Market data and strategical approach to go international

1. Ron Santa Teresa
Group # 4
Mari Cruz Torres
Maria de los Angeles Islas
Javier Silva
Julián Aude
Lucas Iglesias
Frank Lettelier
Jaime Salamanca

2. Why to go international?
 Market Expansion
 Internal market is decreasing
 International market for rum is growing
• Risk of the internal market
 Political
 Economical
• Diversification

3. How to go!
 STP (Segmenting, Targeting & Positioning)
 Rum Market (consumption)
 Alcohol Culture
 Price positioning
 Distribution Channels
 Invest on Business Intelligence in each country

4. Colombia Main Facts
• Logistical advantages
– Taxes: FTA
– Strong transportation structures by land and
sea
• Pricing prejudiced by venezuelan
exchange control
• Seasonality and alcohol customes
– Almost same parties and holydays than
Venezuela: advantage on planning and
sourcing

5. Comparison

6. Total Colombian Market
PRODUCT* 2002 2003 2004 2005 2006 Share
AGUARDIENTE 7,234,833 6,424,360 6,488,508 6,250,910 5,942,197 49.1%
RON 2,991,473 2,767,778 3,448,675 4,117,654 4,415,529 36.5%
LICORES VARIOS 760,475 2,518,600 1,296,617 965,680 971,247 8.0%
BRANDY - COGÑAC 785,402 449,740 632,867 387,875 350,593 2.9%
WHISKY 208,825 208,665 259,664 252,512 344,338 2.8%
VODKA 70,124 38,488 42,726 47,438 43,168 0.4%
TEQUILA 5,741 8,743 13,901 13,224 19,423 0.2%
GINEBRA 7,089 8,861 10,516 8,071 8,409 0.1%
TOTAL 12,063,962 12,425,235 12,193,474 12,043,364 12,094,902
*9 ltr box

7. Imported Vs. Local
Total Liquors Market

8. Geographical Distribution Liquors Comsuption

9. Rum Market
Local Rum Market
Imported Rum Market

10. Rum Market Players in Colombia

11. Competitors Prices (USD/bot)
*Colombian Pesos
U$1 = $2.200

12. Precios en Venezuela
*Venezuelan BsF
U$1 = $2.15 (fixed since 2005)

13. Financial assessment
• Model assumptions

14. Cash flow and value added

15. Other countries to go in…
Suggested Population GDP per Alcohol Positioning
Country capita Culture
Mexico 109.955.400 12,500 USD Tequila Exotic premium
price
Chile 16.454.143 14,400 USD Wine Exotic premium
price
Russia 140.702.094 14,600 USD Vodka Change
avg. price
China 1.330.044.605 5,300 USD Open to exotic Party
things low price
Japan 127.288.419 33,800 USD Sake Exotic premium
price
Arabian 4.621.399 55,200 USD Muslim? Luxury super
Emirates premium price
Cuba 11.423.952 4,500 USD Rum´s cradle Branding
leverage

16. Q&A