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LAN & Tucumán Build A Blueberry Bridge

On September 2, 2010, In competitiveness, energy & agriculture, foreign investment, by InvestBA

Blueberry Bridge

Fresh, not Frozen: BA, Entre Ríos and Tucumán have ramped up U.S. blueberry exports with LAN Cargo.

Global demand for strawberries and blueberries has been on the rise, which is good news for the three Argentine provinces that produce the bulk o’ the berries: Buenos Aires, Entre Ríos and Tucumán. And while Argentina is South America’s third largest exporter of strawberries (after Brazil and Chile), she’s moved up to number two (behind Chile) on the blueberry chart. Agronomy engineer Daniel Kirschbaum told La Gaceta that blueberry demand is up thanks to the fruit’s many nutritional and aesthetic qualities. Kirschbaum, an INTA director and University of Florida IFAS graduate, says blueberry production is creating both jobs and foreign investment in Argentina with greater quantities now being exported at more competitive prices. Argentina’s competitive edge is also a success story in logistics for both Tucumán and LAN Cargo. “Thanks to the agreement with LAN we could open to U.S. markets, since the export duration is only 20 hours,” said Tucumán Governor José Alperovich. LAN Cargo General Manager Carlos Larraín says his company is now “the bridge between the fruit harvested in Tucumán and served one day later on the tables of Americans.”

FreshPlaza.com published the export numbers, while the Buenos Aires Herald has a more in-depth piece on “The Blueberry Route” between Tucumán and Miami. ThePacker.com says Tucumán and Concordia have just come through the coldest August on record, so the route may ramp up a little slower this year. “Argentina is going to be a little bit delayed,” says Dave Bowe of Dave’s Specialty Imports. “They’ve had some freeze damage, so supplies are going to be down a little bit. But overall, the weather has not been conducive.”

For more information on Argentina agribusiness opportunities, see our archives and download the new edition of InvestBA Privada.

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Fasten Seat Belts: Latam Will Be Game Changer

On August 29, 2010, In competitiveness, foreign investment, tourism, by InvestBA
Lan Tam Airplanes

When Cueto Met Amaro: In the works for 7 years, the Latam merger will shake up the regional landscape.

When Chile’s LAN and Brazil’s TAM, two of Latin America’s most efficient and profitable carriers, announced plans to combine operations, the headlines trumpeted the superlatives: the region’s largest fleet, 115 destinations in 23 countries, $8.5 billion valuation, $400 million in annual cost savings, and the list goes on. But the combined operations and creation of Latam Airlines Group (LAG) trumpeted in the global financial press has been downplayed here in Argentina, and Carlos Manzoni of La Nación tells us why. “The merger will be a blow to Aerolíneas Argentinas (AR), because Aerolíneas will have to compete with (Latam) in the two most important routes they have: Chile and Brazil. They are going to lose market share when they should be gaining ground.” If Argentina decides to makes life more difficult for Latam, Manzoni says, the new carrier can retaliate in a few different ways. TAM could stifle the flow of Brazilian tourists to Bariloche during ski season by routing flights to Valle Nevado in Chile instead. Likewise, LAN could opt to shut down trans-Atlantic service from Ezeiza to Europe, and channel those flights in and out of São Paulo instead. Either way, it will be a new airline landscape where Latam dominates as the big continental carrier, while small regional airlines like Gol and Pluna continue to gain market share exploiting the low-cost niche.

In closing, Manzoni says the courtship between the Cueto (LAN) and Amaro (TAM) families has been ongoing since 2003. Now that the nuptials are pending, let’s see if old regional flames try to spoil the honeymoon. (Full article in Spanish)

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In BA, The Creative Class Runneth Over

On August 25, 2010, In buenos aires events, competitiveness, creative class, entrepreneurs, visionaries, by InvestBA
arteBA 2010 Sign

Annual events like arteBA and BAFWeek showcase BA's rising tide of creativity and entrepreneurial activity.

Entrepreneurship and creativity are two of our favorite topics @InvestBA. When we were choosing content category names for the site, we opted for The Creative Class as a nod to urban studies theorist Richard Florida. In his 2002 best seller, Florida developed a Creativity Index to rank cities based on key criteria like Talent, Technology and Tolerance (aka the Three T’s). The review from Atlantic Monthly summed up the book’s thesis beautifully: Why cities without gays and rock bands are losing the economic development race. Most BA visitors come away with the impression the city is chock full of the first, trying hard to nurture the second and taking the regional lead with the third. (Given the recent marriage decision, “gay friendly” tourism will flourish here like no other corner of the Americas.)

