1

Santander and its Exports: Analysis and Description of Factors Influencing the Low
Participation of Santander Companies in International Trade Activities

LEVIATHAN TEAM:

Jaider R. Triana, Daniel A. Durán, Yeiny Galvis,

Paula A. Manrique and Andrea C. Manrique.

Universidad Pontificia Bolivariana

Research Methodology

Ph.D. Andrés Acevedo Ojeda

2022
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TABLE OF CONTENTS

Introduction......................................................................................................................................4
Research Problem and Question......................................................................................................4
Problem................................................................................................................................4
Question...............................................................................................................................4
Research Hypothesis........................................................................................................................5
Research Objectives.........................................................................................................................5
General objective.................................................................................................................5
Specific objectives...............................................................................................................5
Justification......................................................................................................................................5
Theorical Framework.......................................................................................................................6
Concepts..........................................................................................................................................6
Modalities of exports.......................................................................................................................7
Definitive Export.................................................................................................................7
Temporary export for outward processing...........................................................................7
Temporary export for re-importation in the same state.......................................................7
Re-exportation......................................................................................................................7
Export of postal traffic and express shipments....................................................................8
Export of samples without commercial value......................................................................8
Temporary exports made by travelers..................................................................................8
Reshipment..........................................................................................................................8
Export of Household Goods.................................................................................................8
Types of exports..............................................................................................................................8
1) Indirect export..................................................................................................................8
2) Direct export....................................................................................................................9
3) Concerted export............................................................................................................10
4) Definitive export............................................................................................................10
5) Temporary export..........................................................................................................10
Literature Review..........................................................................................................................11
General Type of Research.............................................................................................................13
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Discovering Ideas About the Problem...............................................................................13

Providing Information and Understanding........................................................................13
Define the Problem more Precisely...................................................................................13
Type of Research According to its Purpose..................................................................................13
Theoretical Research..........................................................................................................13
Applied research................................................................................................................14
Type of Research According to the Type of Data Used................................................................14
Quantitative aspects...........................................................................................................14
Qualitative aspects.............................................................................................................14
Types of Information Sources.......................................................................................................14
Primary sources..................................................................................................................14
Secondary sources..............................................................................................................15
Definition of Information Required...............................................................................................15
Who has the necessary information?.................................................................................15
What information should (needs) to be collected?............................................................15
When should the information be collected?.......................................................................16
Where should the information be collected?.....................................................................16
Why (what for) should the information be collected?.......................................................16
How should the information be collected?........................................................................16
Methods for Data Collection..............................................................................................16
Population and Target Population Definition................................................................................16
General Population.............................................................................................................16
Target population...............................................................................................................16
Census............................................................................................................................................17
Sampling Technique......................................................................................................................17
Sample...........................................................................................................................................17
Sample frame.....................................................................................................................17
Sample Size........................................................................................................................18
Data Collection..............................................................................................................................18
Bibliographic References...............................................................................................................18
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Introduction
International trade allows Santander companies and individuals to offer their products
and services to a global market. This can increase sales and profits in terms of creating new
markets or expanding existing ones and can also provide the opportunity to obtain an important
part of the world market, as well as reduce the impact of imported products entering the country.

Santander's economy grew 9.5% in 2022. This positive variation in Santander's GDP
consolidated the region as the fourth largest economy in the country, with an aggregate value of
$74 billion. (Vanguardia, 2022)

Research Problem and Question

Problem: Although Santander is the fourth largest economy in the country, obtaining an
aggregate value in products of US$74 billion in 2021, its level of exports is low; ranking number
ten in export value by region in the same year (US$334 million while the first position of the
ranking had US$2616 million).

As possible causes we can observe the low knowledge of Santander businessmen to

internationalize, also the fear to expand; in addition, according to Remolina (2022), Executive
Director of ProSantander, “the great challenge is the diversification and sophistication of the
business fabric to improve internationalization”.

In order to provide valuable information for those interested in working to improve the situation,
we consider it necessary to question ourselves about these causes, identifying and describing
them in order to have a more experienced knowledge of the entrepreneurial ecosystem in this
area.

