Blog by: X’auntasia Johnson
Major at ECU:Business Administration/MIS
Happy Monday!! I had a somewhat restful weekend in Verona, but today it is back to business. Today’s lecture was a continuation on Business Strategies with Professor Diego Campagnolo (who I’ll refer to simply as Diego from this point on) from University of Padova in Italy. The lecture started with a better look into defining business strategy, competitive advantage and how those concepts are applied in countries both within and outside the European Zone. Diego went through the research findings from the collective project between GE Capital, University of Padova, University of Ohio and other sponsoring parties on the Middle Market companies and their success in driving the European economy.
The study defined middle sized companies in Italy as those bringing in 5 to 250 million euro of revenue. In Italy alone, the midsized companies represent only 2% of all firms. These Italian firms are responsible for over 40% of the Italian GDP. In regard to the European Union Big 4 (EU-4) Italy’s middle sized companies were responsible for more of the national GDP than German (31%), British (32%) and French (29%) middle sized companies were of their respective country’s GDP.
Seeing that most of Italy’s GDP comes from mid-sized corporations helped explain why the luxury brands and products of high quality are so important in Italy’s economy. Luxury products made in Italy lie largely within the food, fashion, furniture and Ferrari mechanics industries. Over half of Italy’s luxury products are sold outside of the country so many mid size companies are on the forefront of Italy’s global market.
Buying Prada or Giorgio Armani from Italy is a status symbol all around the world. The perception of great value that comes with owning these types of products places you in an exclusive group. It shows good taste and an appreciation for the minds and hands of the creator. Similarly, the Ferrari brand of mechanics speaks to the tastes of the product owner.
After our lecture session we visited the Poli Distillerie and were lead on a tour of the plant. This company is in the food and entertainment industry at the mid-sized company level. One of the interesting topics of discussion while there was that Grapa is only a seasonal product for the company yet they are open all year round. The question was then asked how are you able to support having 23 people on staff when production is over. They told us that the business process takes a great deal of effort and attention. They produce Grapa, Whiskey, Brandy and other types of liquor in the plant; not just Grapa. They are able to sustain and increase the number of jobs during the harvest time and continue bringing in more income with a communication based marketing strategy. This plant visit was the last we’ll have while here in Italy and this was a great way to wrap up our business and to come full circle in what we’ve learned about Italian business.