Students: Sebastian Sandoval, Santiago González, Brajhan Rueda

The 9 capabilities of Colombina S.A

Colombina is a Colombian company created in the 1930s by Hernando Caicedo, with

almost 9 decades in the food sector and with more than 45 years in the international market,
is today one of the largest companies in Colombia and is the leading company in
confectionery exports in the country, with international plants and in different cities of
Colombia. Exporting its products to more than 80 countries in the Americas, Africa, Asia
and Europe. Today it participates actively in different categories with a wide range of
foods, it has been consolidated as an international company of food dedicated to the
manufacture and commercialization of these.

Colombina S.A. has a high potential to carry out FDI and it can be evidenced that it meets
the 9 capabilities proposed by Liu Huifang in The Competitive Force of FDI and its
Elements. For starters, it has a monetary strong capability represented on their investments
and financial statements, which he has led over time to make different business activities
both nationally and internationally. Regarding the most significant investments that
Colombina SA has had, the one of 2014 stands out to expand its installed capacity of
sweets and cookies, to which it allocated COP $ 250,000 million, tripling the average
investment of the last five years, these investments were aimed primarily at acquiring
startups and accessing new consumer groups.

In the financial field, has maintained the Fitch AAA rating and its investment in the last 10
years in fixed assets and acquisitions was US $ 493 million. An analysis of the financial
statements presented by the company for the first half of 2019 shows that consolidated net
income grew 7.4% annually and amounted to COP $ 895,766 million. The net income was
COP $ 23,026,000 and exceeded 48% for the same period of 2018 as given by the Revista
Dinero.

The technical capacity of the company can be evidenced by the fact that it has more than
500 trademarks requested and registered in Colombia and abroad. The company's policy is
to register the brands of all new products that go out to the domestic and foreign markets in
order to maintain ownership of the registry and renew the brands of the products that are
still marketed. On the other hand, in 2012 the company focused its growth strategy on
Research, Development and Innovation. In this way, it strengthened its differentiation in
the market and expanded its global presence by applying the learnings of this strategy, thus
structuring an innovation guidance committee for the company.

The company talent capability is a fundamental pillar and link key in the competitive
advantages over domestic and international market. For this reason, it seeks to maintain a
balance between the growth of the company and that of its employees, through job
opportunities, stability, growth in skills management and an excellent organizational
climate, also It has a Corporate Development Plan, which seeks to provide employees with
a series of actions aimed at ensuring greater alignment with their position and, therefore,
help raise their profile with technical training routes and managerial skills programs for
leaders.

The company holds their information capability with a monthly meeting where sales
managers, marketing manager and logistics staff attend to define next month's plans, even
the next 3 months are planned, at the same time, another meeting is held at the plant where
information is given to its employees of dates, shifts, procedures to follow and other aspects
that are important for optimal production and meet customer requirements.
In the matter of dispatches, the distribution centers are multifunctional, all logistic
processes such as package, product separation, exports, maquilas and platforms are
handled. Colombina has the demand management department in which it gives the
instructions to the plant so that the ideas raised are executed as planned and respond to
customer needs.

Now talking about the product and service capability of Colombina it can be said that it has
between 50 and 60 brands from which some leave and others enter depending on their
performance in the market. Most sales are made with 15 brands and the candy store
represents 40% of these. In the confectionery sector there is a great fidelity for the brands
since the consumer wants the brands with which he grew up and Colombina has a great
tradition in the market. Throughout the entire value chain, it works to guarantee the quality
and safety of its products, training the human team and developing preventive actions to
minimize variations in production, storage, and distribution processes. The plants have the
highest standards of quality, safety, food safety, environmental protection and physical
security that guarantee that the products are suitable and safe for consumption.

The strain capability of the company consists in facing the growing tendency of both
government and consumers to have a healthy and balanced diet represents a latent risk for
Colombina at the international and local regulatory level. The FDA in the United States has
promoted a better dissemination of nutritional content in packaged products in recent years,
emphasizing the amount of sugar in grams and the equivalent calories in product
packaging, similar actions are expected in the countries of the American and European
continent.
For this reason, the 100% Colombina product portfolio, are manufactured products free of
dyes, flavorings, without added sugar and with nutritional benefits and represents the way
to adapt to the market to combat these possible threats.

The company has a Board of Directors composed of seven main members, elected for a
period of one year, by the General Assembly of Shareholders and has a high degree of
formality, since it has identified, documented and disclosed its plans, its mission , its vision,
its goals and your policies. The organization has a matrix structure divided into Strategic
Business Units and Support and Service Units, with this approach aims to achieve
permanent synergy among work teams, this constitutes their management capability.

In line with its local fusion capability, Colombina acquired the assets of Fiesta SA, one of
the leading confectionery companies in Spain that has a great track record, solid brands and
a great recognition for the quality and taste of its products. With this operation, Colombina
strengthens its presence in the Spanish confectionery market, where Fiesta has an excellent
distribution network. Spain undoubtedly constitutes a strategic market for Colombina and
this acquisition becomes a platform to expand its positioning in that country, in turn allows
it to develop the markets of Europe and Africa.

A great example of the risking bearing capability for the company is that is constantly
exposed to the implicit risk that runs in each of the 80 international markets in which it has
a presence. A clear example is what has been happening in Venezuela, a market that
became one of its main export locations. There, year by year, sales are decreasing (68%
decrease compared to 2014) and the probability of non-payment of customers. To mitigate
this risk, Colombina has zero credit sales policies with its Venezuelan clients, and
merchandise is only dispatched once the payment has been received.

References

https://www.colombina.com/corporativo/acerca.php#valorescorporativos
https://www.colombina.com/config/img/files/25784.pdf
https://www.colombina.com/config/img/files/25808.pdf
https://repository.cesa.edu.co/bitstream/handle/10726/854/TG00668?
sequence=2&isAllowed=y
http://www.bvc.com.co/recursos/emisores/especiales/2007/Subastas2007/ColombinaSubast
aMarzo2007/Prospecto_Colombina.pdf
https://repository.usta.edu.co/bitstream/handle/11634/12658/2018paolabernal.pdf?
sequence=1&isAllowed=y
https://www.colombina.com/config/img/files/25748.pdf
https://repository.eafit.edu.co/bitstream/handle/10784/11931/FredyHugo_EchavarriaBarona
_HectorArley_PatinoRevelo_2017.pdf?sequence=2&isAllowed=y
https://scioteca.caf.com/bitstream/handle/123456789/1067/Folleto%20CAF%20-%20Caso
%20Colombina%20Innovación%20Empresarial%20final.pdf?sequence=1&isAllowed=y