Healthy Fast Food Business in Colombia
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Business Expansion Plan - Elements to consider in a business and new country.
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Healthy Fast Food Business in Colombia
- 1. Healthy Fast Food in Columbia Business Proposal November 2014 TEAM 21
- 2. The Team
- 3. Customs and Values in Colombia Family is the most important element in Colombian Culture Colombia is a hierarchical society Particularism Race discrimination problem exist and imbalance wealth distribution
- 4. Typical Behaviors in Columbia Normal Etiquette in Colombia: Special Title System. Giving gifts as a token of respect to others. Dining etiquette is quite formal in Colombia. Business Etiquette in Colombia: Shaking hands is courteous upon meeting and departing. Business Cards are a good idea. Business Meetings have a certain protocol
- 6. Why Healthy Fast Food? • Fast food industry had an outstanding performance in 2013 by growing in 11% in current sales. Why? • Health Ministry Official Fernando Ramirez, in conjunction with a professor from the University of Antioquia carried out a study which found that 50% of all Colombians are classified as overweight. Why? HEALTHY FAST FOOD Where?
- 7. Criteria in Business HR Strategic Fit Number of Employees, Type of Contract, Duration Fixed Assets a. Restaurants b. Equipment/Tools c. Motorbikes, Vans Recipes Patents Intercultural Aspects a. Language: Communication, Body… b. Cultural Values, Norms & Believes… c. Organizational Behavior & Globalization d. Emotional Intelligence Immigration & Labor Laws of the Host Country a. Taxation b. Payroll c. Benefits: Medical Coverages, Sick Leave, Bonus… d. Employment Status in Host Country
- 9. Business Fit Analysis Procedure Step 1: Arrange Data by Level of importance Power Distance: High to Low Individualism: Low to High Masculinity: High to Low Uncertainty Avoidance: High to Low Pragmatic: Low to High Indulgence: High to Low Step 2: Communicate your results Step 3: Decision Making
- 11. Colombian Culture Advantages •Hardworking •Peace Loving and Love familyColombians •Power inequality at work is accepted in all layers. •Work is divided properly and follow a certain hierarchy which is contribute to less business conflict in decision making. Colombians prefer authority and Power distance •People prefer more to be in group as part of team spirit, which is good sign for food business.Collectivism •More rules will be there and standardized services will be the norm. •Avoid taking risk which is good for food business to take place as it is stable and has low risk factors. High Uncertainty Avoidance •Work hard to accomplish sales target •The high competition will lead to more efficiency.Masculine Society
- 12. Best Practices Time issues •Columbians are never on time. •Time is not an issue in meetings - they will last as long as they need to last. Patience is key element in business and meetings. Greeting •A small talk before the formal talk is encouraged since relationship building is crucial - it may be a good idea to invest time in establishing trust. • Shaking hands with direct eye contact is important. Business •Giving gift is token of respect to others. Imported alcohol are very expensive and make excellent gifts. •Avoid confrontation at all cost. If someone has made a mistake do not expose it publicly as this will lead to a loss of face and a ruined relationship Language •The language is mainly Spanish •It is advisable to print business card on one side with Spanish and the other side in English
- 13. Interviews Maria Barrera - Born and raised in Bogota, Colombia, Stanford University Student emphasis on trust. “I think Colombians are usually pretty warm and friendly. Very skeptical about anything that has to do with the government in any way”. “I would say that Colombians are pretty health conscious but I don’t think the whole organic/clean food craze has reached Colombia yet... People are very concerned with their appearance and form”.
- 14. Carlos Khoury – Lebanese/Colombian who was born in Bogata after his parents immigrated before the Lebanese Civil War. He is the owner of a Lebanese restaurant in Zona G, Bogota. “Bogota is a beautiful city that is built around water. In addition, it is a new tourist destination for business, culture, health and international events. It is an ideal place to have a business especially restaurants”. “ Economical wise, it is booming leading to an increase in house income. Taking into consideration this fact along with the number of work force which is estimated to be more 4 millions out of more than 7 millions, it is a good place to start up a business. Food is the safest, since people needs to eat all the time no matter what happens”.
- 15. Team Reflection’s Team Process Use of social networks, such Skype and WhatsApp. Everyone was assigned different parts and were asked as well to share input and collaborate. Challenges Time change, language barriers, understanding of material. Resolving difficulties Understanding the Cultural Diversity of the group Visual online meetings, & Coordinators guidance Future Recommendation Expanding the team!! ….. It will be more challenging
Editor's Notes
- The family takes center stage in the social structure. It acts as a source of support and advice and therefore great loyalty is shown to families. Although extended families rarely live under one roof, apart from in rural areas, many are still live very close and frequent one another's houses often. It is still common for children remain at home until they marry. The elderly are generally revered for their age and experience. Colombia can be termed a hierarchical society, People there earn respect due to age and position. Older people are naturally perceived as being wise and as a result are afforded great respect. You will always see the oldest person in a group served their food and drinks first. With this position also comes responsibility - Colombians expect the most senior person, whether at home or at work, to make decisions. The rule in Colombia can be very flexible and adjustable to different situations. Being previously a colony, the older generation think that there should be a social Stratification between aborigine, white and black. In fact, most of the black are middle or lower class in the society.
