Southern Exposure

Desde as Entranhas dos Labirintos Latinos.

Sunday, November 16, 2003

Kola Real and its founders in the spotlight

Interesting how in the space of one month three different publications: The Wall Street Journal, The Economist and Spain' El Pais (unfortunately, all by subscription only), devote articles to the family that created Kola Real. Kola Real was created by the Anano family in Peru during the worst times of the Shining Path guerrilla movement. The family had to flee its farm and moved to the city of Ayacucho, where they noted the lack of soft drinks as major bottlers of Coke and Pepsi, refused to send trucks over to their city. The family put together US$ 30,000 and started making a low cost soda named Kola Real which is now sold in Peru, Ecuador, Mexico and Venezuela. The Wall Street Journal estimates the company has revenues of US$ 300 million.

Kola Real's strategy is simply to undercut the competition by spending less on advertising and using a low budget approach to everything. In Mexico, Kola Real has forced Pepsi to cut prices twice and has accused Coke of ant-monopolistic tactics. The company is now getting ready to introduce other flavors to compete with the big multinational giants. Thus, Pepsi and Coke face a threat from where they least expected it.

In the article in El Pais, written by famous Peruvian writer Mario Vargas Losa, he closes by saying: "Not many have the success of the Ananos. But many more would have it if in Latin America we had more policies, that instead of discouraging or being hostile, would promote individual initiatives and would celebrate the success of a company, of an entrepreneur, as being the success of the whole of the citizens, with benefits towards all citizens, instead of assuming it with mistrust, rancor and envy....Now that here and there, the sadly remembered populism of tragic credentials is once again sprouting in Latin American lands -with Venezuela at the lead- it is worth spreading around the Continent the story of the Ananos family, as a reminder of what Latin America could be if, muck like those daring Ayacuchanos, they set themselves to do it."



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