from poker cards to cigarette papers – Corriere.it

There is a bubble born during Covid and it is not financial. We can call her the Scala 40 bubble is that of table games and playing cards. During the pandemic, a bit like what happened to food or household goods, these products were very sold and producers invested to upgrade their plants. Now they find themselves with a “calm market”, as Stefano Crechici, president of Modiano of Trieste says, of which he is a 44.5% shareholder (another 44.5% belongs to his mother Maria Teresa Bottan and 11.1% are own actions). “We have to sell more and more to fill the lines,” says Crechici which therefore decided to diversify, with two moves.

The return to the origins

The first. In addition to historical cards such as Rummy, Neapolitan and Poker cards, Regional cards and ai Tarot cards that Americans like so much (“They buy them during crises to predict the future, but also for collection”); in addition to paper cases such as those for Fisher blocks or Roco toy trains, now the company — founded in 1868 by Saul Modiano and sold to the Grafad paper converting firm of the Crechici family in 1987 — it will also return to marketing cigarette papers. That is the product with which Saul David Modiano, originally from Thessaloniki and then with little means, had started more than 150 years agolater establishing itself with increasingly illustrated boxes and billboards for giants such as Lloyds, to which artists such as Marcello Dudovich contributed.

The upcoming acquisition

The other step to overcome the calm by Modiano Industria Playing cards and the like (this is the full name of the company), as the lawyer Crechici, who is a sailing enthusiast and doesn’t miss a Barcolana, would say, is an acquisition. «In 1987-88 we sold the Modiano brands for cigarette papers, but we came up with the idea of ​​returning to that market – says the president of Modiano -. So six months ago we took them over. We have prepared the international brand Modiano Classe 34. Soon, first abroad and then in Italy, we will be back to selling rolling papers. And we will increase production for third parties with our machinery for playing cards». As for shopping: «We are evaluating the acquisition of a paper converting company in Veneto – says Crechici -. It is a company with a turnover of about 5.5 million, we expect to close shortly. They produce things that we don’t have.”

Investments and the post-Covid turnaround

In 2017 Modiano had three production lines, now it has nine with a production capacity of over 20 million playing cards per year. Of course he has to fill them, also because he has invested “five million, of which 4.5 with Industry 4.0” in 2021-2022 to renew the machinery. «During the Covid period people stayed at home and played cards, Monopoly, Trivial Pursuit – says the owner of Modiano (which also produces board game cards, in the case of Monopoly, «Unexpected» and «Probability»), vice president of the Association of historic brands of Italy since February -. Now the factory that produced those games has closed, for a rationalization of the plants of the Belgian group Cartamundi. In the world of board games volumes have decreased a lot and warehouses are at a standstill. However, we have increased production capacity by 50% in 2020-2021. We can making many different formats at the same time means speed of production and delivery. We then ordered a new digital printing machine, it costs one and a half million».

Expansion abroad

In short, Modiano is an example of a family business (adhering to Aidaf) which invests and restarts during the crisis, changing its strategy if necessary, but without stopping. With 60 employees, ten million in revenues foreseen in the 2022 budget and a declared gross operating margin of 11.5%, against 11.5 million in turnover in 2021 (8.5 million in 2020); with a net worth “doubled to six million since 2018”, Modiano generates approximately 15% of its turnover in the United States (“I’m there at least once a month,” says Crechici, who returned from Las Vegas two weeks ago). There is the large Tarot market there: «They make the drawings, we produce them». There are also casinos but Modiano now serves those in the Old Continent, such as Nova Gorica and Luxembourg. «Exports cover just over 50% of revenues», says the president who lists the outlet countries, in addition to the USA: «Germany, Spain, India, China and Greece where we are market leaders». Now the focus is on the expansion in India and on China which “should restart”. Italy in the first half of this year “grew by 10%”, in contrast.

Rising costs and Industry 4.0

The declining accounts for 2022 (this year are expected to be in line) were affected not only by the declining demand, but also by two exogenous factors. One is the increase in raw materials, also for Modiano who produces mainly in Italy: «The cost of cardboard remains very high compared to 2021, it has risen by 50% – says Crechici – and plastic has grown by 65-70% in one year”. The other factor is financial charges: “They’ll have a lot to do with the rate hike.” Therefore the entrepreneur, who says he had to raise retail prices “but only slightly, around 5%”, calls for a renewal of the tax breaks for those who invest, starting with tools such as Industry 4.0. «Industry 4.0 had to be renewed as it was, with at least a 40% tax credit – says Crechici -. Having lowered the rate to 20% risks stopping everythingabove all in Italy where there are many manufacturers of machinery for components, starting from the Emilian Packaging valley».

The card market

The playing card market, estimated at around 8-9 million in Italy, is concentrated and revolves around a few protagonists. In Italy, in addition to Modiano, there is Dal Negro, in Treviso, stronger in the North (Modiano is stronger in the Center and South). Over the border there are the giant Cartamundi, in Belgium, with around 500 million in revenues; then insiders cite Piatnik in Austria; Trefl in Poland; the Angel in Japan. The road to growth is therefore that of acquisitions, but Modiano, like other family businesses (Acqua Sant’Anna, for example) struggles to find businesses to buy, he says. And Italy is an anomaly with two companies in the same business, Modiano and Dal Negro. «The idea of ​​a pole with a single company has been around for 30 years, but it hasn’t materialised». Because if Modiano doesn’t want to sell, neither does Dal Negro. Open game.

Subscribe to the newsletter of The Economy

Whatever it Takes by Federico Fubini

The challenges for the economy and markets in an unstable world

Europe Matters by Francesca Basso and Viviana Mazza

Europe, the United States and Italy that count, with innovations and important decisions, but also small important stories

One More Thing by Massimo Sideri

From the world of science and technological innovation the news that changes our lives (more than we think)

And don’t forget the newsletters
The Economy Opinions and the Economy 6 pm