The Creation of Metal Link, Italy’s Most Important Distribution Hub for Aluminium Semis

Alluminio di Qualità (Cauvin Group) and Baratè join forces and form the largest Italian operator in the distribution and machining of flat and extruded aluminium semis. Two companies acknowledged on the market for their earnestness, professionalism, quality of products and reliability of services which provide Metal Link with a shared vision of growth. A meeting with Mattia Marconi and Niccolò Rampini Baratè

by Mario Conserva

In the prestigious Genoa headquarters of Vittorio Cauvin, the holding company of the Cauvin Group which controls Alluminio di Qualità, we met the President Ernesto Cauvin, Mattia Marconi, Managing director of Alluminio di Qualità and Niccolò Rampini Baratè, Sales Manager of Baratè, who are also managers of Metal Link, the new entrepreneurial initiative in the segment of the distribution of aluminium semis, with the companies Alluminio di Qualità and Baratè as equally important players.
Ernesto Cauvin introduced the topic: “This important innovation should significantly affect the appearance of the distribution system for aluminium semis in our country. The Italian market compared to other European markets, in particular Germany, England and France, is historically very fragmented; unlike those countries, to this date there is no distributor in Italy covering the entire national territory with a complete offering of services and products. We have been present on the Italian market for many years, we know its peculiarities and mechanisms and for quite some time we have been aware of the presence of the conditions for an important development. We set ourselves objectives starting with growth through internal lines, then through acquisitions and finally ending up with partnerships, such as the one that led to the Metal Link operation. This is a particular form of partnership, which is not easy in our country, also on account the type of companies in our industry, mainly family-owned. At this point I would like to give the floor to Niccolò and Mattia, the leading players of Metal Link and of the development of this important alliance which bears a strong strategic value for our companies”.

Is it possible to reconstruct the origin and background of the operation?
Niccolò Rampini Baratè: “Everything began with personal relationships: our families and the two companies have known each other for a long time, operating in the same field of activity with mutual esteem. A fruitful relationship of friendly cooperation developed through the exchange of information and services between Alluminio di Qualità and us, which has become increasingly intense in the past few years due to an objective human affinity between Mattia and myself; we are just over thirty years old and represent the new generation in our respective families, we have the same entrepreneurial mentality based on common values. We therefore started working on this project evaluating the strong synergies through the alliance tool. In reality, the presence of the two companies on the Italian market for the distribution of aluminium alloy semis may create conditions of fruitful complementarity: Alluminio di Qualità is a service centre specialised in the machining and marketing of cold rolled products, with an important presence in the naval and automotive sectors; Baratè is specialised in the distribution of aluminium extrusions and hot rolled plates and cast materials for the mould industry and the mechanical industry in general. There are some overlapping areas, but they represent only a small percentage of the turnover of the two companies. The complementarity of the two concerns has undoubtedly fostered the development of our relations: both companies deal with the same metal, but in different fields and with different objectives and peculiarities”.
Mattia Marconi, nephew of Ernesto Cauvin, added: “Niccolò and I met a couple of years ago during a business meeting organized at the Baratè headquarters. Along with Alberto Baratè, president and owner of Baratè and Eugenio Paroletti, managing director together with me of Alluminio di Qualità, we started to think about our expectations and the prospects of our markets, the strengths and weaknesses of our companies and how we could face new challenges together, agreeing immediately on the opportunity and the consequent potential of joining forces. We therefore decided to start sharing our companies’ data and develop an in-depth analysis to understand the size of their respective customer platforms, product portfolios and market penetration by geographical area. From a “stand alone” vision, the strategic benefits and advantages which may be obtained from the creation of a unique commercial platform capable of covering the entire Italian territory began to appear evident. Similar projects may generally be carried out through joint ventures or exchanges of shares, in our case we used the contract formula known as network of companies, which allows to create an alliance and to achieve the sharing of resources while maintaining the autonomy of the two companies. The corporate structure and the boards of directors of the two companies therefore remained unaltered. The Metal Link network contract thus outlined the tools and strategic objectives to be pursued and created a common body, composed by the President Alberto Baratè, the Vice President Ernesto Cauvin and as Managing Directors Niccolò and I, responsible for the coordination and implementation of the Network Programme. Among the first synergies identified, priority was given to the development of commercial and logistic aspects, but there are many others, such as the opening of foreign markets, the development of ‘digital channels’ and more”.

