Attila Kovács, Managing Director

The history of Kerox Kft. dates back to 1982, when it started industrial ceramics production as a business partnership of a few workers, producing a hundred units a day: today the number is 400,000. Their products, manufactured using dry, double-sided ceramic pressing and precise burning technology, first conquered the German market, and then in the 1990s they made inroads into Italy, marking the start of the company’s rapid development.

“The owner had a personal relationship with the German Kludi faucet factory, distributing their products in Hungary. When it became clear that the German partner would need ceramic faucet inserts for production, he saw an opportunity. At the time, this was a new and complicated production technology, with the raw materials having to be heated to 1,600 degrees Celsius in a special oven. This was know-how that already existed in Hungary and was in great demand in Germany”, said Attila Kovács, Managing Director, who joined the company in 1998 as Technical Director.

Initially, they only produced the ceramic accessories for the cartridge, but later they started to produce the plastic elements and even made the necessary tools in-house, as they were not satisfied with the quality of the goods they bought.

By the turn of the millennium, they were shipping to the United States and China, a market that now accounts for 40% of total production, at a higher price than local products. The competitive advantage they have over Chinese companies, which are cheaper, is precisely that their products are Europe- an, which is seen by customers in Asia as a guarantee of quality. Therefore, although the idea of moving Kerox production to China for lower manufacturing costs has been raised several times, it has always been rejected as it would have meant giving up a competitive advantage.

“Our next step was to diversify our product range. In addition to the production of cartridges, ceramic discs for various uses appeared, followed by thermostat elements. Ceramic elements are also made for pumps and truck cab control valves, and the list is almost endless, as any product that needs high wear resistance should be made using ceramics. Based on its experience in high-tech ceramics manufacturing, Kerox also started eleven years ago to produce dental materials, from which dental technicians make custom teeth and bridges”, the CEO said.

The company’s domestic sales are negligible, but it is present abroad wherever there is significant production of faucets, with nearly 400 customers in 40 countries worldwide. Kerox has therefore been included in the Ministry of Foreign Affairs and Trade’s priority programme for exporters, with the opening of their new 22,000 m2 factory in the Sóskút Industrial Park by Minister of Foreign Affairs, Péter Szíjjártó. But however big the company has grown, it’s still a family business, so succession shouldn’t be a problem.

“The pandemic has had both a negative and a positive impact on the company. The main difficulty was caused by workers falling ill; there were times when a hundred of them were infected. However, after a short initial slump, our sales have soared. Partly because people who stayed at home because of the lockdowns started renovating their homes, which induced a lot of bathroom fitting purchases. Partly because there was a lot of disruption in the supply chains, which led many manufacturers to realise that it was not worth ordering everything from the Far East and to start looking for European manufacturers. As a result, we received so many orders that we had to add new people to our team, which now numbers well over 700. The only department to suffer from the pandemic was the dental department, where production fell by 60%”,  said Attila Kovács.

Looking back over the past decades, the CEO cannot recall a year that was difficult for the company, but steady growth of 30% to 40% year on year instead, which has been a major challenge. It is mainly the turnover of blue-collar workers that makes their job more difficult, which is why they try to automate every possible process, and the owners invest significant sums of money back into production every year, spending billions on improvements. The new factory is already starting to be occupied, but it was built with future developments in mind, and the hall can easily be expanded. At the same time, the owners are very cautious, financing the development only from profits, with no major loans or bond issues.

One of Kerox’s strengths, he said, is its rigorous multi-stage quality control, helped by the fact that each plant is considered a customer of the other. Their customer-centricity is also an important principle; they have a good personal relationship with their partners, and a technical colleague travels with the salespeople on business trips, so there is no question at the negotiating table about which the customer cannot get an answer immediately.

Attila Kovács expects to have a very strong presence in Asia in the future, and the company is preparing for the increasing competition with very strong R&D activities. This is also done in-house, and part of the internal organisational development is also aimed at retaining intellectual capital. Already boasting at least a dozen patents, Kerox plans to further strengthen this line to maintain its leading position in the world. The CEO says it’s like a sport. Getting to the top is relatively easy, but staying there takes a lot of hard work.