w w w.fdf wor ld.c om | Ma rch 2016
THE POWER OF
PARTNERSHIPS Pieology founder Carl Chang discusses growth with PRG
HOW TO SAVE WHEN SOURCING MILLIONS OF LABELS
TOP 10 EVENTS OF SPRING 2016
EDITOR’S COMMENT
WORKING TOGETHER “The keystone of successful business is cooperation.” ~ James Cash Penney
H O W D O W E B U I L D our businesses? Do
we try to go it alone, or do we reach out to the resources available to us? In this month’s Food Drink & Franchise we’re exploring the strategic partnership and how building a network of support can boost your success. From examples of partnership success to the best conferences and trade shows for networking and education, it’s all here. So read on, enjoy, and consider how your business and your partners are helping each other reach your full potential.
Sasha Orman Editor Sasha.Orman@wdmgroup.com
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CONTENTS
6 12
Features
Partnering for Growth Food Processors: How to Save Money When Sourcing Millions of Labels
18 Top 10 Conferences for Spring 2016
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March 2016
Company Profiles
Brazil
32 El Tejar
Latin America
60 Agrana Fruit Mexico
Latin America
44
Industrias Licoreras de Guatemala
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Partnering for Growth
We talk to P about its pa and what’s
Written by: SAS
PRODUCTION
Pieology founder and CEO Carl Chang artnership with Panda Restaurant Group s next for the fast-growing franchise
SHA ORMAN
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PRODUCTION THERE ARE MANY ways for a business to grow, and a strategic investment from an ally that believes in your mission can be a powerful catalyst for further development. In January, Pieology Pizzeria announced that it would be receiving such an investment from Andrew and Peggy Cherng, founders of Panda Restaurant Group (PRG). So we sat down with Pieology founder Carl Chang to discuss how this will change the trajectory and future of his franchise.
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FDF: What does this mean for Pieology’s future? Carl Chang: The most important thing from my perspective is that the partnership is a very strategic one. They are nearly 1900+ units across the nation, and they have tremendous infrastructure to support all of those units and their continued aggressive growth—this year alone they have another 150 restaurants they’re planning on opening, and that’s 150
PA R T N E R I N G F O R G R O W T H
corporate stores which is impressive in itself from both a capital and an infrastructure support perspective. For a fast-growing emerging brand like Pieology, to have access—and Andrew and Peggy have been nothing but absolutely generous with me and Pieology in allowing us access to these resources—it allows us to operate as if we were a 2,000 restaurant chain. So I think those competitive advantages, that give us an
infrastructure to leverage both as a brand but also franchise partners is a tremendous competitive advantage. FDF: How closely will Pieology be working with the Panda Restaurant Group? CC: The Cherngs and the Chang family have been friends for some time. We’ve always had tremendous respect for them and what they’re accomplished.
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PRODUCTION Andrew has always said they’re here to be a support role for us. They can be as active or proactive as we would like them to be. It’s still very clear that Pieology has its objectives, and what we want to accomplish with the brand. They would not have made the investment and decided to partner with the brand if we didn’t have an alignment with them. FDF: There seem to be a lot of synergies between Pieology and PRG in terms of core values and mission statements? CC: Over the years, one thing PRG has always been incredibly successful at and known for is building their people. They have had tremendous personal impact in changing lives at that organization, and that may be from impacting a small family to helping someone be successful in changing even their opportunity with their career. There are so many great entrepreneurs and great restaurateurs that have come from the organization—it’s almost like a school where you learn so much from an organization like that. 10
March 2016
At Pieology, for me it wasn’t a business venture. It was something I wanted to start to find a way of giving back—community outreach and building community and being active and supportive of that. That also extends within the Pieology family, the fact that we can be an organization that might help youngsters pursue a career or an opportunity that perhaps life may not otherwise have afforded them. Those are the types of things that motivate me, and the reasons why we started Pieology. There’s a lot from Panda’s success that I hope to learn from. FDF: What’s next for Pieology in light of this announcement? CC: It will be interesting. It’s still early days, but if things continue to progress, I would say it’s more than likely that we’ll accelerate our growth and we certainly have more resource and capability to do so. We already have a very aggressive growth plan, wanting to hopefully be over 200 units by the end of 2016. Over the next 3 to 5 years we can definitely see accelerated growth.
