Latin America and the Caribbean
A Force for Good
An Interview with Pablo E. Vargas, Executive Chairman, Grupo Britt
EDITORS’ NOTE Pablo Vargas, Will you highlight the history and hotels, restaurants and commercial accounts in a Costa Rican citizen, became heritage of Grupo Britt and dis- the U.S., Canada and other parts of the world. Executive Chairman for Grupo cuss how the company has evolved The coffee industry is very specialized and each Britt in January 2018, after being over the years? player does its prescribed job: producers grow Britt’s CEO for 18 years. He joined The brand Café Britt was con- coffee, which is sold as a commodity to a chain the company in 1992, after doing ceived in 1985. I met Britt’s founder, of processors, exporters/importers and distribu- an internship in 1990 when Britt Steve Aronson, in 1990 as a student tors who mostly belong to international trading was just a start-up company with and wrote an academic thesis on the and roasting groups. We wanted to stop selling annual sales of less than $150,000. concept of adding value to coffee this precious raw material and created a con- Under his leadership, Britt’s reve- from Costa Rica as a hedging strategy sumer brand to sell Costa Rica’s fi nest roasted nues went from approximately $10 to cope with this commodity’s price coffee to the world. We thought of coffee as million to approximately $158 mil- volatility. I started working full-time something like wine. When most people in the lion in 2018. During this period, the Pablo E. Vargas with Steve in 1992 and implemented coffee world were obsessed with quantity, we company became a coffee and choc- many of the ideas written in my paper. were fanatical about quality, and we continue olate manufacturer and travel retailer, with over Among them, we wanted to be the fi rst coffee to be. When we had an opportunity to run gift 130 shops, operations in 13 countries, and a company in a country of origin dedicated to shops in the San José, Costa Rica Airport, we head count of 1,800 employees. Prior to joining exporting the fi nal product directly to consum- fulfi lled our dream of exposing our brand and Britt, Vargas worked for international private ers around the world. We dreamt of de-com- products to millions of international travelers, and nonprofit organizations and participated moditizing coffee and started distribution to together with a curated selection of gifts and on several boards of directors. He has taught souvenirs from Costa Rica. Then, in 2004, we graduate and undergraduate level econom- replicated the model at Lima Airport in Peru, ics at three universities. Vargas holds BS and and kept adding more countries and airports to Licenciatura degrees from Universidad de Costa our model. Rica, and MS and MBA degrees from Michigan We benefit from globalization, but we State University. He is a Fulbright Scholar and acknowledge that as human beings we want his MS thesis was elected as Thesis of the Year “I have been humbled to appreciate our roots and cultural differences. by Michigan State University’s Agricultural We developed a model of travel shops with a Economics Department. sense of place. We toured new countries explor- by the heroic way our ing their culture, music, colors, and traditional COMPANY BRIEF Grupo Britt (grupobritt.com) food items and presented them to world trav- was founded in Costa Rica in 1985 with the elers usually in new airport terminals. Hence, goal of making the country’s famed gourmet people responded we only do Costa Rican themed shops in Costa coffee available for consumption around the Rica. In Peru we do Peruvian shops, in Mexico world. In 1991, the company combined cof- we do Mexican shops and the same applies to fee with tourism with the introduction of the during 2020. Our team the 12 countries where we operate. In coffee Britt Coffee Tour, an innovative play staged in and cocoa producing countries, we do coffee Britt’s own plantation that traces the history showed great strength and chocolate products under the Britt brand of coffee and its production cycle and tasting. with those raw materials. In 2001, Grupo Britt entered the travel retail About three years ago, we acknowledged market with its fi rst shop at Juan Santamaria and commitment that we operate two companies, a travel retailer International Airport in Costa Rica. Growth now called Morpho Travel Retail, N.V., and a continued in 2003 with the addition of stores coffee and chocolate company called Café Britt, at various hotels and parks. International in the midst of S.A., both controlled by Grupo Britt, N.V. expansion began in 2005 with Grupo Britt’s How has Grupo Britt adapted its busi- fi rst shop in Peru. Today, the Group has over ness to address the challenges brought on 2000 employees in 13 different countries. In very challenging by the pandemic and how proud are you response to three decades of growth, Grupo to see the way Grupo Britt’s workforce has Britt separated its two market segments as two and fl uid times.” displayed strength and resilience during fully-operational companies in 2017, Morpho this challenging and uncertain time? Travel Retail and Café Britt. Morpho Travel I have been humbled by the heroic way Retail helps make travel convenient and mem- our people responded during 2020. Our team orable for customers by focusing on gift shops showed great strength and commitment in and food and beverage operations in airports, the midst of very challenging and fl uid times. hotels, and resorts. When the pandemic started in March 2020, we 194 LEADERS POSTED WITH PERMISSION. COPYRIGHT © 2021 LEADERS MAGAZINE, LLC VOLUME 44, NUMBER 2 Latin America and the Caribbean
A Force for Good “...it is our responsibility, especially to our daughters, sons, and future generations, to apply our know-how to help society achieve its goals.”
