Tuesday, Oct 24, 2017
Industry & Trade | South America | Colombia

Commerce With A Conscience

“For 53 years we have been in love with what we do instead of just being in love with making money”


2 years ago

Arturo Calle, President of Arturo Calle
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Arturo Calle

President of Arturo Calle

Colombian business leader Arturo Calle opened his first store more than five decades ago and now the fashion industry impresario has 78 department stores across Colombia, Costa Rica, El Salvador and Panama. Here, he discusses the importance of concentrating on the social impact of doing business and of business leaders thinking beyond the bottom line to improve peoples’ lives “because when your time comes, you won’t be able to take your money with you, but you will definitely take that joy with you.”   

What is your assessment of the Colombian economy in 2015? What sectors do you think will become more dynamic?

The country changed in eight months because of the drop in the oil price. Colombia is receiving 40% or 50% less income than it used to. That is positive for Colombian exporters, but we are not an exporting country, apart from oil and mining our exports are mostly flowers, bananas, coffee, and some sugar; the rest are just minor exports. In the last 10 years, because of the rise of the oil price and globalization, the country became an importer of everything. That generates a significant deficit, and a raise of between 30% and 50% in the price of the products that are consumed daily in the country. Obviously that will have a negative impact in the long term.

However, this is an interesting country for investment, although there has to be a profound change in order to stop depending exclusively on the mining sector.

In agriculture we need to expand the amount of arable land, we need to include technology in the cattle industry – that is why the government must open the doors to all the multinational companies interested in investing here, in every sector of the economy. To bring those investments we must offer significant tax benefits in exchange for capital focused on exports. Obviously the ideal situation would be to develop a domestic industry that is able to replace imports, but we still don’t have the necessary infrastructure for that, and to create it we would also need significant, long-term investment.

Another topic on the Colombian agenda is the invitation to be a member of the OECD. What can Colombia learn and what can it contribute to the rest of the OECD members? How will it affect the private sector?

Everything that has to do with best practices is healthy and it is the right thing to do, but the important thing is that they are actually implemented. But this has to work both ways, otherwise you will find situations where member countries from different associations don’t really comply with the norms and don’t benefit from them at all, like what happens with Venezuela, for example.

In your opinion what is the responsibility of the private sector and companies like Arturo Calle in achieving peace, and in the post-conflict process?

About the post-conflict process, we still have to wait. Any relatively intelligent person wants to live in peace; the entrepreneurs, the 45 million people of this country, we all want peace and we are interested in achieving it. Personally, I think it is unlikely that it will happen this year. Our commitment in Arturo Calle is to continue paying our taxes and creating jobs, and support the peace process that way, because there can be no peace where there is permanent poverty and squalor. The entrepreneurs have to keep on producing and paying their taxes, without evasion, which is around 35 million pesos a year according to the government.

President Santos said in his visit to Colombiamoda: “I want to set a goal for you as a sector, that in three years we export more than a billion dollars in textiles and clothes, which is 17% more than last year”. Even though it doesn’t look like an impossible goal, the industry is facing challenges such as the high exchange rate. What is your opinion on this challenge, and how do you think the industry will achieve that goal?

First of all, I think that in a country that is definitely an importer of goods, a billion dollars of exports is not enough; what we need is several billion dollars. Secondly, the textile and clothes infrastructure in Colombia is not solid enough to export, because the old textile industries are closed; the governments left them to die and the culture of dressmaking with it. If there are no textiles produced in the country, the materials to make the clothes must be imported first and that makes the export prices not really that competitive globally. That is why I think it is a very difficult goal to achieve in three years. In order to do that, you would need to replicate the same strategy I mentioned earlier about the agriculture sector.

What is the role of technology in the textile industry in general, and in Arturo Calle in particular?

You need technology, new equipment, and to train your staff, but to do that you need to give incentives to the investors. We are continuously improving our technology, our machines and equipment. We are developing areas for manufacturing and storage at the free zones in Risaralda, near the city of Pereira. We have around 3,500 workers there, manufacturing clothes and shoes, using the latest technologies. I think that we are contributing a lot to the country in that sense; we are the textile company that pays the biggest amount of taxes in Colombia.

Last year Arturo Calle launched its line of children’s clothes, Arturo Calle Kids, and this year you have announced the launching of a line specialized in leather, AC Leather. What does this say about your trust in the Arturo Calle market? What kind of growth do you expect from these new ventures?

A company that doesn’t evolve and move forward will just go backward and die out. For 53 years we have been in love with what we do instead of just being in love with making money – that is why we do things right and are constantly trying to come up with new ideas. We launched the Kids line, now we are going for the development of a line of shoes and leather for exclusive stores, where the customers will find our products plus other international brands we will sell in our franchises. We always try to offer good quality at low prices.