PA R T N E R I N G F O R G R O W T H
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FRANCHISING
FOOD PROCESSORS
HOW TO SAVE MONEY WHEN SOURCING MILLIONS OF LABELS Large food processors that consume millions of thermal labels each month are turning to specialty converters that can deliver the lowest prices, as well as unique consignment and inventory management that can cut annual labeling budgets up to 40%
Writ ten by: O M N I SYSTE M S
ALTHOUGH MOST FOOD processors view labels as a commodity item, for large operations that consume millions of thermal labels per month, it is a prime operating expense with sourcing decisions made at the corporate level. With so much at stake, processors find themselves in a constant quest to find reliable label companies capable of delivering a quality product, 12
March 2016
consistently, and at the lowest possible price. For many, this means partnering with specialty converters that can pass on savings due to bulk purchasing power of thermal media direct from its source, in addition to unique consignment and inventory management options. Although this can be a tall order, sourcing a thermal label supplier that can deliver all of the above can
reduce annual labeling budgets by as much as 40%. “You can run through a couple million thermal labels faster than you think,� says Russell Gayer, manager of printing services for a major U.S. meat processor. In addition to managing the in-house print facility, Gayer has experience sourcing labels at the corporate level. According to Gayer, Fortune 500
food processors can utilize hundreds of millions of labels per month. Even comparably smaller operations of $200 million or more in annual revenue can have label budgets that exceed $250,000 a year. For meat and poultry, specifically, the information that appears on the label varies depending on whether or not it is a processed or prepared meat or poultry product, or an 13
FRANCHISING unprocessed meat cut, or poultry product, and upon the type of package or container in which the product is packed and shipped. However, most packages requires multiple labels including scale labels that list the price pound, net weight, total price, when the item was packed, the sell-by date, safe handling instructions and often a bar code. Labels are also used to provide nutritional information or to promote a product as “great for the grill” or “keep frozen.” Labels are also widely used on shipping or institutional containers to impart information mandated by regulators including product type, handling statement, legend, establishment number, net weight, ingredients statement, signature line, nutrition facts, and safe handling instructions. Far from “blanks,” these labels often come pre-printed from the converter with store name, logos or other branding, as well as fixed information and defined spaces or boxes where variable data will be printed later by the processor. According to Gayer, the process of identifying a thermal label converter 14
March 2016
begins with an RFP to multiple suppliers, followed by careful vetting of each to determine the company’s stability and long-term viability. “Obviously price is the ticket to the dance,” says Gayer. “However, we follow up with a lot of questions so we can learn about the company we are
HOW TO SAVE WHEN SOURCING MILLIONS OF LABELS
partnering with to determine if it can deliver the goods consistently.” Gayer cites the example of OMNI Systems. In 2000, he contacted the company for a quote on scale labels in quantities that were in excess of thirty million per month. OMNI Systems, the largest, privately owned
label convertor in the United States, specializes in pre-printed or blank direct thermal or thermal transfer labels. To start, he found the initial quote hard to believe. “When I got the pricing, I thought surely there was a mistake,” he says. When he contacted the company to confirm the price, OMNI Systems explained that as the largest consumer of thermal media in the world, it had the purchasing power to procure quality raw materials at extremely low rates. In addition, the company operates in a lean, modern, 24/7 operating environment. The savings that result are passed on to the customer. Price, though, is only one piece of the equation. Selecting an unreliable label company can lead to range of problems including inconsistent or late deliveries, as well as raw material, adhesion, or other print-related issues. “Any company can offer product at a good price, but in my opinion you measure a company by how they respond when something goes wrong,” says Gayer. “My experience with OMNI 15
FRANCHISING Systems is that in the past 15 years things do not go wrong very often,” says Gayer. However, he recalls a time when the printing on the scale labels was not properly centered. OMNI Systems “stepped up to the plate and corrected it” immediately by shipping replacements even though it meant taking a $30,000 loss. When dealing with millions of thermal labels in rolls of varying diameters, another major concern for processors is inventory management. Once the supplier is approved at the corporate level, individual or regional processing plants can access the information and order using the company’s ERP system. However, leaving the task of inventory management to in-house staff can result in human error that can leave the processor high and dry. For this reason, large thermal label converters often offer several Vendor Managed Inventory options to ensure that label stock is maintained to inventory minimums and replenished quickly from regional distribution centers. This type of program requires the label converter to maintain its own sizable inventory at specific 16
March 2016
minimums agreed upon with the customer. “From a corporate point of view, we realize that with the volume of tens of millions of scale labels there has to be significant inventory at the supplier as well,” says Gayer. “So we worked with them to identify an appropriate min/max inventory for them to keep based on past order history and projections.” For higher volumes, OMNI Systems offers a consignment option that allows the processor to store thermal transfer or direct thermal labels at their facility at established minimums so stock is available at all times. The processor is not asked to pay for inventory until it has been pulled and reported. If required, OMNI Systems can also take control of the inventory process for the end user by tasking personnel to go to the processor’s site to complete inventory counts and ensure label supplies are maintained.
For more information, contact OMNI Systems: Phone: (216) 3775160; Fax: (216) 377-5192; email: webforms@omnisystem.com or online at www.omnisystem.com
HOW TO SAVE WHEN SOURCING MILLIONS OF LABELS
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TOP 10
Top Conferen Spring
Which conferences stan hospitality, food and
Written by: S
p 10 nces for g 2016
nd out this Spring in the d beverage worlds?
