Cafe Galavis: a brand with the aroma

of innovation
Juan Ernesto Perez Perez

The beginning of a great industry Juan Ernesto Perez Perez is

based at the Department of
Cafe
Galavis was considered one of the leading family companies in industrial development Norte de Santander,
and of greater business recognition, with more than a century of experience in the Corporacio
n Universitaria
production and commercialization of roasted and ground coffee in Cucuta, Colombia. The Minuto de Dios –
company was founded by Don Lino Galavis in 1918. After his death, his son, Lino Galavis UNIMINUTO, Cucuta,
Junior, managed the company for more than 60 years; however, due to his advanced state Colombia.
of health, the management was left in the hands of his four sons – “heirs to the business”.
The low level of experience in business management, the policy of profit sharing among
shareholders and the internal difficulties of family nature led the firm to enter one of its
greatest financial crises, without having the financial muscle to support operating expenses,
taxes and working capital required for its production. In 2015, the diplomatic, humanitarian
and economic crisis that arose between the governments of Colombia and Venezuela led to
the closure of the Colombian–Venezuelan border, which caused the commercialization of
contraband coffee at a lower price compared to the regional market, negatively impacting
the level of sales. On the other hand, the presence of different competitors and traditional
national brands in the city considerably affected the viability of the business.
To capitalize on the firm, the family board made urgent decisions, among which was the
change of the top management and the entry of a new shareholder, engineer Francisco
Ya
ñez, who acquired 52% of the company and was appointed in 2016 as the new chief
executive officer (CEO), in charge of facing the new challenge – to avoid closure and
manage a company with more than 104 years of history, tradition and business roots in an
adult market niche in the Norte de Santander region. In January 2023, he received
feedback from his consulting team, and upon evaluating the new market challenges with his
collaborators, he realized a great challenge that merited the search for a priority alternative
solution. How to design a new product considering the loss of brand identity in the face of
the generational change of its consumers? Consequently, the CEO required objective
information for decision-making.

104 years making history

Per history, coffee entered Colombia through the department of Norte de Santander,
coming from the Guianas crossing Venezuela. It was in the customs office of Cucuta where Disclaimer. This case is written
solely for educational purposes
the first commercial production of grain was registered in the territory of Granada with its and is not intended to represent
corresponding exportation around the year 1835. For this reason, the first roasting successful or unsuccessful
managerial decision-making.

Galavis, a company considered
industries emerged in this locality, as was the case of Cafe The authors may have
disguised names; financial and
in the regional market as one of the leading family businesses in industrial development and other recognizable information
of greater business recognition with more than a century of experience in the production to protect confidentiality.

DOI 10.1108/EEMCS-04-2023-0100 VOL. 13 NO. 4 00, pp. 1-23, © Emerald Publishing Limited, ISSN 2045-0621 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 1
 and commercialization of roasted and ground coffee, founded in 1918 in Villa del Rosario by
Don Lino Galavis Carriedo.
In 1953, after the death of the founder, his son, Mr. Lino Galavis Junior, continued to
manage the company for the past 60 years. The businessman born in Villa del Rosario
decided to give a turn to the company based on greater planning and with a more industrial
criterion modernizing the factory, and for that reason, the production plant was in the city of
Cucuta, Colombia, a territory geographically delimited with the Colombian–Venezuelan
border; hence, the border country was one of the main clients of Colombian coffee. At the
same time, Mr. Lino Galavis Junior began to train himself in the latest technological
tendencies in coffee roasting to create a more prosperous company. Mr. Lino Galavis
Junior died in 2018 at the age of 97. In August 2022, the change of government presidency
in Colombia promoted the improvement of economic relations and the implementation of
new diplomatic guidelines such as the opening of consulates and the progressive
normalization of their bilateral relations within a framework of legal security and
complementarity for the benefit of both countries. The new director, Francisco Ya
ñez, a civil
and environmental engineer, with extensive experience in the development of real estate
projects, expected, probably for 2023, to be prepared and take advantage of the reopening
of the border market to potentiate its exports with a focus on a differentiating product at a
brand level, given that, from his position as director, the plant was running a fully optimized
process, capable of supplying the demand of Venezuela as a potential customer (Figure 1).
However, the new director expressed with great uncertainty to his team of collaborators: “It is
worrying that issues such as smuggling end up changing the commercial conditions. We do
not know what happens on the other side of the border with Venezuela, if they give away the
coffee that we produce or if they charge more for it. Therefore, our serious policy is to look
towards the internal market and that of other countries. And although the proposal is to bet on
other markets, we do not leave aside the philosophy with which Lino Galavis Carriedo began,
which was centered on raising the quality levels of the bean and the production processes”.

