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BASILICATA AND PUGLIA’S UPHOLSTERED FURNITURE ENTERPRISE ZONE
The regions of Basilicata and Puglia, in southern Italy, first saw their rise to prominence in the international upholstery industry during the early 1950s. Of the manufacture of furniture, and woodworking in general, the 110 businesses in the Basilicata and Puglia production chain provide employment to 8000 workers; at least 40% of the turnover from this zone is from woodworking. The high quality living room furniture manufactured here produces trade of EUR €2 billion, of which 80% is in the form of direct exports to European, North American, Australian and Middle Eastern markets. The statistics show that the district provides fully 16% of the global production of leather living room furniture.
The core business of this region’s industry remains precisely that of living room suites; genuine manufacturing excellence in every aspect, including chairs, sofas and armchairs. “The total sales,” explains the Basilicata and Puglia Upholstered Furniture Zone President Tito Di Maggio, “have always been characterised by a high percentage of exports, rising above 95% at the start of the 2000s. Ours is an enterprise zone that is suited to the internationalisation of markets such as North America, which absorbs a large proportion of our sales. To remain competitive, we are incentivising strategies that help us reduce industry costs and provide incentives that make our products successful.”
The politics of production remodelling shaped a business network that has already proven its staying power in the market. The first challenge for the manufacturers was to change direction with their materials, and to improve efficiency in manufacturing times. Challenges passed with flying colours by manufacturers who, in order to remain competitive, have focused production on around ten ‘guiding’ businesses that drive the enterprise zone’s small and medium enterprises with their strategies. In fact, for a sector that has chosen the globalisation path, the solution could not be anything other than innovation.
In Europe, the reference nations for the Basilicata and Puglia enterprise zone are Germany, France and England. Outside Europe, the greatest demand for Made in Italy wood and leather products comes from the USA. Despite the growth of these guide businesses in Basilicata over recent years, the enterprise zone as a whole remains characterised by many SMEs that represent 80% of the total.
The governance model is built around a production organisation spread over three levels: the “guide” businesses develop the market relationships, maintain the production chain, and develop the products; the second level covers the “commission manufacturers” who are involved in one or more phases of the manufacturing process. The final level is that of “subcontractors”, who produce product accessories, such as feet and mechanisms for easy chairs. The economic focus on sector exports during 2011 shows a total sales volume that has reached 768 million Euros, of which 69% are sales within the EU and 31% outside the EU. This has been the result of achieving many goals, and in maintaining the quality that, in the case of the upholstered furniture manufacturers of Basilicata and Puglia, remains one of the primary factors in its success.