Sasha Orman
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TOP 10
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Natural Products Expo West March 9-13,2016 Anaheim, CA www.expowest.com/ew16/ public/enter.aspx March brings the west coast’s leading proving ground for all things natural, organic, gluten and allergen free. This massive trade show attracts both up-and-coming entrepreneurs and some of the biggest names in the industry for networking, demonstrations, and coveted recognition at the Best of the West awards. This year’s speakers include Laura Batcha (CEO, Organic Trade Association), Walter Robb (Co-CEO, Whole Foods Market), and White House personal chef Sam Kass. 21
TOP 10
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SNAXPO Snack Food Association 2016 Expo and Conference March 19-22 Houston, TX www.snaxpo.com Everybody loves snack food, and this is the leading global event for the snack food industry. SNAXPO lands in Houston for its 79th year, welcoming buyers, management, and entrepreneurs from the world of snacks including chips, crackers, cheese snacks, pretzels, fruit snacks, snack bars and much more.
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TOP 10
03
ICGFS 2016: 18th International Conference on Global Food Security March 24-25 Miami, FL www.waset.org/ conference/2016/03/miami/ ICGFS
What does the future of food production look like in the face of climate change and progressing technology? How can we preserve food security for future generations? The International Conference on Global Food Security—hosted by the World Academy of Science, Engineering and Technology—works to answer those questions with its series of discussions and panels.
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2016 IACP Conference April 1-3 Los Angeles, CA www.theiacpconference.org Every year the International Association of Culinary
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Professionals hosts the IACP Conference to connect leaders from the foodservice and hospitality industries including chefs, restaurateurs, foodservice professionals, marketers, academia and more. This year’s conference speakers include Marion Nestle, Phil Lempert, and Carolyn Tao.
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TOP 10
2016 WCR National Conference April 17-18 Los Angeles, CA www.womenchefs.org/ wcr-conference
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Women Chefs and Restaurateurs is an association dedicated to connecting and advancing women in the food and beverage industry. The WCR National Conference is its significant annual event, featuring courses and speakers like Gail Simmons, Carla Hall, Lidia Bastianich, Elizabeth Falkner and many more.
Food Safety Summit and Expo May 10-12 Rosemont, IL www.foodsafetysummit. com Food safety is one of the most important ongoing issues facing
the food and beverage world today, and the Food Safety Summit and Expo is a threeday conference meant to bring that issue to the forefront. The conference attracts growers, processors, retailers, distributors, foodservice operators, regulators and academia within the industry to come together, share knowledge and develop solutions.
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TOP 10
07 National Restaurant Association Show 2016 May 21-24 Chicago, IL show.restaurant.org The NRA Show is touted as the largest trade show and exhibition for the restaurant, foodservice and hospitality industries. The show features education sessions and cooking demos, showcases for new technology, and recognition like the 2016 Kitchen Innovations Awards.
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Sustainable Foods Summit Europe June 9-10 Amsterdam, The Netherlands www.sustainablefoodssummit. com Founded by Organic Monitor, the
Sustainable Foods Summit is held several times around the world to allows as many professionals and innovators in the industry as possible to come together to tackle such issues as food waste, traceability, and developments in marketing to raise the profile and appeal of sustainable food products for consumers. Sustainability is a key issue in the industry. 29
TOP 10
BevNET Live Summer 2016 June 14-15 New York, NY www.bevnet.com/events/ bevnetlivesummer16
3 0 M arch 2016
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BevNET is a leading publication for the beverage industry, and BevNET Live is a leading conference series for professionals in the same industry. BevNET Live welcomes suppliers, distributors, manufacturers, investors and other entrepreneurs to share knowledge and their products.
Annual Summer Fancy Food Show June 26-28 New York, NY www.specialtyfood.com/ shows-events/summerfancy-food-show/
Say farewell to spring and ring in summer with the Specialty Food Association’s annual Summer Fancy Food Show, a celebration of the specialty food industry. Along with hundreds of exhibitors, the trade show features education seminars and a showcase for winners of the coveted sofi awards.
