Day 6 - Kimberly Clark Chile, Anglo American, and Entrepreneur Roundtable

Today was our final day of business visits and again we were educated and challenged to understand the Chilean market and people.  Our first meeting of the morning was with Kimberly Clark Chile.  We were hosted by Claudia Leniz - Human Resources Analyst and Ximena Calderon - Marketing Manager.  We learned that KCC was recently voted the #16 best place to work in Chile.  They have 186 employees - 70% men adn 30% women.  Their mission is to "lead the world in essentials for a better life." The facility we visited here was a distribution facilty only - there is no production of KC products in Chile - most are imported from Argentina. 

 KCC competes in three basic segments:  babies and infants, feminine care, and family care.  The Chilean market is an interesting market because of its relatively small size.The penetration of disposable diapers in Chile is close to 100%. There are 258,000 babies born her each year.  KCC's strategy is to get mothers to trade up to a higher "tier" of diapers.   Their strategy to do this is based on innovation and brand experience.  They focus more on an emotional approach than a functional approach. 

They have a special maternity plan to reach new mothers - a market that turns over every two years or so, as babies stay in diapers for approximately two year.  They have a team of 11 midwives and nurses that visit moms and babies in the hospital to provide samples and information. This allows them to reach more than 55% of their total market.  They have been a price war with Pampers for more than two years and Ms. Calderon re-emphasized the fact that it doesn't benefit any party in the distribution chain. 

She spent considerable time talking about the feminine hygiene market and the family market (particularly adult diapers and pads).  Ms. Calderon sees the adult "diaper" market as a particularly open market for them and they are working to demystify and destigmatize the use of these products.

Following these two wonderful speakers we got a tour of the distribution faciltities.  Many students were interested to learn that KCC uses the same inventory bar code systems as their companies in the US.  We were all amazed at the MOUNTAINS of diapers that we say.  Several folks - including Prof. Daubek - wanted to test out the harness system and get to the top of the mountain!

Our second visit was to Anglo American  - one of Chile's large copper producers.  Angelo American is the fourth largest mining company in the world in terms of market capitalization wit a market cap of US$ 58.8 billion and US$ biillion in earnings in 2008.  It is the third largest mining company in Chile with Codelco being the largest. 

We have heard all week about the importance of copper in the Chilean economy - it is a critical factor in the "Financial Rule" that has been helped Chile withstand the current economic disruptions.  Chile has the largest reserves of copper in the world - 36% of the world's reserves. Chile produces four times as much copper ore as the US produces and mining represents 35% of al taxes paid in Chile in 2008.

We learned about one of their mines near Santiago - the Los Bronces mine.  A mine has a life of approximately 30 years.  This particular mine produced 236,000 tons of ore in 2008. 

Our third visit of the day was back at the hotel were we heard an interesting and intellectually challenging presentation by Michael Tupper who is the founder of Tubaloo.com.  This is Mr. Tupper's thirs dot com start-up - his first was in 1995.  He had experience in Silicon Valley at Intel and for 155 - a telecommunications carrier.  He believes that this experience helps him craft a vision for what technology will hold two years out.  In his present business he is developing softward for Google's new Android phone.  He recommended an article that we should read in understanding the Chilean economic environment for entrepreneurship.  It is an article in TechCrunch.com entitled "Chile wants your poor, your huddled masses, your tech entrepeneurs."  Mr. Tupper has a comment post explaining his views dated October 11 at 1:10 pm. His comments provided a lot of food for discussion and was an interesting counterpart to our first meeting on Monday at Ministerio de Hacienda.