Italian food goes global: Products and services for international markets

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1. ORIGIN MARKING: “MADE IN ITALY” 
Origin marking consists of an indication on the product label and/or on its 
packaging, consisting of the words “Made in...”, “Product of ....” or expressions of 
similar meaning (sometimes the only indication of a country, for example: 
“Italy”), who attribute the origin of the product to a particular country. Origin 
marking mainly performs three functions:  
1. To provide the consumer with additional information about the product 
you intend to purchase; 
2. To prevent fraudulent practices on the part of producers and importers;  
3. To become an indirect means of sales promotions for certain products 
whose consumers connect the origin of a particular country with the 
concept of better quality.  
The GATT
1
 (General Agreement on Tariffs and Trade) dedicated to the theme of 
origin marking the art. IX, in particular the paragraph 2 that establishes that “The 
contracting parties recognize that, adopting and enforcing laws and regulations 
relating to marks of origin, the difficulties and inconveniences which such 
measures may cause to the commerce and industry of exporting countries, should 
be reduced to a minimum, with the aim of protecting consumers against 
                                                           
1
 The GATT was a multilateral agreement regulating international trade. Its 
purpose was the reduction of tariffs and other trade barriers. It was signed in 1947 
and was replaced by the WTO in 1995.
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fraudulent or misleading indications”
2
. Hence, the rules used by the WTO (World 
Trade Organization) member countries not may be used as “instruments to 
promote, directly or indirectly, the realization of commercial policy objectives” 
and “shall not determine effects of restriction, distortion or disorganization of 
international trade”
3
. 
 
1.1: WHAT REPRESENTS “MADE IN ITALY” 
“Made in Italy” is a source of pride for every Italian manufacturer. It is an old 
prestige based on creativity and quality that “marries” inventiveness. From 
fashion to cuisine, from furniture to inventions and scientific discoveries, it has 
always distinguished the Italian people in the world. The Italian culture, style and 
taste contained in these three words (made in Italy) contribute to the immediate 
recognition of the product elevating it in terms of quality as well as overall image. 
“Made in Italy” Brand is not only the history of the last fifty years, the rise of 
some stylists and designers and a new entrepreneurial class that wanted to redeem 
himself from the sadness of war, but has a older history. It is the result of a sort of 
collaboration between millenarian culture, arts, crafts and manufacturing skills, 
territory and history. As the Italian Journalist Prezzolini said: “The fame of Italy is 
big in the world today for the seduction of his way of life and this is due by the 
                                                           
2
 General Agreement on Tariffs and Trade, Article IX, § 2. 
3
 Italian Financial Law 2004, art.4, paragraph 49
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storytellers, poets, painters and sculptors and architects, actors, cooks and 
tailors.”
4
. 
The secret that for many years has ensured the success of the “Made in Italy” has 
to be found precisely in the tradition of working of the small companies: they 
seem weak but have big roots that sank in the artistic history of the Renaissance 
workshops. 
Indeed “Made in Italy” works also for the many small and medium enterprise 
(SME’s), which populate many Industrial Districts spread around Italy but 
interlinked permitting many parallel processes made on small scales. The 
structure of the Industry appears fragmented even if this fragmentation is partially 
recomposed within industrial districts with their social sense of belonging, 
contextual knowledge, specialization and informal integration. 
As Tronconi, president of “Sistema moda Italia”
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 says “The Made in Italy is 
grouped around three concepts: Aesthetics, Status and Taste, as a common 
denominator to explain the development of three industrial sector: Fashion, 
Furnishing and Food. We breathe beauty growing up around beautiful monuments 
                                                           
4
 Giuseppe Prezzolini (1981) “L’Italia finisce: ecco quel che resta”, Rusconi, 
Milano 
5
 “Sistema Moda Italia” is one of the world’s largest organizations representing 
textile and fashion industry.
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and learning from handicrafts; we put our sense of beauty in our products so that 
it can be shared by our consumer”
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.  
Some important sectors have affirmed the concept of “Made in Italy” spreading 
the Italian excellence in the world. In this sense, it is customary to associate the 
symbol of “Made in Italy” in three categories: 
1. Durable goods for personal care, such as clothing, shoes, jewelry; 
2. Products for the furnishing: furniture, kitchens, tiles, taps; 
3. Food goods that are part of Italian tradition: Wine, Pasta, Extra virgin 
olive oil, ham and cheese. 
These activities are really important also in an economic point of view, indeed on 
2009, if these systems are linked to another one, automation, they have generated 
a “Value Added” of 138 billions of euro, the 50% of the total amount of 
exportation on the same year (Secchi 2010).  
Raffaele Secchi, an Italian professor and researcher, tries to explain why Italy, in 
these sectors, reaches also to beat the multinational corporations: 
 Ability of some Italian companies to impose their brand on a global scale; 
 Ability to combine, within its commercial offer, innovative elements of 
design, customization and quality which is identified in the materials used 
and also in the manufacturing performed. 
                                                           
