Case of Panificadora y Negocios El Molino Srl
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ScribdTranslationsCase of Panificadora y Negocios El Molino Srl
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ScribdTranslationsBAKERY AND BUSINESS 'EL MOLINO SRL'
The Three Musketeers: Bread for everyone and everyone for bread
A TEAM OF PROFESSIONALS, EACH WITH SPECIFIC RESPONSIBILITIES
Alfredo Cárdenas del Carpio formed an association with two friends to start his company.
bakery. Order and planning have been the main strategies that have allowed it to
to remain in the market for 13 years.
The main objective of companies is to obtain profits, however I believe that they also
they fulfill a social role. In our case, we highlight as one of the objectives of our
the company generates work for the well-being of the community.
A studied decision
In 1992 we brought together three people; an industrial engineer, an accountant, and an economist with the
objective of creating a company. Convinced that to start a project it is necessary to know
the environment and the city where it will take place, we did a small study of possibilities. This way we
We realized that there was an unattended captive market in Talara: that of bakeries.
Once the decision was made to create a bakery, we conducted a profile of the required investment.
and thus estimate the total project cost to see our financing possibilities.
The company started its operations on July 4, 1992, in a location on Av. G-55.
Talara. The chosen location for the company was key, as it was a place with a lot of
movement. We thought that the smell of fresh bread would attract people who were moving from a
place to another.
A pleasant surprise
Two weeks after starting our activities, we were met with a surprise. The capacity
installed could not meet the rapidly growing demand. Thus, we rethought our
project and we acquired a furnace with greater capacity. This experience taught us that always
one must have a contingency plan, both in case the project grows and in the case
that it becomes paralyzed.
The internal organization
Since we were not investment partners, the three of us wanted to work in the company. To solve this
The problem, we decided to divide the company into areas, with specific functions and responsibilities.
according to the profession of each partner.
The areas are:
Administration and finance,
Logistics, and
Production and maintenance.
Defining and delimiting the roles of the partners was important to avoid duplication of functions.
that could later create conflicts.
The formality and the distribution
From the beginning, we decided to be formalized and created a Limited Liability Company for that purpose.
Limited. Our business name is Panificadora y Negocios El Molino SRL. Initially, the only
the distribution channel was the local itself, as our production capacity was quickly
based preventing us from implementing another distributive system. However, when we acquired the
oven with greater capacity we were presented with the opportunity to distribute our products to the
wineries throughout the city of Talara. This allowed us to attract customers in the remote areas.
our bakery.
Three keys to starting a business
1. Market study: Unlike most small Peruvian businesses, this one is the
association of three professionals who, before deciding on the field of the new company, carry out a
study that demonstrated the feasibility of opening a new bakery in Talara.
2. Response to contingencies: Despite having conducted the studies and estimated the demand,
businessmen must always be ready to react quickly and efficiently to the
surprises. The first was a pleasant surprise because the demand was greater than estimated;
but there would also be unpleasant surprises.
3. Professional organization: Since it is an association of professionals, they distinguished the
activities and functions to maintain efficiency and avoid conflicts among partners.
And an unpleasant surprise
In March 1998, the presence of the El Niño phenomenon dramatically affected our business. The
heavy rains completely flooded the bakery because it was located in a
very low zone. We managed to recover and within two days we resumed production. However, we realized
with the surprise that all the nearby areas had been affected and were
intransitables. The flow of people in front of our store had significantly reduced. Not
We surrendered to this difficulty and developed a strategy for relocating stores.
We decided to regain our customers and in December 1998, we opened a bakery on the Av.
Bolognesi and in November 1999 we opened another one on Av. A-67. These two new locations represent us
they allowed us to recover the sales level we had before.
And the strengthening of the headquarters
In our original location, we were never able to regain our audience, so we decided to relocate.
In May 2001, we moved to the Civic Center of Talara, where we set the goal of
gradually recover our target audience. We achieved it and today the venue is our current
location.