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EL TEJAR
Fazenda Primavera
T
he El Tejar Group is recognized as one of the leading producers of commodities in South America and as a reference point in sustainable agricultural production, working with over 84,300 hectares through its plants. Focused primarily on the commercialization of soy, cotton and corn in Brazil, the company’s land is distributed between 34
March 2016
Primavera do Leste, the municipal where the headquarters is located, and other Mato-Grosso cities, such as Santo Antônio do Leste, Pedra Preta, São José do Rio Claro, Nova Mutum, Ipiranga do Norte, Sorriso and Diamantino. Having sold its operations in Argentina and Uruguay, today, El Tejar operates in Brazil and Bolivia, where it has about 26,500 hectares
BRAZIL
of plantations. STRATEGIC CHANGES In 2010 the company was one of the biggest food producers in the world, with approximately 950 thousand hectares established in South America. “But the paradigm shift of sustainable agriculture made us realize that to be the biggest didn’t mean to be the most profitable
and attractive. This caused us to make changes,” said Carlos Ismael Turbán, president for El Tejar in Brazil. The group’s principle investors are Altima Partners and The Capital Group, international investment funders. “In addition, we have shareholders committed to the company, which recently demonstrated their confidence w w w . e l t e j a r. c o m
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EL TEJAR
Soybean Harvest
BRAZIL
through additional capitalization in February of 2016 of $143 million,” he said. To optimize operations, investors focused funding on revamping the farms and four partner producers. An example of the improvements can be seen in yield increase over just one year. In the 2013 harvest, production per hectare was 45 bags of soy and 80 bags of corn; however, the 2014 harvest produced 53 bags of soy and 112 bags of corn. This is an increase of 17% and 40%, respective to each crop. “We reduced in size, focused on
productivity with controlled costs. Now we aim not to be the biggest, but one of the best producers of agricultural commodities,” said Turbán. INVESTMENTS IN CUTTINGEDGE TECHNOLOGY Operational excellence is also due to constant investments in vertical integration, process improvements, and results optimization. To do this, El Tejar uses precise and comprehensive machinery. The company also has a validation and testing department, where practices
w w w . e l t e j a r. c o m
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EL TEJAR
are tested at different times in order to use the most viable agricultural technology in terms of productivity and controlled costs. Over the past two years, El Tejar also worked on R&D with livestock, such as the use of the best agricultural supplies on market like moth-resistant soybean strains, which increases the production potential and reduces use of agrochemicals. “Since the 2013 harvest, we
Creating customized solutions to mitigate risks and uncertainties
have invested $80 million for the purchase of agricultural machinery and equipment, construction of warehouses and improvement of soil conditions and genetics for crops, as well as training technical staff in producing units within the state,” said Turbán. FOCUS ON PEOPLE AND RESULTS According to Turbán, developing employees has been one of the
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There are 7 billion people in the world. Each year, we are joined by 80 million more. Clearly, we need to grow more food. Yet we must also protect the ecosystems that are vital to our planet’s health. As one of the world’s leading agricultural companies, Syngenta is helping farmers to grow more without taking new land into cultivation. As part of The Good Growth Plan, we are committed to increasing the average productivity of the world’s major crops by 20% and to enhance the biodiversity of five million hectares of farmland. And we are ready to work with growers, governments, NGOs and all who share this agenda. Please follow our progress at www.goodgrowthplan.com © 2016 Syngenta AG, Basel, Switzerland. All rights reserved. The SYNGENTA Wordmark and THE GOOD GROWTH PLAN are trademarks of a Syngenta Group Company. www.syngenta.com
BRAZIL
Edson Vendruscolo, Carlos Ismael Turbán and Ivan Konig
most important aspects of the company. “We constantly seek to create internal and external opportunities that can promote the evolution of our human capital,” he said. With this philosophy in mind, El Tejar invests in environments that offer leisure and interaction, beyond the incentive of creating one culture aligned with the organization’s
standards. The Café com Country Manager, for example, makes communication easier on every organization level, allowing everyone to contribute to more effective management. Through the management and developing System, each collaborator can contribute to the company’s goals and objectives. El Tejar also runs Development w w w . e l t e j a r. c o m
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EL TEJAR
and Improvement Transversal Programs (P*TAG and P*TAC), which aim to evolve operational, technical and management skills via internal and external facilitators. “The focus on and permanent qualification of our people has brought significant profits. One example is the increase of our operational efficiency on planting in 2016 harvest in comparison to 40
March 2016
2015,” said Turbán. PLANS AND PARTNERSHIPS In the future, the plan is to continue investing in people and to increase intellectual capital. “We seek to increase our productivity and profitability even more. We know that we are in the best place in the world to produce,” said Turbán One of the company’s strongest
BRAZIL
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EL TEJAR
points is its large network, including agricultural input suppliers, trading, service providers, financial institutions, foundations and universities, logistics companies and local agribusiness companies. One example of El Tejar’s partnerships is the Group Technological Validation, located on Fazenda Primavera, where 42
March 2016
innumerous tests and validation experiments can be done. The company’s partners can test their technology and present results to the whole agricultural community through the annual Open Gates Field Day. The harvest projections for 2016 are the best possible. The soy projection is 55 bags per hectare, in
BRAZIL
Company Information NAME
El Tejar INDUSTRY
Agribusiness E S TA B L I S H E D
1987 (origin) 2003 (Brazil) EMPLOYEES
600 PRODUCTS
Soy, Cotton, Corn, Cattle Farming ANNUAL REVENUE
125 MI USD
Storage quality
an area of 77,910 hectares, while the expectation for corn is 100 bags per hectare in an area of 46,555 hectares. The estimate for the cotton crop comes in at 270 bushels per hectare in an area of 4,324 hectares. Despite this, Turbán pointed out that the government must play a role as well. “To grow, a change in legislation that eliminates the restriction of rural areas property for foreigner investors is crucial,” he said.
