STRATEGIC PLAN FOR BRAZILIAN FRUITS: A PROPOSAL TO INCREASE THE COMPETITIVENESS OF THE SECTOR IN THE INTERNATIONAL MARKET

Transcription

1 STRATEGIC PLAN FOR BRAZILIAN FRUITS: A PROPOSAL TO INCREASE THE COMPETITIVENESS OF THE SECTOR IN THE INTERNATIONAL MARKET JOSÉ GUILHERME AMBRÓSIO NOGUEIRA School of Economics and Business (FEARP) University of São Paulo Av dos Bandeirantes, 3900, Ribeirão Preto (SP), , Brazil. zeguian@gmail.com MARCOS FAVA NEVES School of Economics and Business (FEARP) University of São Paulo Av dos Bandeirantes, 3900, Ribeirão Preto (SP), , Brazil. mfaneves@usp.br / Review copy for use of the IFAMA 2012 Forum & Symposium. Not for reproduction or distribution. June 9 th -14 th 2012.

2 STRATEGIC PLAN FOR BRAZILIAN FRUITS: A PROPOSAL TO INCREASE THE COMPETITIVENESS OF THE SECTOR IN THE INTERNATIONAL MARKET ABSTRACT The Agribusiness System (SAG) of fruit is one of the most important in Brazil. The fruit system involves: fresh fruit, dried fruit, frozen fruit as well as its by products: fruit pulps, juices, jellies and similar. The exports of fruit and their products, they are considered export volumes for most fruits, excluding orange juice when analyzing the coefficient on export production; seldom result in values above 3%. In front of this obstacle to the internationalization of the sector, the study's goal is to make a diagnosis outside the international market of fruits, in order to identify favorable and unfavorable aspects in the literature and looking at primary data through interviews with 35 industry players, issues favorable and unfavorable for fruit trees in Brazil. To accomplish this objective, in-depth interviews were conducted based on a semi-structured script. The analysis will be done through content analysis of interviews and by merging results from the theory studied. The results of the research identify the main needs, barriers and critical factors for the growth of fruit exports to Brazil. Index Terms: Fruit trees, Strategic Plan, Agroindustrial System.

3 STRATEGIC PLAN FOR BRAZILIAN FRUIT: A PROPOSAL TO INCREASE THE COMPETITIVENESS OF THE SECTOR IN THE INTERNATIONAL MARKET INTRODUCTION The agribusiness system (SAG) covers the activities related to agricultural production and also to upstream and downstream links regarding to the supply of inputs, machinery and implements, beyond the agro-industrialization and agro-commercialization, becoming competitive the agribusiness companies that have the ability to develop and sustain a competitive advantage over its competitors through product differentiation and cost reduction (SIFFERT FILHO; FAVERET FILHO, 1998). For Goldberg (1968) the SAG's comprehend the segments before, within and after the farm gate. NEVES (2007) that when the agribusiness is analyzed, each researcher should have a detailed attention to the SAG because it is extremely important to understand how the different stakeholders interact in the production process. In this way, this study refers to the food system of fruits and derivatives, which consists of two subsystems called agro-commercialization and agroindustrialization. Several authors highlight the relevance of this sector regarding to the possibility of labor absorption, employment and income generation, beyond its importance as an alternative to the Brazilian exports of agricultural products (ANDRADE et al., 2007; BUAINAIN; BATALHA, 2007; QUINTINO, 2007; LOURENZANI et al., 2008; VITTI et al., 2009). In the Figure 1 is possible to identify the links that go from this subsystem inputs, through the producers, processing and commercialization of fruits for the wholesale and retail until they reach the final consumer. According to RUGGIERO et al. (2003), it is a great challenge and also an opportunity for producers, in domestic and foreign markets, the commercialization of fruit and their derivatives. Especially in regions considered hubs of fruit production in Brazil, the fact that producers organize themselves into associations and adopt procedures adding value to the product, brings benefits to producers, the producing region and also to the members. In order that producers and exporters can compete in the foreign markets, it is required following rules, trends and needs imposed by the international markets. From this it is evident the need of the manufacturing companies are in a constant process of updating farming techniques and inputs. The process of innovation and necessity for improvement, especially regarding to varieties, production systems, machinery and equipment linked to the fruit industry and products is constant. BUAINAIN E BATALHA (2007) point out that maintaining the current competitiveness of domestic fruit in the international market depends on the country's ability to face challenges related to the institutional environment, beyond the introduction of technological innovations in the organization, production and post-harvest. If we consider the volumes exported, melon, mango and apple occupy positions satisfactory to Brazil in terms of international market. However, for other fruits, when analyzing the coefficient on export production, rarely result in values above 3%. Thus, even with significant numbers of export of some fruits, the country is still marginal in world trade in fresh fruits, as participates in only 0.5% of international trade. There are few fruits whose export is representative in terms of production.

