Date: 20/02/14

To: Alvaro Rivas CEO

Hyperpaales
From: Wilki Santander.
I&D Manager
RE: Estategic Analysis

I Have Prepared strategic analysis to Assets the current competitive positions of

Hyperpaales in the industry diapers in Venezuela, As shown in exhibit 1, the
Venezuelan industry environment in Venezuela diaper is not exempt to the volatility of
the Venezuelan economy. Although the market for baby diapers is growing every year,
the economy actually is a recesin is also making steady customers migrate to more
economical options. The industry has two major risks tight control of currency
exchange which makes the acquisition of raw material for counteract this we must
develop local suppliers but the quality although is lower and neosocialist policy of
goverment that goes against private property for this we adopt a defensive position
improve ties with the local Major and cooperatives of surrounding region.
As shown in exhibit 2 Hyperpaales has a team of highly integrated throughout the
business chain, his team is one of the best in the country second only to Procter and
Gamble market leader, as many of our members come from there so we could quickly
implement processes as ISO, ERP, Strategos, Six sigma is not complete but it will work.
With this team we can make a multidisciplinary team that leverages the
internationalization of the company.
As shown in exhibit 3 the analysis of the 5 forces of porter can be seen that the diaper
industry is highly attractive because it has high barriers to entry to new entrants since
the investments are high. From the point of view of the power of suppliers and
customers is low because there are few suppliers and customers have many options
which makes the industry unattractive. From the point of view of industry competitors
has an average attractive as there are nearly a tacit agreement between the existing
leader when his price goes up the other goes on. Substitute products cloth diapers are
not in use.

As shown in exhibit 4 Hyperpaales direct competitors are procter and gamble

undisputed market leader which sets the tone for the rest of the competitors, kimberly
clarck is another transactional having very good distribution channels has partnerships
with some large pharmacy chains, Corpoal is the competitor smaller but very well
positioned in the lowest strata of the population. Hyperpaales is very good positioned
in the lower strata in baby diapers and is market leader in the adult diapers market
because for large multinationals this market it is not attractive.
As shown in exhibit 5 as you can see Procter and Gamble is the market leader with the
largest number of sales $ 132 M and a quality perception among consumers with the
highest quality, kimberly clarck is second with 69 M $ and also a perception very good
quality among consumers, corpoal sales are the lowest in the market but this very
well positioned in the lower strata. Hyperpaal is the third in the market but this very
well positioned in the lower strata for babies and all adult diapers.
Conclusion.
Hyperpaales must pursue a strategy of low-cost competitor in baby diapers and a
differentiation strategy in the market for adult diapers, should leverage the capabilities
of our team for internalization and search for Latin American markets where the
middle class is increasing its purchasing power as Panam, Costa Rica and some
caribbean islands especially in adult diapers, including installing a plant taking
advantage of attractive industry especially in the profits once inside. in Venezuela
should be developed local suppliers to have a competitive advantage over other
competitors including some imported diapers we even think of an upstream
integration from the point of view of the environment we need to improve our
relations with the local mayor who is pro- government and cooperatives to reduce the
problems with state agencies , we must also seek alliances with other pharmacy chains
to position ourselves as the most important in adult diapers in Venezuela and
neighboring
countries
domestic
manufacture.

Industry

Venezuela 2014

Demographic Trends

Population is young, In Venezuela born babies between 500 and 550 million per year
which gives a potential market of 90 million diapers per month

Sociocultural Trends

Decreased demand for expensive items by the current recession.

Technological Trends

High investment of transnationals

Macroeconomic Trends

Oil price stable, devaluation of the currency to finance public spending, control
currency exchange, two digits inflation

Global Trends

Decrease in birth and in Europe and USA, growth in birth rates in Latin America.

Political-Legal Trends

Neosocialist policy that favors enterprises and cooperatives.

Exhibit 1 Enviromental Analysis Diapers Industry

Venezuela.

Innovative R&D

High Quality
Manufacturing

Processes

Performance review
based on
publications

6-Sigma Approach

People/Skills

The best
professionals in the
country

Capabilities

Systems/Tech

Alignment

Sustainability

Well aligned
internally and
externally

Marketing

Sales

A sales team well

integrated with
customers

Trained in six sigma

Implemetacion of
the Quality Program
Strategos

ERP

Well aligned
internally and
externally

Well aligned
internally and
externally

Well aligned internally

and externally

difficult to imitate
because it is a work
of years

Exhibit 2 Capabilities Analysis Hyperpaal.

Threat of Entry = high

A) High capital investment
B) Economies of Scale
C) Competitors with market
experience
D) control currency exchanges
limited access to
imported materials
Supplier Power = high

Rivalry = medium

A) Few suppliers cellulose supplies

Buyer Power = high

A) Preferences for high quality products.

, and paste superabsorbent

A) Procter and Gamble

B) Serve all manufacturing companies

B) Kimberly Clark

B) Price sensitivity.
C) Delivery and availability distribution channels

C) Corpopaal
Threat of Substitutes = low

cloth diapers

Exhibit 3 Five Forces Analysis Diapers Industry Venezuela

Performance Metrics
%
share

Competitive Position

Growth Earnings Profitability

5%

3%

10 M $

15%

differentiated strategy, strategic

alliances

Procter
and
Gamble

61,50%

5%

132 M $

ND

Broadly differentiated, Market Leader

Kimberly
Clarck

32,50%

2%

69 M $

ND

Broadly differentiated, Good distributions channels

1%

1%

2M$

ND

Low-cost, niche player

Hiperpaal

Corpopaal

Exhibit 4 Analysis Competitors Industry Diapers

Venezuela

Exhibit 5 Estrategy Maps Industry Diapers Venezuela.

Exhibit 6 References .
1. The strategists toolkit Jared Harris, Michel Lenox, Kindle Edition.
2. Analisis de la competencia, Carlos Jimnez, Ediciones IESA- Dataanalisis, Primera
Edicion, 2010.
3. Estrategia y Planes para la Empresa, Antonio Frances, Ediciones IESA, Primera Edicion
2006.
4. Reporte financiero Hyperpaales 2013, Lic. Jose Luis Rincn.