Now comes the annual ranking from Global Entrepreneurship Monitor (GEM) that confirms our suspicions we’re living in a magnet for creativity and entrepreneurial activity. “Buenos Aires is the Latin American city with the highest start-up rate per capita,” writes BBC Mundo’s Veronica Smink adding, “BA also fares well in comparison with some of the world’s major cities, taking seventh place in terms of entrepreneurial activity ahead of cities like New York, Paris, Madrid, Barcelona and Amsterdam.” The majority of BA entrepreneurs are between 18-35 years old and focused on technology, design and visual arts. In closing, Smink says start-up growth should continue its upward trajectory given Argentina’s rich talent and human resource advantages.

The GEM report’s only negative? The failure rate of local start-ups is fairly high after 2-3 years. But in the immortal words of Winston Churchill, Success is going from failure to failure without losing your enthusiasm. Or in the words of Michael Scott, If tomorrow my company goes under I will just start another paper company. And then another and another and another. I have no shortage of company names. (Full article in Spanish)

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In Uruguay, U.S. Sees Export Hub for Mercosur

On August 19, 2010, In competitiveness, foreign investment, us companies, visionaries, by InvestBA
Montevideo Port

U.S. companies look to Montevideo as a regional hub for expanding export markets throughout Mercosur.

The U.S. may be mired in a full-blown recession, but economic activity and investment is surging here in the Southern Cone. Now Washington may finally be taking note, as evident by news yesterday out of Montevideo courtesy of El País. The U.S. Ambassador to Uruguay, David Nelson, told a gathering of businessmen at the Uruguayan Trade Chamber the U.S. is now encouraging more American companies to invest in the region in order to tap growing consumer demand in Mercosur countries Argentina, Brazil, Uruguay and Paraguay. “As consumer demand has fallen in the U.S., our companies are looking for more export opportunities,” said Nelson adding, “(U.S.) companies are very interested in the region as a platform for investment and also a potential market for exports.” Speaking about Uruguay specifically, Nelson says favorable tariff reductions at the San Juan Mercosur Summit has the U.S. eyeballing Uruguay as a regional distribution center. “In the last two weeks, I visited several free trade ports and companies investing in regional distribution logistics, and I see a very interesting possibility for American companies working together with Uruguayan partners to achieve this objective of export expansion.” In closing, the Ambassador reiterated the most salient talking point for any company considering regional expansion based in Uruguay, “”Uruguay is a very interesting country for investment given its political and economic stability as well as its human resource wealth.” (Full article in Spanish)

For more information on U.S. companies already investing in Argentina and Uruguay, check out the InvestBA archives and download the latest edition of InvestBA Privada.

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After 20 Years, 200 Franchises to Choose From

On August 6, 2010, In competitiveness, entrepreneurs, franchises, by InvestBA
Cardon Argentina

Franquicia Nuestra: Luxury goods retailer Cardon began franchising in '97 and today has over 110 stores.

In Argentina, it can be difficult for a small business to get off the ground, given a variety of bureaucratic, financial and legal hurdles. As such, the franchise business model has become an attractive alternative for local entrepreneurs looking to launch their own business with the backing, resources and support of a well-established franchise brand. Today the Argentina Association of Brands and Franchises estimates there are 400 franchises currently operating in the country, but Emprendedores News Director Marcelo Berenstein says when you take a closer look and weed out the wannabe franchises with only 1 or 2 locations, the number of businesses with a growing franchise network is closer to 200. “We find ourselves with companies classifying themselves as franchises, and soon thereafter they begin to disappear from the market,” says Berenstein, adding a call for better industry standards, “It’s clear the absence of a law regulating activity (which exists in the E.U., the U.S., Mexico and Brazil) creates that opportunity for anyone who wants to call themselves a franchise.” So what are the secrets of success of the 200 best franchise networks and individual franchisees? Berenstein says they work hard, they look at the business from all sides, they don’t believe money comes easily and they have a very long-term vision. The other 50%, he says, will fail and—rather than accepting responsibility—typically blame the market or “franchise network complexities” for their demise. (Full article in Spanish)

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