INSIDE THE FERRERO FAMILY'S SECRET EMPIRE

Family Profile  |   July 2018   |   by Craig Postons

 

Every so often we come across a story of a business family that needs to be shared for the important lessons – and inspiration – it provides to other families.

nutella.jpeg

The story of the Ferrero family, from a recent issue of Forbes, is in this category. 

Among the highlights:

· Ferrero is a third-generation candy company – the makers of Nutella spread, Kinder Joy eggs, Butterfinger chocolate bars  and Tic Tac mints, among many products. It sells $12.5 billion worth of candy annually in 160 countries worldwide.  “We do everything with seriousness and extreme competence," says Giovanni Ferrero, the firm's 53-year-old chairman.  Today, the Ferrero family is worth $31 billion.

· The family has weathered its own share of adversity.  After a lifetime of working with both his brother and his father, Giovanni is now alone at the helm.  His brother and co-CEO, Pietro, died of a heart attack in 2011 at age 47. Three years ago his father, Michele, died as well.  Left on his own – and grappling with overwhelming demands on his time – Giovanni appointed the first outsider as CEO in 2017.

· In Giovanni’s own words, "we are in love with a growth algorithm of 7.33 periodic.”  The rationale?  Revenue growth of at least 7.33% per year, whether organic or non-organic, would double the company in a ten-year time horizon.  Having built a successful business organically – with careful growth, little debt and no acquisitions – Ferrero has completed six purchases in the past three years. It’s shifting its strategy on the fly in order to drive growth and compete with the biggest  players.

· By virtue of its ownership, Ferrero remains a family-controlled business.    Today, the company’s corporate headquarters is in Luxembourg, and Giovanni lives with his own family in Belgium. Yet he’s really running a multinational company, with 25 factories scattered around the world, and a clear mandate to expand.  "I feel like we are duty-bound to grow," he says.

Read the full Ferrero story from Forbes.

 

Craig Postons supports CMG and its clients with strategic marketing, branding and communications expertise.