Question: Why Santander companies do not tend to engage in international commerce,

even though Santander is the fourth largest economy in Colombia?
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Research Hypothesis
The companies in Santander have not fully explored their export potential, largely
because incentives (State subsidies, information programs, etc.) to do so have been low, as a
result of demanding requirements for domestic production, poor infrastructure, costly logistical
services, inexperience in international operations, and a lack of knowledge of international trade.

Research Objectives

General objective
To analyze the reasons why Santander companies, tend not to engage in international commerce,
despite being the fourth largest economy in Colombia.

Specific objectives
a. To explore the relationship between the low participation of Santander companies and the GDP
(fourth largest economy in Colombia).
b. To describe the deficiencies that arise in the business environment when choosing to embark on
the path of internationalization.
c. To identify the reasons for the low participation of Santander companies in international
commerce.

Justification
It is important to carry out this research about the problem that is being presented in the
companies of Santander about the low participation in foreign trade issues by these, since a study
was conducted according to the DANE and Santander ranks fourth in Colombia's economies by
region.

As for the benefits of this research we have: A deeper knowledge of what is happening in
our region, which will allow us to analyze and define whether these factors identified as
influencing the internationalization trend really impede greater participation in foreign trade.
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The research will help to solve the problem of what we should do to increase Santander’s
level of exports and internationalization and thus be able to take advantage of the opportunity for
these companies to internationalize.

Theorical Framework
Concepts
Exporting is selling goods or services produced or generated in one country to buyers abroad.
Importing is the opposite, buying in a country goods or services produced and sold by a different
country (Unidad Editorial Información Económica S.L, 2022).

According to Legiscomex Databases (2022), the module Ranking allows to know how is in
general the behavior of imports and exports of a country or sector, since management reports will
be obtained, either general or specific, since it can compare different periods of time or analyze a
specific period to identify behaviors, trends such as products that are traded, the main trading
partner countries, trade values, the participation of each product in the market, etc.

The agricultural sector is one of the oldest and most important sectors in the economy. In the
rural world, the agricultural sector includes those activities that, in a certain way, are the main
economic engine of that territory. Because we are talking about livestock and agriculture, it is
precisely these rural environments that develop the most agricultural activity.

The internationalization of companies is the process by which companies enter foreign markets
to sell their products or services. Because of the ease with which people communicate and move
money around, the world has become smaller and smaller (Equipo Ekon, 2022).

International trade is a global concept that incorporates imports and exports of products and
services worldwide (Antonio Ceballos, 2022).

Why is it important to export? As stated by Martino Blancas (2022) to answer this, it should be
noted that Export is the set of eminently economic (commercial) activities of a country and is
characterized as the sale of goods or services to markets outside the borders of the producing
country.
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Within the economic concepts, foreign trade is the exchange of goods and services between
countries, being the opportunity to: sell in markets where, due to some comparative advantage,
they are preferred and demanded. Sell surpluses that the national market cannot buy or surplus.

The effects generated at the macroeconomic level are as follows:

- Obtain foreign currency (reserves) / means of payment that serves to acquire imported
goods.
- Generate employment by strengthening, growing, or sustaining such activities.
- Improve the income of exporting units
- Although to a lesser extent, generate higher tax revenues

Modalities of exports

Through a technical note prepared by Asturias Corporación Universitaria (2021), we were able to
know the following definitions:

Definitive Export
This modality regulates the exit of national or nationalized goods from the national customs
territory, destined for another country or an industrial free zone for goods and services, for their
definitive use or consumption.

Temporary export for outward processing

This is a customs regime that allows the temporary export of goods with suspension of payment
of customs duties and taxes. This, to be subjected to some transformation, processing, or repair
for subsequent reimportation.

Temporary export for re-importation in the same state

Is the regime that allows the exit of national or nationalized goods from the customs territory
with the purpose of re-importing them in a determined period, without having undergone any
modification, except for normal deterioration due to their use.

Re-exportation
Is the export of foreign goods in the same state in which they were previously imported.
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Export of postal traffic and express shipments

Shipments leaving the National Territory through the official express mail network may be
exported under this modality, if they do not exceed USD 5,000 and require prompt delivery to
the addressee.

Export of samples without commercial value

Those goods declared as such, whose total FOB value does not exceed the amount indicated by
the National Tax and Customs Directorate by means of a resolution.

