Coping with the crisis

15 November 2001

QHow long have you been general manager? A About eight months now. We have a decentralised structure in the company, ie each factory has its own general manager. Jean-Marie Gigante, who used to work for the BLC in the UK, is general manager of the Pont-Audemer factory, and Mr Pellone is the managing director of the three tanneries. Mr Calabrese is president of the entire company and is also in charge of financial dealings. QHave there been any major changes since you joined the company? A At Strasbourg and Pont-Audemer we have to develop two different business strategies. In Pont-Audemer, we mainly produce upholstery leather for the automotive and aviation industries. The Strasbourg tannery works calf and hides destined for the luxury market, ie footwear and leathergoods. The Strasbourg facility also contains our research and development department where we have already developed different projects with most of our customers. The third company is a small tannery based in Grauhlet now trading under the name TMDF (formerly Darius Fabre) where we produce goat and sheepskins. So, many different steps have been taken over the past few years. Since I became the new general manager, we have rebalanced the amount of skilled labour we have here in Strasbourg. The number of skilled workers had fallen over the past few years, so we are trying to bring the numbers back up again. We're also working alongside local schools to run training programmes in leather making. Our tannery in Pont-Audemer has been recently certified ISO 9001 and accredited by the French body Bureau Veritas for the Far25853 standard for aviation upholstery. We are also in the process of cutting the leather components for our customers. We now need to consolidate our operations if we want to further improve our performances. QHow has the company coped with the current problems facing the leather industry? A We have had a very difficult year like all the tanners. It was really difficult because of the prices of raw materials. We had to look at everything very carefully, but we can look back over the past six months and say that we've coped. Before when there were crises, it was easy to obtain different aids as the company belonged to the CDR, but this time we have to cope on our own. We have been really badly affected by the BSE crisis. We had orders but we couldn't deliver them because of the higher prices of raw materials. QWhen do you think things will get better? A We are hoping that things will pick up by the end of the year. We have been developing our production of upholstery for the automotive industry as the demand is there. We currently tan 1,200 hides a day, but we hope to increase production to 3,000 hides a day in two years' time. QWhat percentage of the hides and skins you tan are French? A About 70% of our raw materials come from France, while the remaining 30% comes from England and some from Switzerland. Our main export markets are the US, England, Italy, Asia and the Far East. QAre you tempted to buy cheaper hides and skins from other countries? A We had to find new origins of raw materials at the peak of the BSE and foot and mouth crises. This was not always cost-effective considering the extra production work required to meet our high standards, and we have now resumed with our standed sources of supply. QWho are your main clients in the automotive industry? A For the time being, we are mainly working with the large French car manufacturers. QDo you have anything else to add? A The strength of our operation mainly relies on the wide spectrum of markets that our three tanneries now specialise in, but also on our overall environmental management. We are able to run our beamhouse and tanning operations in Pont-Audemer at full capacity and still meet the very strict discharge standards currently enforced, thanks to the high perfomance of the wastewater treatment plant we have installed. We are confident that our recent effort to rationalise our operations will start to pay off, and our objectives are now to consolidate our progress and further improve the overall performance of our plants.

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