Francavilla
Strategic Concepts & Mechanics
Primary Evidence
"Francavilla tells the story, though he doesn't speak a word of English, that in 1973 they receive a call from an important American customer. The nose pads on five thousand frames were assembled backwards. Luigi grabs his tools, hops on the first plane with a worker, and dashes to the United States to personally change the nose pads on all five thousand frames. They manage it in one night. Agordo-United States, round trip in the shortest possible time, to return to oversee the production."
"Francavilla, who will become an honorary citizen of Dongguan, the city where Luxottica settles, says that the development pace in China is astonishing: "We were growing like mushrooms. The first time we arrived there, there was nothing, just fields. There weren't even roads and now we have over twelve thousand employees.""
"Del Vecchio sends Francavilla and another collaborator on a scouting mission. In ten days they travel the world, from Ireland to Texas, up to Hong Kong. "When I got back, I realized that there was nothing to save. They worked very poorly, the factories were in bad shape, poorly organized, not managed," Francavilla tells me. "We returned and prepared a quick analysis for Del Vecchio," he explains. "When I met him, I told him clearly: no glasses are being made here.""
". The task is not easy, nobody in the village rented houses all year round, but only those for vacationers. Before this, nobody had ventured there for work reasons. From Agordo, you just left and that was it. Francavilla is the first to reverse this trend in a land used to seeing its children grow up far from home."
"Essentially, he has the opportunity to transform a "commodity" product into a customized one, a fortune that happens to few entrepreneurs, who often, instead, are forced to fight in a context that levels profits rather than expanding them. Some negotiations are initiated with fashion groups, leading up to meeting Armani. The Milanese designer had had negative experiences with other producers in prior years who did not guarantee him adequate quality. A very tough negotiation begins, which lasts for months, with Chemello and Francavilla going back and forth between Agordo and Milan to discuss with Armani's lawyer."
"He says that, from the first days, when he enters the factory early in the morning, he already finds him filing away. The day after, he comes a bit earlier, and Leonardo is already there, from five o'clock. Francavilla decides to test it out for a couple of months. He wonders if that young industrialist really has "the money to pay my salary at the end of the month." He never left Agordo again. Together, they conquered the world. Del Vecchio the mind, Francavilla the arm. However, the beginning is fraught with difficulties."
"Now that his company has become a center of excellence in the production of frames, Del Vecchio must change his skin. It's time to delegate the production side to Francavilla and dedicate himself to studying the market, the commercial side, an area where he and his trusted colleagues have no experience. "Working with distributors had become too risky," he explains. Luxottica is at the mercy of others' choices. It's time for a new evolutionary leap: to develop the commercial network to bypass the distributors. "I could no longer work with wholesalers," they represent the brake for companies, he's hard on it. "In the long run, a wholesaler is the death of companies because it forces them to live day-to-day. This is a conviction I have come to through personal experience." The reasoning is simple. A distributor sells your glasses only as long as they derive a direct benefit but keeps their hands free, ready to abandon you if they find a product that is more popular or allows them greater margins."
"Foreign wholesalers enter right away. The price attracts. It's as if you can see them, the elegant American importers studying the frames of this new company from Belluno with great attention. They are well made, to perfection. They place large orders. Outside the booth, a line of buyers forms. Del Vecchio and Francavilla exchange glances, a mutual understanding is enough. They started off apprehensive, with prices that were perhaps overly competitive. "All the wholesalers were literally diving into our small booth and leaving after placing significant orders." The price of a single piece went from 600 to 1,000 lire. But that still wasn't enough. "At one point, we increased the prices because we realized that they were probably too low, and so every hour the prices went up... it was chaos," explains the president. Francavilla is amused remembering their first Milanese expedition. "An incredible success. On the third day, we managed to triple the prices, up to 1,800 lire a piece.""