4 I N P U T S $(Payment), Request, Information Fruits Fruits Uncontrollable variables - PEST Agrocommercialization Subsystem (47% of fruits, while 2% to exports)* Varieties Production Syst. Primary Transformation Byproducts Concentrates Juices Pulps Beneficiation Beverage Industry Other Industries Juices Nectars Refreshments Sodas Confectionery Dairy Ice Cream Cosmetics etc.. Agroindustrialization Subsystem (53% of fruits, while 29% to exports)* Facilitator agents Product, Service, Communication Fruits Hypermarkets Supermarkets Fruit Retail Boutiques Fruit Fairs Convinience Juice Houses Restaurants Hotels Events Delivery Bakery C O N S U M E R * 2008, in Brazil Figure 1. Fruit Agrifood System. Source: authors, from IBRAF (2010) e NEVES (2004). The study focused on the two subsystems and, more specifically, tried to understand the difficulties faced by Brazilian products in the export process. The products were classified into five lines, which are: fresh fruits, dried fruits, frozen fruits, purees and juices. The question that this article seeks to answer is: How to develop a strategic plan that can be applied in the Brazilian fruit sector allowing a best competitiveness in the international market? OBJECTIVES The main objective of this project is to propose a strategic plan that can be applied in the Brazilian fruit in order to expand the competitiveness of this sector in the international market. MATERIALS AND METHODS The proposed study can be characterized as an exploratory research, so it is demand and discovery driven helping the researcher to delve into the subject (HAIR at al. 2003). Checking secondary data and previous research on the development of strategic plans in the agro-industrial sectors, was detected the need to apply the Planning Method and Strategic Management of Agribusiness Systems (GESis) proposed by NEVES (2004), which was used in the study for the design of the strategic plan for internationalization of the fruit industry and its products. This method, proposed by Neves (2004), has been applied in the past seven years in the Brazilian agribusiness systems

5 (wheat, milk and orange), Uruguayan (wheat) and Argentine (milk) for the preparation of strategic plans and management of agribusiness systems. According to the literature were identified other methods of strategic marketing planning that could be used in the preparation of strategic planning, however the methods still had little applicability in agribusiness systems. The step number 4 of the Gesis method, which concerns the development of the strategic plan, has proven the effectiveness in other studies in the agribusiness and so was used to prepare the plan. Figure 2 below shows the steps that could be used for the preparation of a strategic plan for the next five years. Figure 2. Market Planning Method (Gesis) Source: NEVES, Thus, the proposed method Gesis was developed for agribusiness systems and can be used in this research. The project is developed on three main steps: STEP 1: Understanding and Collection of Secondary Data The first step of this work was based on documents and secondary data (desk research). Among them were studied the document provided by IBRAF, "Strategic Master Plan for ", articles in newspapers and magazines in the sector of fruit and their products. In this step it must be carried out interviews with IBRAF. After collecting the information, it has been prepared the script for further research that will be applied in the second stage of this work. At this stage yet,it is applied a semi-structured script. STEP 2: Interviews and Data Tabulation Interviews We selected 50 potential companies that currently export or have the intention of exporting, however only 35 companies were able to answer or even have your script analyzed and data sufficient to be tabulated, seeing that other respondents could not provide some information. The first contact of the authors was with IBRAF, and so the Institute has made available data and contacts with companies that could help us, and was sent explaining the intent

