HERMI, d. o. o.

Many years can pass from an initial idea, through product development to successful commercialization

Hermi’s story began in 1985 in Herman Rauter’s garage. According to Herman, “the simple desire to create something for my sons” was additional motivation when he started his own business. Being a trained electrician, he looked for success in the field of electrical measurement. He adds that at the beginning he “didn’t even dream” that his main activity would be related to lightning protection. However, during that period, lightning struck nearby buildings, most often churches, several times a year, causing fire or other material damage, which made him think. “We started as a small team of two or three and renovated lightning installations. Badly or inadequately protected sacral buildings inspired me to change something in this area,” tells Herman. 

At the end of the 1980s and in the 1990s, he regularly accompanied his son Miran, who was a member of the Slovenian national alpine skiing team and participated in the Olympic Games in Lillehammer, Norway, to competitions around the world, observing and comparing the performance of various lightning installations. At the same time, he began developing his own system, which was based on using more reliable and cost-effective materials. He designed innovative and durable products, bought his very first machines and tools, and started manufacturing the products. With the development and use of lower fasteners and round lightning conductors, he managed to merge lightning protection more seamlessly and aesthetically with building design, which gave him the idea for the company’s original slogan, “Imperceptible Hermi lightning protection”.

As he says though, the biggest challenge was yet to come. “It’s nice to develop and produce a product, but the hardest part is selling it. It took three to four years to launch the products which complied with all the regulations and standards,” explains Herman. After coordination and tests, which confirmed that the products and the entire system met all professional requirements and standards, he ultimately succeeded. He got his big opening 30 years ago, when he made connections with a renowned manufacturer of roof tiles and first presented his range of lightning protection systems at the International Trade Fair in Celje.

Experience in sport has paved the way for a successful entrepreneurial career

Herman’s lightning protection systems were very well received in the market and the company began to grow. “My father was actually ahead of his time, so the challenge was to convince people that his lightning protection system was the right choice. Owners of farms, craftsmen and entrepreneurs were aware of the consequences of lightning strikes, so they increasingly thought about protecting their properties. My father approached them professionally and at the same time was able to present a compelling offer and close the deal. You value all these efforts and the commitment even more when you observe them your whole life and know that all this came from nothing,” says son Miran Rauter, who joined the company before completing his studies in 1997, when he was still actively involved in sport. “Somehow I managed to convince him to join the company, but it was also something he wanted himself,” recalls Herman.

“It wasn’t always easy, but those were the best and most educational years. I worked in different departments of the business, including production, so it was much easier for me to take over the company later,” Miran recalls of his start. Even though he felt at the time that he lacked knowledge, he greatly benefited from his skiing experience: “When I inherited my father’s very well prepared foundations and started expanding the business, one of the partners told me that normally people need a lifetime to gain the experience I got from sports.” This experience became evident in his perseverance and ability to pick himself up after a setback. He recalls a bitter experience in Romania when a client decided to choose a competitor’s products just as they were about to close the deal. “When we questioned the reasons for their decision, we were told that the competition offered a set of products from different complementary segments and thereby a more comprehensive solution, while we only offered them lightning protection components,” explains Miran. Over the years, their basic range of production has been complemented by three other programes: surge protection, cable trays and ladders, and mounting systems for solar power plants. “Today we already have more than 7,000 products across our range. The main buyers for all these products are electrical installers but our clientele also includes construction workers, roofers, architects and other installers,” adds Miran.“

If you are “ahead of your time”, you must be persistent and patient

Knowing that the small scale of the Slovenian market would require the company to expand beyond national borders, Miran began looking for new business opportunities in foreign markets: “I was looking in different markets for new partners – electrical engineers, architects, construction  companies, distributors, designers – and presenting and explaining the unique advantages of our solutions. We were challenged by expansion to the south and into countries of the former Yugoslavia, because at the time our products were ahead of their time in this part of Europe. We were persistent and patient, so we succeeded.” First, they expanded and established a subsidiary company in Croatia, then in Bosnia and Herzegovina, Serbia and Romania. However, they were aware that they would also have to expand into more demanding and developed markets westwards and  northwards: “We had to adapt, to change our thinking and procedures. Our greatest challenge is moving from a small market to enter those where our main competitors take the largest share.” Entering an already developed market poses unique challenges. “We realized that we needed to promote our products in a different way. What was ahead of its time, for the circumstances and standards of the markets close to us is already a necessity in western and northern markets,” explains Miran.

Challenges, advantages and ambitions of a family business

Challenges do not arise only from the business environment of a family company, but also from its foundation, which is the family itself. According to Herman, he and his son continued to work together for several years after Miran had officially taken over the business. Miran admits that a family  business is very demanding: “I don’t know any other way than this, since I embarked on my career path with my father, and now my wife is with me, too.” His wife, Alenka, who works in marketing, has been involved in the company for 22 years, joining two years before Miran took over the business. “On the one hand, it’s easier having someone with you who understands you and whom you can rely on. But on the other hand, there are, of course, challenges that we successfully face and solve as we go along,” says Miran.

The third, still rather young, generation of the Rauter family is not yet involved, but Miran’s daughters help in the company and gain work experience during the holidays. He admits that he would like at least one of them to be present, but “we are taking things slowly and not putting too much pressure on the daughters or giving them the feeling that they can’t make their own choice.”

Multiple patent holders and award recipients

Two generations of Rauters have ensured Hermi’s success, after beginning in a garage, making a stop at a neighbor’s carpentry workshop, relocating  and expanding several times. As Herman further explains, they have also registered 11 patents, 12 designs and 10 brands in Slovenia, the EU and third countries since his son took over. Their work has been recognized by many awards. They received the award of the Chamber of Commerce of Slovenia for outstanding economic and entrepreneurial achievements, were nominated for the Gazelle for the Savinja-Zasavje Region as the fastest-growing company in the region, they competed for the Factory of the Year title, and two years in a row they received a Regional Innovation Award, gold for the connecting element Hermi Fast Joint® and silver for the Hermi Fast Klick® cable trays series. This year, for the 10th consecutive year, they received an extension of their Excellent SME Slovenia certificate of excellence, with the highest rating of 10.

Of course, these successes would not have been possible without an excellent team of employees. Miran says that the Production, Sales, Logistics, Marketing, Design, Accounting, Assembly and Development departments employ key people for the development and growth of the company but there is no great work without good relationships: “Every morning we make coffee for everyone, there is always fruit, we organize various internal events and meetings, including day trips or team buildings. We also organize a family day and a day for scholarship holders,” he points out.

Sustainable investment in a common (local) future

How will the company be “ahead of its time” in the future? The answer lies in sustainability, which, according to Miran, is a broad term. “We strive to work by connecting people. We also connect with the local community.” They not only grant scholarships for studies in electrical engineering, mechanical  engineering and economics, but also award sports scholarships to support young and promising local athletes from the Savinja and Šalek Valleys.

They also place great emphasis on sustainable practices in production. In addition to avoiding plastic, they separate and collect waste, use more durable and renewable raw materials in the production process and increase their own production of green electricity with investments in renewable energy. “Everything is going towards keeping the carbon footprint as low as possible and at the same time steering our business forward,” says Miran.