Poland can be described as one of the success stories of Eastern Europe’s transition economies.It has been a member of the EU since 2004 but has yet to adopt the Euro and is unlikely to do so before 2012.
A policy of economic liberalisation has been in place since the 1990s and growth has been largely driven by the developing private sector. Many small- and medium-sized state owned companies have been privatised and the law on establishing new firms has been liberal.
However, like other countries in Eastern Europe it suffered from the recession. Production fell, as did exports, partly because of the difficulties suffered in Western Europe.
In August this year, LCNi visited Alux the finishing equipment manufacturer.
The company is based near Bielsko a largely industrial former city that has been amalgamated with Biala on the opposite bank of the Biala river since 1951.
Well-placed for trade
The area is well placed for trade with good and still developing transport links. Bielsko, the more important of the two partners in this amalgamation, is on an expressway to the Czech border and on a national road that provides a direct route to Krakow in the east.
The S69 expressway, which is under construction, will eventually connect Bielsko to Zilna in Slovakia.
While Bielsko does not have direct motorway links, a planned extension along an established dual carriageway to Tychy and Katowice will eventually connect it to the motorway network.
Benefiting from tourism
The area is also in a position to take advantage of Poland’s tourism industry. It is just 3km from the mountain region, and 10km from Szczyrk, a popular destination for skiing and snowboarding and in summer for mountain walking.
In terms of the local customer base, the main recipient for tourist-based laundry services is a hospital laundry that is vast and takes in most of the hotels’ work. There are some small independent laundries but these operate on a very small scale with just a couple of washers and dryers.
So geographically Alux is favourably placed for gradual and planned expansion.
The company which is owned by the Wieckowski family was founded by Aleksander Wieckowski in 1991 as a one-man enterprise based at the family’s home but has gradually developed. It is now a fully-fledged company with 23 employees and it is run by Aleksander and his two sons, Szymon and Marek.
Originally the business concentrated on ironing tables that were sold to the clothing trade, which at that time was booming but as that sudden growth tailed off Alux began to target drycleaning businesses.
Initially the tables used electric irons and were equipped with steam generators but as the company began to grow the range was expanded to include tables with vacuum, bagging machines, and spotting tables.
The company has moved twice, first to a unit converted from an old house which was then extended and in 2007/ 2008 to the current factory on the former site of a sheet metal works.
Further expansion is planned and within the next five years Alux wants to buy a new site which will be solely devoted to production – the current premises also house administration and storage areas.
Expanding into export
The nature of the company has also changed considerably. In the late 1990s it started to sell its finishing equipment beyond the home market and now the company exports to Lithuania, France, Slovakia, the Czech Republic, Germany
and Ukraine. Export now accounts for around 30% of finishing equipment sales.
In addition to selling its own production, Alux also buys drycleaning machines and laundry equipment from European manufacturers which it then sells on in the home market.
Drycleaning market
Poland’s drycleaning market too has expanded greatly. Szymon Wieckowski explains how it has developed. The big expansion started in the late 1990s after the fall of the communist regime.
Until that time it had been relatively small and the services were expensive.
In Bielsko there were only two drycleaning businesses plus a state run co-operative that produced poor quality work.
Szymon’s father Aleksander had realised the Polish market needed good quality machines that allowed the businesses to produce good results and this was why he started his company. It is still the country’s only manufacturer of finishing equipment.
Now Szymon estimates that there are around 1,200 businesses providing drycleaning services throughout Poland. These are mainly laundry companies that have branched into drycleaning and Alux has around 300 of these on its books.Some supermarkets also offer drycleaning services.
In terms of solvents, the market remains perc based.
Geographic distribution of the drycleaning businesses varies. In the larger towns, there may be one drycleaning services supplier for every 12,000 to 15,000 of the population.
Bielsko with approximately 120,000 people has around 15 companies offering drycleaning.
The 5 à Sec group has been represented in Poland since the late 1990s and its presence has provided a boost to Alux. The group buys machines from across Alux’s full range of equipment, apart from drycleaning machines.
Alux also supplies machines for 5 à Sec’s operations in Czech Republic and in the Ukraine.
Looking at the supplier sector, Alux has many competitors but these are based outside Poland and being the only home-based manufacturer
does give the company a unique selling advantage.
Aleksander Wieckowski says that his competition in the home market is mainly price based.
After-sales support
Alux prides itself on its after-sales support, which it provides both through its own technicians and through independent service agents.
It will provide its customers with one- or two-year warranties and will also commission the machines.
This ability to offer good after-sales service gives the company a big advantage.
The support may be expensive to provide but it is worth it and a complement to the quality of the company’s equipment.
Quality has always been important. A visit to the factory also makes this point for Alux has invested in its production not only in volume terms but also in making sure it has the most up-to-date technology.
Cutting under water
Earlier this year it invested in a water-jet cutting machine. This gives an extremely smooth finish and the machine can handle all types of material – stone, rubber, metal, Inox and tiles and with thicknesses of 1 – 16cm.
It is extremely precise and can be used to produce the most intricate patterns.
Further investment is planned and the next stage will be for Alux to establish its own paint-shop which it hopes to have on site in the near future.
So the company is certainly ready to expand its business. Further growth opportunities in the customer base however are limited at present as Poland has suffered under the global recession and as a result new businesses would find it hard to get credit. Start up costs would be around 30,000 to 40,000 Euros.
So extending its international presence would be a way for Alux to expand.
Increasing exports is one of the company’s ambitions and the reason for its decision to exhibit at Expo Detergo, which it saw as an important opportunity and one that could broaden its customer base. The company feels that it has a quality product range to offer and can be competitive as production costs are low relative to mainland Europe.
So at the show it was looking for distributors to build a broader international network. Its main target countries are France, Spain and Germany.
Representative display
The company produces around 50 different finishing machines but its display in Milan had a representative range.
These included the WA-17 ironing table, which has proved very popular, particularly in the large supermarkets.
It provides both vacuum and blowing options and includes a spotting arm with built-in air steam gun.
The table also incorporates a steam generator and includes outputs to one or two irons and a steam brush.
Two spotting machines were also on show, the WA-16 cold spotting cabin features a stainless-steel treatment area, two spotting arms and two vacuum systems, one to remove vapours from the cabin housing, the other to remove vapours and liquid spills from the treatment area and spotting arms. The WA-15 spotting table was also featured.
Alux also showed two styles of bagging machine, the WA-22p an automatic, air-operated, vertical design which can be used by drycleaners to wrap garments on hangers or by garment makers to wrap the finished garment, again on a hanger.
It also showed a recent introduction to its packaging range the WA-23 horizontal style bagger, which is designed to pack folded clothes in sealed foil bags.