A visionary and dynamic Mexican company, Grupo Michel-Salver has expanded into multiple business divisions in four continents. Susana Baumann reports how the company keeps looking for new challenges and business opportunities to bring happiness to customers worldwide.
Grupo Michel-Salver manufactures and distributes products that make people happy. From snacks to sangrias, hot sauces to chocolate and candies, and recently the incorporation of recreational plastic balls, the company combines what makes many consumers joyful: tasty food with fun and entertainment.
The group is a leading part of the rapidly growing international snack food industry, following trends and guidelines of the Snack Food Association (SFA), the international trade association that represents over 800 companies worldwide. Last March, SFA President & CEO Jim McCarthy addressed the American Wholesale Marketers Association in Las Vegas at the Real Deal Expo, tracing the history of snacks. What people want today, related McCarthy, are more easy open-and-eat products, which are setting new trends in the snack food industry, as snacking replaces meals, and nutrition has taken front and center.
As in many other segments of the food industry, whole grains are taking over the industry, and in trying to reach the USDA standards, companies are not only creating new products but also looking for flavors that consumers would crave.
Grupo Industrial Michel-Salver understands its business and as a global producer it has created its products based on tradition, variety, quality, flavor and value since its inception in 1950. The visionary behind the group is Ignacio Michel Velasco, who originally founded Dulces de la Rosa. In 1962, Michel Velasco split from the original company to start Grupo Industrial Michel. Since then, the company has grown locally and globally, exporting its products to four continents and more than 30 countries.
Grupo Michel’s success is based on its 60 years of leadership in the industry. It has developed necessary technology and experience to manufacture products that are consistent in freshness, color and taste. In addition, Grupo Michel includes added-value with timely service and competitive prices. “Since the beginning, our company prioritized quality, value and best service to our customers. A creative team of product development efficiently works to continuously produce new ideas in sync with main industry trends,” said Alejandro Rivera, the exterior commerce director for the group.
INTEGRATED STRUCTURE FOR BETTER PRODUCTS
Grupo Michel has developed a vertically integrated organization that allows complete control of the manufacturing process, from origin to final distribution. The group’s agro-industrial area, which includes grain farming and milling, provides the raw materials to produce its own brand name pellet based snacks, cereals and ready to eat snacks as well as to provide companies abroad with ingredients and products manufactured to specification. The company also manufactures hot sauces and ketchup, fruit beverages and sangrias, candies and chocolates.
Snack pellets, which represent the core of the group’s business, include wheat, potato, corn and rice flours in a great variety of forms and shapes. Presentation of pellets includes sacks of 15 to 20 kilograms and a shelf life up to 12 months when the product is stored in the right conditions. Cereal is processed to produce different lines of products such as cereal bars, breakfast extruded cereal and flakes in an assortment of flavors such as plain corn flakes, frosted corn flakes, chocolate corn flakes, fruit and chocolate donuts. Ready-to-eat snacks include cheese curls and balls, chili-lemon and lemon-salt wheat snacks, smoked bacon flavor wheat snack, and cheddar cheese, caramel and fruits pop-corn.
Michel’s candy line includes artificially flavored fruit soft gel candy in a unique presentation, a plastic cylinder with a piston that when pressed, squeezes out the candy. Flavors are fruity pineapple, strawberry, lemon and grape, liquid tamarind, chamoy, and flavored chocolate gel candy.
Many of the products created and technology used and adapted by the group are based on Michel Velasco’s personal vision, creativity and know-how, Rivera said. For instance, the company is now developing three lines of marshmallow production that will raise speed to 1800 Kg/hour in each line, while conventional lines produce around 350 to 450 Kg/hour.
“All these products and its derivates are manufactured under strict quality control systems in order to guarantee total client satisfaction. The group is ISO: 9001, version 2000 certified, including the HACCP for control and prevention of risks. We work with the ERP and ABC systems and our administrative and process control systems are BWQP certified,” he added.
In response to these careful and dedicated manufacturing procedures, Grupo Michel experienced a national market growth rate of 55 percent in the last three years, and 280 percent in the global markets. The group presently exports to Central and South America, the Caribbean, Africa, Eastern and Western Europe, the Middle East and Arab Emirates, and some regions in Asia, covering over 30 countries.
The company’s three plants are located in Guadalajara, covering 85,000 square meters on a property of 150,000 square meters, with expansion plans on the way. The facilities produce 5,000 tons a month of snack pellets, 3,500 tons of breakfast cereals, 1,800 tons of candies, two million liters of hot sauces and 800 tons of finished snacks, with a compound sales amount of $185 million per year. Thirty-five percent of the production is exported to over 30 companies abroad in the United States, Canada, Central and South America. “Snack pellets are the product we export the most, with a high demand in all sorts of flour to countries such as Israel, Germany and Australia,” Rivera said.
In addition to food, the group has expanded into the production of plastic utensils, glucose, dog food ingredients, fruit beverages and PET and PVC containers. It also offers consulting services and commercial advice to companies and conglomerates in the same segments related to supplies and vendors, financing, operational and administrative systems and procedures.
In 2005, the group purchased a 65-year company, Salver S.A. de C.V., manufacturing quality plastic play balls since 1945. The company has a market share of 85 percent in Mexico in its segment, and has participated at the Toy Fair in Nuremberg, Germany since 1989. In 1996 it was named best company of the year by the American Chamber of Commerce.
Salver manufactures full print plastic balls in bright solid colors and unique decorations that include its own designs and patented images. The company can also print to specifications corporation logos and promotional images. A variety of sizes and presentations include scented balls, sport balls for soccer, football, and basketball, and gym balls. A line of balloons in standard and crystal colors has been launched this year in sizes from seven to 16 inches.
WHAT TO LOOK FOR
Rivera believes that Grupo Michel-Salver’s success is based on the high quality and competitive prices of its products, supported with intensive market research, especially carried out in foreign countries. “We constantly visit our international markets to select distributors, support them with promotional programs and an annual plan with clear objectives and goals. Each distributor is set with a sales quota and an array of advertising strategies according to the local market trends, and we support those distributors’ performance several times during the year,” said Rivera. The group is constantly looking for new and exclusive representatives worldwide with deep knowledge of the wholesale, institutional, and chain stores distribution channels to market its products.
In order to continue with expansion, Michel Velasco’s sons hold leading positions in the company to carry on with the tradition, variety, quality, flavor and value that have characterized its products for over 60 years. The group’s competitive advantages include product innovation and development that surpass clients’ expectations, service in place and time, versatility to adjust to specific requirements, and an international presence that guarantees the best resources and following international trends. “We are always participating at international expos and fairs such as SNAXPO and FMI in the United States, ANUGA and ISM in Germany, EXPOCOMER in Panama and Mexican Fiesta in South Africa in order to enhance our presence worldwide and keep up with the leadership our team has worked hard to achieve,” he concluded.