Metalac has a history that has been duly recorded in several different ways.
With only a few short interruptions, the company has had its internal newsletter for several decades, published monthly at first, and later and to this day, mostly quarterly. Numerous annual reports have also been preserved, which have been published since 2002 in a magazine edition, MGM Report.
Most importantly, Metalac has published three monographs dedicated to its anniversaries. The first one was issued in 1984 to celebrate 25 years of the company’s existence. A thoroughly revised new edition was issued in 1999 to mark the first 40 years of its operations, while the last one was published in 2009 on the occasion of the first half century of life of the company. This is the fourth Metalac’s monograph, and it will attempt, in the spirit of the previous monograph, to focus on the last decade and some of the most important aspects of the company that are best known to the Serbian public and beyond. We will deal with additional history only to the extent that is necessary to present a more complete picture, and we hope that you will forgive us if we repeat or reinterpret certain parts of previously published editions.
Continuing on the path established by the previous monograph, which summarized its historical overview under the title 30+20, the latest monograph covers in detail the last 10 years. Essentially, the history of Metalac can be meaningfully viewed through the lens of 30+30.
FROM THE CRAFT WORKSHOP TO THE COOKWARE FACTORY
With only 480,000 DEM of initial capital, Metalac was founded on 4 April 1959 on the basis of a merger between the metalworking cooperative Jedinstvo and the craft and automotive repair shop Metalac. The main goal behind this merger was to integrate their modest capacities and increase the manufacturing capabilities of Gornji Milanovac, a small town with a population of only a few thousand inhabitants, without any industrial traditions. The initially unclear concept of future development relied on two indisputable facts: the post-war Yugoslavia was in the middle of the process of intensive industrialization, while its market was hungry for all kinds of products.
Already in 1960, Metalac had its first encounter with the technology of enameling. In cooperation with “Sloboda”, a company from Cacak, Metalac produced its first white bucket with blue polka dots – the same bucket that four decades later would be built into the foundation of the modern Business Center. After that, as a result of coincidence, more than any kind of strategic planning, the company bought its first press and the first chambered furnace for heat treatment of enamel, soon developing the full range of cookware production.
The cookware corresponded to the times and the prevailing habits. The bucket was followed by the grease bucket, bowls, baking pans, frying pans, copper pots, small milk bucket, worker’s pot… In 1963, these products also included galvanized cookware.
During this period of initial expansion and hard work aimed at gaining the trust of consumers, a lot of effort went into the affirmation of Metalac as a reliable manufacturer of high-quality cookware. In 1967, the factory was moved from the city center to a new site at today’s location in 212 Kneza Aleksandra Street, which allowed increased production, better organization of operations and improvements in the quality of manufactured products. During this year alone, 700 new workers were employed, evidencing the huge increase in production and the insatiable demand of consumers. “The cookware was loaded in trucks while it was still hot” … “just load it and drive away”, said the first commercial director while reminiscing about this period of the company’s history.
The youngest manufacturer of cookware in Yugoslavia soon reached the second place, following behind a Slovenian company, Emo from Celje. The number of employees exceeded 1,000, while at the end of its first decade the initial capital of Metalac was increased nine times, amounting to 4,300,000 DEM.
Curiously enough, during the first 10 years of its existence Metalac had five CEOs, getting a new one every year until 1963, when Milan Misovic took the helm of the company, where he would remain for the next ten years.
Thanks to its rapid industrial development, Gornji Milanovac was already recognized as an “economic miracle” of Yugoslavia at the time. Despite its huge advances, Metalac was still held back. It was hindered by insufficient technological and organizational development, the lack of young professionals among its personnel, and a problematic access to the domestic market, as well as negative commercial results, which lead to the implementation of a rehabilitation program for the company. Things finally begin to change in 1974 thanks to Branko Milovanovic, a fifty-year-old mechanical engineer with many years of managerial experience. He was the one to recognize that the company needed young professionals, more advanced organization and access to foreign markets. After gathering a team of young engineers, he hired the Economic Bureau – Belgrade to arrange organizational processes and the necessary operational documentation. What followed was the period of strategic adjustment. Most of the investment was made in automation and advancement of the manufacturing process, since the competition was increasing, while the consumers’ demands were becoming more challenging.