Colombia, a country with a coffee culture

The country’s privileged geographical location in the equatorial zone of South America
provided ideal conditions for coffee cultivation, with soils rich in nutrients. The Paramos,
native forests, volcanoes and a variety of microclimates allowed for a wide diversity of

Figure 1
Galavis
Background of the company Cafe

PAGE 2 j EMERALD EMERGING MARKETS CASE STUDIES j VOL. 13 NO. 4 00

flavors and aromas. In addition, the altitude of the Colombian mountains created an optimal
temperature for the growth of coffee with a tradition of high-quality production and
cultivation techniques that were perfected for more than a century.
Research on “Colombian Coffee” highlighted the advantages that the country had at a
geographical, environmental and location level. Its volcanic soil and tropical mountain climate,
facilitated a natural environment to grow high-quality coffee all year round, while most
countries, for example, Brazil, Indonesia and Vietnam, were limited to seasonal harvesting; in
addition, the construction of three important intangible assets, namely, Juan Valdez character,
the 100% Colombian Coffee logo and the descriptor “country of origin” of Colombian Coffee
(Deshpande, 2001), made it one of the most iconic beverages in the markets.
According to the National Federation of Coffee Growers, in Colombia, there are 541,228
coffee-growing families, 656,906 producing farms, 853,809 hectares and 544 brands in the
world that carry the “Colombian Coffee” seal. In 2019, coffee growers obtained an income of
US$1.5m, which became the second-highest figure in the history of the Colombian coffee
economy, compared to 2017 with a value of $1.6m. According to the volume of exports, the
USA is the most representative country in the import of this great product, followed by
Canada, Germany, Belgium and Japan (Table 1). On the other hand, by the year 2023, the
Colombian coffee market was made up of five main strategic players: Juan Valdez, Tostao’,
Dunkin’ Donuts, Starbucks and Oma (La Repu
blica, 2023) (Figure 2).

Building solid competencies

Galavis was considered a reference
During its more than 100 years of history and tradition, Cafe
company in management and business; this was how research was developed in different

Table 1 Volume of Colombian exports according to destination

Countries 2018 2019 2020 2021 2022

America
USA 5.722 5.895 5.105 5.207 5.007
Canada 929 994 876 951 821
Argentina 12 14 14 22 23
Europe
Germany 1.023 1.196 1.082 969 779
Belgium 599 660 854 889 769
Italy 298 345 253 257 198
UK 284 268 258 293 243
Sweden 85 90 86 55 59
The Netherlands 118 149 115 159 176
Spain 281 321 292 267 246
Finland 280 300 247 193 130
France 141 144 137 110 84
Denmark 25 26 17 22 14
Poland 49 41 33 34 20
Portugal 23 28 20 12 12
Austria 0 0 0 0 0
Greece 24 34 28 40 32
Norway 137 171 186 160 172
Switzerland 6 1 4 2 0
Other countries
Japan 1.071 1.107 1.023 861 777
South Korea 475 493 540 517 490
Australia 177 184 202 195 167
Others 991 1.205 1.154 1.225 1.189
Total 12.751 13.668 12.527 12.439 11.408
Note:  Thousands of 60-kg bags of green coffee equivalent

n Nacional de Cafeteros (2023)
Source: Federacio

VOL. 13 NO. 4 00 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 3

 areas of knowledge, such as marketing, international business and strategy, among others
(Perez, 2022; PEREZ Perez & ROMERO Arcos, 2019; Perez & Muñoz, 2018; Perez Perez,
2018). This is how the tacit knowledge that was generated in the production process through

