growing and this, in turn, drives process and packaging systems demand, sectors in which Pavan is present on the market with high range products able to guarantee best value for money. Pavan emerged from 2010 with an extraordinary result, a turnover increase of 30 per cent and a 45 per cent EBIDTA increase. A realistic objective for 2011 was a further increase, with turnover reaching €125 million.

The Pavan Group invests 1 per cent of its turnover in the health and safety of its employees. Thanks to initiatives such as the availability of relaxation areas, a gym with free courses for staff, the organisation of sport and cultural events aimed at improving the work environment and at favouring cohesion and a sense of belonging, there has been an important increase in psycho-physical wellbeing within the company. Even more important are the safety record results achieved in the past five years. Work accidents have been halved and have all been of a minor nature.

The Pavan Group results have also been achieved thanks to the growing professionalism of its staff, aided in 2010 by 850 hours of training courses. n

www.pavan.com