During the second decade of its existence, Metalac left the field of galvanized cookware, but began producing cutlery, which lasted for several years. In 1979, in cooperation with a partner from Sweden, the company also launched the production of high-pressure washing machines. Still in the process of adjusting to the demands of the market, Metalac also experimented with the production of parts in cooperation with Zastava from Kragujevac, Electronic Industry – Nis, Magnohrom from Kraljevo and some other manufacturers. Of course, this period was also characterized by an increased product range, improvements in the technology of production of enameled cookware, and the introduction of heavy cookware with stainless still rims, later followed by bakelite handles and decorating technology.
Still, the most important moment came with first exports to Germany for the Jakubajt company, and to USA for the National Silver Company. First exported products were Takovo Special, Majda cookware, Vesna, Zora… Things began to change, but the long path towards modernization of the company was still ahead. During this period, the company’s capital was increased to 11,300,000 DEM, and near the end of the second decade of Metalac, a young, ambitious and capable economist, Dusan Papic, was hired to run the company.
EXPANSION OF PRODUCTION AND MARKET REACH
The seventies and the eighties are remembered as the years of greatest prosperity in the old Yugoslavia. At the time, the city of Gornji Milanovac was widely known as the famous “economic miracle” whose rate of industrial development closely followed the Slovenian Velenje company. The city was best known for its giant companies: PIK Takovo, MK Rudnik, Tipoplastika, Graditelj, Decje Novine… Metalac cookware was used in most households of the country with a population of 20 million, since the company succeeded in taking over the leading position from Emo Celje during the mid-eighties. However, despite significant advances, its blue-collar workers still had a difficult life in the metal-processing complex, far below the standard and the image of other Gornji Milanovac companies that were admired by the whole country.
In such conditions, during its third decade, Metalac focused all its activities on new investments in the expansion of production capacities and increased access to the domestic and foreign markets, as well as the strategic adaptation to new times and new needs.
The first five years of this decade were marked by the strong personality of director Dusan Papic, who was a successful manager, despite the fact that he devoted a part of his time to the roles of the president of the Communist Alliance, the president of the municipality, and the president of the Kraljevo Regional Chamber of Commerce. Identifying the needs of the new era, Papic sent a group of experts to European fairs and the best factories. At the same time, Metalac began organizing independent exhibitions abroad. All these steps resulted in significant investments in the enameling facility, ring production, as well as the packaging and storage of finished products. New automated machines, new furnaces, construction of a modern warehouse, and new presses in MOL succeeded in transforming Metalac into one of the best-equipped and modern cookware factories.
Apart from further advancement of the range of enameled products, the company also began manufacturing aluminium cookware. As incredible as it may sound today, the company stopped using straw packaging. Cardboard packaging was introduced for the entire product range. Following the demand of the market, Metalac then launched the production of panel heaters, universal weekend barbecues, high-pressure hose reels, water heater boilers, etc.
After the appointment of Radivoje Lucic as the CEO of the company, who was the first among the employees to take this position, even more attention was dedicated to the quality of the manufacturing process and the products, as well as the further improvement of organization and better balancing of income and expenses. Overall, a better part of the third decade was characterized by stable and successful operations, and therefore a stable increase of capital as a precondition for independent financing of new projects.
At the end of this period, the value of the company’s capital increased to 17,300,000 DEM, which was 50% more than at the end of the second decade. The company was well-organized, its PZO production facilities and mechanical processing were modernized, with good productivity and a new warehouse with finished products, but it was still financially exhausted because of the rehabilitation program and investments in its development. Salaries were still 20% below the national average and 30% below the average salary in the municipality. Regarding its product range, the company was predominantly focused on enameled cookware. At this moment in its history, Metalac already had more than 1,300 workers. More than half of them were still unskilled and semi-skilled labor. Fortunately, highly-educated professionally were increasing their numbers. At the end of the third decade, there would be 35 of them.