6 and importance of their participation in the study. After sending the , the researchers contacted by telephone, with each company to schedule the interview. The interviews were conducted in Markestrat, research center and marketing strategies linked to the University of São Paulo - USP, based in Ribeirao Preto-SP, by phone or sending the script to search by address. At the end of each interview was sent an of thanks for participating. Tabulation of Data Collected The first analysis was made of a sample of 10 companies and from the responses will be possible to develop a preview of the results to check for errors in the script and the direction of questions aimed at their goal. STEP 3: Preparation of Strategic Plan - Results and Conclusion After analysis and tabulation of data was designed a set of necessary actions that could be implemented by the relevant authorities in Brazil. Occurred at this stage the preparation of the strategic plan for the sector, based on data from interviews of selected companies, as well as information collected from secondary data. Results, conclusions and limitations of the research will be discussed in this step. RESULTS Involvement of the Participants: Interviews Companies participating in the interviews were segmented into exporters and non exporters. Among the exporters, were classified into five segments. They are: In Development, Intermediate, Experienced and Internationalized. The interviews with the companies analyzed five different aspects, they are: Verticalization degree: To study the degree of vertical integration (Low, Medium and High) in which companies in the fruit and their products are, evaluation criteria were adopted based on the identification and analysis of some points along the chain. Marketing orientation: To understand the degree of marketing orientation (Low, Medium and High) some criteria were adopted: to determine whether the respondent or any employee of the company performs technical visits to locations where exports; if you have knowledge about the culture and consumption habits of the target country to identify how they obtain this information, the trend is accompanied by consumption of other fruits that are not produced and / or exported by the company. Infrastructure and Skills to Meet the International Market: In this analysis some issues were listed as: the implementation of innovations in products and services at least once a year, the existence of the company employees who speak other languages and product catalogs other languages. Main competitors: To analyze the company's main competitors and what factors that give advantage in exports, research criteria were used based on prices charged by competitors in the variety and quality of products offered by them and advantages in logistics and trade (differentiated and / or other advantages) they have. Planning and Target Markets: In this analysis we adopted criteria capable of identifying the main target markets for the following years and see if companies have today, a long-term planning to strengthen exports. Sector Overview Versus Company Overview: In this section, the intention was to compare the vision of the respondent in relation to the export sector of the Brazilian fruit, with the vision of the company's situation over the next five years. With this, the views of business and industry, could be classified as optimistic or pessimistic.

