ost people say that by the third generation, a family business will no longer be family run, or it will no longer be a business. But Guarany Industria e Comércio (pronounced gwah-rah-NEE) is different. With total sales of $35 million and an annual growth rate of 15 percent over the past seven years, Guarany is counting on continued growth – and making its strategic plans accordingly. “My brother and I are the main shareholders,” says President Alida Fleury Bellandi. We are different because we continue to upgrade our people and improve our production. We are constantly investing in the company and its progress. We believe in our business and in Brazil.”
Today, Guarany sets one of her sights on international partnerships as a strategy for the future. “Our intention is to have joint ventures with companies related to our business. Internationalization is a key factor.” To accomplish this goal of international growth, Bellandi is planning to take the company’s core product lines into greater levels of specialization and diversification.
Guarany’s core business, its pumps and sprayers, is targeted to four key market segments: agriculture, horticulture, gardening, and forestry. But emerging from this landscape are two specialty sidelines that are growing in importance. “One of our sidelines is the firefighting business, especially forest fires, the other deals with public health,” explains Bellandi. Guarany designs products to combat endemic diseases, like malaria and yellow fever, as an extension of its chemical spraying equipment. “In both firefighting and public health, the need is for applying liquids, but each has evolved into a specific system with its own special requirements.” Guarany made strategic international alliances with companies such as Wildfire and Clarke, both highly specialized in their respective business. Together, these companies promote public health in many different countries.
With its sideline businesses, Guarany is something of a pioneer in Latin America. The company’s integrated approach to firefighting is three-fold. “One aspect is a package of products for ‘initial combat’: the principle is to prevent, then control, if not possible to fight the fires. Then we provide training for the fire brigades and permanent technical assistance. Our clients are often governments of other countries. The third part is in designing plans for preventing fires, especially for countries that produce a lot of wood, paper, and other such products.
Guarany also made some important strategic alliances in its public health sideline. “We have an alliance with an American company called Clarke Mosquito Control,” explains Bellandi. “This company is a leader in chemicals and heavy ULV equipment; we purchase and then distribute them in Brazil. We also make two products that Clarke buys and sells in many countries around the world. We designed these alliances based on common interests with products, markets and projects. We work together to solve problems and develop markets in many areas of the world.”
One of the ingredients that Guarany adds to the mix is its wide distribution network, with regular exports to 50 countries and a dominant presence in Latin America. “We have distributors in these countries with a scheme that’s interesting to our partners,” remarks Bellandi. “Our partners also have customers in areas where we are not active, such as Asia.”
Guarany exports about 25 percent of its production, which Bellandi says is normal in countries like Brazil, where
the domestic market is large and important. “The Italians, for example, export about 80 percent of their production. For us, our domestic market is very important, especially with the Chinese invasion coming.”
Bellandi cites unfair competition and domestic issues as key obstacles for her company and for Brazil in general. “We deal with a lot of government officials and are familiar with the difficulties that the business community faces in Brazil. The foreign exchange policy and heavy tributary system will not change on a short term for many reasons. But for exports, there may be a compensation coming. The scenery here is interesting; interest rates are coming down slowly and the market is reacting positively. Next year will be an improvement for our market.” But with increasing competition and more costly raw materials, companies like Guarany have to be more efficient all
One of “the biggest problems is unfair competition,” laments Bellandi. “Competition is always important and necessary, and there is competition from companies and from countries. In the case of China, the country is focused on exporting. Materials are subsidized, taxes do not exist for exports, and wages are kept low. This creates a difficult situation for a company like ours. Either you go and produce products in China or you produce highly specialized products that are not interesting for the Chinese because they don’t have the economies of scale.” Bellandi, who also serves as vice president of the Association of Machinery and Equipment Manufactures in Brazil, also points to Brazil’s currency as a weakness in competing with Chinese products. “The Chinese currency is a main force for them. Our currency is stronger and higher.”
Bellandi remains faithful to her company’s key philosophies and strategies, which have seen it through 84 years of operation. That’s an accomplishment in a country like Brazil. “We always look inside and out. We have social and environmental responsibility, not just because it’s fashionable, but we’ve done this for more than 20 years. We have constant evolution in our thoughts and attitudes and we work closely with international institutions in the lines we produce. We have ISO 9001 certification, and others from the World Health Organization, the London Fire Brigade and many more. In each of our lines, we have approached these institutions to put the engineering and scientific components together to back up our ideas.” Indeed, partnerships are part of the core strategy at Guarany and Bellandi is looking to build new and stronger alliances all over the world.