An Interview with Pablo E. Vargas, Executive Chairman, Grupo Britt
EDITORS’ NOTE Pablo Vargas, Will you highlight the history and hotels, restaurants and commercial accounts in prepared for the simultaneous closures of air- and investors are becoming more demanding has over 9,000 employees in Costa Rica. Other a Costa Rican citizen, became heritage of Grupo Britt and dis- the U.S., Canada and other parts of the world. ports for an estimated period of four months. of transparency and environmental and social areas with high potential include IT and light Executive Chairman for Grupo cuss how the company has evolved The coffee industry is very specialized and each Then, as each of those four months went by, responsibility from corporate leaders. I wel- manufacturing operations. Britt in January 2018, after being over the years? player does its prescribed job: producers grow we had to make additional preparations for come those changes and I actually think that What are your perspectives on the Britt’s CEO for 18 years. He joined The brand Café Britt was con- coffee, which is sold as a commodity to a chain an extended period. In Morpho, we had to as climate change becomes more apparent, we regional developments taking place in the company in 1992, after doing ceived in 1985. I met Britt’s founder, of processors, exporters/importers and distribu- furlough most of our personnel in the shops. will see an acceleration of this trend. Latin America as you look to the future? an internship in 1990 when Britt Steve Aronson, in 1990 as a student tors who mostly belong to international trading We had to rearrange the balance sheet of the The truth is that businesses are the most Latin American countries most often are was just a start-up company with and wrote an academic thesis on the and roasting groups. We wanted to stop selling Company and brought in fresh capital. In the organized and effi cient platforms in our current in the news because of highly-charged political annual sales of less than $150,000. concept of adding value to coffee this precious raw material and created a con- coffee segment, things were much better, with society, and sadly democracy and governments events. There are always a few dictatorial govern- Under his leadership, Britt’s reve- from Costa Rica as a hedging strategy sumer brand to sell Costa Rica’s fi nest roasted the e-commerce channel hitting record sales are not supplying the public goods society ments, currently Cuba, Venezuela and Nicaragua nues went from approximately $10 to cope with this commodity’s price coffee to the world. We thought of coffee as month after month. demands. Therefore, it is our responsibility, are the ones that fi t that role, and they capture million to approximately $158 mil- volatility. I started working full-time something like wine. When most people in the Business is recovering across the board, especially to our daughters, sons, and future most of the information pipeline that fi lls media lion in 2018. During this period, the Pablo E. Vargas with Steve in 1992 and implemented coffee world were obsessed with quantity, we although some countries are behind in this generations, to apply our know-how to help outlets around the world. Argentina also makes it company became a coffee and choc- many of the ideas written in my paper. were fanatical about quality, and we continue recovery cycle. society achieve its goals. to the newsrooms because of recurrent crises of olate manufacturer and travel retailer, with over Among them, we wanted to be the fi rst coffee to be. When we had an opportunity to run gift What has been the impact of the pan- What do you see as Costa Rica’s com- the peso. However, most countries have vibrant 130 shops, operations in 13 countries, and a company in a country of origin dedicated to shops in the San José, Costa Rica Airport, we demic on the agribusiness sector and what petitive advantages as a country and what economies with highly sophisticated participants head count of 1,800 employees. Prior to joining exporting the fi nal product directly to consum- fulfi lled our dream of exposing our brand and are the keys to recovery for the industry? do you see as its strengths from a business in key industries. First world foreign investors Britt, Vargas worked for international private ers around the world. We dreamt of de-com- products to millions of international travelers, Agribusiness showed great resilience dur- standpoint? without much international experience will prob- and nonprofit organizations and participated moditizing coffee and started distribution to together with a curated selection of gifts and ing the pandemic. People continued to con- Costa Rica is known for its political stabil- ably need to do more homework than they use on several boards of directors. He has taught souvenirs from Costa Rica. Then, in 2004, we sume quality products and companies that went ity, peace efforts, sustainability, and its educated to do in order to fi nd the right partners or the graduate and undergraduate level econom- replicated the model at Lima Airport in Peru, direct to consumer saw their sales grow. We and healthy population. It is one of a select right business model, or in order to obtain the ics at three universities. Vargas holds BS and and kept adding more countries and airports to believe it’s in this “direct to consumer” approach group of 23 countries rated as “full democra- required permits to operate, but the effort can be Licenciatura degrees from Universidad de Costa our model. where most recovery opportunities lie on the cies” by the Economist Intelligence Unit. The rewarded with higher returns. Rica, and MS and MBA degrees from Michigan We benefit from globalization, but we road ahead. Facilitators to the industry in this country is currently rated as #15 in the Happy Additionally, Latin America has adopted State University. He is a Fulbright Scholar and acknowledge that as human beings we want process will also thrive. Country Index of the World Happiness Report, the digital revolution and it has an entrepre- his MS thesis was elected as Thesis of the Year “I have been humbled to appreciate our roots and cultural differences. Grupo Britt is a purpose-driven com- and it has been showcased in many environ- neurial, young population interested in