7 Project Need and Responsibility: To identify the projects and responsible, respondents were encouraged to discuss projects they believe are necessary to remove the main barriers to exports and who could be responsible for such projects. This criterion made it possible to identify issues such as tariffs, phytosanitary barriers, internal regulation, infrastructure problems, registration of agrochemicals, logistical problems, organization of specific sectors of the fruit, among others. From the analysis of answers given by the participating companies, it was possible to prepare the summary table below, showing the needs of companies with different levels of export. Non Exporter In Development Exporter Medium Exporter Experience Exporter Internacionalized Verticalization Degree Marketing Orientation MEDIUM MEDIUM MEDIUM Infrastructure and Skills to Meet the International Market MEDIUM Competitiveness Degree MEDIUM Planning and Target-market Only Inside Market Europe (east), Asia e Middle East Europe, China, Middle East, Canadá and USA Germany, France China, Saudi Arabia, Emirates and USA EU and USA Sector Expectation x Company Expectation Sector: Optimist Company: Optimist Sector: Pessimist Company: - Sector: Optimist Company: - Sector: Pessimista Company: - Sector: Pessimist Empresa: Pessimist Figure 3. Summary of the final outcome of the study. Source: authors VISION An important tool for strategic planning is to create a vision for the future. Technically, she should express what the industry wants to be in five or ten years, serving as a compass that guides over the years. Based on the concerns of entrepreneurs and industry experts, has formulated a vision for the future of agro-industrial system of fruit and their products: Being a highly competitive industry in the production and marketing of fruit products, with strong focus on trends in consumer markets, anchored by sectoral actions to establish effective policies to create a business environment that allows companies to access target markets, reduce costs and work in an organized, innovative and promoter of sustainable territorial development. STRATEGIC OBJECTIVES: As reported in interviews, making sure the needs of agents developed five strategic objectives for the short-term export development of fruit growing in the international market. They are: increasing the participation of Brazilian companies Brazilian total exports of fruits and derivatives, increasing the participation of brazil on imports of fruit and derivatives of the target countries, increasing the number of exporting units, promoting the export culture among small and medium producers and agribusiness, strengthen collective action to stimulate the synergy between the companies; SHORT TERM PROJECTS Figure 4 below shows the projects of short-term goals, relating them to the profiles of companies, thereby facilitating the actions of some companies.

8 Company Export Degree x Related projects Project Trainning and Capacitation Website Project Buyer e Business campaigns Image Internati Prospectio onal Fairs ns Missions Cooperative action with food retail companies Cooperativ e actions with other brazilian export sectors Non exporter In Development Medium Exporter Experienced Exporter Internacionalized Figure 4. Details of Projects Relating to Short-Term Objectives Source: authors We will see yet, the great need for long-term projects, where coordination of institutional actors such as government and its bodies will be required for the development of fruit growing in the country. LONG TERM PROJECTS Figure 5 below presents the main long-term strategic objectives. The related projects are related to the involvement of agents. Objectives related to strategic coordination and institutional capacity building related goal, objectives related to production, R & D, Products and Innovations and Objectives related to logistics and distribution. Objetivos Objectives Relacionados Related à Coordination Coordenação and e Institucional Institutional International negotiations to reduce tariffs Negotiating agreements for phytosanitary (regionalization of protocols) Registration of pesticides Dismemberment of NCMs Release of imports of pesticides directly by producers Tax exemption - Compensation of PIS / COFINS Facilitate access to credit lines and creating special lines for fruit Negotiating for lower port charges Export Insurance Organization of producers and agribusinesses for marketing Policies to curb the appreciation of the real Mapping and Simplification of export (export saver) Unify state laws for processed products Objetives Objetivos Related Relacionados to trainning à Capacitação and capacitation Information System (Market Intelligence) that allows companies to plan production, set and access markets. Among other data, this system should be a tendency of the market, potential demand, certifications required by country. Objetivos ObjectivesRelacionados Related to Production, à Produção, Products, Produtos, R & P&D D and e Innovations Inovações Partnerships with universities and research centers to increase the technical level of the chain fruit; Factory Revitalization Plant Protection, especially on imports of fruit. Objectives Objetivos Relacionados Related to the à Distribution Distribuição and e Logística Logistics Improvement and modernization of transport infrastructure (roads, ports and airports) Opening of new marketing channels Figure 5. Summary of Long-Term Strategic Objectives (5 years) with involvement of Stakeholders Source: authors

