Today, Latin America is one of retailers’ main destinations, but something few people have reported is the fact that Latin America is also the source of innovative retail concepts, which are expanding internationally, becoming some of them, leaders in their specific sector.
Some examples worth mentioning: Kidzania, the world’s leading theme park for children and has a presence in 16 countries of 3 continents, they just opened its latest park in the famous Westfield London shopping mall; Cinépolis, the fourth largest cinema chain in the world and the largest chain with presence in most of Latin America, USA, India and recently closed an operation to buy Spain’s Yelmo; Juan Valdez Café, the retail brand owned by the National Federation of Coffee Growers of Colombia, with 300 units in 13 countries they have presence in Latin America, USA, Europe and the Middle East; Pollo Campero, Guatemala’s fried chicken brand founded by Dionisio Gutierrez, currently has about 300 stores in Latin America, Europe, Middle East, Asia and about 50 in USA. Likewise, there are some Latin American brands that have become almost cult brands in international markets, as the Brazilian sandals brand Havaianas, Argentina’s polo inspired La Martina and Brazil’s plastic shoes brand Melissa. Likewise, other Latin American concepts have been successful in global markets such as Peru’s Tanta, also from Peru Michèlle Belau who just opened a store in Dubai; Argentina’s Freddo which at the end of last year opened two stores in the United States; Brazil’s O’Boticario, and Colombia’s Totto who has 510 outlets in 35 countries.
We recently had the opportunity to talk with some of the executives who have been reached this positioning, who shared information such as the countries where they currently operates, the markets they are aiming to conquer, the company’s starting, their successful key, their franchise system, their challenges and opportunities, and what they are looking ahead. This is what they told us:
Arturo López Martín
Chief Investment Officer
Ciudad de México / Mexico City
A passionate person in work, who believes in the power of education as an agent of change. A believer in teamwork to achieve goals and multiply results.
Cinépolis operates in 13 countries, Mexico, United States, Guatemala, Honduras, El Salvador, Costa Rica, Panama, Peru, Colombia, Chile, Brazil, Spain and India. We want to consolidate the markets in which we currently operate, and continually look for new business opportunities.
Cinépolis is a company that started in 1971 in the city of Morelia, Michoacán, México, founded by Mr. Enrique Ramírez Miguel and his son, Enrique Ramírez Villalón, who managed to evolve from being a family business to a multinational company and now has become the fourth largest movie theater chain worldwide.
Cinépolis is a company that has learned to adapt its concept to different countries, a company that is constantly innovating and a company keen on customer service. Cinépolis does not operate under the franchise scheme. He owns half of the property and the rest operate under the lease format.
Today, going to Spain gives us the opportunity to enter the European market, starting in a relevant country to Mexico. The challenges are similar to those we have faced in the past when we enter a new market regulations, tariffs, culture, competition, differences in tastes of films, different schedules, differences in consumption habits, etc.
Cinépolis continue to grow at the forefront of new content, projection and sound technologies, we continue our growth strategy facing mature markets and market saturation. Surely in 2025 growth in screens outside Mexico will be higher than in our country. Currently we grow at par in and out of Mexico, at a rate of 200 screens in Mexico and the same number in the rest of our markets. We will continue growing both organically and through acquisitions.
Xavier López Ancona
Presidente y Fundador / President and Founder
Ciudad de México /Mexico City
Mexican and passionate about Mexico. If KidZania were to be remembered in the future, he would like it because it is an idea of Mexicans born in Mexico and proudly bears the name of Mexico to everyone.
Today, there are 19 KidZania parks opened in 16 countries in the World: Mexico, Japan, Indonesia, Portugal, United Arab Emirates, South Korea, Malaysia, Chile, Thailand, Kuwait, India, Egypt, Turkey, Saudi Arabia, Brazil and UK. There are 7 more in various stages of development in cities like Manila, Moscow, Singapore, Busan, New Delhi, Doha and Johannesburg. Manila KidZania will become the 20th KidZania park this July 2015. We are in negotiations with a large group in China and exploring opportunities in France, Canada, New Zealand, Australia, Germany and the Benelux region (Belgium, Netherlands and Luxembourg).
