Entrepreneurs are investing again in the textile care sector

The Italian economy is showing signs of a gradual recovery, according to the Italian statistics agency, Istat. GDP grew by 0.3% in the first quarter of 2015, driven by increases in the value of both manufacturing and construction.
While confidence in the economy had not yet infiltrated household consumption (with a 0.1% drop in consumer spending in the same quarter) the agency expects the economy to continue to slowly grow for the rest of the year.
Alessandro Rolli, Kannegiesser Italia MD says: "Italy expanded for the first time in four years in the first quarter, but the recent contraction suggests that the economy rests on a weak foundation - a slow and inefficient civil justice system is one of the biggest constraints on growth and investment."
The main impact on the laundry sector is bad debts and payment delays. As a result, cash flow is becoming a problem. Therefore, to increase their competitiveness, laundries are starting to merge together, Rolli says.
"This business model is slowly spreading," he adds. "As the sector in Italy is mostly composed of small industries, family-owned companies and local markets, it will take time - but this process won't stop."
Maurizio Genesini, president of the trade association Assosistema, says 92% of the Italian laundry market is made up of small companies, while 6% are mid-sized companies (50 to 250 employees) and 2% are large companies (over 250 employees). "The high number of small businesses is due to the expansion that has occurred since 2000, which gave birth to many activities, thanks to a favourable market offer," he suggests.
Turnover in the sector is worth around €4.2bn, of which 56% can be attributed to healthcare, 22% to horeca (hotels, restaurants, catering) and 22% to safety (PPE and clothing).
"Of these, the health sector and tourism are suffering most, - the first from the government spending review and the consequent reduction of resources, the second as a result of the general economic crisis," Genesini adds.
"After the growth phase from 2000 to 2009, the industry began a crisis that has severely affected businesses. Between 2009 and 2015 the death rate of companies was 39%, while the birth rate was 57%, representing a total turnover in the industry of 18%."
For summer 2015, however, Genesini thinks there are good prospects for recovery of tourism in Italy, thanks above all to the Expo in Milan. This international expo, which focusses on on food production and nutrition, is expected to attract 20million visitors during its May to October run.
Certainly for Jensen, the expo helped brighten up its returns in the first six months of the year as laundries in the north of the country ordered new machines to cope with the influx of tourists. However, Georgio Cinalli, general manager of Jensen Italy, is not so optimistic about the rest of the year.
"The crisis is still not finished," he says. "Our customers understand that investing is now the only chance available if they don't want to get left behind in market competitiveness. Without continuous cost administration and system renovation, there is a risk of working with outdated machines and having to afford outrageous investment later on. Our customers are increasingly asking us to help them acquire financing with a bank - and financing by leasing is being used more and more in Italy."
Imesa's Chiara Ronchiato is more optimistic about the future of the industry. "In comparison with the last few years, the situation is better, but, from our point of view, the laundry sector was not really affected by the last five years of economic crisis. Imesa increased its sales, including those in the Italian market and achieved , important goals."
Ronchiato says the laundry market is growing and is optimistic about the next 12 months. Finance is opening up for investment. "The banks may be asking for stronger warranties, but new investment is on the way. Imesa itself made a big investment this year, in production and in new machines."
Paolo Cattai, sales area manager for Electrolux, agrees: "Entrepreneurs are starting to invest again in the laundry sector, where there is a great need for renewal of equipment."
He says there was a good recovery in the high-end textile sector, while the coin-op market, which has been growing significantly over the past few years, experienced somewhat of a downturn.
"We expect that in the near future the winning organisations will be those that provide high-quality products and services," Cattai says. "In the medium term the most successful companies will be those offering innovative cutting-edge products that combine advanced technology with low environmental impact and meet, or even anticipate, customers' needs and expectations with unquestionable quality and service."

