Enzo Mularoni, president of Del Conca: Focus on Leadership
Interview by Kemp Harr
Enzo Mularoni graduated from college with a degree in civil engineering and went to work in his father’s ready mix concrete business at the age of 24. Less than six months later, his father sold the business, and in 1979, he and Enzo purchased a financially distressed Italian tile factory, which they named Del Conca.
Today, the company claims to be the largest importer of Italian tile to the U.S. In mid-February, Del Conca began producing products in its brand new U.S. manufacturing facility, located just south of Knoxville, Tennessee.
Enzo’s wife and three sons all work within this family-owned business. Paolo, his oldest, is the president of Del Conca USA; Davide handles Far East business and the European markets; and Marco, the youngest, focuses on manufacturing. Enzo’s wife, Stefania, manages the foundation (Fondazione Cino Mularoni) created to honor his father.
Q: What drove the decision for Del Conca to build a plant in the U.S. and, specifically, in East Tennessee?
A: The American market wants to buy more U.S.-made tile because these products have lower freight costs and no duty. They also have a shorter time to market and require less stocked inventory. Del Conca has had a successful presence in the U.S. since the mid ’90s and imports over 4,000 containers of its tile into the States annually. East Tennessee is strategically positioned: close to both raw materials and to the traditionally larger markets for ceramic tile—the South, East Coast and Midwest.
Q: You were very careful in selecting Loudon County for your U.S. factory. What made it stand out compared to the other sites?
A: In Loudon, we found a business-friendly community. They really wanted us to invest in that county, and they facilitated our approach with the institutions.
Q: Why are you building the plant in two phases?
A: We plan to adapt our output to our sales demand. Today, we sell about 40 million square feet in the U.S. per year. The new facility will manufacture 30 million square feet annually, and the second phase will double that. There’s a chance for a third production line as well, if we choose to expand the size of the building. The products that we manufacture in the U.S. will be different from those we manufacture in Italy. We don’t want to take marketshare from our Italian production, so we have to build a market for the American-made products. This will not be so difficult because we have a lot of customers in the U.S. Some of them are huge, like Lowe’s, and they are happy to have a new domestic supplier.
Q: With the opening of your factory in the U.S., you free up approximately 40% of the capacity in Italy. What are the plans for this capacity?
A: The U.S. manufacturing team has to walk before they can run. Our goal is to supply the basic products—the mid-size floor tiles—from the U.S. production and to continue importing smaller and larger tiles, wall tiles and special products like our innovative Fast, the easy-to-install floating tile that doesn’t use adhesive. Part of the capacity we free up in Europe will be used for expansion into other growing markets such as Eastern Europe and Russia.
Q: How do you intend to maintain your Italian heritage once your products are made in Tennessee?
A: Our products are and will always be designed in our Italian research and development department.
Q: Lowe’s named you vendor of the year in 2008. What made you stand out ahead of their other suppliers?
A: They were and continue to be very satisfied with our design, quality and service level. Also, our ratio of quality to price is highly appreciated.
Q: How do you make sure that the products sold at Lowe’s don’t compete with the products sold through your distributors?
A: We never sell the same product to traditional distribution and DIY retailers. The products are always different. We hope to sell half of the U.S. production in the DIY channel and the rest in the distribution channel.
Q: Do you intend to grow your presence in the U.S. commercial market? Will that focus play a secondary role to your current focus on the residential market?
A: Residential is our primary focus, but with the new facility we will have some lines of products for the commercial market as well.
Q: What are your environmental goals, and will you be doing anything at your U.S. facility to increase environmental sustainability?
A: Del Conca was one of the founders of the Green Building Council of Italy. In our Italian facilities, we recycle 100% of process water, dust and unfired and fired scrapes. All of our emissions are automatically controlled and registered. In the Loudon factory, we’ll adopt the same procedures and the best available technologies.
Q: I’ve been impressed with your innovative products like Fast and Due, and I get the feeling that you are personally involved in many of the ideas that set Del Conca apart. Is that a true assessment, and how do you balance the responsibility of growing your business when you serve a fundamental product development role.
A: We have a staff of several people in the R&D department. Nonetheless, I like to spend some time with our technicians and bring them my ideas and suggestions. I enjoy that side of the business.
Q: How can we increase the per capita usage of tile here in America?
A: In the past, tile was used only in bathrooms, then in kitchens, now it is also used in living rooms. Bedrooms are the next target, but outdoor spaces are also a huge opportunity.
Q: What current tile trends are having the biggest impact in driving growth in this market?
A: Wood look tiles are a trend that is bringing great satisfaction to producers and distribution. But stone and marble looks are still an important part of our sales. And sizes are always growing.
Q: I notice that the Del Conca brand has a little more personality than other imported brands, sponsoring sporting events (motorsport races) and artists that draw seductive female superheroes. Tell us more about the personality of the company and the Del Conca brand.
A: Italy is a country where art is everywhere; millennia of history and beauty are always visible. Motor sports are also very popular; Italy is land of Bugatti, Maserati, Ferrari. You can’t avoid being influenced by this environment.
Q: I get the feeling that you are having fun running Del Conca. How do you work around the daily drudgery of running a business?
A: Sometimes I have fun, and sometimes not. A company of this size is like a family in some ways. At times you are worried; at times you are happy—but you always love it.
Q: What pastimes do you enjoy?
A: I bike with my family, and I also like skiing and sailing.
Q: You are very proud to be from the Republic of San Marino—a small microstate geographically surrounded by Italy. What should people know about San Marino, and in what ways are its culture and people different from Italy’s?
A: San Marino is the oldest republic in the world and one of the smallest. There is a tradition of democracy and solidarity that has been recognized by all the world’s countries. During World War II, San Marino was a community of 15,000 but hosted 100,000 Italian refugees. My family has lived in San Marino for generations. My last name can be found in public documents dated as far back as the 16th century, and I’m very proud of this.
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