9 CONCLUSIONS In the development of a strategic plan for fruit, the methodology was effective, allowing its use in business and academia. The method was simple and straightforward, the information obtained by primary and secondary data enabled better development in the plan, and the implementation of the script to the first 10 respondents was important to validate it. The SAG of fruits and its derivatives saw the necessity of implementation actions in this segment, since the sector is losing its competitiveness for others producing countries and still have great relevance in the international market, except the orange juice. Although there are large industries, producer and businessman suffer from high fiscal aspects and bureaucracy. Another aggravating factor is the lack of capital of the entrepreneurs, aggravated by rising production costs, high interest rates charged by financial agents, logistics costs and poor infrastructure, beyond other factors. Note that the fruit is still living the same problem as other segments in the Brazilian agriculture, such as lack of coordination and associations. So Brazilian producers have to work alone to seek new channels and new ways of products commercialization. Added to this, the barriers that affect the Brazilian market for fruit and their products are increasingly strict. Import quotas, antidumping, countervailing duties and measures of protection are some ways to hinder the entry of Brazilian products in these countries. With the development of the plan with goals and vision of the industry seeking the international market, this article brings up different projects for different spectra types of companies for the actions to be implemented are somewhat assertive and decisive for the growth of the Brazilian fruit sector in foreign markets. Acknowledgment IBRAF and APEX Brasil. REFERENCES ANDRADE, R. A.; MARTINS, A. B. G.; LEMOS, E. G. M.; LUZ, F. J. F.; SILVA, M. T. H. Detecção de poli-morfismo em porta-enxertos para citros. Revista Brasileira de Fruticultura, Jaboticabal, v. 29, n. 2, p BUAINAIN, A. M.; BATALHA, M. O. (Coord.). Cadeia produtiva de frutas. Brasília: IICA: MAPA/SPA, p. (Agronegócios, v. 7). GOLDBERG, R. A. Agribusiness coordination: a systems approach to the wheat, soybean and Florida orange economics. Boston: Division of Research, Harvard University, p. HAIR, J. J. ; MONEY, A. ; SAMOUEL, P. Fundamentos de métodos de pesquisa em administração. Porto Alegre : Bookman, 2003 IBRAF Instituto Brasileiro de Frutas. Plano diretor estratégico para São Paulo: IBRAF, p. LOURENZANI, W. L.; LOURENZANI, A. E. B. S.; BAGAIOLO, G. R.; RODARTE, T. D. Fruticultura e sua importância para a região Nova Alta Paulista. In: CONGRESSO BRASILEIRO DE ECONOMIA E SOCIOLOGIA RURAL, 46, 2008, Rio Branco. Anais do XLVI Congresso Brasileiro de Economia e Sociologia Rural. Disponível em: < Acesso em: 10 ago NEVES, M. F. Strategic marketing plans and collaborative networks. Marketing Intelligence & Planning, Bingley, v. 25, n. 2, p , 2007a. NEVES, M. F. Uma proposta de modelo para o planejamento e gestão estratégica de marketing (orientação para o mercado) nas organizações p. Tese de Livre

10 Docência (Área de concentração: Marketing). Faculdade de Economia Administração e Contabilidade de Ribeirão Preto, Universidade de São Paulo, Ribeirão Preto, QUINTINO, H. M. S. Benefícios sociais da política de incentivos à cultura do mamão no Estado do Ceará p. Dissertação (Mestrado em Economia Rural) - Universidade Federal do Ceará. Fortaleza, RUGGIERO, C. et al. Panorama da cultura do mamão no Brasil e no Mundo: Situação Atual e tendências. Rev. Papaya Brasil. Vitória-ES, a 34 p. SIFFERT FILHO, N.; FAVERET FILHO, P. O sistema agroindustrial de carnes: competitividade e estruturas de governança. Disponível em: < gov.br/sitebndes/export/sites/default/bndes_pt/galerias/arquivos/conhecimento/revista/re v1012.pdf>. Acesso em: 10 ago VITTI, A.; MELO, A. L. F.; BOTEON, M. Potencialidade e oportunidades para a fruticultura brasileira no mercado internacional. In: CONGRESSO BRASILEIRO DE ECONOMIA E SOCIOLOGIA RURAL, 47, 2009, Porto Alegre. Anais do XLVII Congresso Brasileiro de Economia e Sociologia Rural. Disponível em: < Acesso em: 10 ago