creating by Michigan State University’s Agricultural We developed a model of travel shops with a pany and deeply engaged in the communi- mental and sustainability reports for its efforts new businesses that could solve relevant prob- Economics Department. sense of place. We toured new countries explor- ties it serves. Will you discuss your views in protecting the environment. This country of lems and fulfi ll societal needs. Foreign investors by the heroic way our ing their culture, music, colors, and traditional on the role of business as a force for good healthy and educated people also performs coming to the region could spot these young COMPANY BRIEF Grupo Britt (grupobritt.com) food items and presented them to world trav- in society and the need for leading compa- well in terms of its innovation capacity, usually entrepreneurs and support them at different was founded in Costa Rica in 1985 with the elers usually in new airport terminals. Hence, nies to address global challenges? ranked number three or four in Latin America. stages of select ventures’ lives. goal of making the country’s famed gourmet people responded we only do Costa Rican themed shops in Costa We always saw ourselves as a force for Costa Rica constantly attracts new interna- What do you see as the keys to effec- coffee available for consumption around the Rica. In Peru we do Peruvian shops, in Mexico good in the market. We championed organic tional companies who decide to set up manu- tive leadership and how do you describe world. In 1991, the company combined cof- we do Mexican shops and the same applies to growth cultivation and marketing since the early facturing or service operations in the country. your management style? fee with tourism with the introduction of the during 2020. Our team the 12 countries where we operate. In coffee 1990s when the regulation and coffee bureau- The process of setting up operations in Costa Effective leaders have always needed a Britt Coffee Tour, an innovative play staged in and cocoa producing countries, we do coffee cracy in Costa Rica did not accept the concept. Rica has been streamlined and made simple high dose of character. These days you also Britt’s own plantation that traces the history showed great strength and chocolate products under the Britt brand We fl ew in the inspectors because there were no with the help of a private-public partnership need a high level of fl exibility and vision. The of coffee and its production cycle and tasting. with those raw materials. local organic certifying agencies. We believed a called CINDE. adoption of digital technologies is changing In 2001, Grupo Britt entered the travel retail About three years ago, we acknowledged bit naively that by the year 2000 about 80 per- What do you tell foreign investors society in ways that are hard to predict. Those market with its fi rst shop at Juan Santamaria and commitment that we operate two companies, a travel retailer cent of our coffee sales would be organic. We about the opportunities for investment in who could see where this wave is taking us International Airport in Costa Rica. Growth now called Morpho Travel Retail, N.V., and a had to face the reality that the consumer was Latin America and the strength that the will have the opportunity to lead their organi- continued in 2003 with the addition of stores coffee and chocolate company called Café Britt, not aware of the benefi ts of organic produc- region offers for investors? zations in a sustainable way. Mastering strategy at various hotels and parks. International in the midst of S.A., both controlled by Grupo Britt, N.V. tion - at least they were not as conscious of the Latin America continues to offer interesting and being close to the fi nal customer are part of expansion began in 2005 with Grupo Britt’s How has Grupo Britt adapted its busi- benefi ts as to accept a price differential. opportunities in several sectors of the economy. the current leader’s toolbox. fi rst shop in Peru. Today, the Group has over ness to address the challenges brought on Times are changing, and business leaders The region has a strong agribusiness base and At a more personal level, I have to say 2000 employees in 13 different countries. In very challenging by the pandemic and how proud are you are much more aware that the responsibility of business models that could add value to its bio- that I hate hierarchies and I like being around response to three decades of growth, Grupo to see the way Grupo Britt’s workforce has business does not end with maximizing profi ts. diversity have great potential. As I mentioned people. I consider myself a customer and I Britt separated its two market segments as two and fl uid times.” displayed strength and resilience during The world is still behind in pricing environmen- in the case of Costa Rica, many companies are like companies and organizations that provide fully-operational companies in 2017, Morpho this challenging and uncertain time? tal benefi ts, or accounting for negative exter- establishing service centers. Companies are outstanding quality and service to the normal Travel Retail and Café Britt. Morpho Travel I have been humbled by the heroic way nalities, although there have been some policy doing their human resources, IT, accounting and customer. I strive to run an organization where Retail helps make travel convenient and mem- our people responded during 2020. Our team successes around the world taxing carbon emis- even R&D from centers in countries like Mexico, all customers are treated as VIP’s, and where orable for customers by focusing on gift shops showed great strength and commitment in sions or creating markets for carbon bonds as Colombia, Chile, Uruguay and Costa Rica. Each all quality and service are premium - where a and food and beverage operations in airports, the midst of very challenging and fl uid times. well as other innovative initiatives. However, in country offers a competitive set of incentives to fl at organization does whatever it can, and then hotels, and resorts. When the pandemic started in March 2020, we the absence of market mechanisms, consumers foreign investors. As an example, Amazon alone more, to serve each of its clients.• VOLUME 44, NUMBER 2 POSTED WITH PERMISSION. COPYRIGHT © 2021 LEADERS MAGAZINE, LLC LEADERS 195