Oct. 15, 2021


Gustavo Salas

Colombia

Gustavo Salas

Former General Manager, PepsiCo Alimentos Colombia

PepsiCo is investing heavily in Colombia to boost not only its production capacity but also its sustainability agenda.

BIO

Gustavo Salas was the General Manager of PepsiCo Alimentos Colombia from 2018. His tenure with the company started in 2000 when he held the position of marketing brand manager. He has built and solidified brands in an array of South American markets. Salas is an industrial engineer from Tecnologico de Monterrey and has an MBA with a focus on finance from the IPADE Business School and the Freeman School of Business. He is a board member of the ANDI, CEA and AmChan Colombia.


Why is this a key moment for PepsiCo's strategy in Colombia, and what is the objective of your record investment in Guarne and Funza?

PepsiCo is investing USD158 million in Colombia, the biggest investment the company has ever done in the country. The injection was planned a few years ago and is part of our strategic planning process: betting on countries where we can succeed and grow. These countries have the best and strongest economic outlooks for the future and a demographic bonus. Additionally, they are markets where PepsiCo has the right sourcing and supply chain to grow while supporting local communities and generating shared prosperity. We are investing in expanding our Funza plant and incorporating sustainability initiatives at our new manufacturing facility in Guarne, Antioquia. The objective of these investments is to bring to life the PepsiCo promise of winning with purpose, meaning this investment is made to grow our production capacity in order to deliver our products to a wider range and a broader population of Colombia while continuing our journey in the sustainability agenda. These investments also have a huge component beyond the capacity increase; in Funza, for example, this investment will be used to expand the capacity and quality of our water treatment plant. In Colombia, we invested in a state-of-the-art water treatment plant that recycles or reuses 80% of the water consumed by our factory. We also invested in solar panels that will provide more than 25% of the total energy consumed by the manufacturing plant. Such investments are the same ones we are making in Guarne as well. There will be a positive impact on our communities because we will create new jobs in the area and continue to develop and grow our source of agricultural products: potato, corn, and plantain. PepsiCo is the number-one industrial buyer of potatoes in all Colombia. We consume around 80,000 tons of potatoes annually, which is something we will continue to grow.

How does PepsiCo collaborate with its partners upstream and downstream to improve their processes, efficiency, and so on?

It all starts in the fields in agriculture with the planting of potato and corn crops. We make long-term contracts with our partners, certify them, and accompany them to make sure all the crops are grown in a sustainable manner. We sign contracts at a fixed price so partners do not have to worry about how much they will earn. PepsiCo helps them with techniques and seeds; we provide them with the specific seeds that will guarantee them the right yields per field. We train them on sustainable farming techniques and fertilizers, water usage, and techniques that allow the soil to maintain all its nutrients. In the rest of the supply chain, we do the same as well. We co-create with our suppliers and work with them in the short and long term. For example, we co-develop solutions of packaging that are biodegradable and can be reused.

What makes Colombia important for PepsiCo's export markets, and why is the country well positioned to be that business center for the company?

PepsiCo has manufacturing hubs in the region; in Colombia, we have three of our largest factories across Latin America. We export products to Ecuador, Peru, and some countries in the Caribbean and Central America, and this is because of the scale of Colombia. Colombia, depending on the size of the business and the scale, is the third-largest operation for PepsiCo in Latin America and is ranked amongst the 20 largest markets in the world. It is a market that has the right to innovate and hosts manufacturing lines that other smaller markets cannot afford to or do not have the scale to sustain a manufacturing facility on their own.

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