July 26, 2016 Appliance Whiz

Volume 11 | Issue 4

The Brazilian household appliance company Mallory has gone from a humble $25 million in revenue in 2002 to a whopping $130 million for 2007. The secret? Vision, innovation and technology, as Gibran Haq finds.

These days, Mallory is one of the top three home appliances companies in Brazil, but this was not always the case. To put things into context, one needs to go back to 2002. At that time Mallory was owned and controlled by the once-giant French home appliances company Moulinex. However, due to increasing losses, the company filed for bankruptcy. In the process, many of Moulinex’s subsidiaries were absorbed by different parent companies, while Spain-based Grupo Taurus specifically acquired Mallory.
Immediately after the acquisition in 2002, Mallory went through a thorough and substantial process of restructuring every single aspect of its business. One of its major changes was concentrating all manufacturing, corporate offices and headquarters in one plant in Maranguape (Ceara), a consolidation that resulted in significant and immediate growth in its businesses. After consolidating the company achieved excellent financial results in the second half of that year.

Priority was next given to the expansion of Mallory’s manufacturing unit in Maranguape (Ceara), which now has over 64,000 square feet, allowing the company to not only meet the domestic market needs but to also increase exports to Europe, the Middle East and several South American countries, which accounted for approximately 25-30 percent of total production output in 2004. In this new phase, Mallory reformulated its entire post sale service system, with the goal of meeting its customers’ expectations and to provide overall better service through a network of well-trained and efficient personnel, with more than 500 authorized distributors throughout the major Brazilian cities.

During this time, most of Mallory’s growth expectations were met by strengthening and expanding staff and investing in technical equipment. Special care and emphasis went into researching, designing, developing and launching new products, something that, according to Mallory’s President and CEO Alberto Betrian, has been a key factor in the company’s development.

“In these past six years, since Grupo Taurus bought Mallory, our main goal has been to revitalize the company,” he notes. “We took the company when it was on the verge of going bankrupt: its workforce was comprised of 165 workers; it only had eight products out – four juice-makers and four ventilators – while its revenue did not exceed $25 million per year. Today we have quintupled that revenue, so we have gone from making $25 million a year to $130 million. Our staff has also grown from 165 to 800 people, and in my opinion, I think that innovation and new products are at the forefront of our success. Today we have a catalogue that boasts more than 140 products, all of them appliances, for self care, the kitchen and more. But we have also incorporated new lines of business, namely power tools and air extractors and ventilators for the kitchen. From 2002 to this point we have launched 250 products. Many times the lifespan of our product doesn’t go beyond three or four years, so we always have to keep updated with what’s trendy in technology and design.”

STRATEGIC VISION
Engineering and development, marketing, quality control, continuous market research, and product testing, among others, are some of the key elements in Mallory’s successful rise in the past six years. By 2004, the company was seeing steady growth, which allowed it to match and exceed its expectations for that year, resulting in expansion of its product portfolio. In turn, Mallory’s clientele recovered their trust and confidence in the company, which was another key factor in establishing its new identity. Mallory’s inner corporate philosophy follows suit with this growth and its team has worked tirelessly.

Of course, Mallory’s drive also comes from its parent company, Taurus, which is one of the leading manufacturers of consumer durables, electrical & home appliances in Europe with a presence in more than 90 countries worldwide. Despite the fact that Taurus has its head office in Spain, the vast majority of the group’s manufacturing activities takes place in Spain, Brazil, India, China, Russia, Mexico & South Africa. While Mallory is its face in Brazil, the company also has two other subsidiaries called Monix and Imagina. Most of Taurus’ products have strong presence in Europe, Latin America, the Middle East and Africa, and during the last few years, Taurus has expanded almost as exponentially as Mallory, by increasing its presence in the form of subsidiary operations as well as taking over existing regional brands.

SMART APPLIANCES
Some of the products in Mallory’s catalogue are small kitchen appliances such as blenders, juicers, cutters, coffee makers, big white appliances such as air conditioners and washing machines, microwave ovens, kitchen chimneys, vacuum cleaners, irons, iron boards, cook hoods/tops and power tools. The expansive portfolio is, in Betrian’s opinion, another key element in the success of the company’s operations.

In the past two years Mallory has marketed a large number of products that have been licensed to be sold around the world. The latest is a ventilator that has a device that eliminates mites and fungus, and although it does not kill nor exterminate insects, it shrinks their concentration, something that is very important for the local market in Brazil. Betrian adds, “We have introduced other products in the market that have unique qualities, which is something we achieve by adding more function to the products, which in turn results in an overall improvement of the product and greater appeal for our potential customers. I think our strongest asset is being able to offer a new supply of technologically groundbreaking products, while at the same time, offering top-notch customer service, two things that they truly appreciate.”

Betrian also emphasizes how globalization has changed the market and has forced Taurus and all of its subsidiaries to find new strategies for developing and marketing products. “Currently, or let’s say five years ago, the products you found in Brazil were extremely specific to this market, with not much technology nor design developed into them,” Betrian says. “But lately, in these past five years, globalization has perpetuated itself at lightning speed in almost every corner of the world, so now, in the past five years, trends, and more specifically, products, have much more of a global scale to live up to. There is not too much difference between a product you may find, say, in Europe or here in Brazil. So our goal in these past five years has been to bring products and technologies from some of the other countries in which we have presence. You also have to keep in mind that our products are not very large and most of them tend toward the same profit, meaning that there aren’t any products with big profits, so we work with products that range from $100-$200.”

NEW BUSINESS
Grupo Taurus has seven engineering locations around the world, one of which is in Brazil, so while most of the products sold by Mallory in Brazil are also made in Brazil, the company also imports and exports products to be sold in different markets around the globe. “We like to say that we are not a transnational company, but we rather say that we are a ‘translocal’ company, so each one of our subsidiaries, including this one in Brazil, acts in a very independent and autonomous way, meaning that they do not have to respond to the company’s headquarters [Grupo Taurus] in Spain,” Betrian says. Some of Grupo Taurus’ other subsidiaries are located in France, Poland, Italy, and Portugal. The company also has factories in Mexico, Brazil, South Africa, India, China and Russia.

“We have seven engineering plants spread throughout the globe and all of them work in coordination with each other, so the person who is in charge of operations here in Brazil knows perfectly well what is going on in China, Spain or India,” Betrian explains, adding, “The group’s main focus is to innovate and develop. This means launching new products with new technologies and making the products better every time.”

Subscribe to Industry Today