Colombian Protectionism


A Juan Valdez

When you have ice-cream, of course you also get coffee. It’s one of the two things that are most commonly available here (I am sorry, but it’s predictable, isn’t it?). Entry barrier in this country tends to be high. So, like the ice-cream retail industry, the coffee sector also suffers from a similar destiny. The local coffee brands (that have both coffee shops and coffee products for sale) like Juan Valdez and Oma are so successful that Starbucks just hasn’t been able to set foot here (which can be a nice change sometimes, not to be constantly reminded of America’s influence by the green capitalistic symbol whichever city you visit)..

Actually, even if Starbucks did manage to enter Colombia, it wouldn’t be able to survive anyway because a cup of Juan Valdez is much better than its American competitor, with better coffee (what beats a Colombian?), less diluted by milk, and costs at least a third less. Apart from your standard hot, cold and frappe options, you also have the fancy coffee drinks with baileys, Irish whisky or amaretto (and we’re talking about real liquor, not syrup!)!
Or maybe the American has chosen to be rational (according to Warren Buffet, being rational was the sole contributor of his success) and not to operate in a loss market? Juan Valdez lost COP 1,560M, or US$880K in the first half of 2012..
Profitable or not, most market participants face the same problem of a close market. I haven’t seen the familiar names like Cadbury or McVitie’s (although you still have your standard confectionary like Kit Kat). Admittedly, American groups tend to be more successful than their European counterparts, most likely because of the vicinity factor.. Hershey’s Kisses and M&Ms are easy to find.. Nestle brands, coming from one of the biggest FMCG companies, are also prominent.. I guess it’s a good opportunity to be adventurous to try unfamiliar brands of chicken stock, crackers and chocolate powder..
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2 comments

  1. […] sorry if I have disappointed those who thought this was going to be an article about coffee.. The colour is not really your regular Fanta. It has an alluring glow-in-the-dark. How it managed […]

  2. good idea to write about other products also & if they have good quality…keep sharing the wisdom hermosita

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