- Normal Etiquette in Colombia: Special title system Most Colombians use both a maternal and paternal surname The father's surname is important for them and they will placed first and is the one used in conversation. Always refer to people by the appropriate honorific title and their surname. 2 . In a normal situation the following are considered nice gifts: If you are going to a girls 15th birthday, gold is the usual gift. Imported alcohol (especially spirits) are very expensive and make excellent gifts. Wrapped gifts are not opened when received. 3. Dining etiquette is quite formal in Colombia as they tend to give importance to decorum and presentation. Business Etiquette in Colombia: It is courteous to shake hands both upon meeting and departing. Men should wait for a woman to extend her hand. Greetings should take some time - ensure you engage in some small talk, i.e. ask about family, health and business. Usually eye contact is viewed positively. During a meeting, usually they wait for the other party to initiate a change to first names. It is a good idea to try and have one side of your business card translated into Spanish. It should Include any university degrees or qualifications as this is valued, and make sure to treat business cards with respect. Relationship building is crucial - it may be a good idea to invest time in establishing trust for the first few meetings. Time is not an issue in meetings - they will last as long as they need to last. Do not try and rush proceedings. Colombians are termed as 'indirect communicators' - this means there is more information within body language and context rather than the words. The reason for this way of communicating it to protect relationships and face.
- Why investing in Colombia? Top Left Figure: Colombia is located in Northern South America, bordering the Caribbean Sea, between Panama and Venezuela, and bordering the North Pacific Ocean, between Ecuador and Panama. Less than 6 hours to main Latin American Capitals as shown. More than 800 Weekly international flights and more than 4500 weekly domestic flights. In addition Colombia is part of the economical Pacific alliance which includes: Mexico, Colombia, Peru and Chilie. Top Right Figure: 3rd country in Latin America when it comes to population with a total of 47.2 million People as per 2013 statistics, with more than 55% of Colombians are below 30 years old. This provide a good consumer base when it comes to markets. Bottom Left Figure: Colombia is one of the largest countries in term of economical market in Latin America, it is the 4th country in term of GDP and economical growth as well with a net worth of 369 US Billons, and GDP annual growth of 4.3 %, and controlled inflation of 1.98 % and unemployment rate of 9.6%. Bottom Right Figure: Number of Visitors coming to Colombia whether for Business, Tourism or even Spa is increasing as shown on the figure and it is estimated to increase more than 1,652,078 visitors with the coming years. This expand the economical market when it comes to speding and consuming products and services.
- Fast food had an outstanding performance in 2013, growing by 11% in current sales and by 6% in number of outlets. This strong growth is explained by the broader menu options, the increasing importance of shopping centers, an increase in disposable income and busy lifestyles. This good growth is mainly due to an increase in disposable income, busy lifestyles due to demographic and economic factors such as an increase in the number of working women, smaller family sizes and wage increases, and the arrival of new chains and an increase in food diversity Widespread obesity “is due to bad eating habits. The most concerning problem is in children younger than four years old, where he claims 20% of the demographic is prone to obesity. What is the solution: Healthy food and eating habits, in addition to good old fashioned exercises as well as less consumption of alcohol and tobacco. Bogota (Main Capital: Metropolitan Quality of Life, Internet services and platforms, Qualified Human Talents, Strategic Location and connectivity, Competitive costs).
- Criteria in Business Human Resources to consider: Strategic Fit: It is necessary to understand the fit of the business plan in the host country. Several issues need to be considered in compliance with the country customs, Behaviors, Managerial practices, Law, dominants values and economical fitness and ability to invest in the market and generate profit. Number of Employees, Type of Contract, Duration Fixed Assets such as: Restaurants Equipment/Tools Motorbikes, Vans Recipes Patents: when it comes to special ancient recipes or formulas used in the preparation of drinks and food which makes the product differentiated from other products in the market. Intercultural Aspects: Several issues need to be understood on the intercultural level when deciding investing in the host country. These factors includes the followings: Language: Communication, Body… Cultural Values, Norms & Believes… Organizational Behavior & Globalization Emotional Intelligence Immigration & Labor Laws of the Host Country: Several issues need to be understood when it comes to Immigration and Labor laws. These factors includes the followings: Taxation Payroll Benefits: Medical Coverages, Sick Leave, Bonus… Employment Status in Host Country
- Power Distance- Colombia falls in the high power distance category along with Lebanon, Hong Kong and India. The Colombian accept inequality amongst people as a fact. However U.S. comes low on power distance. Individualism- The degree of independence in the society is very low. It breeds more of a collectivistic culture. While Hong Kong and Lebanon are also collective society, India is a mix of both collective and individualistic culture. U.S. is high in Individualism. Masculinity- Colombia is a masculine society driven by competition, achievement and success. U.S. and Lebanon is also a masculine society. Hong Kong and India are less masculine. Uncertainty Avoidance- Colombia is high on this. They avoid ambiguity and express their emotions freely. They like structure and planning just like France. Hong Kong is very low on this so they find themselves comfortable with ambiguity. India and U.S. is somewhere in between. Pragmatism- Colombian culture is Low on Pragmatism and hence is a normative society. They have great respect for future and myopic view for future. U.S. also scores low on pragmatism. While India, France and Hong Kong are pragmatic society showing adaptability and a more practical view towards future. Indulgence- Colombia with a high score is considered an Indulgent society. They realize their impulse and desire with regard to enjoying life. Along with U.S. they believe in the principle of work hard and party harder. Hong Kong and India are low on indulgence and is a more restrained society. France come somewhere in the middle.