Galavis resulted in the human talent having the key
the routines in the facilities of Cafe
competencies to develop in the production chain, a high-quality and export-type product.
By 2022, the company had standardized processes in Quality Management ISO 9001:2015;
Food Safety Management ISO 22000:2018 and HACCP NTC 5830:2010, guaranteeing food
safety at each stage of the production chain; a change in strategic direction; expansion of
the core business to lines such as gourmet coffee, export type coffee and beans (Figure 3);
and learning the export process from countries such as Chile and the USA, in addition to a
strategic focus centered on innovation, quality and tradition of the product (Figure 4).

A modernized production system

The production process of Colombian Coffee in the Cafe
Galavis plant was constituted by
the following six operations: collection and reception of the bean, storage and weighing,
roasting and cooling, milling, packaging, control and distribution (Figure 5):
1. Collection and reception of the bean: In the first place, the seed of the coffee tree (the
plant that produces coffee) was collected by the farmer. Subsequently, the bean was
taken to the factory and stored in ideal conditions of temperature and humidity for its
preservation; it was evaluated to comply with the conditions of humidity, acidity, overall
impression, coffee body, flavor and aroma.

2. Storage and weighing: The coffee was stored in the green bean warehouse, a large and
adequate place to protect the raw material from any contaminating agent. Depending on the
demand, the amount of coffee needed for the production order of the day was weighed.
3. Roasting and cooling: During the dehydration of the beans through the application of
heat, physical changes and chemical reactions originated that developed the aroma

Figure 2 Participation of the main coffee brands in the Colombian market

PAGE 4 j EMERALD EMERGING MARKETS CASE STUDIES j VOL. 13 NO. 4 00

Figure 3 Company’s product portfolio

and flavor of the beans. Afterward, it was taken to the air coolers for approximately
5 min, and consequently, using an air suction system, the coffee was elevated to a
height of 3 m, producing the first cleaning of the pure bean.
4. Milling: This was carried out using two types of mills; one part was processed in the
granulating mills (75%) and the other in the fractional mills (25%). The ground beans
were then transferred mechanically through special ducts to a belt, and using a
vibration system, the third cleaning of the coffee was carried out.

5. Packing: The ground coffee beans entered the hoppers of the packing machines and
began to be deposited in the different presentations according to their weight and

VOL. 13 NO. 4 00 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 5

 Figure 4
Galavis for 2022
Competency tree of Cafe

Figure 5 Production process

PAGE 6 j EMERALD EMERGING MARKETS CASE STUDIES j VOL. 13 NO. 4 00

 previously selected and programmed measurements, thus finishing the process in
perfect conditions without direct labor intervention.

6. Control and distribution: The finished product was placed on plastic pallets where the
control process was carried out. Once the coffee was packaged, it was taken by carts
to the finished product warehouse for subsequent distribution.

In search of intangible value

For this reason, Francisco Ya
ñez made a call to arrange a meeting with a colleague he met in
a business meeting, an outstanding professional who had made different contributions to
companies of the department, requesting a space to arrange a work meeting. On September
20, 2022, at 3 pm, they met at the company’s facility. The executive director commented to the
engineer Juan Trujillo, on the need to establish the differentiating factors of the brand to have
the necessary inputs for the innovation process of their products. However, the consultant told
him the following: “CEOs require reliable and objective measures to determine the value of
their brands; a frame of reference that allows them to evaluate the effect of their strategies and
make decisions that encourage the construction of disruptive innovation processes, therefore,
knowing the value of a brand from a theoretical approach would be a good starting point”.
The first question raised by the consultant was as follows: How to measure an intangible
asset? What dimensions of analysis are required to create a relevant, objective and reliable
model? The consultant analyzed the most-studied dimensions in the branding literature,
addressing brand awareness and brand associations as a construct. He elaborated the
instruments and consulted the main stakeholders such as collaborators, potential
customers and suppliers, to make an approximation of the brand value and provide the
management with the necessary tools for decision-making.
On November 25, 2022, two months after the meeting, the researcher sent an email to the
top management and the board of shareholders with the results of the research,
consolidating in an executive report the potential factors of brand awareness and
partnerships, detailed in 11 points (Box 1).

