Exporting the sweet rural life

Nigel Huddleston talks to the man who heads a third-generation family liqueur business
27 August, 2008
Page 19 
Franco Luxardo's introduction into the drinks industry was more dramatic than most. He was still a boy at the end of World War II, when three family members were killed by communist partisans led by the future president Tito of Yugoslavia and the remainder of the family driven into exile in Italy.

Though the family's roots are in Italy, the family liqueur business was founded in 1821 in what is now Croatia, but was then part of the greater republic of Venice.

Franco entered the business in the early 60s after being sent abroad to learn about the world and hone his impeccable English - including an enlightening spell in the Mormon community of Salt Lake City.

Today the company supplies its 62 export markets out of a distillery in the village of Torreglia in the Veneto region of northern Italy, built by Franco's father, Giorgio, 60 years ago.

Franco says: "He chose a rural area because of the quality of the water ; the soil, which is perfect for growing the cherries for the maraschino liqueur; and, in case there was another war, it wouldn't get bombed."

At 71, Franco's the patriarchal head of the company, though he still uses the title export manager, a nod to the dimension he's given to the business in more than four decades of service.

"The big responsibilities are shared and whether you're called the president, the general manager or something else it doesn't mean a lot. The salaries are the same for everyone - but with a little bit extra for age."

Franco fell into the export role because "I knew languages better than my cousins and we needed to export".

He adds: "The market in Italy was limited and there was a lot of competition.

"We were always told by the previous generations that we used to export a lot, so why didn't we try it again?"

Canada was one of the first export markets he cracked and remains the company's second most important market today.

"I realised Canada, with the liquor boards, was very much about doing business on a personal level, because you have one buyer for the state who was also dealing with the distributors, so if you have them on your side you're in with a good chance.

"I just kept going back, year after year, until they agreed to take our products."

For a long time the family had to cope with rival products from Yugoslavia using its name in international markets.

"We had to fight to defend ourselves because what we had there had been confiscated, including our labels, which were being used by another producer controlled by the government.

"They were using our labels and selling them in Switzerland, Germany and France. It took at least 20 years but we managed to overcome that."

The UK has been one of Luxardo's most successful markets - particularly for sambuca, where distributor Cellar Trends claims a 72 per cent share for the on-premise sector.

The market has been opened up b y promoting "shot-tails" - layered mixes of sambuca and other liqueurs from the range that stretch usage of Luxardo's products away from their origins.

"Shot-tails are an excellent idea," Franco says diplomatically, "but I like my sambuca as a digestif.

"The shot is very English. In Italy, even the word doesn't exist. The closest we have is il senso russo, which means 'in the Russian way'."

The secret to success, he believes, is to adapt to the conditions of different markets, which is relatively easy to do with a range of more than 30 liqueur and grappa products in the portfolio.

"In Japan, the anise-based products aren't so well-liked. It's more about amaretto, maraschino and the espresso coffee liqueur."

Distributors are chosen carefully to fit the Luxardo profile.

"Traditionally, we've tried to get together with family-owned companies because it gives you continuity," he says. "With multinationals, it's a mess because they change personnel every six months and don't have a personal feel for the business."

Greece, the Netherlands, Russia, Ukraine and Argentina all presumably have agents with a good feel for the business, as Franco picks them out as current export highlights for Luxardo.

It's an understandable stance to take, given what the family firm has taken to get to where it is. "It's rare to see it through three generations like this," says Franco, with some pride.
----=== Luxardo facts ===Founded: Dalmatia (now Croatia), 1821

Current location: Veneto, northern Italy

Annual production: 5 million bottles

Exports as proportion of total sales: 65 per cent

Number of export markets: 62

Top three export markets: UK, Canada, Japan



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