Hide & Seek

What is the background story of Mario Hernandez?

We opened the first stores under the name of Cuerolandia in the early 1970s, whereas the factory, Marroquinera SA, only opened in 1978. The story of Marroquinera is a complex one, as it was born out of a merger between two small companies, Cuerolandia and Marroquinera, after I acquired a majority stake in of both of them from close friends. We incorporated the production of Swiss Bally. Over the years, we also opened in New York; an experience that helped me open my eyes and see that Marroquinera was not perhaps the best trading name. After some international market research, I decided to change the name of the company to Mario Hernandez. That meant a fresh start for the company, and it has been 17 years now since then, a period of time in which we have been growing both nationally and internationally. We now employ over 500 people and have manufacturing activities in several countries, as we always aim to produce using the best raw materials.

What is the extent of your international presence?

Today, we have 55 stores in countries Colombia, Mexico, Panama, Costa Rica, Venezuela, and Aruba. In all these countries, we are present with Mario Hernandez stores in the most successful shopping malls. In terms of future expansions, we prioritize remaining for the long term. Our five-year plan foresees the company reaching 120 stores and increasing its international activity, with a special focus on the US, which will be our top priority.

How would you assess the development of the Colombian leather industry?

The number of players has declined compared to a few years ago. Previously, we had been commercializing rather cheap leather, and there were many manufacturers, thanks to high demand from countries like the US. However, that changed some 15 years ago, as leather became a more expensive product, changing, too, the manufacturing patterns in the industry toward more traditional and unique methods. That drove prices up and reduced the number of players in the industry, leaving those with brands focused on consumer experience. Over the past decade, Colombia has been working hard to promote its leather among the finest quality in the world, trying to knock down old stereotypes and make our leather production highly recognized in the international arena. The supply chain is diminished due to the flight to lower labor cost countries. However, the biggest challenge is procuring raw materials and hardware.

What are the competitive advantages of your company?

I think we are unique in terms of service, quality, as well as manufacturing methods. We believe that differentiation is the only road to success in today’s globalized world, and for that reason we have worked very hard to achieve the denomination of origin in Mario Hernandez, something we proudly achieved some years back. Another of our distinctive features is our products’ unique identity. And our challenge for the future is to ensure that our business grows.

How has the company evolved over the past five years and what are your main future plans?

We have been growing at an average annual rate of between 15% and 20%. In terms of future priorities, we plan to expand our international profile, while acquiring more international expertise in the industry with some of the best professionals out there. Additionally, we will continue investing in customer experience, technology, research, innovation, stores, manufacturing methods, product differentiation, promotion, and PR. That’s the only way to survive in such a global and exigent world. We will continue producing in those countries with the best raw materials for the manufacturing of our products, as well as import the finest leather to produce locally. We are on the way to building a global and international brand, and we have already won the attention of several global investors. Thus far, we have refused any potential deals, as we believe we still have a long road ahead of us, and that there will be a moment, in the future, when we will be in a stronger position. So far, we are prioritizing re-investing in our utilities and continuing our expansion in terms of international activity and number of stores.

How closely do you work with Marca Colombia and Proexport Colombia?

They both feature us as a good business example of companies that want to expand their activities to other international markets. Overall, we collaborate closely with them, as the government has offered its hand to many companies to grow internationally. We are regularly invited on commercial trips to countries like Russia, Venezuela, and many others to share our experience, and who knows, perhaps open new and potential markets. Our company takes part in negotiations for the Pacific Alliance as one of Colombia’s four representative companies; this initiative will bring together over 210 million people from four different countries—Colombia, Peru, Chile, and Mexico—and remove visa requirements, reduce custom tariffs, and create commercial opportunities across many different industries.

© The Business Year – January 2014