Indukern tanca el 2018 amb un 8% de creixement i consolidant el mercat exterior
Indukern tanca el 2018 amb un 8% de creixement i consolidant el mercat exterior

Indukern, the discreet multinational

The chemical and pharmaceutical production and distribution group has spent more than five decades quietly conquering the world with total determination

As with any good family firm, the Indukern group understands that going the distance is what matters. “We are marathon runners,” insists the founder and president, José Luis Díaz-Varela Somoza. It is a race that has so far lasted 55 years and that today accounts for a 725-million euro turnover (some 53% from abroad) with 1,700 employees and 18 companies around the world. The group is a genuine multinational forged by consistency and discretion that today has three main divisions: Indukern, devoted to the manufacturing and distribution of chemicals for industry; Laboratoris Calier, which specialises in medicine for animals; and Kern Pharma in the pharmaceutical sector. In one of Díaz-Varela’s rare public appearances, the founder and his eldest son, Raúl, share the history and evolution of the company in the Captains of Industry series held in the Cercle d’Economia.

From Galicia to Venezuela

Indukern is a Catalan multinational, but its origins are in Galicia and Venezuela. Natives of Monforte de Lemos, the Díaz-Varela family was living in La Corunya when the José Luis’ father offered him the management of a ceramics company near to Caracas. He was only 18, but soon after arriving there he began working as a pharmaceutical sales rep. “I had never sold anything,” he recalls nostalgically. However, he showed an aptitude for sales straight away. “In 20 days I had closed all the month’s visits and I was getting bored, so I asked for a change,” he says.

So, he went to Industrial Kern, representing large companies in the chemical and pharmaceutical sector. “I earned such a good living that by the end of the year I was going around in a Mercedes,” he recalls. He worked so well as a sales rep that by the age of 22 he was a manager, but “I didn’t like the idea of always being shut up in an office.” So, he decided to propose to mister Kern that he do a study of the Spanish market. “I visited the whole of Spanish industry in the sector and proposed setting up a company in Spain.” Kern wanted to set it up in Madrid, but Díaz-Varela convinced him that the ideal place would be Barcelona. “Catalonia was a very industrial area...and it had the sea, which reminded me of Galicia,” he says all these years later. It was 1962 and aged 24 he had just founded Industrial Kern Española.

 

Daniel, Tamara, Raúl i José Luis Díaz-Varela | Cedida

Daniel, Tamara, Raúl and José Luis Díaz-Varela | Ceded

Specialists in sales

Despite beginning with “half a secretary” so as to save resources, Díaz-Varela says that things started well and the following year the company was making money. And that was “without having anything to sell,” says the head ironically. “I was looking for suppliers of different things and, for example, I went to Igualada to sell leather, but I didn’t see a future in it,” he admits. The main seam he found to mine was in fodder, in which “we began to sell vitamins and minerals.” Today this is still the company’s most important industry and an eminently profitable business.

 “Catalonia was much more industrial than Madrid...and had the sea, which reminded me of Galicia”

In 1968 mister Kern sold his shares in the company to US suppliers. It led to a partnership that lasted until 1976, when Indukern passed entirely into Díaz-Varela’s hands. Also at that time, recalls the founder, “we saw that our competitors were buying medicines for animals and so we decided to set up a small factory in Hospitalet to make veterinary products.”

International expansion

This is the beginning of a period of expansion that would last throughout the 1980s and into the ‘90s. Indukern opened offices in Portugal, Norway, Switzerland and Hong Kong, laying the foundations for the group’s international character. Yet, José Luis Díaz-Varela recognises that “we began to create companies that were not within our branch, imitating Japanese multinationals that had a finger in every pie.”

Instalacions de Calier a Les Franqueses del Vallès | Cedida

Calier facilities in Les Franqueses del Vallès | Ceded

It was an ambition that gave them a turnover of three billion pesetas, while it took them further from their traditional sphere of selling office furniture or electronics. Until the crisis of 1992 arrived. “No one was buying anything and we reinvested all our personal savings into the company to pay all the accounts with problems,” says the businessman about what turned out to be a lesson well-learnt inside the company.

Arrival of the second generation

Today the founder’s three children are part of the group, spread among Indukern’s three main divisions. This second generation came into the family firm during the 1990s. First Raúl in 1993, and then Tamara and Daniel in 1997 and 1998 respectively. “From the age of 15, I would talk to them about the work, about the problems we had. I involved them in a natural way, listening to what was going on in the business, and I made them work in the summers delivering documents for the different divisions of the office,” says their father.

The vision of his eldest son brought a new perspective. “When I was 16 I told him I didn’t want to work in the company. I thought I could never do what he had done.” Even though his father insists that he was subtle in his attempt to convince him, Raúl Díaz-Varela says how his father brought him American articles about second and third generations who had improved on what the founders had achieved.

 “When I was 16 I told him I didn’t want to work in the company. I thought I could never do what he had done”

In fact, his first projects after working for six months in the United States after finishing his studies consisted of trying to set up a golf course in Viladecans. Great fans of this sport, Raúl admits that “as everyone knows, today there is no golf course in Viladecans. Nor in Cerdanyola, which is where we tried next.” It was an unsuccessful experience that ended up bringing him to Indukern and, in very little time, to go and take over the Hong Kong office.

However, since 1999, the older brother has been the head of the Kern Pharma division. It is an area that grew out of the purchase of the Boehringer Ingelheim plant in Terrassa along with some of its products. “It has proved to be one of the group’s most important decisions. We were looking for somewhere to set up a factory and have everything together,” recalls the founder. Coming out of the final meeting that closed the deal, Raúl told his father: "Dad, I’ll take this one."

 

Foto aèria de les instal·lacions de Kern Pharma aTerrassa | Cedida

Aerial photo of the Kern Pharma facilities in Terrassa | Ceded

The value of experience

The oldest of the second generation insists that “we almost have it better during times of crisis than plenty.” Indukern’s the three basic product lines are all necessities: food, veterinary and pharmaceutical complements. “These activities have allowed us to keep going and continue to build what is now the group,” he says.

Moreover, the international experience of more than 40 years also works in their favour. “The company already had some characteristics that some companies have had to pursue since the crisis,” points out Raúl Díaz-Varela.

In recent years, moreover, Indukern has made some changes. “Organic growth was becoming difficult because we are in mature markets with increasingly narrow margins. Adding our own new divisions has meant we have started new activities, such as solutions for food companies, with more added value than simple distribution,” he says.

Thus, they entered a strong dynamic of acquisitions, of between “two or three purchases a year.” Yet, as always, without making much of a fuss. “We have not given out dividends in 40 years, we have focused on the culture of effort and reinvestment,” say the heads. That is how they have built this discreet multinational.

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