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ESQUIVIAS, Spain (Reuters Life!) - In a small town in La Mancha, the region that inspired the epic Spanish novel "Don Quixote," a third generation guitar-maker is struggling to secure the future of his business.
Manuel Rodriguez III owns the century-old family business of the same name, heir to a tradition of guitar manufacturers which dates back to 1905 when his grandfather gave up fishing in Cadiz to dedicate his life to his musical passion.
More than 100 years later, Toledo-based Manuel Rodriguez and Son is still making handmade guitars and exports 90 percent of its production to 120 countries. Many of its finest guitars have found their way into the hands of famous musicians, world leaders, Nobel Prize-winners and royalty.
Over the years, the production process developed by Rodriguez's grandfather has undergone some changes, and while made to order and top range guitars are still totally hand-produced, the workshop now employs some mechanical processes to make production safer and more efficient.
"There used to be a lot of accidents. If you see anyone in the town missing fingers or even a hand you know he worked here," workshop manager Jose Luis Cebillo told Reuters.
Still, the workshop requires 60 percent manpower to make its guitars, and the global crisis of the last few years has forced the business to adapt to challenging market conditions.
Spain plunged into recession three years ago after a decade-long property and construction boom collapsed. Tight credit and falling demand for luxury goods forced the number of workshops down to six from 40 or 50 in just two decades.
Financing can be tricky in such conditions, even for an established company with a good balance sheet, Rodriguez said.
"If we go to a Spanish bank and say we're guitar-makers they ask if it's possible to make a living out of that."
Manuel Rodriguez and Sons has had to reduce its staff by two-thirds in under three years in a country where the number of unemployed has risen to over 4 million, leaving parts of the workshop in eerie silence.
Yet some processes, such as the gluing of parts and a laborious binding procedure remain completely manual, making it easy to understand why the manufacturing time takes a month.
"We're still using string to do the binding, there is no tool or machine to do that. We use a CNN Router to make the necks, that has helped to lower costs. Another approach has been to use machines to polish the varnish," said Rodriguez.
More significantly, the company was able to outsource its lower range instruments to China, a key cost cutting and efficiency move which has aided its survival.
The company makes 22,000 guitars annually, of which 18,000 are now made in China and 4,000 in Spain.
In Spain, the cheapest guitars start at around $400 and the top range instruments cost about $20,000 wholesale, although with distribution and retail they go up a further 100 percent. In China, the guitars range from $100-$500 dollars.
"I would say that our margins are about 5-10 per cent in Europe and 20-25 per cent in China," Rodriguez said. We're making $3.3 million a year...and must do more to be efficient."
Rodriguez talks passionately about a dying trade and he speaks from the heart when he says it is a source of pride to represent one of Spain's classic products. Spanish guitars, together with bullfighting and flamenco, are symbols of the Spanish culture, which the luthier fervently wishes to spread.
"We should not be ashamed in Spain of bullfighting, guitars, of our music, we are famous for wonderful masterpieces, we should not be ashamed of our culture," Rodriguez said.
Despite his strong Spanish roots, Rodriguez believes his American background -- he was born and raised in California where the family moved its business for 18 years -- gives him a different outlook.
"A teacher from UCLA visiting Madrid asked my father if he would go to the States to make guitars, so without knowing any English, with just $100 in his pocket, a few pieces of wood and a few tools my father went to Los Angeles," said Rodriguez.
For 18 years the family lived and worked in California, making guitars for Hollywood actors, lawyers and doctors.
"It was a fantastic experience...and my time there has given me a vision of marketing and the world which is very different to that in Spain."
Eventually, the family returned to Spain and resumed their craft, but the guitars did not sell.
"We bought a truck and travelled around Europe with the Yellow Pages and knocked on doors to sell our guitars."
Rodriguez, who has two small children, sees the future for this small family business as very challenging.
"In 4 or 5 years I would prefer to join my brand with a big guitar corporation and make it bigger. I'm still the face of the company so I'll be the marketing tool of the product."
Reporting by Carlos Castellanos and Carlos Ruano; Edited by Tracy Rucinski