We asked Niccolò for some comments on the complementarity between
the two partners: “Complementarity is the fundamental element of this partnership and has paved the way for the operation, because the union of two organizations with similar bases but operating in different market segments allowed Metal Link’s offer to become complete: definitely the organization with the widest customer and product portfolio existing in Italy today. Apart from the objective conditions of excellent operational integration between our two groups, the cultural affinity between companies and operators should also not be underestimated; both Mattia and I had significant study experiences abroad and I believe this helped us to broaden our horizons and to focus with great determination on this strategic project. We exchanged data with the utmost openness and spontaneity, convinced of the opportunity to achieve something which had never been successful in Italy in our sector so far and sure that we would not have hindered each other nor reaped advantages to the other’s detriment. The project’s incubation lasted a year and a half, before being presented internally; the process began with data analysis in 2017, we formalized the alliance in May 2019. The Metal Link network is also an opportunity for Mattia and myself to manage the generational transition within our companies in absolute clarity, being able to share the best resources of both. We turned a dream and vision into a concrete project which has been shared and approved by our families and will be realized with determination. We consider it a privilege to have full responsibility. We know we can count on each other, since we are complementary as regards training and work experience: Mattia has a financial-management background matured in the long growth path of Alluminio di Qualità while I have a technical-commercial preparation developed in several years of activity in Baratè, coordinating the sales function and market development”.

We asked Mattia to explain Metal Link’s lines of operation in some detail: in quantitative and qualitative terms what is your starting point and what are your objectives?
“We know where to start, you may find the summary data in the table: a joint turnover in 2018 close to 70 million euros, a total volume of more than 20 thousand tons of metal, with a significant overall growth compared to 2017 and also growing in 2019, 86 employees, 23 salesmen on the market between sales agents and direct representatives and a portfolio of almost 3,000 customers with, incredibly, only 70 overlapping.
We believe that the partnership between the two companies through the network and the synergies being developed will bring about important benefits in terms of further development and increased profitability. The alliance is the catalyst for growth; we wanted to emphasize the concept also in the logo which we chose to represent the new organization, the shape of the flat knot with our respective colours, to immediately highlight the commercial union of the two companies. The shapes also represent the materials we deal with, rolled products, molten plates and aluminium extrusions, but our outlook goes even beyond, Metal Link implies the idea that in the future other metals may fall within the commercial sphere of the new organization”.

How did the sales force react to the Metal Link operation, how are sales structured today and what are the future prospects?
Niccolò Rampini Baratè: “After an initial surprise, we immediately found great cooperation and enthusiasm. During the meeting organized at the headquarters of Alluminio di Qualità in Villafranca, after presenting the project we discussed and presented the new territorial organization, with a far-reaching coverage. We shall have a single sales direction which will coordinate the Area Managers and the salespersons of both companies; there will be three Managers of the Sales Divisions, Naval, Automotive and Industry, and three Area Managers in charge of macro-areas, coordinating the salespersons spread out over the territory. Each customer will have only one salesperson for both companies with two different back offices to support them. The market in the South, for instance, is now fully covered. Of course, we will need a learning phase, we have set up training courses for salespersons on products they have never dealt with, for example for the sales personnel of Alluminio di Qualità on foundry products and on mould plates, or on pre-coated products for Baratè salespersons and more, on the other hand the training and competence of our sales network are already a distinctive feature compared to other Italian commercial concerns.
The core business of rolled products will be followed by Alluminio di Qualità for products less than 6 mm thick and by Baratè for greater thicknesses. Alluminio di Qualità will maintain the specialization in its strategic sectors, Marine and Automotive, while Baratè will be directed on higher formats for the mechanical industry in general and on extrusions in particular in its traditional sectors. It sounds complicated, but in reality it is more difficult to explain than to put into practice, what matters is facing the market with a clear and transparent offer and the broadest possible product portfolio. I would like to add that in January 2020 the reciprocal sale of overlapping products has been defined, consistently with the new division of the portfolio and we will present ourselves to the Italian market with the most important and assorted stock available. As far as geographical coverage is concerned, Metal Link concentrates almost 44% of its sales in the North West, 48% between the North East and the Centre, the remaining 6% in the South; foreign markets are of course still entirely to be developed. We shall devote our efforts to them as soon as the stabilisation phase of the national network will be over”.

Finally, we asked Mattia to talk to us about the logistics planned for Metal Link and the new competitive opportunities offered by the alliance: “Of course, optimising logistics is a fundamental issue which will make a difference, and we are paying the utmost attention to this aspect because it will be an extraordinary competitive tool on the market. The matter is clear, we have four distribution hubs located in different areas: in Lombardy, where we are building a new service centre, in Veneto, in Liguria from where we can best serve all of northern Italy and in Tuscany, a logistical base for central/southern Italy.
Basically, Metal Link, supported by the extensive experience of two allies and strengthened by a substantial complementarity which means knowledge, logistics rationalization, far-reaching presence on the market, completeness of the offering and technical and commercial expertise, is ready to present itself as a leading organization for the Italian market and to open up to foreign markets. We are confident that by proposing to the Italian market a complete offer, made possible by the synergy between Baratè and Alluminio di Qualità, we shall have all that it takes in order to compete also in Europe”.