KidZania is one of those ideas that evolve on their own. Everyone thinks that people will one day wake up with a great idea, a focus of unexpected turns. In the case of KidZania, it was not. Almost 18 years ago, a close friend of mine, which imported US toy came with the idea of doing a similar small nursery to one he had seen in North Carolina, where they had a supermarket and a children’s hospital. They were not more than 200 m2. At that time I was in charge of the area of venture capital at GE Capital and the idea did not call my attention. But my friend was so insistent, so every time we talked about it the idea was evolving. That was how he planned to make “The City of Children” in a much larger space (4,500 m2 of space on two levels, with a total construction of almost 8,000 m2), we invited brands to participate, did activities for children the closest to reality as possible. With the growth and international expansion we had to find another name for our brand, because although “The City of Children” explains our concept perfectly, does not say much in Japan or Saudi. We had to find an international name and was well as “KidZania” which means “Land of cool children” (Kid comes from the German Kindergarten, which means children; Ania comes from Latin and means land or place; the Z was taken from the Anglo-Saxon word Zany, which means crazy, amazing, cool).
The concept of KidZania is based on role-play, to play at being adults. This is the oldest form of gambling known and is fully universal and timeless. What KidZania did it was to take this idea and taking it a step ahead. To do this, we build a whole city to the scale of children, with different areas and all the elements that enable children to role-play very in a very sophisticated way and the closest to reality as possible.
Our franchise system is a traditional model. We select only one licensee / franchisee by country or territory. They pay a Territorial Fee and a Park Fee. The royalties are 5% of total sales (including sales of tickets, food and drinks, merchandising, photography, special events, school groups and sponsorship revenue of brands involved in the project). In Mexico, all KidZania centers are fully developed and operated by us. United States is a special market, it has a sophisticated and demanding consumer, it is a highly competitive market, where we could open up to 14 parks, with a 30 million dollars investment for each, so we decided not to franchise in the United States nor go ourselves, but rather through a partnership or joint venture.
Our mission is to KidZania to serve the largest possible number of children worldwide. China and the US are the two most important markets that we still have to attack. We are also working to find ways to monetize virtual KidZania in which we can extend the experience in the virtual world of the park and back. This would allow us to reach more children in small cities or remote areas. Finally, we are evaluating several proposals to bring KidZania to other means, such as educational toys, TV shows, comics, animated series and movies
Jaime Rionda Marin-Foucher
COO & CDO
Ciudad de México / Mexico City
He is an entrepreneur, highly focused on results oriented with a long-term vision in the industry. He believes in teamwork and in giving his people the ability to make decisions and take responsibility for results.
Today we only operates in Mexico, but we already have signed contracts in the United States and we are starting our expansion in Central and South America. Our main focus is on the American continent but if an opportunity arises in Southern Europe we could consider it.
The first Cinemex opened in 1995 in the Altavista Shopping Mall south of Mexico City. Later, in 2002 the company was sold to the Canadian ONEX and in 2004 was again sold to Carlyle Group. In early 2009 Entretenimiento GM its current owner acquired Cinemex.
The service we provide in our multiplexes is the key factor for our success. We have developed virtual training programs in each of our theaters and have standardized processes that allow us to better serve our guests. Another important competitive advantage is the quality of our food, which are by far the best in the industry in terms of quality.
The opportunities are in the VIP segment, in which sector we have a competitive advantage in Mexico by operating this concept for more than 8 years. In this sense, we see a neglected market in the US for a population that has a high purchasing power. The challenge is to replicate our quality standards in other markets and at the same time adapting to the customers’ preferences in those markets.
Looking ahead, we see us as one of the top 3 operators worldwide. We’re also developing other concepts that allow us to offer our services to more people who are looking for different leisure options.