Galavis
Box 1. Communication to the top management of Cafe

de Cucuta, November 25, 2022
San Jose

Subject: Technical report on brand equity

Messrs.

Director Francisco Yañez and shareholders meeting

Through this communication, I submit for your consideration the technical report that
evidences the approximation of the brand value, a key input for the innovation
processes of your organization.
1. “Cafe Galavis” in the roasted and ground coffee product category was
recognized as one of the main “top of mind” brands of trajectory and history, of
high demand, greater rotation in supermarkets and chain stores, whose main
distinguishing feature in the mind of the consumer is its flavor, aroma, and
freshness.
2. The brand image was positioned in the region as a reference of tradition and
quality that encompasses a large niche market of adults since it is a brand that
has been remembered from generation to generation. In addition, suppliers
considered Cafe
Galavis as one of the most representative clients in Norte de
Santander.

VOL. 13 NO. 4 00 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 7

 3. The associations of the brand about the quality perceived by each of the
stakeholders were related to the product; a coffee whose attributes of flavor,
purity, aroma, and freshness had an impact on the consumer’s trust and
generated a favorable attitudinal and affective link.
4. The raw material was considered a key factor in the construction of the brand,
being the basis for a relevant and effective evaluation by collaborators, suppliers,
and clients.
5. The packaging design (protective film with two cellophane, polyethylene, and
aluminum films and vacuum-packed) favored the preservation of the aroma and
flavor quality that distinguish it in the market.
6. The trajectory of human capital made it possible to acquire tacit knowledge and good
practices of the production process as an intangible heritage of product quality.
7. The presence of multiple brands, innovation, and marketing strategies
implemented by competitors to promote the purchase of the product, were aspects
that potential customers had as a reference to consider it as their first choice of
purchase compared to other brands.

8. The perceived value with the cost-benefit ratio was based on the firm’s trajectory,
highly reliable products, and quality guaranteed by production and
administrative processes certified under high-quality standards.

9. The cultivation zones located in the geographical areas of the country (Armenia,
Pereira, Bucaramanga, Popayan, Huila) had certifications in the production of
organic coffee, in the same way, the climatic conditions propitiated excellent
physical characteristics to produce coffee and the good planting practices that
guarantee the quality.

10. The global trend towards specialty coffees was oriented towards a market niche
that seeks the commitment of producers to the environment, social responsibility
with the growers behind the crop, and the assurance of food safety in each of the
stages of the production chain.
11. The logo “Cafe
de Colombia” communicated respect for the origin and tradition,
as well as the guarantee of a high-quality product, based on the efficient
harvesting models and the “Sustainability in Action” programs that improve the
income of the coffee-growing families.

Best regards.
Engineer Juan Trujillo

MBA, Master in Innovation

Source: Author’s own elaboration

The possibility of losing his identity

After the engineer Francisco Ya
ñez received the report in his email, he sat down in the office
and sipped a cup of hot coffee, leaned back in his executive chair and began to analyze each
of the points. He realized the strengths that the brand had built over more than a century, and
the relevant aspects related to product attributes, raw materials and processes; however, he
detailed in point number two, the importance of expanding the organization’s strategies, given
that it was mentioned that “the image of the brand had positioned itself in the region as a
benchmark of tradition and quality that encompassed a large niche market of adults“; for this

PAGE 8 j EMERALD EMERGING MARKETS CASE STUDIES j VOL. 13 NO. 4 00

reason, it was realized that the brand could lose its identity, given that in the future, the
population could disappear due to generational change. Therefore, given the complex
problem identified, the solution could emerge through a process of creativity and innovation.
On December 1, 2022, the board of shareholders and senior management met in the
company’s boardroom, discussing each of the points of the technical report presented by
the consultancy, and the need to convene a trial of experts arose, to detail the prospective
plan of the organization for the next 5 years, all this before the end of the year.