MANAGEMENT
CEO: Carlos Ismael Turbán Commercial Director: Ivan Konig Operational Director: Edson Vendruscolo
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WHO ‘RUMS’ THE WORLD? Industrias Licoreras de Guatemala takes on the world while maintaining the excellent quality of its spirited beverages
Written by: Mateo Rafael Tablado Produced by: Taybele Piven Interviewee: Dn. Roberto García Botrán, President of Industrias Licoreras de Guatemala from 2002 to 2015
I N D U S T R I A S L I C O R E R A S D E G U AT E M A L A
I Industrias Licoreras de
t’s no secret that the Caribbean region is the world’s epicenter for rum production, but until recently, rum produced in Guatemala was. The mountain range within the country’s borders causes certain distilling processes to be carried out well above sea level, creating rum with a taste that is unique from its counterparts bottled in the Antilles.
Guatemala relies on cutting-edge technology for different processes within the sugar harvest
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Industrias Licoreras de Guatemala (ILG) is a mid-20th century fusion of different distilleries in Guatemala. ILG’s products not only benefit from raw materials which provide consistency, but also from the commitment shared by generation after
L AT I N A M E R I C A
generation to every product through exclusive family recipes and production processes.
Key People
Rones de Guatemala is a collective brand for ILG’s products, which also produces vodka, cocktail mixes, and aguardiente liquor. The company is also a distributor of other imported liquors. Ron Botrán and Ron Zacapa – ILG’s champion brands – have been a stronghold of the company in the domestic market for more than 75 years, and have become some of the best globally known Central American brands.
industriaslicorerasdeguatemala.com
Roberto García Botrán President of Industrias Licoreras de Guatemala 2002-2015 Between 1911 and 1923, members of Don Roberto García Botrán’s family migrated to Guatemala from Burgos, Spain; these were the first steps toward creating a Central American liquor emporium. García Botrán graduated in BA and earned a Masters in economy. He worked in the farming business until 1996, when he became part of ILG’s board. In 2002 he became president of the board and ILG president also.
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I N D U S T R I A S L I C O R E R A S D E G U AT E M A L A ILG’s certifications include compliance with ISO 9001:2000, ISO:14000 and HACCP/ISO:22000. The company observes strict marketing codes in both internal operations and with external vendors. These policies imply a respectful approach to women, ethnic diversity and other entities. From 2002 until December 2015, Roberto García Botrán was President of Industrias Licoreras de Guatemala. Before becoming part of the management board in 1996, García Botrán worked in his farming business. His academic
L AT I N A M E R I C A
achievements include a bachelor’s degree in business management and postgraduate studies in economy. From the cane to the point of purchase The main raw materials in ILG’s rum are cane syrup and yeast from pineapple. These ingredients guarantee a consistent taste and aroma in every bottle. Each line of rum is a direct result of family recipes and of the aging process happening at more than 7,500 ft. above sea level.
i inndduussttrri iaassl li iccoorreerraassddeegguuaatteem maal laa..ccoom m
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I N D U S T R I A S L I C O R E R A S D E G U AT E M A L A
{
ILG’s workforce is aware of each procedure’s importance
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One of the main attributes to keep ILG’s business a profitable venture is the vertical integration of its production line, controlling every step from cane seeding and sugar mills to distilleries, bottling plants, and distribution. “Our control of production areas and sugarcane variety are a distinguishing factor for our rums,” García Botrán said. Striking a balance between technology and workforce ILG is supported by cutting-edge technology, both for operational and business management processes. Technology is present in every
L AT I N A M E R I C A
Each bottle contains the good standing name of a country and an entire region
step, from sugarcane seeding up to bottles arriving at retail outlets. Investments in acquiring new technologies, completing preventative maintenance, and updating equipment encourages automation in most processes, overseen by the company’s team members. Managerial tasks are supported by a customized SAP system, specially designed for ILG’s endeavors and procedures. “We try to remain on the cutting-edge of efficiency, always striving to keep our products at competitive prices once they arrive at the retail market,” the executive said.