Temporary exports made by travelers

This type of export shall apply to national or nationalized goods carried by travelers who leave
the country and, upon their return, wish to re-import them in the same state, without payment of
taxes.

Reshipment
Consists of sending foreign goods stored in bonded warehouses or private warehouses set up for
this purpose to other customs offices in the country or to other customs offices outside the
national customs territory.

Export of Household Goods

This type of export is for the household goods of residents in the country who leave the national
customs territory to establish their residence abroad. For such a purpose, they must file a request
for shipment authorization and the corresponding declaration, in the manner provided for in this
decree for definitive export, as a single shipment with definitive data.

The export of the household goods may also be carried out by whoever proves to be heir, legatee,
representative of the heirs, liquidator of the succession, in case of death of a resident in the
country.

The request for authorization of shipment must be signed and presented by the owner of the
household goods or the person duly authorized by him, in the form and conditions established by
the Special Administrative Unit of the National Tax and Customs Directorate-DIAN.
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Types of exports based on definitions given by Klawter (2022).

1) Indirect export
With this the exporting company uses the services of intermediaries, usually installed in the local
market itself, who are the ones who carry out the export.

This is a passive export. The exporting company limits itself to accepting or rejecting the price
proposed by the occasional buyers, who oversee the export operations and the marketing-mix
policy is determined by the intermediary. The company only makes the agreed modifications to
the product.

As advantages we can highlight that it is a very simple and economical way of exporting. As a
disadvantage, the absolute loss of control over the commercial strategy and the choice of
destination markets.

The most common intermediaries in this modality are usually the following:

- Foreign buyer: Purchasing department of a foreign company.

- Broker: Intermediary that puts buyer and seller in contact in exchange for a commission.
- Independent agent: A commission agent who maintains a more permanent relationship
with the company.
- Trading company: Multinational company specialized in import and export operations.}

2) Direct export
The exporting company contacts intermediaries or buyers abroad and takes direct charge of the
export.

This is an active export: the company itself seeks contacts abroad, manages the documentation,
physical distribution and the establishment of pricing and branding policies. It involves a higher
level of commitment of resources than indirect exporting, but it also achieves a substantial
improvement in the control of operations.

This can be carried out through four very different entry modes:

- Export through intermediaries.

- Internet sales.
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- Direct sales through the company's own personnel.

- Establishment of a commercial subsidiary.

The advantages over indirect exporting are greater control over exports and much better
feedback on the market, so that experience and knowledge are acquired. On the other hand, the
disadvantage is greater investment and risk, together with less flexibility.

3) Concerted export
It involves the collaboration of the exporting company with other manufacturers. It includes
several very different entry modes that always involve the collaboration of the exporting
company with the help of one or more manufacturers.

They are categorized into:

- Piggyback or kangaroo export: The exporting company distributes its products abroad
through the distribution channels or subsidiaries of another company already established
in the market.
- The export consortium: Local companies in competition or with complementary product
lines cooperate to carry out a common export.
- The commercial joint venture: This is a venture created by two or more companies to
market a product.

4) Definitive export
Within this category, the merchandise sent to the international market will be consumed in that
market. Therefore, this merchandise will not return to the country of origin or go to another
country, unless it is damaged or does not comply with the conditions of the sales contract and
customs rules.

5) Temporary export
Goods are sent to a certain destination and must remain there for a certain period of time,
according to customs conditions, before being sent to the market where they were nationalized.
This is usual for vehicles, heavy machinery and even oil, when there is no qualified personnel in
the company or in the location where the company is located to carry out this task.

As we have seen, there are different ways to sell our products abroad, without exporting. This is
done through destination manufacturing.
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Destination manufacturing consists of manufacturing the product or providing the service in the
country where it is to be marketed. This involves transferring resources, technologies and know-
how. Doing this is intended to exploit distinctive capabilities abroad.

There are two possibilities:

- Internally: This is carried out by the company itself. This is done through a production
subsidiary of the company at the destination, or through a manufacturing joint venture.
- By transferring the operation of the business: Some of these forms are well known, such
as franchising, manufacturing licenses or manufacturing contracts.