6
 Quotation from “Sistema moda Italia” website
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Thus we can assert that the success of “Made in Italy” is due to a strong 
“industrial craftsmanship”, that is the ability to produce goods also tailored to 
individual customers, with the attributes almost “sartorial”, characterized by an 
epitome of creativity, innovation, quality and design. 
In the world there are many Italian companies appreciated for their quality and 
also for their structure of production and supply chain management and in this 
sense I can’t not quoting the case of Barilla that belong to the most known and 
awarded.  
Indeed Barilla Spa, pursuant to a research done by “Reputation Institute” of New 
York, was ranked nineteenth among the ones with the best reputation, and first 
with regard to the food industry. The assessment was based on a number of 
factors such as the supply of products and services, the level of innovation, the 
quality of the workplace, the governance, the financial performance and the 
market leadership. Therefore the strong orientation towards innovation, quality 
and service during the recent years, led up to this result.  
Unfortunately, in the last decades, a series of events led to a major change in the 
international arena, creating unfavorable conditions that have converted the 
“Made in Italy”’ products into less competitive goods. 
First, with the fall of the Berlin wall on 1989, began the process of globalization 
of the economy that led to the reduction of trade barriers and to the dispersion of 
international processing activities. The processes of outsourcing weakened the
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Italian productive structure, which was really competitive because rooted in a 
specific territory and developed on an expert “social fabric”. 
Another important step was the “Italian entry” into the single currency. 
Previously, the lira was “weak”, and also for this the competitive differential with 
other countries increased. With the adoption of the euro some conditions, that 
allowed the Italian products to be more competitive in terms of price, fell short. 
Moreover the development of the world economy led to a predominant rule the 
Asian markets that until a few years ago seemed too far away to compete with 
Italian companies. The greater competition of the Asians has transformed the 
market into a “battle” on price and not on the quality; for this reason, the “Made 
in Italy” products have lost inevitably a lot of market share. 
Therefore, in the last years, the Made in Italy could not more survive only for the 
glorious past, because it had to face an external environment that was increasingly 
more complex and difficult.  
Despite this, the phenomenon of counterfeiting of products made by non-
European countries but labeled “Made in Italy” is growing (§3): a remarkable 
proof of the appeal that this label still exerts on consumers.  
The case of Prato (Tuscany) testifies to this concept: from the most famous city of 
the Italian textile industry it became a capital of cheap clothing. In this case the 
Chinese, about ten years ago, considered the rapid expanding of fashion market in 
Prato as an opportunity for Italian companies to exploit differently the desirability
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of the “Made in Italy”. Before the arrival of the Chinese, thousands of small 
Italian textile units were a source of cheap “Made in Italy” clothes, producing 
them on “Made in Italy” fabric, often with the help of hired Chinese workers. 
Then Chinese have beaten the Italians at their own game: setting up their own 
business and driving down prices by importing from cheaper fabrics of China. 
According to Marco Landi, president of the Tuscany branch of trade body CNA, 
which represents small and medium-sized firms, the remaining 3.000 small-scale 
Italian enterprises in Prato's industrial district, faced unprecedented upheaval. He 
says: “At the moment there are approximately 4.000 Chinese-run clothing 
factories in Prato. These new production dynamics are compelling the remaining 
Italian businesses to rethink their markets. […] More than half of Italian-owned 
businesses in the industrial zone have gone to the wall over the past decade. There 
are now more Chinese garment manufacturers than Italian textile producers.”
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. 
Now the Chinese newcomers have opened up the market in Mainland China 
following a new “Italian way”. They are exporting millions of low-cost garments 
bearing the “Made in Italy” tag in a seemingly unregulated export drive. 
Therefore companies are increasingly less linked to the territory, with the 
introduction of news technologies of communication and transport, which enable 
economic operators, located in different countries, to exchange orders and real-
time information, such as real-time business transactions where the goods arrive at 
                                                           
7
 Quotation from BBC website