i inndduussttrri iaassl li iccoorreerraassddeegguuaatteem maal laa..ccoom m
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I N D U S T R I A S L I C O R E R A S D E G U AT E M A L A Sharing the company philosophy with suppliers
“Our current
capacity is more than enough to support our growth pace
for the next
few years” – Dn. Roberto García Botrán, President of Industrias Licoreras de Guatemala from 2002 to 2015
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Even though ILG’s production process is vertically integrated, the company still relies on several suppliers for most steps in its production line: sugarcane plantations need fertilizers, chemicals and machinery; bottling plants need container bottles, labels, bottle caps, etc. Dealings with all of the company’s vendors are dictated by ILG’s Ethical Code, which is shared with suppliers along with a training program in chemicals management and packaging recycling. This plan earned ILG the “CentraRSE” Award from the Guatemala CSR Action Center in 2009. Presence abroad: the pride of Central America Besides a longstanding presence in the domestic market, ILG’s goal is to maintain a bustling exports agenda. This goal is accomplished mainly through Ron Zacapa rum, the only global liquor brand from Central America that is available in 120 countries. Ron Botrán rum is not far behind — the family’s recipe is available in 70 nations, including Mexico and large cities in the United States, such as Miami, New York and Chicago, among others. Overseas, Ron Botrán is exported into
L AT I N A M E R I C A
Spain, Italy, France, the Czech Republic and Scandinavian countries. Other ILG products abroad include Quezalteca “aguardiente” spirit and Ron Venado rum, soughtafter by a nostalgic demographic in the U.S. García Botrán made it clear that it’s not just ILG that can improve Guatemala’s standing in the international market.
ILG’s distillery
“It is very important that companies similar to ours work hard to make Guatemala shine outside of our territory,” he said. Great places to work... and develop In 2015, ten of ILG’s divisions ranked among Guatemala’s 30 best companies to work for, two of which landed in the top 10. The company invests in regular training programs, educational activities, sports and recreational events for employees and their families, among other activities. But the most important development is the “Licorera Looks After You” program, focused on the wellbeing of the company’s associates and their families, including healthcare, work safety programs and other features.
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I N D U S T R I A S L I C O R E R A S D E G U AT E M A L A
“We are a product able to create bran with global quality – Dn. Roberto García Botrán, President of Industrias Licoreras de Guatemala from 2002 to 2015
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March 2016
L AT I N A M E R I C A
tive country, we are nds and products y�
industriaslicorerasdeguatemala.com
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L AT I N A M E R I C A
CSR in every frontline ILG’s endeavors outside liquor production are focused in three main areas:
• Reforestation: In 1988, ILG created Forestadora S.A. (FORESA). This venture manufactures and markets solid wood products from raw material grown at ILG’s fields.
• Environment: Sugarcane residuals are used for power generation during sugar harvest season. This practice has earned ILG awards from the Environment Ministry.
Inside the bottling plant
ILG Foundation supports two schools
• Education: ILG Foundation supports a school in Lomas de Portugal and another in the Tulula sugar mill area.
within Guatemala’s inner country
“We provide educational support so people from the inner country can become self-sufficient and be more productive individuals,” García Botrán said. Continuous development and expansion in the forecast Short and mid-term expectations for ILG are optimistic. The company’s infrastructure stands to sustain a double-digit growth rate until the
industriaslicorerasdeguatemala.com
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www.fertica.com
Offering Chemical Specialties for Water Treatment, Cleaning & Sanitization, Industrial Maintenance and Institutional Care.
www.alkemycorp.com
L AT I N A M E R I C A
year 2020 without requiring any expansion on production operations. Established brands such as Ron Zacapa and Ron Botrán are set to have a new package design, available exclusively at duty-free stores. Strengthening its global team is a key labor to accomplish set goals for ILG. “We are currently in a planning process to see our purposes come to fruition in the short to midterm,” the executive concluded.
Company Information NAME
Industrias Licoreras de Guatemala INDUSTRY
Liquor production and distribution HEADQUARTERS
Ciudad de Guatemala FOUNDED
1939 EMPLOYEES
2,000 REVENUE
$150 million WEBSITE www.industriaslicorerasdeguatemala.com
industriaslicorerasdeguatemala.com
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IN
A THE H F
NNOVATION
AND STANDARDS AT HIGHEST LEVELS IN FOOD PRODUCTION Agrana’s affiliate in Mexico is the benchmarking enterprise for certified operations, able to bring innovation into products, processes, and company culture
Written by: Mateo Rafael Tablado Produced by: Taybele Piven Interviewee: Bernardo Baader, CEO for Agrana Fruit Mexico
AGRANA FRUIT MEXICO
A
grana is a successful Austria-based, international company starting in the sugar and starch business more than 25 years ago, actually also present in the fruit industries. Agrana Fruit Mexico came onto the scene around 2004. French liquor giant Pernod Ricard partnered with a local food production company in 1981 to create SIASPORT; after splitting from the local company 13 years later, Pernod Ricard sold the company in 2002 to Atys, S.A. de C.V. Finally, in 2004, Agrana acquired its current Mexican facilities from Atys. “Before Agrana arrived at Zamora, this was
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a potato growing region with no berries at all. Agrana – and the companies preceding us – brought all berry development to the region,” shared Bernardo Baader, CEO for Agrana Fruit Mexico. Baader was born in Argentina and graduated as a naval engineer from the National Technological University (UTN, Argentina). His background also includes management courses and training in countries he has worked in, such as Colombia and Venezuela. “I’ve worked abroad more years than I have worked in Argentina,” Baader said.