COOL DE SAC
José Luis Bueno
President & CEO
Miami, EUA / Miami, USA
Marketer with wide experience en companies such as Procter & Gamble, Kimberly Clark, Mabe and General Electric. Moving to Miami to do his MBA, he developed this brand and established an entertainment and hospitality holding.
We are currently in United States, Mexico, Panama, Colombia and Singapore, and have currently under construction unites in Qatar (opens 08/01/2015) Venezuela (09/15) and Dubai (04/16). We look forward to continuing growth in Asia as we have the platform of Singapore as a hub in the region. In Latin America we are interested in Brazil, Chile and Argentina as next steps.
Cool de Sac was born in Miami in 2004, when I identify the lack of retail concepts which could cover both the children and their parents’ needs. Our competitive advantage is that there are very few similar concepts out there.
Francorp in Chicago developed our franchise system, it is the standard system of American franchise with a franchise fee and a royalty on going.
As we arrived to Singapore, we had to make many adaptations on the menu and habits of the breast, mainly on the issue of mommy and me and birthday parties.
Looking ahead, I see Cool de Sac with a network of 100 stores in 15 countries.
Since 2001, Lolita has started its expansion process which led to the opening of 84 boutiques in 14 countries: Uruguay, Bolivia, Brasil, Chile, Costa Rica, Dubai, Ecuador, Guatemala, Nicaragua, Paraguay, Peru, Puerto Rico, Southafrica and Venezuela. Our franchise system has been crucial for our growth. While in 2003 we had 24 boutiques, the number grew to 84 in 2014. Currently, 550 people work at Lolita. We have our headquarters in Montevideo and two logistic centers in Uruguay. Our goal is to continue growing in the GCC countries and North Africa as well as to consolidate our presence in Central and South America.
Lolita is an international fashion company devoted to the design, production and commercialization of women clothing. It was founded in 1960 by my mother Greta Engelman and her sister Lolita. Our first shop was a small boutique in Punta del Este. Our mision is to accompany women in their social growth designing collections, which adapt to their modern and versatile personalities with a preference for the international trends. We made it posible through our “local strategy”: even though we are a global company, we meet the local markets’ needs creating collections specially designed to satisfy each market’s requests. Unlike other retailers, we are a medium company which gives us flexibility and allows us to provide our franchisees with a personalized attention. At Lolita decions are made when they have to: they do not need to be analyzed by a comettee. This allows us to respond efficiently and immediately to the markets’ needs.
Our success is based in three pillars: quality, design and our comercial mix, that is the variety of products which is appropriate for the collections to be successful. To sum up, our strengths are the personalized attention we provide to the franchisees, our capacity to adapt to the different markets and our immediate response to the franchisees’ needs.
Our system allows the franchisees to establish our brand’s shops in the most diverse markets in the world. We design 8 collections per year so that a new mix of products arrives to the store every 45 days. Our design team, leaded by my wife Silvina Leibenberg, works nonstop in the launching of functional and elegant garnments for modern women with different lifestyles. Therefore, we offer casual, working and cocktail clothes giving women an integral solution.
On April 15th we opened our store at the Dubai Mall. Over a thousand international brands from different sectors are hoping to have a shop there. Our challenge is to be successful in such a competitive market and our opportunity is the visibility that our brand will have because Dubai is one of the most important display windows that a brand can have. Looking ahead, I see Lolita in 2025 as a consolidated company with more that 200 stores spread over the five continents.
Martin Tro Gamboa
Responsable de Franquicias y Ventas Mayoristas / Head of Franchise and Wholesale Sales
Buenos Aires, Argentina
He considers himself a very dynamic person with great adaptability to change, who feels very comfortable with new projects and greater challenges. Marketing and business development is his forte; he feels very safe.