During these first 30 years, Metalac had ten CEOs, with five of them remaining at the helm of the company for only a year or less, all of them mostly appointed as a result of political considerations, all of them being more or less professional and enterprising. The company went through ups and downs, shaped by the circumstances of the time, somehow always sharing the difficult fate of the metal complex.
Dusan Papic 1978-1984
Acting CEO Slobodan Jelic 1984-1985
Radivoje Lucic 1985-1989
THE ECONOMIC JEWEL OF THE NINETIES
Three hundred million marks of income in ten years. Of these, every tenth banknote was invested in new factory halls and equipment. Five new manufacturing programs. Independent retail stores. Ownership by shareholders. In a decade when almost every economic indicator plunged downwards, Metalac’s product range expanded. The value of the company grew 2.5 times, eventually reaching 47.5 million DEM before 1999.
During this decade, Metalac confirmed that difficult times can be the right time for good decisions. The disintegration of the former Yugoslavia, accompanied by the horrors of war and the embargo imposed by the international community, the economic crisis and the bombardment campaign, resulted in the loss of certain markets and lower income than expected.
On the other hand, Metalac’s fourth decade began with a new management, led by Dragoljub Vukadinovic. In 1989, he put forward seven demands that needed to be met in order for him to accept the role of the CEO. However unusual at the time, today it is obvious that these demands signaled a new era for Metalac.
He had the following requests:
- 30% increase of employees’ wages,
- 7:1 ratio between the salaries of the CEO and sector directors and the minimum wage,
- increase in highly skilled personnel from 27 to 70 professionals with accompanying benefits,
- 30% reduction in the number of employees through retirement and incentive severance pay,
- cost reduction by the way of internal cost-cutting measures
- diversification of the product range, modernization of manufacturing and introduction of information technologies (MIS), and
- ownership restructuring with a new management model.
Ten years later, Vukadinovic was still at the helm of the company, while the overall balance sheet of the company showed that Metalac was a case study of what was possible to achieve in impossible conditions.
Metalac succeeded in everything it set out to do that depended on the actions of the company itself, i.e. its top management and employees. Financial parameters would have certainly been much better if there had been fewer problematic circumstances in the economy and otherwise, but 300 million marks of total income during the most difficult decade, including 120 million marks of income from the foreign market and 33 million marks invested in new production halls and equipment, were a clear indicator of success.
Metalac entered the nineties of the last century with a very thorough technological modernization of its main production program – enamelware. The introduction of embargo in 1992 made it difficult to cross the borders, with waiting times of 5-6 hours for passenger vehicles and 2-45 days for trucks, even on borders with friendly neighbors. Despite these hindrances, Metalac succeeded in finding a way to do business abroad. This helped the company retain most of the markets that would later consume 70-80 percent of its production, while the company itself would join the ranks of ten largest European manufacturers of enameled cookware.
At the same time, the general consensus was that the product range should be expanded. Therefore, in 1994, Metalac launched the manufacture of Teflon-coated cookware. Two years later, the company began producing stainless steel sinks in a newly-built production facility. High-quality transport boxes, manufactured on modern equipment with a capacity of a million boxes per year, appeared in 1995. At the beginning of September 1998, the company took over a manufacturer of cardboard packaging and paper accessories, Sigma from Gornji Milanovac. In the same year, Metalac’s offset printing facility with an annual capacity of four and a half million boxes launched a trial production. Soon after that, Metalac decided to have its own graphic preparation. Now the luxury packaging was successfully adopted. Metalac cookware was prepared to reach the global market in its own, high-quality packaging.
The bombardment of Yugoslavia delayed for several months the celebration of the company’s fortieth birthday, until the autumn of 1999. In September of the same year, another Metalac’s factory was opened, with a state-of-the-art manufacturing line for production of stainless steel cookware. Almost nine and a half million marks were invested in this manufacturing line alone.
