The entrepreneurial adventure begins
I am Mario Toniutti, CEO and director of Illiria SpA group, a company born from the merger of different artisanal family businesses started in the 70s, after the split of Coca-Cola Friuli Venezia Giulia into small companies, because there were employees that worked there since Coca-Cola is the company that first introduced vending machines and automatic distribution in Italy, with the iconic Coca-Cola machines that we all know. From there, from the 70s with these first companies, they developed this business in the entire Friuli Venezia Giulia region, adding coffee, snacks and other products. The vending machine market was mainly started to provide services for large companies operating in those years.
I started this company in the 80s. My father worked for Coca-Cola, and he kept his job because he didn’t want to take entrepreneurial risks. But when he realized that these new small businesses had room for growth, because the market was expanding, he decided to let his children start their own business. The development of these family firms led some entrepreneurs, some former Coca-Cola employees with good entrepreneurial skills, to grow their businesses enough to be able to acquire other smaller businesses led by less skilled entrepreneurs. With our preparation, determination, and ability, we found our space in the region. We developed this project and we found ourselves, at the end of the 90s (after an important trade fight with the provinces of Gorizia and Trieste), in the position to acquire other firms even in those areas. We started thinking about merging all these companies into one important entity, which was established initially in 2001 as a holding, with different operating branches in several areas, and in 2007 the project saw the light with a complete merger involving 250-300 employees. Each of the firms that existed before the merger had no more than 20-30 employees, and we realized that without a large organization in terms of turnover and people it would be difficult to face future challenges. From 2004-2005 we opened the first subsidiaries outside the Region. We opened in Torino, then Milano, Bologna, Roma, not in this order. In fact, the first was in Roma. Today we are an important actor in the industry because we are the fifth group in the country, with 400 employees.
The money to start
I would say that it is very linked to juvenile naivety. I was exactly 19 years old, I had just graduated, the same as my brother, he was 20 or 21, and we firmly believed in all our parents urged us to do.
If I had to tell you an anecdote, I remember that after a few years, when my father was still working as an inspector for Coca Cola, he was called up by one of the executives of the Coca-Cola company saying that our company had a 200 million of old Lira debt with Coca-Cola, due to unpaid products. I remember that day as “Fine, but 200 million do not frighten me”, because I had this strength, this desire to pursue my project that was to create an important and big company in my future, so I was convinced that everything I would do in the future would have certainly allowed me to cover the debt and to fulfill my dream. It is actually true that a big debt could be scary when you start your own business, but it is also true that if we are not determined in realizing our idea it will be difficult to achieve it.
I can say that Coca Cola, even in their own interest -a great multinational company that had its own development strategy for the awareness of its brand in the area- they helped us by not asking for heavy interests on the debt, but maybe we can also say we were able to choose the right partner for developing our business.
A negative and a positive event
The negative event that I certainly remember is the important trade fight that started in 1994, more or less, and this is happening again now, when we find ourselves heavily fighting to steal customers from our competitors. But, when it comes to competition, we often talk about fair competition and unfair competition and when you enter in a war all rules are allowed, so when there is a heavy “war” on the territory, it is very likely that an unfair war will take place. But I must say that from that famous war in 1993, that lasted for five years, very unfair I said, the whole idea of the group was born, because that enemy company that collapsed facing our stubbornness, our will, our desire to still win it, for conquering that territory, we bought that company, we aggregated other businesses from the provinces of Gorizia and Trieste, and this allowed to develop the whole project of the group that was completed a few years later. Then, I would say, the project of this company was really a consequence of that negative event.
Regarding the positive events, I would say that there are two, in particular: one that created a huge opening in our industry and that is happening again in these years, which shows that this sector can actually create many opportunities. These are the change of the coffee group within the vending machines. The coffee group has always been historically in brass, it created very strong problems for the initial delivery of coffee, because they were not of good quality; with this important invention, by a Swiss guy, of a coffee group in plastic, the result was a good coffee, even for customers, even for few coffee, then also for small companies. This opened up a huge market and developed the industry even more, of course our company as well.