Literature Review

This collection of articles, studies, data and reports has allowed us to broaden our vision
of the environment, create new hypotheses, clarify ideas and optimally define our research:

Through the history of Colombia, we have seen a lot of obstacles to the

internationalization of companies, starting with the fact that, Colombia was for a long time a
protectionist country (María Lacouture, 2021); that protectionist consequently created an ideal
environment where companies felt that they didn’t need to reach other markets because of the
comfort zone, companies had to supply the local demand cause the politics didn’t let foreign
companies to start business here easily, so the local companies were in a pleasant place of
privilege where they didn’t need to think about go to another country, to export or
internationalization in general.

When the time passed this politics changed the businessman mindset, so the new mindset was to
supply the local demand and nothing else, and the sequels didn’t wait since the fact that
businessman cultural mindset was all about supplying local demand.

When Colombia started to think about the international market and opened its economy, it was
kind of late, because the mindset in businessman was already clear, just supplying local markets
was enough for them, the fact that businessman doesn’t want to go outside of his own box is now
a big problem when we talk about trying to be a more international economy.
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Nowadays Colombia has been working in a lot of programs to improve the internationalization
of companies and many authors have talked about it, trying to discover the real reasons, and
creating new knowledge to apport something that can help in his resolution, it’s not a big deal
know why this trend continues being a big problem for Colombian economy, but its key to check
previous info about it.

Santander for example it’s one of the most curious cases, because if we go exclusively to
check the data, we could say that Santander it’s going to be one of the most important
departments in exports or internalized companies, but in the reality is all the contrary, compared
with other departments Santander’s level of non-exporting culture seems more notorious and
stronger, having in mind it’s the fourth most important economy in the country (Global Plan
Santander, 2021), it doesn’t look very reasonable just to be in the top 10 of level of exportations
and out of the top 10 in previous years. In some ways, it could seem that the causes of the
problems that are present at the national level are increasing in the department of Santander and
its industry.

We have found that in one of the other previous investigations a methodology is proposed
and used, which according to its own authors "measures the total protection caused by the tariff
and non-tariff measures by comparing the evolution of the domestic price indexes of Colombian
manufactures with that of the price indexes of the industrial exports of the main exporting
countries of the world” (Garcia, Lopez, Montes, 2020).

The comparison of our previous knowledge on the subject with the research and
conclusions of other authors has generated important coincidences to establish a roadmap for our
research. These other authors have dealt with the subject from a more national and historical
analysis, contributing new possible causes to the problem, mentioning some main ones such as
the lack of incentives, the consequences of a highly protectionist past and some others that we
had not foreseen in our hypotheses. Undoubtedly, these resources translate into a great starting
point to deepen the investigation in the department of Santander specifically and more centrally,
where it could be that the determinant aspects at national level somehow increase, deriving in
turn from other related causes working in conjunction with available and achievable statistics to
obtain the most complete picture of the situation.
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General Type of Research

The general type of our research is descriptive, since we seek to determine, describe, or identify
the nature of our research problem; for this we will consider the following concepts.

Discovering Ideas About the Problem

What we mainly want with this research design is to discover the root of our problem, which is,
why Santander feel the fourth best economy in the country, its level of internationalization is so
low, and why we mention this, well, it is due to the analysis we have made of Santander's exports
where we carefully observed that its level of exports is very low compared to the economic
positioning it has, being one of the most important economies in our country.

Providing Information and Understanding

To obtain this information we will make use of quantitative and qualitative aspects, where the
quantitative ones will help us to observe the level of participation of Santander companies, how
many entrepreneurs are currently exporting, export volumes and the total value of Santander
exports; and for the qualitative ones we observe through aspects, such as what are the factors that
influence the participation of Santander entrepreneurs in exports, how inexperience influences
exports.

Define the Problem more Precisely

With the help of the aspects mentioned above, we will be able to make a more concise and clear
definition of our problem, since it will be observed and determined what is happening in our
department, regarding internationalization.

Type of Research According to its Purpose

To determine this, we must clearly know the differences between the type of theoretical and
applied research.

