This news article was originally written in Spanish. It has been automatically translated for your convenience. Reasonable efforts have been made to provide an accurate translation, however, no automated translation is perfect nor is it intended to replace a human translator. The original article in Spanish can be viewed at Entrevista a Ana Arce, directora de Internacional e Innovación de Fenin, Federación española de Empresas de Tecnología Sanitaria

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“Our SMEs are competitive and able to grow in the international field in adverse moments”

Interview to Ana Arce, director of International and Innovation of Fenin, Spanish Federation of Companies of Sanitary ware Technology

Esther Güell14/01/2013

In spite of the complicated situation that live the companies of sanitary ware technology in Spain, the internationalisation and his clear bet by the R&D is supposing an important step forward for many of them. They are the majority of them small and medium enterprises that have had to face from the complicated relations with the public sector until the problems of endemic financials already in a lot of companies. But no thus they have thrown the towel if no that, on the contrary, have known to find an opportunity in markets so diverse like the United States, Brazil, Japan, Korea, Arab Countries or Australia. Ana Arce, director of International and Innovation of Fenin, Spanish Federation of Companies of Sanitary ware Technology, gives us a ‘X-ray' on the situation of this business segment.

Fenin Groups to some 1.200 companies, of which 520 are manufacturers, according to his data of 2011. We are speaking of SMEs or big companies?

Mainly are SMEs, in 80% roughly. This sector is formed by big quantity of small and medium enterprises.

Ana Arce, director of International and Innovation of Fenin.

This situation, has supposed a hándicap or an advantage to the hour to compete so much in the Spanish market as in the international?

If for a SME always has resulted complicated to compete with the big companies because of the lower availability of resources, inferior economies of scale, greater difficulty of access to the financials among others reasons, the economic crisis that is crossing Spain is supposing the incorporation of factors that stress this situation.

In the public field the aggregation of the demand by means of the centralisation of the buy of the sanitary ware technology that is llevar so much from the Autonomous Communities as from the General Administration of the State, through the platform of shopping centralised of the National System of Health, represent difficulties added for the access to the national market for the SMEs.

Is increasingly frequent that the public contests demand that the adjudicators supply big quantities of products to resupply to all the sanitary ware centres of one or several autonomous communities, appearance to the that only can answer the big companies with an important productive capacity but that supposes a barrier infranqueable for the SMEs whose capacity supply no always can attend this demand.

But the situation of the health deprived does not differ too much of the previous stage given the increase in the tendency of the gestión of shopping of sanitary ware technology by part of groups of several sanitary ware centres that impose conditions to the companies to which results complicated to access to the SMEs.

Regarding the national market, have to compete against big companies can be a hándicap. The main reasons can find in the difficulty to obtain financials that has a SME, bear the important morosidad that for the time being exists, although the forecasts are optimistic in this sense, adaptation to the different systems of purchase that pose from the different Autonomous Communities.

By the contrary, the Spanish SMEs are exporting and are increasing his figures of export of constant way from does years. Our SMEs are very competitive in the outside and although they also are suffering the consequences of the crisis mainly by the difficulty of access to the necessary financials to bear all the activity that carries implicit a process of internationalisation and by the reduction of the internal demand of a lot of countries, keep a successful tendency in the outside.

Photo: Victor Maltby

The main market of the sector is the service of public health?

Traditionally between 70% and 80% of the sales of sanitary ware technology went allocated to the public sector, direct consequence of the remarkable predominance of the public gestión of the health that always has characterised to our National System of Health.

Nevertheless the private sector has grown in the last years of important form because of the utilisation of formulas of private gestión of the health that result increasingly prevalentes, therefore, seems reasonable to foresee that the impact in the sales of the private sector increase notably in the last years.

Which percentage of the production in Spain allocates to the export?

it is exporting Roughly 30% of the production, reaching a near figure to the 1.800 million euros, what supposes an increase of 14% in the last years. Nevertheless, whereas the taxles of external growth were increasing to an upper average to 7%, from the year 2009 begin to give percentages of growth very inferior. Since up to now, the companies have followed increasing his figures of export although to an already inferior rhythm to the year 2009. In fact in 2011 the growth was of 1,7%.

The reason can find in the important crisis of the European Union, that has happened to represent almost 70% of our exports to 58% current. This circumstance, on the other hand, has improved the diversification of our exports, like this, although the EU keeps like our main destination, the Spanish companies have been able to position in all type of markets, with important growths in United States, Brazil, Japan, Korea, Arab Countries or Australia, country where porcentualmente, more has grown our export.

The diversification in the markets is attaining to keep our figures of export, and indicates that with the recovery of the EU, will go back to taxles of growth much higher put that our SMEs are showing his competitiveness, being able to grow in the international field in adverse moments.

Photo: Sundeip Arora

And which percentage of sanitary ware technology matters ? Of which type of technology are speaking?

Roughly it represents some 4.600 million euros. Regarding products, traditionally has mattered equipment and products of all type but especially of very high technology put that although it is true that the Spanish product is in a half technological zone-high, there is determinate equipment that up to now do not manufacture in Spain.

Nevertheless, are growing the imports of pertinent products of emergent countries like China, India and Brazil, had to fundamentally to the utilisation of the price like only criterion for the acquisition of sanitary ware technology, obviando appearances like the quality, services associated, etc. In spite of this increasing and worrisome tendency by the impact asistencial that it can have, the main countries of which Spain follows mattering are United States and countries of the European Union such like France, Germany, Italy and Portugal.

In the coyuntura current, which are the segments that are 'throwing' more than the car?

The incorporation of the advances in the information and telecommunications is generating new businesses and products in the sector of sanitary ware technology as well as the apparition of new companies. A clear example are the technologies AAL (Ambient Assisted Living) and all the developments in and-Health. The majority of them are companies with a strong technological base.

Nevertheless there are other powerful sectors as they are the one of diagnostic in vitro, electromedicina or dental.

The internationalisation has gone very tied to the increase of the demand in the external market. Which relation establishes between provider and demandante?

Increasingly it exists a greater dialogue between offer and demand, although it is necessary to follow advancing in this terrain. It does not treat only to launch products to the market but to offer the most suitable solutions taking into account a lot of circumstances. No always a product technologically very developed is the most appropriate by diverse questions or do not take into account the needs that has to cover or the results that want to obtain . On the other hand they exist technologies that can be costlier in a first moment but that to half long term suppose an important saving of the costs or can contribute solutions to complex problems.

Here it goes in at stake the bet by the innovation. According to data published recently by Fenin, his companies devote of the 6 to 7% of the turnover to the R&D. Where it puts more the accent to the hour of innovar?

These data correspond to a study based in the answers of 118 companies, again the majority of them SMEs. Basically this study comes to show, independently of the figures, that have to take into account like a sample and are not necessarily extrapolables to all the sectors, that the companies that innovan are those that more success are having so much in the national market like the international. That is to say, that the investment in R&D does more competitive to the company. In spite of the difficulties of financials and of shortage of resources that live, consequence of this grave crisis, the companies are very conscious that to succeed in international markets have to incorporate the innovation in his strategy.

Equally the study puts of self-evident that the most innovative companies are much more opened to the cooperation with the rest of agents of the system, like the own buyer, the technology centres, universities, hospitals, etc., looking for these more suitable solutions, in some surroundings that call of ‘Open Innovation' or open innovation.