The company managed to achieve success in every field of work. Perhaps the most important was the ownership transformation that was initiated in 1991 and completed after the shares were paid off following the revaluation. This transformation was performed so thoroughly that by the end of the decade, 85% of the value of the shares belonged to current and former employees of Metalac. This was one of the fairest and most successful privatizations in the recent economic history of Serbia.
In December 1994, Metalac was the first one in Yugoslavia to receive the JUS ISO 9001 certificate for its full product range, while in June 1996, the company received an international certificate with the, German TÜV seal.
At the very beginning of the decade, a new workers’ restaurant was built, and at the same time the company began manufacturing Bakelite elements for its cookware range. The fleet of vehicles for international traffic was also rejuvenated… In mid-1996, Metalac began opening its own retail stores in all major cities throughout Yugoslavia.
During the period that will certainly be characterized in the history of this region as the most difficult decade of the second half of the 20th century, a company in the very center of Serbia managed not only to operate its business, but also to earn money, invest and develop. Metalac became one of the most successful companies in this part of the world. A powerful and stable organization, with a reliable foundation and competent leadership.
During the decade when almost every economic indicator pointed downwards, Metalac’s product range grew. The value of the company increased 2.5 times during this decade, reaching 47,500,000 DEM. The number of employees with higher education was doubled compared to the end of the previous decade. The company had 75 economists and engineers of all specialties.
Most significant decisions and best achievements during the most difficult decade:
– Introduction of the information system
– Introduction of the ISO 9001 quality system with JUS and TÜV certificates
– Ownership transformation
– Transition towards a joint-stock company
– Founding of companies in Cyprus, Moscow, Skoplje, Celje and Belgrade
– Modernization of the technology of enamelware production
– Expansion of the main product range and production programs
– Entry into the Teflon-coated cookware market
– Opening of the stainless steel sink factory
– Purchase of the Sigma company with 48 workers for the price of 2.2 million DEM
– Opening of the facility for production of luxury boxes with offset printing technology
– Opening of a chain of retail stores in all major cities
– Opening of the stainless steel cookware factory
– Infrastructural investments including construction of the employees’ restaurant and receptionist’s office
– Construction of 11 personnel apartments and 20 apartments for other workers
– Completion of wastewater treatment project
A DECADE OF INVESTMENT ENGINEERING
Metalac’s most recent decade took place, approximately, between the year of the bombardment of Serbia and the year of the global economic crisis. At the same time, for Serbia, this was a decade of social and political turmoil, transition, new opening towards the world and a gradual influx of foreign capital, frequent political upheavals, changes in the government of the republic, but also a relatively stable banking system and currency. On the one hand, the transition brought new unemployment, but on the other hand, it was accompanied with an expansion of credit possibilities…
During the fifth decade, Metalac wrote the most significant pages of its future history. Without trying to overly interpret the period of which we are contemporaries, let us simply and factually present the most important results and events. Among them is the gradual growth of Metalac into a holding corporation with 12 companies, which is a consequence of its expansion in all areas. At the end of this period, the value of the company amounted to 75,000,000 euros.
Why was this decade so intensive and significant in the developmental sense?
– Metalac became the majority owner of Agrovojvodina from Novi Sad
– Metalac became the majority owner of Proleter in Gornji Milanovac
– Metrot company was opened in Moscow
– Metalac Trade was founded in Gornji Milanovac
– Promo-Metal was founded in Zagreb
– Metalac Market was founded in Podgorica
– Metalac Business Center was built
– Production of decorative prints for enameled cookware was launched for the first time
– A warehouse for raw materials appeared
– A new water heater factory began operations
– Teflon-coated aluminium cookware began production
– Metalac branched out of the metal-processing complex for the first time with its Granmatrix facility for solid-surface materials
– Continuous growth of export and expansion into foreign markets was achieved
– Pronounced marketing orientation of the company became evident
– Transition to BAAN-erp information system was successfully achieved
– Integration of QMS/EMS system was completed
– Transition to a holding corporation was implemented
– Number of employees reached 1,800
– Major investments in education of personnel were made
– Wastewater treatment system was completed
– Company won a large number of awards
GLOBAL CRISIS AGAIN FORCES THE COMPANY TO CONCENTRATE ITS RESOURCES
Only the healthiest can survive the hardest times, the ones who have enough professional knowledge to make the right decisions. Deeply convicted that it belongs to the ranks of such companies, Metalac entered the year of 2009 with several possible scenarios in the context of the global economic crisis. The company’s business plan was adapted to new circumstances, although it was slightly above the result achieved in 2008 and above the plan of growth at the level of the national economy.
