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Magneti Ljubljana hold firm even during difficult times
Magneti Ljubljana have been making permanent metallic magnets, bonded magnets and magnetic systems since 1951. In these seven decades, the company survived many turbulent situations. Today, they are an important player in their industry and are looking forward to a bright future. Based in Ljubljana, Slovenia, Magneti Ljubljana is already a European manufacturer of magnets, with practically all their clients based in other European countries, but the goal is to become a global company. The company became a family enterprise under the current Director Albert Erman. His wife Simona is part of Magneti Ljubljana and several of his children were, are, and may still be connected with the company in one way or another.
Active search for business partners brings success
Magneti Ljubljana was established in 1951 and joined then state-owned ISKRA Group 11 years later. The story of Magneti Ljubljana became intertwined with the Erman family in 1986, when Albert Erman, university graduated metallurgical engineer, current majority owner and Director, took over the management of the company that was facing a difficult time as the demand for their products fell. He says that the first thing he did after joining the company was to establish a separate financial department and a commercial department; before, these activities were managed by ISKRA group. Even though he was the Director, his job looked like a salesman’s job: he travelled around Europe searching for new clients. At the time, the company mostly made magnets for the Yugoslavian army, but Albert saw the opportunity brought by new technology: “I saw that there was a demand for the ABS system, which is made from magnets and was first used in cars in the 1980s,” he recalls. Another important factor was the relationship he built with the first buyer of their new products, where Albert’s personal approach brought results: “He played golf and I didn’t. Despite this, I organized to meet him for golf in Bled and we soon found common ground.” After the contract was signed, Albert had the client’s financial backing and quickly started procuring the equipment needed for the new magnets. “In just two years, we went from zero to making almost 40 million pieces.”
Our main advantages are our knowledge and technological know-how.
Risk brings rewards
Emboldened by this and other successes, the company decided to forge its own path and left ISKRA Group in 1989. In 1992, after Slovene independence, it also underwent privatization. On the advice of a colleague from Bosch, who believed in long-term future of magnets, Albert took a personal loan to buy company shares. He also encouraged other employees to buy the shares; there was even a supplement to the salary for this purpose. However, most of the other shareholders soon decided to sell their shares and today, the Erman family owns more than 80 % of the company. The rest of the shares are still owned by current and retired employees. “I always wanted the employees to be included into the ownership of the company,” explains Albert.
A wealth of experience and youthful enthusiasm
Simona Erman, who has a Master’s degree in economics, has been Albert’s life partner for 21 years and ten years ago, at Albert’s encouragement, she also joined him in writing the story of Magneti Ljubljana. “It was not an easy decision to make, but from the very day I started working at Magneti Ljubljana, I felt great here and was included into the team,” recalls Simona. She is the Director of accounting, finances and HR. Albert adds: “She is also my deputy and I can always rely on her.”
Alert’s sons, Tilen, who has a Master’s degree in economics, and Žiga, a metallurgy and materials engineer with university degree, both had a Magneti Ljubljana scholarship and started their careers at the company. Later on, they wanted to acquire new skills and experiences and have found new challenges outside of the company. Grega, the oldest son, has a university degree in business and has been the president of the Magneti Ljubljana Supervisory Board since 1998, while daughter Mojca, a Master of Law and freelance lawyer, consults for Magneti Ljubljana on a contractual basis. Albert adds: “I see it as a great success that my children gained a lot of knowledge and experiences at the company, which allowed them to take on responsible positions at other companies.”
Erazem, Albert and Simona’s 15-year-old son, is also drawn to the company. “When Albert received the award by the Slovenian Chamber of Commerce in 2017, Erazem as a 9-year-old boy boldly told the journalist that he would once lead Magneti Ljubljana. He still follows this dream; he is now finishing primary school and is deciding on his secondary education based on what would be good for the company,” explains Simona.
Even though he could have retired quite some time ago, Albert still enjoys his work. But after the heart attack around 25 years ago, which had been brough on by his hectic lifestyle, he also realized the importance of family and free time. He and Simona enjoy being active; they ride motorcycles, they like bicycle trips, and Albert is a pilot. However, Simona admits that the thoughts of the company always remain somewhere in the background. She often start talking about Magneti Ljubljana in the evening while they play cards, but Albert is quick to stop her and remind her that this is their time to switch off. “But if there are problems, we of course talk them through. You can’t switch everything off,” adds Albert.
As a young man, Albert Erman realized the importance of keeping ones word and transferred this value to his work in Magneti Ljubljana.
One of the leading magnet manufacturers in Europe
Magneti Ljubljana is one of the few surviving companies in Europe that manufacture magnets for different industries, from automotive industry to railways and electro industry. In the time since Albert joined the company, Chinese competition caused the downfall of many European manufacturers.
For example, Magneti Ljubljana is the only company in Europe still producing AlNiCo magnets. “Our advantages are our knowledge and technological know-how. Another point in our favor is that we are located in Europe and closer to the clients. Lately, we have also been trying to recycle as many raw materials as possible to decrease our dependance on China,” explains Albert. Their magnets are not mass-produced; they design a new product to the clients’ specifications for practically every project, which requires a lot of knowledge and experience.
Albert admits that he leans towards more conservative management of the company, but in an industry where it takes at least a year from signing the contract to actually producing the magnets, this often pays off. “When new types of magnets were developed, everybody immediately started closing down programs for old, AlNiCo magnets. They advised me to do the same, but now this is our fastest growing program,” he explains.
Quality, development, sustainability
The company is proud of the quality of its products, which they confirm with various certificates. “Without certificates, there is no way to become a supplier for the automotive industry,” says Albert. “Every year, we also achieve an excellent credit rating. And we are very proud that Albert was recognized as a businessman of the year and entrepreneur of the year,” adds Simona. An important part of quality assurance are measurements and quality checks of the raw materials. “Just the lab equipment we use for the measurements is worth several million euros. Other companies don’t have such equipment, so they often ask us for help,” explains Alberts.
Magneti Ljubljana actively participates in research and collaborates with several institutions within EU as a research and development partner. “Currently, we are part of around 10 development projects at the European level, most of which are focused on recycling and developing material,” says Simona. One of their projects was also construction of their own solar power plant, which is a step towards a more sustainable future. Their care for the environment was recognized also by the EcoVadis silver medal 2020 and by the SPIRIT Slovenia Business Development Agency, who selected them to be ambassadors of Slovenian economy as part of the campaign I feel Slovenia. Green. Creative. Smart.
Employees are key to success
All these successes would not be possible without their 220 employees. Albert and Simona are proud of the relationships, support and team spirit in the company. “We are a successful international company, and we are happy that we can guarantee our people stable employment. We have a very relaxed atmosphere and encourage education, career development and good work-life balance,” points out Simona.
Now that the company is firmly on the path to success, there have been several potential strategic partners who are looking for partnership or even to buy the company, but Albert won’t have any of that. “The company will stay in the hands of the Erman family,” is determined Albert. “As the first step, I want to hand over the reigns to Simona, who is already very familiar with the workings of the company.” Simona adds: “After all, we want to keep it a family company and continue with the family tradition. I want the Erman family to continue writing this story and to keep Magneti Ljubljana a successful and well-known company.”
Company name: MAGNETI LJUBLJANA, d.d., Ljubljana
Number of employees (2021): 244
Net sales revenue (2021): €18.5 million
Interviewees:
Albert Erman, Majority owner and Director
Simona Erman, Deputy Director as well as Accounting, Finance and HR Director
Summary
Magneti Ljubljana in a nutshell: tradition, experiences, know-how, development, inclusion of employees.