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High competitiveness and low consumption

Guido Carabelli Pace - Peru

These are the two characteristics that best describe the Peruvian market. However, the sustained growth of the economy augurs  well for GDP.

by Natalia Ospina Vélez

"It's very competitive today. There are four companies that produce between 75%  and 80% of the paint. The rest is served by more than 50 companies." This is how this professional, who has worked for more than four decades in that industry, described the Peruvian paint market.

- Publicidad -

Nearly 44 years faithfully dedicated to Teknoquímica S.A., have allowed Guido Carabelli Pace to learn about each of the movements of this market in his country and have made him an authority to talk about it.

This Peruvian, who came to the company as a salesman, today holds one of the most important positions in Teknoquímica. With an exclusive job for this company, supplier of products for industrial finishes in Peru, Carabelli managed to climb different positions to currently serve as general manager.

Proud to be there, this Peruvian said he had been seduced and motivated by the constant novelties that are registered in the company. "Teknoquimica S.A. has always distinguished itself by launching new products to the market. Offering the consumer quality products and achieving recognition of them, makes us constantly strive to improve our products and the quality of service to our customers," he said.

Staying for so many years in the company and having a career that has allowed him to ascend to the place where he is today, has not been an easy task. However, Guido is convinced that his achievements and the professional success achieved so far he owes to the exclusive dedication to his work and the company. In addition to having a team of excellent professionals who are experts in their  specialties and involved in the management and development of the company.

From Japan to Peru

Finding methods to implement quality standards in the company has been one of Carabelli's greatest challenges throughout his work at Teknoquímica S.A. To do this, this Peruvian "imported" from Japan the philosophy of the 5S ́s that according to his experience and knowledge, is fundamental to establish processes of quality and excellence in companies.

"For five years I have been contributing to the introduction of the 5S's philosophy in our company as a first step to quality. Of Japanese origin, this philosophy was established in the 50s after the war and is the first step to the establishment of total quality of a company," he said. The 5S's are Seiri (sorting), Seiton (organizing), Seiso (cleaning), Seiketsu (personal wellness) and Shitsuke (discipline). Carabelli said that the training of all Teknoquímica staff in this area has been basic to achieve a better work environment and at the same time, to prepare the company to receive certification in the COMING MONTHS in the ISO 9001: 2000 Standard.

- Publicidad -

On the other hand, the construction of an ERP, Enterprise Resource Planning, was another of the main challenges faced by this Peruvian within the company. "This is the integrated management system of the company, where all the data is online. Through it we have information available for decision making. This project took us 42 months and 42 officials participated," Guido explained.

Likewise, throughout his stay at Teknoquímica, the current general manager, highlights his work in the introduction of processes for budget management in the company, which has allowed him a significant reduction in costs and a sustained growth of sales and profits.
Globalization affects production
"Competition with imported products. The persistent increase in the prices of the raw materials we use, the difficulty of supply in some cases and the availability of freight for the transport of the same. All this has been accentuated by the significant growth of trade."
In this way, Carabelli referred to the main difficulties faced by the painting companies of the Inca country today. And it is not for less, because the growing demand from India and China for some years has significantly increased the price of raw materials.

To this phenomenon is added the increase in the price of oil, which on the one hand forces to reduce costs in companies and on the other, to transfer this increase  to the prices offered to the consumer.  
Regarding the supply problems, Carabelli said that in Peru about 50% of the inputs to be used must be imported and added: "for the same reasons mentioned above, the plants that manufacture raw materials are having limitations to supply the orders because they are working at full capacity. The last thing that has happened is that with the growth of the world economy the availability of freight is limited."

Low consumption, an opportunity
The projections of the Peruvian painting industry for this year are, according to the Peruvian executive, highly positive thanks to the sustained growth at very high rates of the economy of that country for more than five years.

However, despite the fact that the low consumption of paints per capita in Peru has been a stone in the shoe for the industry, Carabelli said that this situation before a threat becomes an opportunity for growth for that market. in Peru, it is estimated that the increase in consumption will go above the growth of the Gross Domestic Product (GDP)," he said.

All this has its explanation thanks to the reduction in poverty rates in Peru. According to Carabelli, in 2003 the country had between 50 and 52% of extreme poverty in the population, that figure has decreased to 43%  in 2006, which causes the socio-economic level to rise and demand to grow.

- Publicidad -

Finally, listening to this professional speak of the painter's market in his country suggests that it is an industry of contrasts. When asked about the advantages and disadvantages in Peru, Guido said that the size of the market limits the reduction of costs by economies of scale, but that the geographical location of the country is the most important aspect in favor of the industry in the continent. "The location is privileged and favors the frequency of travel of shipping companies, for example, those that go to Chile have to pass through Peru and vice versa. However, the country's population is 28 million inhabitants of which only half consume industrial products. If we compare it with an economy like Argentina or Brazil, practically the level of consumption of these countries is much higher and allows economies of scale," concluded Carabelli.

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