Theoretical Research
Theoretical research is used to generate knowledge, as well as to formulate theories. It is
conducted with the objective of collecting information on any topic, and to increase our
understanding of it. The knowledge thus collected is not used for something concrete, since the
important thing about this type of research is, precisely, to expand knowledge (Mayte Ayala,
2020)
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Applied research
Applied research is used to find strategies to address a problem, improve processes or systems; it
also allows us to measure variables to predict behaviors.
Applied research has a very close relationship with basic research, since it depends on the
discoveries of the latter and is enriched by such discoveries. (Daniela Rodríguez, 2020)
For our project, applied research will be used, because it will allow us to give an answer to our
research problem and thus to know the reason for this difficulty. We can also see that the
objective of applied research is to predict, a specific behavior in a defined situation and that is
what we are looking for with our research project.

Type of Research According to the Type of Data Used

Quantitative aspects

- Level of participation of Santander companies.

- How many entrepreneurs are currently exporting.
- Volume of exports.
- Total value of Santander's exports.
- How long entrepreneurs have been exporting.

Qualitative aspects

- What is the factor that influences the participation of Santander entrepreneurs in exports.
- In which department are the entrepreneurs with the highest exports currently registered.
- How inexperience influences exports.

Types of Information Sources

Primary sources
Interview with the director of global plan Santander.
Level of participation of Santander companies
- How many entrepreneurs are currently exporting.
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- Volume of exports.
- Total value of Santander exports.
- How long entrepreneurs have been exporting.
- What is the factor that influences the participation of Santander entrepreneurs in exports.
- In which department are the entrepreneurs with the highest exports currently registered.
- How does inexperience influence exports.

Secondary sources
Repositories, news, official pages, reports, articles.
- Annual participation of Santander companies in exports.
- Santander's place in the GDP.
- How Santander is doing in exports.
- What Santander exports most.
- What products/services Santander is strong in.

Definition of Information Required

Who has the necessary information?

- Marco Andrés Vásquez Méndez, director of Global Plan Santander.
- Bucaramanga Chamber of Commerce.

What information should (needs) to be collected?

The participation of exporting companies since this is one of the structural problems for the
internationalization of the Colombian economy.
1- What factors do you think prevent entrepreneurs from exporting?
2- Do you consider that programs or incentives are needed to promote the exporting spirit of
SMEs?
3- How is Santander currently doing in terms of exports, do you consider that the
department is on the right track to achieve greater internationalization?
4- What do you consider to be the success factors of Santander's exports, do you think we
should focus on these exports or should we diversify more?
5- What do you think are the major obstacles that businessman face when they want to
export?
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When should the information be collected?

At the end of October, beginning of November 2022.

Where should the information be collected?

Primary Sources:
Interviews to the director of Global Plan Santander Marco Andrés Vásquez and to our
businessmen base.
Secondary Sources:
Repositories, news, official pages, reports, articles.

Why (what for) should the information be collected?

To get to the bottom of the problem and try to identify the reasons for low exports in Santander.

How should the information be collected?

Through interviews with entrepreneurs, Global Plan Santander’s director Marco Andrés
Vásquez.

Methods for Data Collection

- Interviews with the director of Global Plan Santander Marco Andrés Vásquez.
- Sampling through the data given in the interview.

Population and Target Population Definition

General Population
Entrepreneurs from Santander who have experience in the domestic market and wish to expand
their business to the international market.

Target population
Entrepreneurs from Santander that are registered with the chamber of commerce and have
experience in the national market for at least 5 years and that they have international commerce
experience.
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Census
In our project we will use sampling, since we will select a group of people, in this case some
businessmen from Santander who are registered in the chamber of commerce, in order to know
more about our hypothesis "is there a low participation of Santander in exportation and
internationalization?” and what would be the factors that could be affecting this problem.

Sampling Technique
Probabilistic sampling: We will select some businessmen from Santander registered in the
chamber of commerce in a random way, without considering, place of origin, size of the
company, product/service to be exported, etc. To avoid bias in our research.

Sample

Sample frame
Entrepreneurs from Santander who have experience in the domestic market and wish to expand
their business to the international market.

- List of the elements that are part of the target population in our research:

1. Sanchez hardware and blacksmith shop - 3187116259

2. Alicia Wonderland - 3176753777

3. Martina - 3153518454

4. Bohor - 3012951439

5. Gogo makeup - 3172785281

6. Margo Col - 3015558145

7. Skarcha boutique - 3507322336

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Sample Size
Our sample size will be 5 Organizations.

Data Collection
Through interviews, data and figures provided by the director of Global Plan Santander (Marco
Andrés Vásquez) and the businessmen.