Third largest market
For Alliance Laundry Systems, Italy is its third largest market in Europe, after France and the UK. As a result, it is opening an Italian headquarters in Brescia, equipped with four showrooms as well as a number of high-tech test and training rooms and meeting rooms.
The company is also planning to launch its dedicated financial services offering in Italy, once it receives government authorisation. Developed in the US, the service was recently launched in France, Spain and the UK.
"Another key initiative for Alliance in Italy is the Speed Queen Laundromat Stores programme, which introduces our own concept, under our own brand," says Rocco Di Bari, sales director Europe. "The prospects are very promising: we have already opened some 100 stores in Europe, including 10 in Italy, in a very short space of time, and plan to open 50 stores per year from 2016 onwards."
Although the most Italian households own washing machines, the use of self-service laundries continues to grow quickly. According to Di Bari, the main reason for this is the competitive cost of washing and drying compared to drycleaning or 'traditional' laundries. This applies particularly to larger items such as blankets, duvets or curtains.Self-service laundries allow customers to wash large quantities on one large machine or several smaller ones. The task is easier, faster and allows gentler drying.
With regard to OPLs, Di Bari says, there is now a clear trend towards taking laundry and the treatment of linens back in-house, after many years of outsourcing. OPLs are proving more efficient and deliver a better quality result for the end user.
With the focus on handling the pressures of the financial crisis, sustainability continues to take a back seat, although those coming into the industry tend to go for more sustainable solutions.
"Recent legal requirements regarding the environment have provided further challenges to the general situation that has become particularly difficult, with a decrease in the general quality of life. There is a notable resistance to upgrade existing machinery to new regulations," comments Peter Wennekes at CINET.
"There are also notable difficulties in recruiting personnel, particularly
in the more industrialised areas of
the North, where working in a laundry is considered not to be a highly skilled job."
To help improve the situation, CINET is working with Italian stakeholders on a joint initiative that aims to implement best practice in the market.
Christeyns is bringing some sustainability into the equation by producing most of its products locally. "We've been supplying our big customers in bulk for years, avoiding the waste of plastic cans," explains Livio Bassan, managing director for Christeyns Italia. "We have also launched innovations such as Cool Chemistry with success, even if the customers' attitudes are only changing slowly. But we are sure that, with time, the prospects for Cool Chemistry will increase due to cost savings and the high level of whiteness it brings. These are always more important in Italy."
In addition, Christeyns is collaborating with the laundry association on its "Use and Reuse" initiative. "The suppliers' association has a project called "notate la differenza" that aims at showing restaurants how good it is to use textile instead of paper," Bassan says.

Drycleaning sector
In the drycleaning sector, as in laundry, there is a trend towards consolidation, although franchise chains have yet to make a mark in the country.
"Some owners have multiple shops in different shopping malls, and this is precisely the category that is growing at this time," says Corinna Mapelli, marketing manager at Trevil. "These customers require a high degree of automation because they process high volumes at low cost and can hire unskilled personnel."
She says the market is progressively being taken over by new entrepreneurs who invest their money in profitable stores and have a managerial approach to the drycleaning business.
Mid and North Italy are the most productive areas for the entrepreneurial multi-shop approach, according to Marco Mallegni, managing director of Ilsa. "The most interesting services in modern shops are loyalty cards, as well as dedicated advertisements that promote alternatives to perc, highlighting the low environmental impact of the new solutions. This works even better where they use professionally constructed social network websites."
Because most drycleaning shops are still small, family-owned businesses, finance is very difficult to obtain. "This makes the replacement of equipment difficult and stops the development of new projects," says Gabriele Di Punzo at Pony. "The best-selling models are state-of-the-art machines developed with advanced technology, since they allow the user to obtain economic results that justify their investment. These new machines guarantee quick returns on investments, not only contributing to a reduction in processing costs, but also increasing the range of services offered to the end user."
Popular machines in Italy include its latest Twins rotary double-buck shirt press, the Eagle blowing shirt press and the Pantamaster trouser press.
Walter Cividini, Fimas MD, agrees that a lack of financing is holding drycleaners back from modernising their businesses. "For our customers without a strong financing structure it is not easy to find money to invest in new equipment," he explains.
"The internal market is suffering, because of a lack of help from the government and from the financing system. As a supplier, we try to help our best customers but we can't replace the bank."
Perc is still used by a large percentage of cleaners in Italy and many have started up wetcleaning, possibly in response to the growing popularity of coin-ops, which have had a definite impact on the sector.
In addition, alternative solvents are beginning to grow in popularity and those opening new shops are turning to more modern machines that use hydrocarbons or other more environmentally friendly solvents.
"My feeling is that the cost drive is still more powerful, so the attitude towards environmental issues is driven by the fact that saving energy and resources in general also reduces costs," says Di Punzo. "Implementing devices that save resources has become one of our key points in product development." This includes the economiser, which Pony can apply to its machines on request. "For several years now we have offered this option on our steam generators.
Davide Rotondi from Rotondi Group agrees. "Service has to be always better and faster than before," he says. "People are looking for automation. Therefore, we sell more automatic machines than basic tables."
Italian consumers are looking for quality, so drycleaners want machines that produce high-quality results. Rotondi's most popular items in Italy are its shirt finishers and automatic bagging machines.
However, Renzacci's Marco Niccolini believes that moves away from perc are not just driven by cost efficiency. He says that Italian consumers are becoming more environmentally aware so those opening up new drycleaning shops in Italy want to be able to offer them a service that they can say not only respects the environment but also is high quality, clean and meets concerns about wellbeing.
New owners include the children of drycleaners who can't find another job in Italy's depressed economy so take over their parents' business - Niccolini says Renzacci is committed to using its funds to help support young people wanting to start their own business - or others who have lost their jobs and want to use their savings to start a new business.
To support drycleaners who want to change how they operate to meet the demands of the current environment, Renzacci is also organising conventions with the drycleaning association to tell them about new technologies and the opportunities they present.
Ilsa is working with the trade association to help revitalise the drycleaning sector. Assofornitori (ExpoDetergo organiser) has developed an activity plan with the goal of creating a critical mass of machine, service, chemical suppliers and shop owners, with the goal of revitalising a sector where Italy has a long tradition and a worldwide leading expertise.