New changes, new scenarios

On December 9, 2022, at 8:00 a.m. at the company’s facility, Francisco Ya
ñez and his
marketing team, five professionals with high-level postgraduate training, were received by the
company to conduct a strategic foresight exercise. To start the exercise, the director mentioned
that he was looking for new ways to innovate in their products, position themselves nationally
and internationally and penetrate a niche market of young customers. The meeting was held in
a rustic room, the walls of which were lined with countless awards from governmental
organizations and companies for the organization’s business trajectory and its contribution to
the region’s economic development. The experts were welcomed with a cup of fresh hot coffee
and a cozy atmosphere. Each one received a sheet of paper with the following questions: What
aspects could the firm innovate in its products? How do you think the brand could be positioned
nationally and internationally? How could the firm address a niche market of young clients?
After 6 h of work, the different positions of the experts were compiled, the results were
grouped and the contributions were consolidated for each variable analyzed. The results
were projected before the shareholders’ meeting to determine the organization’s horizon.
Engineer Camilo Vela
zquez, who was Master in Administration and Innovation, mentioned,
“The coffee products have increased in variety, flavors and combinations according to the
taste of the palate. Consumers are no longer looking for the traditional flavor. Your product
must diversify in presentation, flavors and consumer experience. The company must show
itself through digital marketing strategies and events in the productive sector or business
rounds as a premium regional brand made up of high-quality certified processes and
products. The brands Tostado, Juan Valdez and Starbucks have young customers, who
seek a sense of status; therefore, Cafe
Galavis should focus its strategy on the promotion of
a premium coffee that promotes that experience in the customer”.
Similarly, Engineer Maryori Rodrı́guez, who was Master in Product Design and Innovation,
said, “The presentation of the product could be by color according to the family of products
to which they belong depending on the flavor, aroma and roast. In addition to including
messages in social networks where videos of the operations were made showing the
processes and the interaction of human talent with the possibility of projecting aerial shots
of the Colombian fields. Finally, in the case of young people, I would propose places that
were in trend, flavors that lead them to have a unique experience to the palate, and the
possibility that they could prepare their coffee using certain coffee equipment”.
On the other hand, Engineer Sergio Jaimes, who was Master in Strategic Management,
proposed that, “The firm should sell its image as a regional product representative of the city
and the department of Norte de Santander. Within their innovation process, they could
involve a change of image considering the logo, type of packaging and variety of flavors in
their portfolio. Regarding brand positioning, I would propose improving their logistics chains
and opening new markets through internationalization processes. Finally, to attract young
people, it would be convenient to implement marketing strategies focused on highlighting
the health benefits of coffee and the role of its consumption in the daily life of young people”.
In addition, the engineer Juan Trujillo, who was Master in Innovation, stated that, “Innovation
could be approached from the packaging, which could include a QR code that leads the