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Key People
Bernardo Baader CEO for Agrana Fruit Mexico Baader was born in Argentina and graduated as a naval engineer from the National Technological University (UTN, Argentina). Baader was involved in sailing, a trait he inherited from his German grandparents, who were involved in the boatyard industry. Heading up Agrana Fruit Mexico since October 2014, Baader is no stranger to working abroad. He has held leadership positions for ALPLA packaging solutions in Colombia and Venezuela, spending nearly five years at each position. Baader is fluent in Spanish, English and German, and a successful leader with a prominent record of revitalizing organizations, creating high performance teams and developing positive P&L results, excelling at obtaining the best results by engaging a mix of Latin American and European labor culture.
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Left to right: Johannes Kleppers, Chairman of the Board and CEO for Agrana Fruit Division; Bernardo Baader, CEO for Agrana Fruit Mexico; Carlos Garcia, General Manager for Agrana Fruit LATAM
From field to cup Agrana’s venture into Mexico has improved the Zamora, Michoacan agricultural area, not only production-wise, but also by setting a high labor, social, environmental and ethical bar for rival companies – and the rest of the country – to meet. The company’s clients, leading brands and food service chains, have thrived by offering consumers in the Mexican market an array of tasty, innovative and healthy products, most of them developed by Argana’s intensive R&D work. As Mexico’s number one supplier for healthy, fruit-based foods, the corporation displays global leadership and the highest quality product and sanitation standards. “Counting all of our clients, there must be 500 of our formulas currently available,” the executive said. 64
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Value in every single line of products Agrana’s portfolio includes products in these four divisions:
1. Fruit preparations & fillings: Agrana manufactures stabilized fruit bases for dairy, ice cream and bakery industries, among others. This division represents 80 percent of the company’s core business. 2. Frozen: Berries, processed fruits and vegetables are produced in various forms, including: individually quick frozen (IQF), free of additives and preservatives; block quick frozen (BQF), blended or not with additional ingredients depending on client’s needs; and frozen purees, pasteurized or unpasteurized, with or without sugar added. This adds up to 15 percent of the company’s sales, including clients in the food service industry. 3. Fresh fruits: Packed berries are sent directly to retail outlets, with the majority exported to the U.S. according to health standards. Fresh fruit production and packaging amount to less than five percent of the company’s revenue. 4. Dried fruit: This unit develops and produces innovative, competitive and versatile solutions aligned to trends in health foods. Offered products include hot air dried fruit (DAC), dry infused fruit, sweetened dried fruit, (FED), restyled fruit and dehydrated-flavored cubes (CDS).
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“There’s a current ma innovations we creat natural products. Th reached Europe and the into Mexico s
– Bernardo Baader, CEO
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arket trend toward the te by delivering fresh, his trend has already e U.S., and it will arrive soon enough�
O for Agrana Fruit Mexico
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Leading yoghurt brands are supplied by Agrana both for best-selling products and also introducing new, tasty, healthier formulas
The company’s efforts are focused toward value generation through sustainable development, fostering relationships with clients, farmers and consumers, and meeting the market’s needs as a premier B2B and B2B2C supplier. In order of importance within Agrana Fruit Mexico, the company works with strawberries, mangos, apples, pineapples, berries and vegetables. Agrana’s crops in Mexico deliver a better product that has become more resistant to pests and needs less help from chemical treatments. “Not every country has Mexico’s versatility for food production. Mexico offers a wide variety of fruits at very affordable prices,” Baader stressed. Rewards from constant innovation Satisfying the market’s needs worldwide is not the only thing Agrana is about. The development of new food presentations and recipes is also an endless endeavor for the company on a global level. The Agrana Holding has a central R&D facility in Vienna, uniting an elite corps of 60 Agrana experts to work on new products designed to fulfill end customers’ demands, market tendencies and explore new ingredient combinations. Agrana Fruit Mexico’s R&D lab displays the same craftsmanship set at the Vienna headquarters. The local facility is able to create 500 new prototype blends per month by modifying ingredient quantities and processes’ times, which results in delivering five new mixes
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into the market every 30 days. Thinking out of the box is a must at Agrana laboratories; some markets may be more receptive to new developments than others, but that does not keep Agrana from looking into new ways of bringing healthier, tastier products for end consumers. “In our sector, most innovations actually come from the field and lands than from the industrial aspect,” the executive said.
