Business Principles, Tools, and Techniques in Participating in Various Types...
TCI 2014 Shared value creation in the Coffee Industry of Minas Gerais
1. Shared value creation in the Coffee Industry of Minas
Gerais
Carlos Tarrason Collado
Parallel 1.1 Common problems, common markets and shared value
creation
11 November 2014
2. 17th TCI Conference
Session 1B: Common problems, common markets
and shared value creation
Shared value creation in the Coffee Industry of
Minas Gerais (MG), Brazil
11th November 2014
Monterrey, Mexico
3. What is Shared Value?
Competitive advantage CSR
Shared Value
Bottom of the Pyramid
Inclusive business models
Local Economic Development Integrated and sustainable
12. Minas Gerais today
2014
Industry
Development
2005 2010 2014
Multinationals
Regional
Specialty
2000
13. How to help MG
>400 industries to
compete against
strong
multinationals
and
the concentration
of distribution
channels
1200
10
65%
2014
Nestlé
Smuckers
Strauss
43,5%
market
15. 1. Understand business segments
PRODUCT EXPERIÊNCE
2nd WAVE
3ª WAVE
1st WAVE
QUANTITY QUALITY
• Fresh
• Industrial
• Gourmet chanel
• Drink
• Certifications /
Country
• Ultra fresh
• Semi artesanal/ art.
• Gastronomy.
• Experience.
• Origin (story of the producer)
• Not fresh
• Economies scale
• Masive distribution
• Product
• Brand
16. Which segment is better for MG cluster?
PRODUCT EXPERIENCE
1st WAVE 2nd WAVE 3rd WAVE
Fragmented business
with micro, small a
medium companies
We went to see where 2nd and 3rd Wave business
models are expanding.
Business
dominated by
multinational
companies
Competition
among
Medium and
large
companies
17. World Reference in new trends
and business models
United States of
America (US$)
50% comom
coffee
Seattle, Portland,
São Francisco
50% specialty
coffee
Specialty
Coffee Meca
18. Example 2nd Wave Specialty coffee
small lots
fresh grains
superior quality
A new type of coffe
New generation of foodies and roasters
1966
Food Service
franchised
Growing strategically
Own
coffee shops
Differenciated Institutional
supermarkets
19. With a good number of coffee shops and
good quality
CA
180
3
Fonte: www.peets.com
2
5
7
18
8
4
21. Company improving quality day to
day with focus on freshness
Fresh product made in the day by order,
“small” lots, by hand
Recognition of the quality on the price
22. Portland, Oregon
Example 3rd Wave Specialty coffee
Sell specialty coffee with >86
points to >1000 coffee
shops, restaurants and shops
at the highest price of the
market!
Do they really sell coffee
or someting else?
Adam Maclellan
23. Build a brand = Identity
Mainly with own coffee shops and selected
points of sale
9 own
cafeterias
Portland
Seattle
Los Angeles
New York
1000
selected
cafeterias
Some high
end
restaurants
NY
SF
Gourmet
natural
fresh
shops and
supermarkets
24. Identity: Show room + business
PORTLAND DIVISION BELMONT DOWNTOWN STARK THE ANNEX
SEATTLE PINE 12TH
NEW YORK
W. 29TH
W. 8TH
LOS ANGELES
S. SANTA FE
30. 3rd Wave strategies
Specialized
Service
Service
Marca
Branca
Identity
+
+
Quality
Identity
Service
Quality Identity
31. 3rd Wave = Higher value with the
participation of all the value chain
actors = Shared Value
Producer Industry Distribution
Quality
Identity
Service
Quality
Identity
Delivers
the
experience
Strategy (Greek "στρατηγία"—stratēgia, "art of troop leader; office of general, command, generalship"[1]) is a high level plan to achieve one or more goals under conditions of uncertainty.
Alexander the Great - Often called the greatest military commander in history, Alexander expanded the Greek empire to its greatest size, never losing a battle.
Main question of the presentation
How to develop a cluster strategy? Thinking in the majority of the companies of the cluster and the current situtation of the cluster
And a company strategy? Thinking in the conditions of the company
All the companies have to follow the cluster strategy?
The support institutions will follow the cluster strategy
1. In 2012 the Minas Gerais association of bakers hired us to develop a strategy for the 1100 bakeries of the city of Belo Horizonte.
2. Around 300 bakeries were closing down because of poor results
3. In part due to competition from supermarkets, since 90s, and new consumer behaviour.
4. The most of the bakeries were saling own made fresh bread and some grocery products
5. There were some differentiated bakeries in the wealthy part of the city (special breads and products)
Define the business as an industry, sector, … but with a clear definition
Define the business segments using demand requirements, and differences in value chain
Analize atractiveness and choose one segment
Define strategies for the chosen segment and choose the best for the cluster
Strategy (Greek "στρατηγία"—stratēgia, "art of troop leader; office of general, command, generalship"[1]) is a high level plan to achieve one or more goals under conditions of uncertainty.
Alexander the Great - Often called the greatest military commander in history, Alexander expanded the Greek empire to its greatest size, never losing a battle.
Segmento é um grupo de clientes (empresas ou pessoas) que possui as mesmas demandas (necessidades ou problemas), e que tem critérios de compra definidos.
Um segmento de negocio é determinado pelas necessidades e demandas dos clientes.
As empresas decidem em que segmentos vão concorrer.
As empresas que estão em um mesmo segmento procuram os mesmos clientes.
Segmento é um grupo de clientes (empresas ou pessoas) que possui as mesmas demandas (necessidades ou problemas), e que tem critérios de compra definidos.
Um segmento de negocio é determinado pelas necessidades e demandas dos clientes.
As empresas decidem em que segmentos vão concorrer.
As empresas que estão em um mesmo segmento procuram os mesmos clientes.
LONG LIFE
Longa vida do produto.
Produção em massa com economias de escala.
Maior abrangência geográfica.
Vendas principalmente de empresa a empresa (B2B).
SHORT LIVE
Vida curta do produto (1 dia)
Produção produto principio a fim.
Economia de escala menos importante.
Raio geográfico de distribuição limitado (1 hora).