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Guala Closures: protecting 2.000 beverage brands all over the world
Thanks to Guala Closures Italy is among the worldwide leaders in the extremely specialised business of non-refillable closures for spirits, beverages and edible oil. The firm, listed in the Italian stock exchange since 2005, derives over 90% of its revenues (worth 235.3 million in Jan-Sept. 2007, +25.3% year-on-year) from abroad, testifying the international success of Guala Closures products, which are used by over 2,000 brands all over the world.
“Safety closures – says the company’s MD, Marco Giovannini – should prevent bottles being refilled, in order to avoid counterfeiting. Though it may seem like a minor problem, drinks counterfeiting to escape from taxation is one of the biggest frauds in the global food & drink sector. International counterfeiting is estimated to be worth 600 billion euros every year (2006 statistics), amounting to 10% of global trade. In this respect, our closure systems are the best defence against frauds for producers: being ‘single-flow’, they allow bottles to be emptied but not refilled, preventing the re-use of empty containers”.
The company’s safety closures, besides, defend producers not only from frauds, but also their image, which would be undermined by the sale of lower quality counterfeit goods bearing their brand. It’s often a concrete risk, given that drinks – particularly distilled alcohol – are easily reproducible. Guala closures, therefore, can offer the only form of protection against counterfeiting. Its products, made primarily in plastic or aluminium, have several components: 5 in the simplest models, going up to 13 for the most complex ones. “I won’t deny that people try to copy or imitate our products – admits Mr Giovannini – but those attempts are destined to fail as Guala Closures’ safety valves are attached to the bottleneck. Any attempt to tamper with the safety closure deforms or breaks them, making them useless. Our competitors are local firms that try to imitate our products which are already present on their domestic market. Some of them try to offer a sufficiently good alternative, others simply copy the look of our products. In China alone, for example, there are 45 new players”.
Guala Closures is working on a specific system to prevent counterfeiting of certified origin produce (Dop and Igp), particularly for olive oil (a niche in which the company is an undisputed leader, with a 70% market share), where current legislation provides insufficient protection for consumers. “With today’s laws, it’s easy for restaurant owners to cheat on the quality of their oil: they just need to fill up a high quality bottle with a lower grade and cheaper variety – explains Mr Giovannini – We are working with trade associations and the Italian ministry for Agriculture to update the specifications for the protection of the quality of products. We need a system to avoid adulterations that introduces some technical standards”.
A high level of technical and technological content in closure systems is not just a guarantee for consumers, but is also the best defence against fakes. Guala Closures invests around 6-7 million euros in R&D every year and remains in close contact with research institutes in Italy (Università di Piacenza, Politecnico di Torino and Alessandria) as well as abroad (Bordeaux e Glasgow universities, which offer their know-how on wine and whisky). “Every year – adds Mr Giovannini – we produce prototypes to be tested by our clients. In particular, we are trying to develop a new injection technology, but we will need at least 12 to 18 months before getting to any results. Obviously when we embark on projects of this kind, we increase our expenditure on R&D”. Guala Closures’ first patent was registered in the Fifties. “These days we develop up to seven innovations every year – says Mr Giovannini – Research is indispensable for us, as we are a very particular company that is obliged to make ‘tailor made’ products”.
Customising safety closures is not simply dictated by clients’ demands. It is also a way to uphold the company’s position. “Guala Closures – explains the MD – sells medium and top range products. There are interesting margins in a particular niche – decorative closures for top end bottles – where we are an undisputed world leader. In 2006 this business line accounted for 3% of our revenues, and is expected to grow to 7% in 2007”.