lunes, 13 de abril de 2009

The Agribusiness World Today

Ken Shwedel
Investigador de Agronegocios de Rabobank, México
6-10 de Abril de 2009

The World

Dominating the digital ambit. Traditionally, value chain strategy has focused on the bricks and mortar. This has also been true even for those who analyze companies and their strategies. The online or digital domain, nevertheless, has become increasingly more important in creating value, and, as such, has redefined the value chain. Wal-Mart, probably more than any other major retailer has come around to realize this. “It has outspent most of [their] suppliers and rivals on online display for years”. Recently they have become even more aggressive in their efforts to “‘own’ the concept of value online.” Their strategy is designed to relate to potential clients on an “emotional, logical and rational level” in an effort to build the brand. To reach their objectives they have gone beyond seeing the internet as only a vehicle for offering products for sale on their “flagship” site. They have “launched free classifieds last year” and they are now building a site around the Save Money Live Better tagline ( Wal-Mart invited “Mom bloggers” to form the elevenmom online community, and have just recently formed a Spanish language version of the community. Looking to identify with other consumer segments they launched Soundcheck ( three years ago as “an original performance series created to give you a chance to go behind the scenes with some of your favorite artists”. Recently they partnered with nine different Unilever brands, with Unilever sponsoring “free downloads and streaming music videos.” In other words they also see the digital domain as another mechanism for creating dependence of suppliers on the retailer.

It’s not just splitting but itemizing. Depending on the cultural environment in which you live and work, it is not all that unusual to split the bill when eating out. Although the evidence is anecdotal, there appears to be a trend emerging, or at least emerging in the United States: “diners say they are asking for separate itemized checks when they eat out with a group.” In other words, they are “asking for checks that reflect how hungry they were.” What appears to be behind this is that with the unfavorable economic situation consumers are watching very closely what they spend, and this is a way “to save more money when they eat out.” For the restaurants separate checks have always meant an increased administrative burden, especially when paying with a credit card-and “81% of diners pay with a credit or debit card” at a sit-down restaurant”. Itemizing takes more of the waiter’s time, but, they complain, the tips usually don’t reflect the extra effort.


Supporting the peso. Because of the loss of value and increased volatility in the exchange market the government has employed a number of measures to support the country’s currency. These measures have included selling dollars, and even announcing in advance market intervention rates. Now, in the latest effort the government announced that it will request a standby credit line up to US$40 billion from the IMF. At the end of the last week in March the country’s foreign reserves stood at US$79 billion. While the US$79 billion still represents a level of reserves close to the historic high, that the standby line equals an additional 50% is definitely a calming factor. Undoubtedly government policy has played a positive role strengthening the peso and providing stability, nevertheless the global environment has also played an important role or even more important in the mild recovery of the peso: the peso hit its low point during the first week in March. Since then it has recovered 9.5% of its value. Petroleum at the beginning of March was hovering near US$40 per barrel.
By the end of March it had shot up 21%.

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