Bibliographic References

 Vanguardia. (2020). Economía santandereana creció 9,5% en el 2021, revela el Dane.

https://www.vanguardia.com/economia/local/economia-santandereana-crecio-95-en-el-

2021-revela-el-dane-YC5370760

 Alguero, M. (2020). Santander importa más de lo que exporta: tiene un déficit en su

balanza comercial de US$67,211 millones.

https://www.vanguardia.com/economia/local/santander-importa-mas-de-lo-que-exporta-

tiene-un-deficit-en-su-balanza-comercial-de-us-67211-millones-KY4771581

 Unidad Editorial Información Económica S.L. (2022). ¿Qué significa exportar o

importar? https://www.expansion.com/economia-para-todos/economia/que-significa-

exportar-o-importar.html

 Legiscomex. (2022). Ranking de Importaciones y Exportaciones.

https://www.legiscomex.com/ranking-de-importaciones-y-exportaciones

 Blancas, M. (2022). ¿Por qué es importante que un país exporte?

https://radiomotul.com.mx/por-que-es-importante-que-un-pais-exporte/
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 Asturias Corporación Universitaria. (2021). Régimen Aduanero y Modalidades de

Exportación.

https://www.centro-virtual.com/recursos/biblioteca/pdf/comercio_ext_exp/

unidad3_pdf1.pdf

 Klawter. (2022). Tipos de exportación. https://klawter.com/blog/tipos-de-exportacion/

 García, J. Et al. ¿Por qué Colombia no exporta más?

https://investiga.banrep.gov.co/es/be-1139

 Global Plan Santander. (2021). Balance exportaciones santander enero a septiembre de

2021. https://www.camaradirecta.com/temas/documentos%20pdf/Santander_exporta/

GPS_2021/Balance%20GPS%20a%20Septiembre%202021.pdf

 Lacouture, M. (2021). ¿Por qué Colombia no exporta?

https://www.larepublica.co/analisis/maria-claudia-lacouture-402341/por-que-colombia-

no-exporta-3209856

 Ayala, M. (2020). Investigación teórica: características, metodología y ejemplos.

https://www.lifeder.com/investigacion-teorica/

 Rodríguez, D. (2020). Investigación aplicada: características, definición, ejemplos.

https://www.lifeder.com/investigacion-aplicada/

 Alguero, M. (2022). Santander se consolidó como la cuarta economía colombiana, pero

registró su mayor caída en 2020. https://www.vanguardia.com/economia/local/santander-

se-consolido-como-la-cuarta-economia-colombiana-pero-registro-su-mayor-caida-en-

2020-EY5023226
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 Global Plan Santander. (2022). Balance Exportaciones Santander Resultados I Trimestre

2022. https://www.globalplansantander.com/files/CCB-

GPS_BALANCEEXPORTACIONES_JUNIO.pdf

 Pérez, V. (2022). “Podemos aumentar las exportaciones agroindustriales y así seguir

creciendo". https://www.larepublica.co/especiales/una-decada-del-acuerdo/podemos-

aumentar-las-exportaciones-agroindustriales-3362589

 Mendoza, E. & López P. (2004). Consideraciones sobre el desarrollo de la teoría de la

mente (ToM) y del lenguaje. https://dialnet.unirioja.es/descarga/articulo/856428.pdf

 Cámara de Comercio de Bucaramanga. (2021). Comportamiento de las 360 empresas

más grandes de Santander en el 2020.

https://www.camaradirecta.com/temas/documentos%20pdf/informes%20de

%20actualidad/2021/Comportamiento_360_2020.pdf

 Cámara de Comercio de Bucaramanga. (2021). Producto interno bruto (pib)

departamental santander 2020. https://www.camaradirecta.com/temas/documentos

%20pdf/informes%20de%20actualidad/2021/Comportamiento_360_2020.pdf

 Banco de la República. (2015). Régimen de exportación de mercancías e ingreso y salida

de mercancías de y hacia una zona franca. https://www.banrep.gov.co/es/jornadas-

capacitacion-dcin-2015-2

 Ale, P. (2019). Investigación de mercados internacionales para comenzar a exporter.

https://craneandot.com/investigacion-de-mercados-internacionales-para-comenzar-a-

exportar/