BIG SPRAY GROUP: SUM OF PARTS
The Exel Group may not be that familiar to UK farmers, but some of its daughter companies certainly are. Peter Hill reports
FRENCH sprayer manufacturers have always held a strong position in Europe. At the SIMA show, the Exel Group will have the biggest presence – not with a single stand, but through the individual exhibits of its several group companies
Principal among these are Tecnoma, which started the group in the late 1980s, and fellow agricultural sprayer makers Berthoud and Caruelle. More specialist manufacturers of vineyard, orchard and self-propelled sprayers, as well as domestic and horticultural designs, give the group a diverse product line.
The Exel Group commands a dominant 70% of the French crop sprayer market. A more buoyant sales situation, both there and in principle export markets, has seen turnover increased by an impressive 30% in the 1995/96 financial year to £125m.
Just over a quarter of sales are outside the home market, and the group employs more than 1000 people in France and its overseas subsidiaries.
Maintaining individual brands, design features, sales teams, dealer networks, manufacturing centres and export arrangements is largely responsible for the groups success. Selling under a single name and a single distribution network would simply not generate as much business. At SIMA, that policy extends to Exel group companies having their own stands where they compete directly with each other as well as non-group companies.
"Such arrangements enable our companies to be very price and specification-competitive, provide customers with choice and ensure provision of high quality equipment while collectively obtaining an overall larger market share than would be possible individually," says Rene Marchese, director general of Tecnoma.
Exel was created in the summer of 1987 by Tecnoma (now one of the major subsidiaries) to manage all the companies that Tecnoma had acquired at that time and to provide a sound basis for future acquisitions.
Following the death in 1980 of the founder, Vincent Ballu, his son Patrick took over management of company, based at Epernay in the Champagne region. He began acquisitions in 1986; Caruelle, another manufacturer of agricultural sprayers, was the first target, followed by Nicolas, a specialist manufacturer of vineyard and orchard sprayers.
Tecnoma then bought Berthoud and its subsidiary companies Seguip (also farm sprayers), Thomas (a vineyard sprayer manufacturer), and Perras, which makes hand-held sprayers. At that point an umbrella company was needed to oversee group financial management and avoid contravening Frances anti-competition legislation.
Loiseau (which makes high clearance vineyard tractors) and Preciculture (self-propelled sprayers) joined the group in 1989 and 1990 respectively, followed in 1991 by RCM (hand-held sprayers). More recently – and in a departure from crop sprayers but using similar technology – came Kremlin, which makes paint guns and booths, in 1995.
While retaining individuality, group companies share manufacturing facilities to some extent and in some cases they provide products for other group companies.
Preciculture, for instance, makes essentially the same self-propelled sprayers but turns them out in different colours and detail specification, and with different components and control systems according to which name will appear on the side.
Berthoud is the largest of the Exel companies with some 40% of the French market and contributing almost 50 per cent of total group turnover, says UK sales manager John Bowring.
"The company is based at Belleville, near Lyon in the heart of the Beaujolais area," he adds. "It was formed over 100 years ago and exports to 68 countries worldwide, particularly Africa, Eastern Europe and both North and South America."
New "Bertronic" electronic sprayer management systems are the current major product development from the company.
Tecnoma is based at Epernay in the Champagne region east of Paris. It also contributes substantially to group performance with total annual turnover for the 1995/96 financial year of £27.5million.
"Around 25% of production is exported, 80% of it within Europe," says John Sandys, UK sales manager. "Britain and Germany are the most important markets and the company spends 5% of turnover on research and development to maintain a technological edge," he adds.
Recent technical innovations include Axair self-levelling pneumatic suspension for trailed and self-propelled sprayers, and individual pneumatic shut-off valves for each spray nozzle.
Typical of the economies of scale that can be achieved with such a set-up is that, in the UK, Berthoud and Tecnoma share the same premises under the Exel name, sharing spares, administration and financial management while retaining separate sales and marketing arrangements and dealer networks. Both have plans for expansion and increased market share in the UK.
Companies: Berthoud, Tecnoma, Caruelle, Seguip, Preciculture, Thomas, Nicolas, Perras, Loiseau, RCM, Kremlin
Market share in France: 70%; exports 26%
Group turnover (1995/96): £125m
Products: Sprayers for agriculture, horticulture, domestic, amenity and public health; factory spray booths and paint guns
Above: Berthoud in action. The Lyon-based sprayer maker is the largest company in the Exel Group. Below: Exel companies retain their individuality but benefit from the economies of being part of a large group, say Tecnoma directors Gerald Depriester (left) and Rene Marchese.
Companies: Berthoud, Tecnoma, Caruelle, Seguip, Preciculture, Thomas, Nicolas, Perras, Loiseau, RCM, Kremlin.
Market share in France: 70%; exports 26%.
Group turnover (1995/96): £125m.
Products: Sprayers for agriculture, horticulture, domestic, amenity and public health; factory spray booths and paint guns.