C O M P A N Y I N S I G H T
Cargill: A bastion of brands to conquer the poultry market in Central America Artisanal quality and genetics for the regional market
Written by: Rebecca Castrejon Produced by: Taybele Piven Interviewee: Xavier Vargas, Business Unit Leader, Cargill Meats Central America
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CARGILL
Xavier Vargas, Business Unit Leader
A history of acquisitions to promote progress
Products Cinta Azul, one of Cargill’s brands in Costa Rica
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y 1975 the poultry processing and commercialization company initiated the strategic alliance of two Cargill business units in Central America, Cargill Meats Central America and Cargill Animal Nutrition, this after opening and acquiring companies in: Nicaragua, Costa Rica, Honduras and Guatemala. After 50 years of operations in Central America, they are now one of the most valuable companies in the global sphere and have the preference of 60,000 customers in the region. Their production of chicken, sausage and food for animals and pets, has marked a strong market competitiveness, providing innovative solutions in
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agriculture, food products and industrial services with highly recognized brands such as: Pollo Norteño, Delicia, San Miguel, Tip-Top, Cainsa, Pipasa, Cinta Azul, Kimby, Tiquicia, Zaragoza, Perry, Cinta Roja, Premier, Mike’s, Castillo del Roble, Beannie’s, Purina Nutrimentos, Alcon, Dogui, Gati, Pet Master, Tuiti, Ascan, Kan Kan, Mimados, Don Gato, As de Oros, Aguilar & Solis and Dog Pro. In addition to their success in the food market, Cargill continues to thrive in its commitment towards the community, and in partnership with the national government, clients and farmers, they conduct social and ecological works. “We are committed to feeding the world responsibly, reducing our environmental impact and improving the communities where we live and work,” says Xavier Vargas, Business Unit Leader of Cargill Meats Central America.
“We are committed to feeding the world responsibly” – Xavier Vargas, Business Unit Leader
The exact formation for an strategic direction Within the management of Cargill Meats, is engineer Xavier Vargas, who as head of the company has driven its evolution, presence and businesses. Vargas has spent most of his career with Cargill, managing all operations in Central American countries (Honduras, Nicaragua, Costa Rica and Guatemala). It was 1996, when the current president of the board of Cargill Meats Central America, began his work at the company as training manager in w w w. c a r g i l l . c o m . h n
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CARGILL Honduras. Subsequently, he worked his way up, occupying the cold cuts management post. By the year 2000 he moved to Guatemala to handle one of Cargill’s acquisitions and took over the commercial management position. By 2002, Vargas decides to start his own business, a coffee roaster. Six years later (2008), he returned to Cargill as purchasing manager for Central America, and then became commercial manager for Cargill in Honduras. In 2010 he moved back to serve as CEO of Cargill in Nicaragua. In 2013, Vargas served as commercial manager and CEO of Cargill in Costa Rica; afterwards he was selected as executive director for Nicaragua and Costa Rica. Since May first, 2014, Xavier Vargas was announced Chairman of the board of Cargill Meats Central America.
Products Cinta Azul, one of Cargill’s brands in Costa Rica
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Brands that make a difference “Our most important asset is the trademark of our products, we own more than 20 brands in the region that have a lot of tradition in our operating countries,” says Vargas. The brand value of Cargill, is equivalent to customer appreciation, with products that have been in the Central American households for decades. One example of this value is the brand Tip-Top of Nicaragua, Pipasa from Costa Rica and Pollo Norteño in Honduras, which have captivated the national market for decades. In the range of cold
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meats, where the main attribute is practicality, the company has strong brands such as Perry in Guatemala, Delicia in Honduras, CAINSA in Nicaragua and Blue Ribbon in Costa Rica, to name a few. “Brands are associated with tradition, quality and taste; which helps us have the preference of consumers,” he adds. Investments and next acquisitions for global competitiveness Among their main investments for entrepreneurial development, some examples are: • Costa Rica: With an investment of millions to increase the fabrication of products with added value. • Nicaragua: With the opening of a new distribution center that will become the largest
Products Zaragoza one of Cargill’s brands in Costa Rica w w w. c a r g i l l . c o m . h n
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CARGILL site of operations in the country. In addition it will include two processing plants. This project has an investment of $40 million. Their growth strategy will evaluate the possible incorporation of companies that fit Cargill’s vision for commercial expansion in the Caribbean, Central and South America. Human talent, basis of corporate success The outstanding achievements Cargill Meats has acquired in Central America over the years have been largely thanks to the human resource commitment and competent execution. Among their objectives is being the best company to work for in Central America by 2020. To achieve these goals they are optimizing their work environment and are developing talent by transferring employees to international Cargill plants. “We are not a company of chicken, we are a company of people, and we are dedicated to have the best for them to take care of our chickens. But our job as leaders of this company is to bring the best talent, develop them, retain them and promote them,” says Vargas. Food advances for consumers’ taste In recent years, Cargill has increased their brand’s market presence by packaging individual pieces with information about the company, thereby increasing the consumer preference. Additionally they have expanded their added 8
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value lines, providing a greater number of solutions towards convenience and ready to cook products. Artisanal and modern processes As the poultry industry continues to use traditional methods, the implementation of modern technology exceeds investments of $20 million in equipment, improvements and genetics. Given the intensity of the process, farms require about 10 thousand employees. Strategic partners that supply quality “Our suppliers, which we call strategic partners, walk hand in hand with us, providing us with raw materials,” says Vargas. Aside from having their own fleet, Cargill has a department that negotiates all regional purchases. To be less dependent on imports and strengthen domestic suppliers, they are updating agricultural techniques to develop local crops of corn and sorghum in Honduras and Nicaragua. “We are trying to give more value to the country, by supporting the local produce of grains, corn, sorghum and soybeans, and stop importing,” he adds. A future of vast opportunities Cargill’s success in Central America is more than evident; the company has doubled the size of their operations in the region in just five years, making w w w. c a r g i l l . c o m . h n
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them a model for other units in Latin America. For 2020, they are looking to double the size of the company once again. The future remains prominent for Cargill Meats Central America and Cargill Animal Nutrition, in a region with one of the largest GDP growth in the world and with an increasing domestic consumption of animal protein. The company will continue to innovate to bring to market new lines and solutions, creating new consumption and increasing in percentage.
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Company Information INDUSTRY
Aviculture (process products) HEADQUARTERS
San Pedro Sula, Honduras FOUNDED
1969 EMPLOYEES
9,300 PRODUCTS AND SERVICES
Aliments, agricultural products and services, financing and industrial services REVENUE
“We are trying to give more value to the country, by supporting the local produce of grains, corn, sorghum and soybeans, www.facebook com/pages/Cargill/108265632534606 and stop importing” mpany/cargill
USD $250 million WEBSITE
www.cargill.com.hn
rgillConstructora/100558403364829 – Xavier Vargas, Business Unit Leader
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CARGILL Oficinas administrativas Boulevard hacia Armenta, Altia Bussiness park, Torre 3, Piso 6 San Pedro Sula, Honduras Pipasa Apartado 22-4005, La Ribera de Belén, de la compañía Intel un kilómetro y medio al oeste Costa Rica Tel. +(505) 2279-9245, +(506) 2298-1800 Fax. +(505) 2279-9245 Ext 1293, (506) 2239-1322 Dylana_Segura@cargill.com http://www.cargill.com.hn