By Nick Tichy
One of the biggest obstacles facing the communities CEN assists is a lack of economic opportunity. Because of this, one of CEN’s main priorities is to help the communities where we work create new income generation projects. This is complicated by the communities’ inexperience managing businesses and the few role models available to them.
One of the few bright spot enterprises in the community of Maguary is the ecological "leather" bag-producing business Couro Ecológico . This is an association of roughly 20 members who work a few hours a week in the business and share proceeds. Using an abundant and sustainable resource, natural rubber, this business has been making bags to sell to retailers in Brazil, the USA and Europe. While the enterprise shows promise, of the group's minimal business management experience results in underperformance. Finding a way to successfully manage, market, and sustain Couro Ecológico is a high priority for the community of Maguary. In support of this, CEN recently organized a group of MBA students from the Wharton School at the University of Pennsylvania, to travel to Maguary to evaluate Couro Ecológico and provide consulting to improve the business.
“The experience was amazing,” reflects Cristina Mariaca, Wharton School student and coordinator of the project. “It was incredible to see the business savvy and entrepreneurial spirit of the community members,” said Cristina, a Brazilian originally from São Paulo who lived in Miami before beginning her studies at University of Pennsylvania.
“If they only had access to business education, such as a bit of accounting, marketing, and operations management, I am sure that we would see some success stories coming out of Maguary,” Cristina suggests.
Cristina and the students spent time observing the running of the business, from the manufacturing of the bags to their relationships with retailers. After examining the successes, failures, strengths, and weaknesses of the business, the group came to a number of conclusions.
Although there were some issues of consistency in the manufacture of the bags, most of the problems lay in the marketing of the product and establishing a consistent customer base.
There is a large market of consumers in the United States that pride themselves on their informed and conscious purchasing choices. Fair trade, environmentally friendly, and other niches have emerged and prospered over the years as people in the U.S. and the developed world use their most powerful tool--their buying habits--to support the causes they are passionate about.
Businesses similar to Couro Ecológico have successfully capitalized on this market. However, according to the student consulting team, Couro Ecológico could do a better job emphasizing these distinguishing and desirable aspects of the business to their potential consumers.
The group suggested a new marketing strategy that emphasizes the personal craftsmanship, environmental sustainability, and other positive impacts of Couro Ecológico. By appealing to the issues that are important to consumers in the U.S., the product can create desirability. The Wharton students believe that this, along with streamlined and consistent production, will help the business to become successful and sustainable.
CEN Objectives for the Next 12 Months
Moving forward from the Wharton team's recommendations, CEN's strategic plan for Couro Ecológico in the coming twelve months includes:
- Helping CE communicate their unique message to retailers and customers
- Working with the association to improve the consistency of product quality
- Performing market research and analysis on key U.S. markets
- Increasing the sale of CE bags by linking with potential retailers and possibly selling bags directly