U.S. Housing Crisis Changes Export Strategy in Guatemala

Posted about 5 years ago

Article Summary:

Guatemala saw a severe decline in its exports following U.S. Housing Crisis a year ago, which was a large receiver of its export wood projects. In order to improve sales, Guatemalan business adapted their products according to demand and established distribution centers and retailers in the U.S. Leading to an inflow of foreign currency of U.S. $69 million, almost a 20% growth.

Photo Credit: America Economia

Original Article Text From America Economia via Google Translate :

Change of Strategy Promotes Exports in Guatemala

The figure is 16.35% higher in relation to what was sold in 2010, when there was an inflow of foreign currency for U.S. $ 69.15 million (Q540 million).

Rosa María Monzón, coordinator of the Committee of Furniture and Forest Products Agexport, said that for 2012 is estimated to grow between 10% and 15%, enabling the sector to meet, at least, the historical amount of U.S. $ 87 million sales, which occurred in 2007.

According to figures of all furniture sales abroad are the most reported exchange with U.S. $ 22.3 million, followed by lumber, with US21.9 million, the doors, with $ 10.25 million, and the platforms, with U.S. $ 7.2 million.

El Salvador ranks as the largest importer of domestic products, with U.S. $ 19.3 million, the U.S. is in second place with U.S. $ 18.3 million, followed by Honduras, with U.S. $ 13.3 million.

Monzon stressed that a market of growing importance is that of Italy, to which it sends the highest percentage of production of coffins.

According to statistics from Agexport, the furniture sub-sector, which leads exports in 2011 grew by 25.99% from U.S. $ 17.7 million in 2010 to U.S. $ 22.3 million.

The situation was different two years ago when the U.S. housing crisis led to a fall of 27.76%.

Strategies.
Monzon stated that some of the strategies of the business to improve sales were to change their products according to demand and to establish distribution centers and retailers in the U.S.

Other companies used as a tactic to attract affluent buyers, or design products for a specific company, with a destination or particular market niche.

Caobadoors
The company that originally manufactured billiard tables, managed to enter the market and decided to develop wooden doors with stained glass. Subsequently decided to enter the production of windows, fireplaces and interior finish carpentry.

Another example is the Laminati company whose flagship product is engineered wood floor, resulting in growing demand in international markets, which is exported to the United States especially.

This type of floor, unlike the traditional parquet, small parts, is made of several layers that give better performance in wet locations or in rooms that have a heating system below ground.

The firm also has a distribution center in the U.S. that caters to quickly process orders from any state in the country.

Finally, another group of businessmen decided to join the group called Mesoamerica access table that supports exporters seeking to expand its operations in markets in southern Mexico, Honduras, El Salvador and the Dominican Republic.