- Step 1: In order to perform Business Fit Analysis, we need to first arrange our data according to the level of importance when it comes to each country cultural aspect: Power Distance: High to Low Individualism: Low to High Masculinity: High to Low Uncertainty Avoidance: High to Low Pragmatic: Low to High Indulgence: High to Low Step 2: Communicating the results would be in the mean of chart or a graph that facilitate reading the outcomes. Step 3: Make a decision when it comes to how fit is your selected business when it comes to the host country and its cultural aspects.
- Evaluating the data and the information obtained from the Hofstede Center when it comes to Cultural comparison between our countries and the host country, by arranging each data in each characteristic according to its level of importance for our business to succeed, we obtained the following pie chart. According to the chart, Colombia is more fit for such business with 24% business fit, then Lebanon follows with 22%, and later India (19%), USA (18%) and last Hong Kong (17%).
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- Maria Barrera: Background so to give you a quick back story- “I was born there and lived there until she was 10 and then have been going back about 3 or 4 times a year, when I was little Iwould spend all my summers there too but once I got to college I would only go for like a 1 month” Family background: Middle to upper middle class She hasn’t seen issues with obesity, most people higher than lower middle class can afford to have a housekeeper, who will clean and cook and for the upper classes actually live with you. Fast food isn’t a big thing – Mcdonald’s is seen as a “prize” that you get/go to rarely People enjoy “homemade food” many of the best restaurants (like Andres Carne de Res) actually thrive on this so i would say it is popular to eat out (probably 2x or 3 x a week). but going back to obesity - people are extremely considered with their physical appearance you’ll never see a woman leave her house with her hair not done (beauty salons as super cheap so my stepmom goes 2x a week) or without make up I would say that they are pretty health conscious but i don’t think the whole organic/clean food craze has reached there yet you also have to keep in mind that its a country filled with so much poverty as well. so it really depends how you’re looking to shape your brand and the demographic you’re targeting On trust: I think Colombians are usually pretty warm and friendly. very skeptical about anything that has to do with the government in any way
- An interview was conducted with Carlos Khoury an Colombian from Lebanese background who was was born and raised in Bogata. He is the owner of a Lebanese restaurant in Zona G, Bogota. According to Mr. Khoury,: “Bogota is a beautiful city that is built around water. In addition, it is a new tourist destination for business, culture, health and international events. It is an ideal place to have a business especially restaurants”. “ Economical wise, it is booming leading to an increase in house income. Taking into consideration this fact along with the number of work force which is estimated to be more 4 millions out of more than 7 millions, it is a good place to start up a business. Food is the safest, since people needs to eat all the time no matter what happens”. Based on what has been said in the two interview, we truly believe that our business proposal will be successful along with our business fit in Colombia.
- Team Process Use of social networks, Skype and WhatsApp gave us the opportunity to defeat the different time zone and geographical locations. Video conferencing though skype facilitated the work among the group in addition to strengthening our bonds. WhatsApp gave us the chance to be on alert when it comes to specifying meeting times and giving update of work process and phases. Our Team Leader facilitated all the project phases as briefing was given at the end of each meeting and of what to expect during our next meeting. Project parts were assigned after consulting each member where he/she finds himself/herself as related to the major of studies. Challenges Many challenges faced us in this project, which can be stated as follows: Time change as members were located in France, Chilie, India and Hong Kong, in addition to language barriers as English was not the mother tongue of most of the team members. Understanding of material and what expected should be mentioned but confusion was eliminated after contacting our coordinators. Resolving difficulties Understanding the cultural diversity of the group along with the intercultural aspects facilitated the interaction among the team members and the way everyone behavior within the group. The use of online virtual meetings through skype gave us the opportunity to melt the ice and eliminate barriers. At the end everyone was ready to meet the other member in the midway through bridging relations, trust, collaboration and understanding. Technical guidance was provided by the coordinators to clear away any ambiguity.