This long-established Italian lens manufacturer from the Venice region went into liquidation in 1999 and was subsequently acquired by Ital-lenti, located in the Belluno region, in January of 2000 for e5.7 million. Called Oftalmica Galileo Italia, the new company set up by Leo Polzotto, owner of Ital-lenti, integrated his company's glass lens production with the polycarbonate, CR and titanium lens production of Galileo. The new structure enabled Ital-lenti to increase group turnover to e8 million in 2001, a 35 percent hike compared with 2000. But this figure was still not enough to cover costs, and Oftalmica Galileo Italia closed 2001 with a loss.

After a shakeout of the management and of the product spectrum, revenues grew by a further 22.5 percent in 2002 to e9.8 million, generating a 5 percent profit. The new management appointments last year included Lorenzo Caldart, product manager, a former top executive of Marcolin, and Silvano Pellegrini, general manager, formerly with Sola Italia.

Some large global competitors are baffled by the methods used by Galileo to try to recover its former market position in Italy. The new company is experimenting with a new consignment system whereby opticians are supplied with a permanent stock of frames that are paid for only if they sell them. Deliveries are guaranteed within 48 hours.

This year, the group is launching a major marketing campaign in Italy that allows opticians that commit themselves to a certain volume to get the right to display a special "Galileo Point" sign in their shop windows, to clad the salesforce in white Galileo shirts and to use other point-of-sale material. Some 130 opticians have already signed up.

The new Galileo operates for the moment exclusively on the Italian market, where its market share is foreseen rising from its current level of 5-6 percent to 20 percent in the next five years, reaching the level currently attained by Sola, the Italian market leader.

Galileo's former foreign sales subsidiaries in in France, Spain, the UK and Germany have now become independent lens laboratories and wholesalers that use the Galileo brand through a licensing agreement running until 2004. From then on Polzotto plans to return to a system of subsidiaries, and negotiations are already underway with the various local managers to define the terms of the new network.

The original Galileo factory in Mestre, near Venice, now stands idle. The group's manufacturing facilities are now in Cadore ? at the former Ital-lenti plant ? and at Settimo Milanese. A new subsidiary with a lab was recently opened in Giulianova in the Abruzzo region and others will follow in Turin and Mestre.

Galileo is trying to compete with the major international brands with more personalized products, in addition to its fully automated standard series. Warehouse management is now fully computerized. The Mestre facilities will house a service center for mounting lenses, which will take on part of the workforce that was laid off when Galileo went into liquidation three years ago.