UDDERLY UNBELIEVABLE GROWTH

Colombia 2017 | INDUSTRY | INTERVIEW

TBY talks to Guilherme Franklin, Managing Director of Tetra Pak Andina, on the decision to locate the regional headquarters in Bogotá, the plan for double-digit growth, and its efforts on digital innovations and sustainable operations.

Guilherme Franklin
BIOGRAPHY
Guilherme Franklin has been with Tetra Pak since 2000 and has held his current position of Managing Director of the Andean region since 2015. Originally from Brazil, he holds a master’s degree in marketing from Pontifícia Universidade Católica do Rio de Janeiro and an MBA from UC Berkeley.

Why was Bogotá chosen as Tetra Pak's headquarters for the Andean region?

The headquarters of the company in this region is in Bogotá for many different reasons: there are almost 50 million consumers here, Colombia has shown economic stability for the past few years, and its political institutions have been stable, all of which attract foreign investment. One of our main categories is milk, and Colombia has the highest consumption of milk per capita in South America and after Brazil is the second-largest milk producer in the region. Here, our market share is one of the lowest worldwide, meaning there is a huge opportunity for growth. We also see that in other categories such as juice and nectar. Compared to other markets, Colombia is still underdeveloped. Therefore, if we put everything together, Colombia is a key market for the company, and the group has been investing heavily in the country and the region over the past years. For the region in general, we have had double-digit growth the last two years and intend to maintain this level.

How would you characterize the first half of 2017 for Tetra Pak?

For 2017, we expect to have the same level of double-digit growth we had last year. As of today, we will see 12% growth. The market has not started out as strong as the previous year; the beverage category in Colombia for the first three months fell compared to the previous year. Colombia has all the pillars to keep growing; however, the situation in the region, such as tax increase and other factors, created a constraint during the beginning of this year. I expect, however, these factors to change in the coming months. Thus, our expectation is to grow around 15% in Colombia this year.

How is Tetra Pak implementing digital innovations into its operations?

Today, it is key to work on digitization and on digital platforms. With current technology, we are able to connect the entire plant, from where we prepare the product, to the filling line and the package itself. This also allows us to monitor the entire process and provides digital information to the plant manager that helps improve operations and performance. In addition, we are now introducing The Hololens, a kind of goggle, in partnership with Microsoft. With these goggles, we can provide remote support 24/7; if there is an issue in the plant, a user can wear these and receive support from a specialist anywhere in the world, whether it is for our technicians or even customers. We are investing heavily in digital innovations, and there is still much to be done.

How are you implementing Tetra Pak's sustainability initiatives in the local market?

The environment is one of the four strategic pillars of Tetra Pak; the company has big ambitions for sustainability and has invested a great deal in this area. For example, as of last year, all Tetra Pak packages are 100% recyclable—with new technology we were able to make caps and polymers out of sugar cane to create the first 100% renewable carton package. For our ambient packages, 82% is made of renewable material, using the same approach as pasteurized products with bio-based resources. Our goal is to get 100% recyclable or 100% renewable packaging. We are supporting the construction of five plants in Colombia that will recollect packaging and through various processes separate the paper part from aluminum and the polythene; the paper can then be used for books and more. The aluminum and polythene can be the used to produce chairs, tables, and roofs, for example. We also have programs across the region where we go to schools and explain to students about the importance of recycling and the environment. We have invested around USD400,000 over the last two years supporting various recycling activities in the country.