Later, due to competition and the proximity of our sales points, we decided
close the branches. Currently, the distribution channels we have are: the main store,
the distribution to warehouses and delivery service of pastries. In addition, we expanded our sales with
related or complementary products such as juices, milk, cheese, ham, etc.
Piuran experience
In February 1997, in light of the good results in Talara, we decided to conduct a study of
feasibility to install a bakery in the city of Piura. After evaluating the studies, it was approved
investment and thus, in April of that year the store located on Grau Avenue opens. Our clientele
grew rapidly thanks to our brand being recognized due to the experience of Talara.
Due to the reception from the public in Piura, we decided to apply the same marketing strategy that had
successful in Talara after the flooding: opening of branches and distribution to warehouses.
We also handle three distribution channels: the store, warehouse sales, and delivery.
But the competition became stronger as the number of bread-producing companies multiplied. This
the fact caused the sales level in the branches to drop, which forced us to close the branch of
Miraflores district. At the same time, we converted the main store in Piura into a center of
hot bread production. This decision has yielded good results for us. In the future, the branch
Santa Isabel will be implemented with industrial machinery so that it can become a center.
of additional production.
Talara after the flood: opening of branches and delivery to warehouses. Likewise
We manage three distribution channels: the store, sales in warehouses, and delivery.
But the competition became stronger as the number of bread-producing companies multiplied. This
the event caused sales levels in the branches to drop, which forced us to close the branch of
district of Miraflores. At the same time, we converted the main store in Piura into a center of
production of hot bread. This decision has yielded good results for us. In the future, the branch
Santa Isabel will be implemented with industrial machinery so that it can become a center.
of additional production
MSE Analysis: El Molino - Three factors that contributed to success
1. Geographic location: The good initial location of the business and the quality of the products ensured
a constant demand. In addition, being located quite close to the cities of Talara and Piura,
The expansion to this second city was facilitated, as they were already known there.
2. Sales strategies: To attract more customers, the strategy was developed to also sell to
through warehouses, branches, delivery service, as well as offering, in addition to bread, other products
complementary items such as butter, cheese, ham, soft drinks, etc.
3. Replicability of strategies: Having succeeded in Talara, the same strategies could be applied.
development strategies in Piura. This way, it was possible to take advantage of the experience or
knowledge developed by the company in similar circumstances in its various
locations.
Problems and obstacles
The variation of the rules of the game by the government.
The unfair competition from informal bakeries that do not pay taxes.
The variations in the price of wheat, which is mostly imported. In the year 2003, there was
wheat scarcity in Argentina and the United States, which determined the rise in price of the
flour.
And keys to success
In addition to the work and drive needed to move a business forward, there are some points
important to highlight as keys to success:
Constant innovation of our products.
Marketing of the products.
Strict quality control of products.
Continuous training of production and sales personnel.
Good customer service.
Ongoing training for the company's executives.
The fundamental principle for the success of our company is the good faith of its partners. This takes
especially important when it comes to people who have different approaches and ideas.
There should always be a contingency plan, both in case the project grows.
as in the case that it is paralyzed.
MYPE Analysis: The Mill
General evaluation and projections
1. Association of professionals: It should be noted that it is a work team with high
training, with a good disposition to work collaboratively and with respect for decisions
of each one. It will not be enough just to have a formal division of functions, but to share the vision and the
good faith of each of the participants.
2. Flexibility in the face of contingencies: While studies and prior plans are necessary, one must
to highlight that the business world is not static but is full of surprises. The demand
it will never behave exactly as predicted by the studies, even the weather and the
Competition can quickly change the operating conditions.
3. Consolidation in the region: The company's goal is to establish itself as the best chain of
bakeries in the northern region. With that objective, they develop location strategies for their centers
productive, as well as selecting a basket of products—both baking and
complementary products - suitable for your various sales channels.
