THIS ROUND’S ON ME
TBY talks to two distillery managers on the achievements they have experienced, current investments, and the outlook for the future.
What have been the major achievements of your company since it was established?
FERNANDO RESTREPO Being in business for 95 years is a milestone for us, as not all the companies enjoy such longevity. We achieved 95 years by being the principal distillery in Colombia, as a financially solid company in a world where public distilleries tend to be weak. We feel from the financial and commercial point of view we are stronger than ever. We celebrate our Anniversary firstly with our workers, who have remained with us over the years. We celebrate it with our public, our distributors, and our principal clients. We also celebrate it with our owners; the governor and his cabinet.
JAIME ECHAVARRIA LOPEZ Our enterprise is the third most important distribution company in Colombia. We are active across three product categories, namely wines and liquors, personal care, soaps, and detergents, and food, with an essentially even distribution. We currently reach 55,000 points of sale, and while we supply medium-sized convenience stores, arguably our most important clients are the neighborhood “Mom and Pop” stores. Well established today, the company was founded 57 years ago. The other two distributors are huge in that they distribute their own production output. Although we do to an extent, our orientation is not to work extensively with consumer commodities, and we pride ourselves on building new brands and products.
What is the company currently focusing its investments on?
FRR In 2014, we worked considerably to modernize our factory and the installations, because we have been present for 45 years and there were many upgrades needed. We assembled a bottling line, which is state of the art, allowing us to produce faster and in a more integrated manner. From the moment the bottle arrives, it is packaged and sent to the winery, all of which is totally integrated. We have increased our alcohol storage capacity, with many infrastructural and office improvements. We have invested heavily in the brand, at around $25 million dollars in 2014, in advertising and promotions. In 2015, we plan to invest around $30 million. We are going from 25 to 30 in brand investments, not just in above the line investment, but also promotions, events, parties, and so on. In 2014, we increased sales by 2% and sold products worth around $480 million.
JEL We are in an important phase for the company, which was formerly heavily sales oriented in nature and centrally managed. Today, however, the company is prioritizing efficiency in the markets it serves. We have operations at nine locations in Colombia, each of which are different. If I am able to communicate effectively, we will operate better locally, with distribution efforts adapted to local markets. We are working toward a new structure that cedes autonomy to each local operation. Our structure's basic components are its corporate architecture, choosing the right products for the markets, and working on a new administrative model to implement this. And beneath these components is an efficient IT platform. We are in a market of lower margins, and, therefore, improving productivity, achieving faster turnaround times, and better communication with the consumer are imperatives. We are bringing in new talent and better utilizing our optimized IT platform.
What are your objectives for the next year?
JRR Our main goal is to help to make Antioquia the most educated region. This is always our priority, helping our stakeholders with resources sent to education and health. Secondly, we are going to work hard in our two principal categories, aguardiente and rum. Once one is a leader going from 55% to 60%, it is not important. Growing the categories overall and making that 55% represent more bottles is the important thing. Therefore, we need to focus on defending our market in Antioquia.
JEL We are not particularly ambitious in terms of results for 2015, although we forecast YoY growth of 7%. Once you discount the 3% to 4% increase in price, it emerges that we have grown in unit terms. We are also working on interesting categories (candies, health drinks, and canned foods) experiencing rapid growth, and will be distributing new brands.
THIS ROUND’S ON ME
TABLE OF CONTENTS
Interview
María Claudia Páez, Executive Chairman, Cámara de Comercio de Cartagena
TBY talks to María Claudia Páez, Executive Chairman of Cámara de Comercio de Cartagena, on developing international partnerships, what to expect from new development projects, and helping local business succeed in the global market place.
read articleInterview
Juan Pablo Córdoba Garcés, President, Bolsa de Valores de Colombia
TBY talks to, Juan Pablo Córdoba Garcés, President, Bolsa de Valores de Colombia, on investment strategies in the context of depressed commodity prices, and efforts to foster the right conditions for institutional and private investors in the country.
read articleInterview
Alberto Samuel Yohai, President, Colombian Chamber of Information Technology and Telecommunications
TBY talks to Alberto Samuel Yohai, President of the Colombian Chamber of Information Technology and Telecommunications, on the organization's role in the ICT sector, coordinating with the Ministry of ICT, and important developments in the sector.
read articleFocus: INTERNET OF THINGS
Life is a Highway
During times of unpredictable fluctuations in commodity and energy prices in Latin America and the world's emerging markets, awareness is growing about the potential of the ongoing technological revolution known as the Internet of Things (IoT), or most recently, the Internet of Everything (IoE), as a clear pathway to future development and gains in efficiency.
read articleFocus: Magdalena River Concession
The General in His Labyrinth
The River Magdalena is scheduled for a grand transformation, this infrastructural project will not only change the entire dynamic of trade domestically in Colombia, but the $1 billion megaproject will also determine how the country trades internationally.
read articleInterview
Luis Fernando Andrade Moreno, President, Agencia Nacional de Infraestructura (ANI)
TBY talks to Luis Fernando Andrade Moreno, President of Agencia Nacional de Infraestructura (ANI), on the interplay between politics and economics, 4G projects, and important new regulatory developments.
read articleFocus: Construction 4G
Can’t Stop, Won’t Stop
The pledge to improve the country's roads and intercity infrastructure was one of the most important promises made during Santos' re-election campaign. Vice-President Germán Vargas Lleras has been a force of nature in moving forward with the contracts.
read articleInterview
Aurelio Iragorri Valencia, Minister , Agriculture and Rural Development
TBY talks to Aurelio Iragorri Valencia, Minister of Agriculture and Rural Development, on integrating rural farmers into the national economy, regional disparities, and the recent success of Colombian agricultural exports.
read articleInterview
Olaf Hektoen, Director of Latin America, Yara International ASA
TBY talks to Olaf Hektoen, Director of Latin America (with the exception of Brazil) for Yara International ASA, on corporate restructuring, increasing productivity and profitability for farmers, and improving financing in the sector.
read articleColumn
Francisco De Paula Gómez, Executive President of Corporate Information, Association of Pharmaceutical Laboratories Research and Development (AFIDRO)
TBY talks to Francisco De Paula Gómez, Executive President of Corporate Information, Association of Pharmaceutical Laboratories Research and Development (AFIDRO), on clinical trials.
read articleInterview
Iván Enrique Ramos Calderón, Rector, Universidad del Valle
TBY Talks to Iván Enrique Ramos Calderón, Rector of Universidad del Valle, on pushing into new areas of research, development collaborations with the automotive sector, and creating a learinging environment for students.
read articleInterview
Rosalba Montoya Pereira, Andean Regional Director, Manpower Group
TBY talks to Rosalba Montoya Pereira, Andean Regional Director of Manpower Group, on their international mergers, putting the right people in the right positions, and the importance of diversity in the workplace.
read article