To expand itself, a company of pipes and fittings aims at the sector of buildings
Folha de S. Paulo
When he took over, newly graduated, the administration of his father's business "which was also a newcomer in the market", the lawyer Sergio Monteiro, 36, had no precise idea of the potential of the business. "It was a small company with 60 employees and earnings of R$ 1 million (US$ 588,2 thousand) per year", said the managing director of Corr Plastik.
Fourteen years later, the company, still 100% familiar, left the cake of the 55 companies which fight for nearly 20% of the Brazilian market for pipes and fittings to join the group of the three leaders. "The jump came in 2001 when we moved from Diadema to Cabreúva (78 km from the state capital). We increased the plant and invest in state-of-the-art technology". And the intent is to get even closer to the main competitors: Tigre and Amanco. In this strategy, the company decided to expand the focus of activity.
It left to provide only for the infrastructure sector (which includes works such as sanitation and irrigation) to meet also the building segment (civil construction). The company plans coming out of earnings from R$ 140 million (US$ 71.1 million) in 2009 to R$ 200 million (US$ 117.6 million) in 2010. This year, the company invested R$ 20 million (US$ 11.8 million) in the expansion of the plant in Cabreúva (SP) and in the unit of Marechal Deodoro (AL), inaugurated last year. "We did the opposite of the most companies of the sector", says Miller. "We started with a more specialized assistance and now we get into a segment that requires a larger scale", he adds.
In this undertaking, logistics is one of the great challenges that occur. The executive says that the expenses with shipping of tubes represent 8% of the costs. "The products occupy much space. We cannot carry a large quantity in only one truck", he says. In relation to the connections (small), the freight weighs less in the total cost: 2%. Considering these numbers, the company split the coverage of the Brazilian market. The plant in Alagoas, which produces only tubes, will serve the Northeast and Mid-South. The São Paulo unit, which also produces connections, will attend the Southeast, South and Midwest, besides provides the stock of connections (which have low costs of transport) to the factory of Alagoas. In addition, the company studies open a third unit, in the Midwest. "This is still under analysis. The decision will be taken in the coming months", says Miller.