VOL. 13 NO. 4 00 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 9

 consumer to visualize part of the production process starting with the cultivation of the
coffee plant up to its final packaging. Regarding positioning, the firm should take advantage
of the localization advantages of the country of origin, since the Colombian Coffee logo and
the quality of the product are competitive advantages that should be exploited in foreign
environments to generate a close link with the consumer. To penetrate a youth market
niche, the brand should be aligned with the daily life of the youth and highlight how the
product contributes added value to them. Finally, it should seek to generate an experience
for the customer, through personalization and identification of distinctive features that
generate an affective and positive neural network of the product”.
Finally, Engineer Brandon Duarte, Project Management Specialist, highlighted that, “The
firm Cafe
Galavis should innovate its packaging promoting the regions, as the Juan Valdez
brand does (Antioquia, Huila, Cundinamarca, among others); the same could be done with
the municipalities of the department (Bochalema, Gramalote and Salazar) supporting the
sectorization of the municipalities of the department that have coffee producing areas. On
the other hand, to capture the niche of the young market, the company could venture into
the offer of cold coffees, cappuccinos, coffee with a touch of whiskey and other varieties
welcomed by young people in coffee shops. And finally, design a mobile application for the
accumulation of points that can be redeemed in a next purchase”.
After an arduous day of workshop development, the firm’s desired prospective scenario
was laid out. Each of the shareholders was amazed by the futuristic thinking and approach
that the professionals expressed before the questions, generating ideas that were used in
the development of the scenarios, divided into four states. Finally, the most optimistic
scenario was taken as a reference for the construction of the organization’s strategic plan,
which was unanimously approved at 4:00 p.m. on the same day (Figure 6).

A new challenge: the search for its positioning

According to the new projection, the company’s strategic expansion plan focused on
foreign markets, the development of new products and the expansion of the market niche to
penetrate the Asian, European and Latin American markets.

Figure 6 Projection of prospective scenarios for the firm

PAGE 10 j EMERALD EMERGING MARKETS CASE STUDIES j VOL. 13 NO. 4 00

Francisco Yañez exclaimed, “I must differentiate myself and sell something with added
value. We are aiming for new products that go hand in hand with the new market dynamics
and young consumers who are looking for an innovative experience.”
To achieve this, the new director planned to achieve a differentiating factor by innovating
grain by grain about competitors. His new challenge would be “to create a new product
through creativity and innovation in the face of a complex problem, such as the loss of
identity of the company in the face of the future generational change”, for which, taking into
account the results presented in the technical report and the desired prospective scenario,
he will hold a board meeting on January 15, 2023, with the members of the production and Keywords:
Brand management,
commercial areas to address the question: How to design a new product taking into
Creativity,
account the loss of brand identity in the face of the generational change of its consumers? Innovation,
For this reason, he sent a communique
for the leaders to compile proposals for innovation to Marketing,
strengthen the brand’s positioning and expand into new markets. Strategic management

References

Galavis. (2019). Portafolio de productos Cafe
Galavis.. Retrieved from www.cafegalavis.com.co/
Cafe
productos-2/

Deshpande, R. (2001). Cafe
de Colombia. Harvard Business School, Case, 502, 26. (Globalizacio

n;
Marcas y branding; Campañas publicitarias; Producto; Bienes y materias primas; Colombia) https://
store.hbr.org/product/cafe-de-colombia/502024?sku¼502024-PDF-ENG

n Nacional de Cafeteros. (2023). Estadı́sticas cafeteras. Exportacion de Cafe
Colombiano,
Federacio
Retrieved from https://federaciondecafeteros.org/wp/estadisticas-cafeteras/
La Repu
que registran mayor

blica. (2023). Juan Valdez, Tostao’ y Starbucks, las tiendas de cafe
crecimiento. Retrieved from www.larepublica.co/empresas/juan-valdez-tostao-y-starbucks-las-tiendas-
de-cafe-que-registran-mayor-crecimiento-3617751
Perez, J. E. P. (2022). Tradition or innovation? Cafe Galavis, a brand with an international vision, Bingley:
Emerald Emerging Markets Case Studies.

lisis del valor de la marca “Cafe
Perez, J. E. P., & Muñoz, J. E. P. (2018). Ana
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Galavis. Journal of Physics:

Perez Perez, J. E. (2018). Approximation of the brand value of the firm Cafe
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Perez Perez, J. E., & Romero Arcos, A. (2019). Determinantes Para el proceso de internacionalizacio

Galavis-Colombia.
la firma Cafe

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Corresponding author
Juan Ernesto Perez Perez can be contacted at: juaner15@hotmail.com

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