Currently we have stores in Brazil, Argentina, Peru and USA. In addition we operate franchises in Kuwait two shops, two shops in Colombia, Mexico, Ecuador, Paraguay, Chile, the Dominican Republic, Costa Rica., and we have a distributor in Norway. The idea is to conquer those countries requiring our brand, we know that quality Pima cotton coupled with Argentinean design has a great acceptance worldwide.
Babycottons was born in 1999. The original idea belongs to Maria Paz de la Piedra, granddaughter of a diplomat who was born in Peru, she developed a worldclass concept, and carried it out in order to develop a clothing brand for babies and children, which became successful venture. In 2011 the Vierci Group acquired most of the company with the aim of expanding Babycottons globally. The success of the brand has been to be able to reach to achieve harmony from the store design, fragrance, quality and classic design of each of the garments.
Looking ahead, we see Babycottons as a very entrenched brand in the Americas working on expanding to new continents to become the global industry leader for their quality and their unique brand classic designs.
International Business Manager
São Paulo, Brasil
We have stores in Brazil, Portugal, United States, Colombia, Kuwait, Peru, United Arab Emirates and Mexico. With strong presence in California, in the United States, the brand opened in December 2014 the first international flagship, in Santa Monica. We are prospecting openings in Spain, Chile, Thailand and Australia.
Chilli Beans began operations at the end of the 90s, on the command of Caito Maia. After 15 years, it is now established as the largest dedicated sunglasses Latin American network, the company has 650 outlets worldwide. Taking the fast fashion as a business platform, we launch 10 models of sunglasses, 5 watches and 3 frame models weekly. Chilli Beans is worth remembering that pioneered the concept of self-optic service, which allows customers touch and test the products, Chilli Beans was also the first brand to launch a personalization machine, which allows the customer to manufacture their own glasses. Recently, the brand was elected best franchise in Brazil, by the Brazilian Franchising As sociation (ABF).
Weekly collections of products, an accessible average price for all classes, as well as ease of having as expansion option of working through kiosks and shops, make an international investment is attractive at the time of positioning the brand giving a positive financial return in a short period of time for the franchisee.
We conducted a very tight working together with our future franchisee analyzing the market, our positioning in it, strategies and action plan through the expansion sectioned by cities in each country. Once open market purchases of collections are held weekly with monthly shipments made from Brazil to your country, receiving support in each of the areas and bringing the spicy essence of the brand to each outlet. Our vision is to be positioned on every continent through our points of essentially single-brand sales.
Proud to lead a team that, with great responsibility, is growing the company. She seeks to take care of the company in order to pass it on to the next generations better than she received it, and following the dream of her grandparents, her father and now herself. “If the family is well, the company is well. If the company is good, the family is better”, she says.
We mainly have a big stores network in Mexico, but we also have operations in Guatemala, El Salvador and recently in the southern United States, Texas and California. We want to continue expanding our presence in the Mexican market with all our formats aimed at different market segments, but we also want to strengthen our presence in Central America and in specific cities to sell the Hispanic market in the United States.
Next year we will be fulfilling 80 years since Dr. Frank Devlyn began operating in Ciudad Juarez, Chihuahua. From the 60’s his older sons Frank and Jesse started the expansion of business activities and presence in the country. Later, they were also joined by his younger brother, Pat, who started a period of rapid national expansion. For Devlyn it has always been a central focus on making customers for life. This combined with strengthening trade relations with its suppliers, constant innovation in its marketing, and continued strengthening of its brand have made Devlyn the leader of the Mexico optical industry. We are proud to be the largest optical chain in Latin America and one of the most important in the world.
Currently we not drive our growth through franchising. Since our inception in the United States we found a significant knowledge and affinity with the Devlyn brand in the Hispanic market and our commercial proposition, especially in terms of attention and customer service has been well received. We seek to grow through mergers and acquisitions to consolidate as one of the major international players in the optical industry.
Looking ahead, we see ourselves improving our customer service promise through constant innovation and maintaining our social responsibility in Mexico and the countries where we are present.