The company’s engagement with local farmers includes financing fruit growing
Energy-efficient upgrades Machinery is upgraded annually at Agrana. Using the most recent models increases efficiency, and upgraded features result in less energy consumption and a reduced impact on the environment. Freezing and packaging are also important processes in Argana’s operations. As the company’s products demand grows in the domestic market and in the U.S., equipment must be constantly upgraded to meet the evergrowing need. “We acquire machinery able to reduce the KW we use for every kg of fruit we produce,” Baader explained.
and harvesting equipment and consumables
Close relationships with local farmers Agrana’s business model, working methods, resources and business strategies provide for win-win ventures between the company and its main suppliers, the local landowners and their respective farmhands. Products are exported to the U.S., priced according to growing seasons to w w w. a g r a n a . c o m / e n / a g r a n a - g ro u p
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Agrana’s farmhand are trained based in the company’s standards
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assure that farmers sell their entire crop. The company’s involvement with local farmers includes using best practices, a reduced use of chemicals, and creating safe working environments with the best sanitation conditions for the product and farmhands. “We are able to trace every single strawberry back to the field it was harvested from, who picked it, and what – if any – chemicals were used on it,” the CEO said. Certification, a key to global business Agrana Fruit Mexico’s exports and overall operations are certified by different organizations. Field operations, safe practices, hiring ethics, and on-field sanitation all meet the various requirements of global standards, U.S. compliance, and industryspecialized organizations. Aside from its own standards for sustainable operations, Agrana Fruit Mexico has all the proper credentials to guarantee the healthiest products, the safest conditions for every worker and the best practices for new hires. ISO, FSSC, Kosher, CSR, SEDEX and other entities guarantee the company’s operations and practices. In fact, Agrana Fruit Mexico was the first company in Mexico to be certified by Global G.A.P. and by the Rainforest Alliance, starting an evolution of corporate culture in the region. “Being certified is part of Agrana’s DNA; certifications are not difficult to obtain once the company is used to performing with best practices,” Baader said. w w w. a g r a n a . c o m / e n / a g r a n a - g ro u p
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Argana’s presence worldwide: red for production, dotted where Agrana fruits are sold
Presence abroad Agrana Fruit Mexico mainly exports to the U.S. and Canada, as well as to Central America and Caribbean islands. The division’s southern territorial limit is Colombia. Territories such as Peru and Ecuador are being evaluated as to which of Agrana’s companies should supply the brands’ products; options include the corporation’s affiliate in Mexico, Argentina or Brazil, depending on trade conditions and treaties between these countries. “We have a strategic location that favors strawberry exports from Mexico to the U.S. If we were stateside, it wouldn’t be that profitable,” the executive said. Fruit for export... and talent as well Agrana Fruit Mexico invests in its HR department to aid in its evaluation of future hires, career development and training programs for its existing staff. This has become a fruitful exercise for the Mexican affiliate, as it has exported ten talented Mexican professionals that currently hold high management, operational and financial positions for the company’s locations in Brazil, Fidji and in the U.S., among other countries. The company’s talent detection process begins early in a staff member’s career. Selected candidates attend one of two Guadalajara colleges for further management or technical training: either Panamerican University’s IPADE business management school, or the city’s
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Management Formation and Improvement Center (ICAMI) location. “Exporting talent from Mexico to other Agrana locations is a result of a structured plan of development and replacement. Mexico has set the example among Agrana affiliates globally,” Baader said.
Agrana Fruit Mexico creates different
Agrana’s social footprint The company’s growth is an inclusive venture, gathering farmers into a business model that benefits communities. The frame of this model is passed on to its suppliers. Every 2.5 acres of strawberry fields demands the work of 50 persons three days a
product varieties that have become a proven success for the company’s clients
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Agrana Fruit Mexico, from field to cup
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week. The employees working the fields are hired from the Zamora and Jacona areas, as well as surrounding towns and villages. After a hard workday, they return home to their families, but they never have to leave their community for work. This business model is reliable, confident and the best social oriented option, very different to other options where low cost workers are moved massively from one region to the other during different crop seasons. Also, 2015 was the year Agrana became the main supplier of fruit-based health food for the Mexican youth benefitted by the National System for Integral Family Development (DIF). Expectations up to 2020 Agrana Fruit Mexico’s set goals answer to a fiveyear development plan, aligned with Agrana Holding’s planned development for the entire corporation for 2020. The Mexican affiliate directed by Baader has already exceeded original growth expectations. Baader is currently developing new business endeavors and setting higher challenges into the five-year plan. The annual growth rate has remained at a steady 10 percent growth, a figure that seems likely to be repeated during 2016.
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Company Information NAME
Agrana Fruit Mexico INDUSTRY
Fruit production (from crops to finished products), fruit based products HEADQUARTERS
Jacona, Michoacán, México FOUNDED
2004 EMPLOYEES
800 REVENUE
US $300 million WEBSITE www.agrana.com/en/agrana-group
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