Latin America and its potential
Markets, their challenges, and potential. For decades, Fronius Perfect Welding has been expanding rapidly and establishing itself in markets around the world. Latin America is one region that possesses huge potential. International companies with a strong presence in Mexico, Brazil, and Argentina, including some in the automotive sector, were the reason behind Fronius wanting to tap into this market. The company’s subsidiaries in Brazil (2002) and Mexico (2007) employ around 150 people and were the first step in opening up this market.
The next important step came in 2019 – the opening of a new site in Argentina. Based on internal estimates of welding and cutting equipment imports, Fronius regards Argentina as the third-biggest market in South America. Reason enough to strengthen business activities in the country with the aim of increasing the company’s market share.
The procedure in Argentina was marked by a variety of complex challenges that the company is often confronted with across Latin America in general. Differences in culture and mindset play a key role. However, the company will surely benefit from already having gained important experiences in Mexico and Brazil.
COMBINING GERMAN PUNCTUALITY WITH A LATINO RHYTHM
Although Argentine tango music is a world apart from classical music, this does not mean that classical music has nothing of value to add. It is equally possible to set up an office that conforms to European standards but also ensures South American customers are completely satisfied. If you want to understand business in Latin America, it is first and foremost important to understand and appreciate the culture, so that you can adapt accordingly to it. A number of major Fronius customers in the automotive sector are European companies such as VW, Daimler, Benteler, and others, all of whom require outstanding quality and service from their South American production facilities – and above all, German punctuality.
Where significant differences arise, Fronius takes on the role of mediator. By establishing a subsidiary in Argentina, the existing Fronius representative in Buenos Aires, RH Welding S.A., will have access to the relevant internal standards and support, thus allowing them to further improve service quality, from which the industrial manufacturers in the region will ultimately Benefit.
» If you want to understand business in Latin America, it is first and foremost important to understand and appreciate the culture, so that you can adapt accordingly to it. «Andres Loaiza-Espinosa, Area Sales Manager at Fronius
PERSONAL RELATIONSHIPS ARE KEY
In addition, Andres Loaiza-Espinosa, Area Sales Manager at Fronius, stresses the importance of having a good network. In Latin America, personal relationships are of great importance in any business dealings. The almost familial network that sometimes exists between individual business partners plays a crucial role and must be regarded as a deeply-rooted cultural facet that should be maintained.
Fronius can provide high quality products and the best technology. However, to ensure perfect implementation of the company’s internal strategy of customer proximity, “we need to adapt to the circumstances on the ground. In order to carry out any product presentations or test welds at all, the first thing we need to do is to get a foot in the door”, explains Loaiza-Espinosa.
WIDESPREAD PRESENCE IN SOUTH AMERICA
Fronius also has a firm foothold in the rest of Latin America thanks to its representatives. For example, Fronius manual welding systems are popular in the Chilean copper mining industry. Across Latin America, there are a wide range of sales opportunities for these devices in the general industry sector. From Costa Rica to Panama, Colombia to Venezuela, Ecuador to Peru and Uruguay, there are promising markets to be found.
In general, Loaiza-Espinosa sees huge potential for welding automation: “Until now, welding in each of the countries has been 60 to 70 percent manual. However, becoming a welder has been losing its attractiveness as a career in South America. Sooner or later, this will create a situation where industry has to automate a variety of processes.”
The same is true for robotic welding systems: “If you compare the figures from the robotics industry in Asia with its Latin American equivalent, it’s clear that we can expect to see an enormous growth market. This is yet another area in which Fronius can apply its outstanding know-how.”
PATIENCE AND PERSEVERANCE
“Investing energy, time, and perseverance in the Latin American market is ultimately worth it every time”, states Loaiza-Espinosa confidently. Even though the economic stability is not comparable with that of the European commercial hubs, the market nevertheless has huge potential. According to the Area Sales Manager, growth in the region happens in waves, which are alwaysfollowed by longer difficult periods. Despite this, or perhaps precisely because of this, it is crucial to develop a strong position during these harder times “to be able to ride the wave before it breaks."