The nicest event, for myself, however, was just to start the adventure outside Friuli Venezia Giulia, because going for the first time on October 15th 2003, to Rome, by train, with my handbag, with a representative, with the spirit and the push of all shareholders saying “go to buy, let’s open a branch in Rome” for people who had worked for 20 years only our region, a very rude one, the people of Friuli Venezia Giulia are known to be very temperamentally closed, well, going to Rome, thinking of doing business there was really something …
For me, however, it was a great personal stimulus, to develop my person, but also the company, and today I think it is a source of great satisfaction also for the Illyria group because we have a registered office with 50 employees, we make over 6 million in turnover in that branch, we have opportunities for a huge growth in the area. From there, we extended the application of our know-how, developed and thought for many years in Friuli Venezia Giulia, to the whole national territory, which was for all of us a question mark, maybe because there was this sense of inferiority that we felt and that instead it has proven itself exactly the opposite. Because, if today we can say that over 30% of the Illiria group’s turnover is produced outside Friuli Venezia Giulia, probably the turnover from outside our region will reach it [the level of revenues from Friuli Venezia Giulia], and will certainly surpass it in the next years, I would say that was certainly one of the most positive events.
Doing business in Italy
Why doing business in Italy? in Italy, first of all because, I mean, this business is clearly very local, therefore very particular. I mean coffee, the Italian coffee is a concept, it is a business linked to something that connects us to our land, so it’s a little difficult to export this idea of coffee outside Italy, of espresso coffee, of the quality of espresso coffee. Definitely, automatic distribution for how it is conceived in Italy, for how it is developed in Italy, which is the country in Europe where it is certainly more developed, it was born in Italy and developed in Italy with a concept that is related to the territory, so it’s a bit difficult to export it. First, there are other business models applied mainly in northern Europe, Germany or other countries of eastern Europe, where the business is developed in a completely different way, companies buy the vending machines, there is no refill and management of them and I do not then elaborate further on the peculiarities of our business. I know Italian companies that still developed and brought their business concept to Spain and France with modest success, I must say, however, that this type of business is typically Italian.
The difficulties of doing business in Italy, the institutions, everything that is said in Italy about the struggles for entrepreneurship, they heavily apply in our industry as well. I do not want to bore you, telling you about all the complications that we have to overcome every day, but we were born in Italy, we have an Italian spirit, we want to do business in Italy, we want to develop this country, represent it all over the world as a country that is capable, which is made of really clever people who know how to do business, we must stay in Italy, we must develop this business in Italy, we must know and fight because all the activities that were born and thought like ours here in Italy, they can eventually be applied in other countries, in the same way as you get, you achieve excellent results in our country.
The key traits of an entrepreneur
The characteristics of an entrepreneur must be, in my opinion, the determination, putting yourself out there, take risk, he must know that risk is part of his life, always, every day, since the beginning until he stops being an entrepreneur. I stress a lot the determination, the courage, the desire to do, because these are the elements that give the strength to get the result. This push, this motivation to get to the final result, to never impose final goals, but to stretch, to always raise the crossbar, and therefore to continue to regenerate your own desire to get the result; this, to me, is the fundamental idea that allows to overcome all obstacles.
Then, when you first start to be an entrepreneur, and this is really just what I believe, the entrepreneur must be intellectually honest toward all the people he works with, because he will never do anything alone. So, the entrepreneur will never have an excellent result if he thinks he can do it all alone: he needs all the people around him, I would say that a large part of his result will only be achieved thanks to the people around him, certainly from his ideas and his drive, from his will to do things, but in the end it is exactly this team spirit what will bring the final result and … a bit of madness occasionally, in its desire to think of new things that can give added value, compared to its competitors.
The future for the new generations
A good example I can bring to young people is remembering when I was young, I’m thinking, a few days ago a friend came to visit me, in this beautiful building we have now 35 years after we started, he reminded me when I was in a very old industrial building, sitting on a diesel forklift which certainly didn’t have power steering, it had a very hard to use steering wheel, which I used to unload these Coca Cola pallets we started with. A building, I mean, something that could be defined as a garage, and all the difficulties that you could have at that time.
So, I would suggest, don’t be scared at all if now, despite a degree, despite all the sacrifices that everyone has made in their studies, to deserve a decent job, we must think or starting from scratch; because the fundamental thing is what one has in mind, the project he has in his head that he wants to develop in his own life, what he would like to accomplish, because that, if there is will, there is the desire and determination, a little bit of luck too, if we put everything we have, I am very convinced that even young people will have a great opportunity.
So, if I had to give some advice to young people, I would say: go all out, be determined, continue to persist on what is the project you have in mind, because surely, maybe someone will be a little less fortunate and will not get a full result, but in part he will get it, but everyone, everyone has an opportunity to achieve his own dream.