Most of all, a strong message was delivered to employees: we will attempt to save every job, there will be no layoffs, we will rely on internal reserves; the heavy burden of the crisis will be equally shared. Key words were motivation with cost-cutting and solidarity with profitability. This was the ultimate confirmation of the company’s strength and healthy, and a socially responsible approach.
Despite the fact that Metalac ended the first year of the global economic crisis with a 16% lower total income than in 2008, the company’s profit amounted to around 3.5 million euros, with a successfully maintained presence in all markets and entry into some new ones. The agreement with employees, to equally distribute the burden of the crisis without layoffs, was honored.
In the years that followed, Metalac managed to achieve growth in exceptionally difficult circumstances, and the year of 2012 will be remembered as one of the most successful in the history of the company, with 86.1 million euros in total revenue. The revenue grew 10% compared to the previous year, exports grew by 20%, while profit increased by 18%.
In 2012, a bicameral way of management of the company was introduced via the Supervisory Board and the Executive Board. The company grew into Metalac Group with 14 companies, while Dragoljub Vukadinovic was re-elected as the chairman of the Supervisory Board and the president of the company.
Metalac still had the reputation of one of the most successful and healthiest Serbian companies, with a high degree of corporate social responsibility. In 2012, apart from the start of production of granite sinks, expansion of production of non-stick cookware including ceramic coatings, modernization of the packaging production, and opening of its own company in Ukraine, Metalac even managed to build a modern football stadium in Gornji Milanovac, with a total value of around 3 million euros.
BEST SOLUTIONS FOR DIFFICULT TIMES
Metalac entered its seventh decade of existence on 4 April 2019. We celebrated our 60th anniversary with more than 2,200 employees, 15 companies in Serbia and abroad, 115 million euros in total revenue, and 40 markets all over the world where we exported our products. Metalac held a birthday celebration in the presence of 400 local and foreign partners. A comprehensive monograph was published, covering the first 60 of the blue-white years.
2019. Metalac Group ended the year of 2019 with 120 million euros in combined total income. The first quarter of 2020 was characterized by fear and uncertainty caused by the coronavirus. The whole world stopped because of the coronavirus, including Metalac. Production continued with reduced capacity in order to meet the obligations towards business partners who had not canceled their orders. Sales in all channels dropped significantly, certain facilities worked reduced work hours, while some of them suspended their operations. If we tried to find a bright spot, that would certainly be Metalac Proleter, which again demonstrated its organizational capacity, its business and social responsibility, and the willingness of its employees to respond to all challenges in extraordinary circumstances.
At the end of June 2020, Dragoljub Vukadinovic was elected as the president of the Metalac company for the following four years.
Two waves of serious COVID pandemic, a historical increase in prices of almost all raw materials, long and uncertain procurement waiting times, increasingly expensive and more uncertain transport, rising energy prices… these were the keywords for the year of 2021 in the Metalac company, which again demonstrated that despite all these challenges, good organization, discipline and hard work can achieve record profits even in such undesirable circumstances.
The recent history of Metalac is certainly influenced by the military conflict between Russia and Ukraine. Russia’s military intervention has had an effect on the whole world, including Metalac, which conducts its business operations in the countries in conflict.
In the first half of 2022, Metalac opened its logistical center, which was certainly one of its most demanding projects. Introduction of WMS is an important step towards the future and a foundation for major competitive advantages for all of Metalac’s manufacturing companies and the Company as a whole. At the same time, construction of a solar power plant has begun, which is an investment which allows Metalac to enter the world of green energy from renewable sources.