Today, you don’t only have stores in Colombia, but also in Costa Rica, El Salvador and Panama. How important is internationalization for the company and what are your new objectives?

The important thing about going international is that you learn a lot; you don’t make money but you gain knowledge. It’s not the same working in the domestic market as the international markets; it’s teaching us a great deal. Working in both areas means that we have to be always 100% updated in terms of fashion, otherwise we wouldn’t be doing well internationally, so that is also pushing towards being constantly up to date.

What is the strategy of Arturo Calle to enter the US market?

To enter the US market you need to start with hundreds of stores; with only a couple of them the loss in enormous. The US market is all about size, it’s the big leagues. We can’t really get in there because with the few stores we will be able to open, it would be very difficult. We will leave that to the big league brands, like Amancio Ortega’s Zara. We would like to, but we don’t really have the liquidity nor the cash flow to start a chain store, and in the US you have to do things the big way, or just forget about it. Only Amancio Ortega and a couple more companies did it, and we will leave them alone. What we can do is expand into Central and South America. I think we would do very well in markets like Peru, Bolivia, Ecuador, and even Brazil.

Arturo Calle has its own foundation under the same name, though which the company funds initiatives and programs that contribute to strengthen the social progress in the country, in areas like education, health, and housing. We also know that the company supports more than 20 foundations periodically. What is the responsibility of the private sector towards the society? What kind of example are you giving to the rest of the business community?

I don’t think it’s an example, I think it’s an obligation of every human being to share with the ones who don’t have anything. That’s not a gift, nor something to be particularly proud of, it is just our duty as human beings, and that’s what we do, both Arturo Calle as a company and personally. We do it because we like it, and because that is what we learned from our ancestors. I believe one of the greatest satisfactions in life is sharing instead of accumulating, because when your time comes, you won’t be able to take your money with you, but you will definitely take that joy with you.

About the rest of the people in the country, some of them do help, and some others, even though they could, they just choose to take more money to the grave with them. I really enjoy helping especially in everything that has to do with education and universities, because it is our job to prepare the young people who will replace us in the future. We make a lot of donations for scholarships like Rosario, CESA, Javeriana, and Sabana. I also think it is important to support the health system and hospitals, especially the San Ignacio hospital, so it can always have the best technology to provide a better service for all of us.

Arturo Calle has also created an Online University where the employees can be constantly trained and build a career inside the company. Why did you create this university? What kind of success have you been able to achieve among your employees?

Everything has been a success. Our company has a personalized customer service. As a result, the companies with these kinds of services are the ones with the most positive image among their customers, especially in a sector like clothing. Another excellent result was to find that the more educated people are, they have a higher respect for their superiors and for customers; they are more honest, they feel love and commitment to the company. We are in a constant evolution in order to train our staff. Additionally, they really think twice before leaving us to work in a different company, because after everything they learned here and how happy they are, they often reject the job offers made by other companies. Without education, without investing in the human aspect, it is very difficult to manage a company like this.

Coco Channel used to say that, in order to be irreplaceable, you have to be different. Where do you find your everyday motivation and inspiration?

To be different is very easy. First of all, you have to be young in your attitude. Personally I like sports, I like fashion. I just refuse to grow old, I don’t accept it. I am really into what I do and what I sell. You also have to be honest, to be happy, not to think about the money, to think about doing things. I try to like myself and everything I do, everything I wear, every day I kiss my own desk. I also love nature. To be different, you must love, and also to be organized and not to be the same every day of your life.

Apparently, as a very young person you already wanted to be independent; you even managed to save all your earnings for two and a half years in order to achieve that. How important was Héctor Correa for you, and the chance of opening your first store in San Victorino?

Héctor Correa died, he was my father-in-law and a very good friend. I admired him, he was a great professional in the retail sector. He was a transparent man, he sold his businesses and started working for a big dressmaking company. I learned a lot from him, from his love, and his constant help to others. Héctor Correa was a great man, I learned many lessons from him.

You have been awarded many times, in 2011 you received the award given by Ernst & Young for Entrepreneur of the Year in the Lifetime Achievement category. What do you think are the qualities of a good leader? What is your philosophy?

The qualities of a leader are the ones I mentioned earlier: to love what you do, not to think about the money you will take to the grave, to work with the gift of patience, hopefully without any debts, and growing slowly because the world is not going to end. To be honest; never thinking about making money that is not a product of the most absolute transparency; to share with others; to love what you do; to kiss and really love your things. To be positive, never to grow old. To live happily.


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