Interview with Fernando Torres, Managing Director of Grupo Tatoma
August 27, 2009
"Should ensure that the" society, in general, and the Government, in particular, recognize the complex situation experienced by the sector and, therefore, to allow an improvement "of prices". Fernando Torres, Managing Director of Grupo Tatoma advocates the establishment of a minimum price, by quality, to provide stability to a market that crosses, long time, a negative process of conversion. This family company, whose origins date back to 1971, is dedicated to the manufacture of machinery for the agricultural sector, among other areas of business. Today, Grupo Tatoma turnover more than 23 million euros and exports to the five continents.
In his opinion, how would you define the current situation of the agricultural machinery sector?
In recent decades, the agricultural and livestock sector has suffered a strong reconversion for what the general situation of it has been difficult. If to this we add the global financial crisis that we experience today, we could say that the sector is going through one of the most delicate moments of recent years. In addition, the concentration of the distribution in Europe is drowning the producer that, sometimes, is forced to sell their products below cost. Also, the changes introduced with the CAP (common agricultural policy) they not only reduce profitability, but that they impair the illusion of the professionals in the industry.
How it affect this juncture to the activity of the Group Tatoma?
"In recent decades, the agricultural and livestock sector has suffered a strong conversion." "In addition, the concentration of the distribution in Europe is drowning producer that, sometimes, sells its products under its cost"
As manufacturers of mixers and other machinery to farmers, do influence them low prices that are paid by the agricultural products at foot of field and the abandonment of farms by producers?
In recent months, as is the case in other industries, we have identified a clear decrease in sales of mixers with regard to previous years. For many years, the dairy sector undergoes structural changes, especially in the concentration of the distribution, which dwindles the bargaining position of producers and produces a noticeable drop in prices. Sometimes, the resulting decline in margins has represented an insurmountable barrier to the growing investment needs of these professionals, due to improvements in facilities and the purchase of milk quota. The abandonment of many milk producers exacerbates problems of a bouquet in which investment and hardness of the activity create barriers to entry that prevent the reopening of new farms. All this affects, seriously, the demand for mixers and other agricultural machinery linked to this activity.
According to his experience in the sector, what are the main challenges of the same for the current year and also for 2010?
In my view, the sector is one that has most evolved in r & d, over the past 25 years. And it has surely been the worse rewarded. One of its main challenges should be to ensure that society, in general, and the Government, in particular, recognize the complex situation facing and permit an improvement in prices. This, would ensure the profitability and stability of the sector, to achieve a price according to the quality, as production quotas were already set in his day. For the dairy sector, the second challenge in Spain would be to have a unique representation that group all farmers, able to discuss and negotiate the problems of the branch to the higher administrative level, following the model of agricultural and livestock unions of other countries of the European Unionsuch as France or Germany.
"The abandonment of many producers of milk" exacerbates the problems of a bouquet in which investment and hardness of the activity create barriers to entry that prevent the reopening of "new farm"
How you group Tatoma copes these business challenges?
Currently, Grupo Tatoma is facing this crisis improving their processes, trying to reduce costs, increasing the formation of the staff, trying to improve their products, expanding its range of machinery and looking for new markets. In general, as we did in similar previous periods, making them flexible production needs of the market to emerge strengthened from this situation.
As for lines of business, what percentage of the total is the agricultural machinery for the Tatoma group? What is the most commercially successful product and market share?
In turnover, agricultural machinery accounts for 30% of the turnover of Grupo Tatoma. In particular, the mixer represents 85% of the same. Within this line of business, it also represents the product with greater market share.
What are the main projects that currently Tatoma? Do you have scheduled any release or investment in facilities in the coming months?
At this time, improve costs and processes to become more competitive and gain in performance in each line of mixers, as competition is enormous and its steady progress. At the end of the year 2007, we made a major investment which has allowed us to improve the production. Our company has a significant presence in France that we intend to strengthen through an agreement with the company you had SA and improve the commercial network in one of the most important markets in Europe. Currently, we are also working in the markets of Mexico and United States, with the illusion of grow or at least maintain the volume of activity in the coming years.
Earlier this year, the Group Tatoma participated at the Fima Ganadera 2009 Salon. Are expected to participate in any other contest in the coming months? As for the year 2010, will be the major events that will presumably be?
This year, our company has participated in Fima Ganadera, Silleda fair and Agromaq 2009 (Salamanca). Outside Spain, Tatoma has attended the Exhibition Space in Rennes (France). In October, you will visit the exhibition of livestock in Clermont-Ferrand (France) and will travel to Wisconsin (United States). Whereas in November it will move to Hanover (Germany). The next year, we will be in the 2010 edition of Fima and other events still to be defined, according to our budget.
Last year, Tatoma won the prize "Company Huesca 2008". In your opinion, what is the secret of business success?
A company does not work thinking in awards, but in a project. There are no magic formulas or it is the result of any secret. There is work, imagination, perseverance, a great team, good suppliers and a market that is confident in the company. And above all great illusion.
Bearing in mind that Tatoma exports to the five continents, are the countries in which has a greater presence and why? Do you have planned expand this internationally soon?
Basically, Tatoma is present in the nearest surroundings, so it takes care, with the best possible care, Spain, Portugal, North Africa and France markets. We manufacture very large machines, whose transport penalizes the cost and that require a service post special sale. That is why we must grow in other markets, but sustained by such a service. We sell our products in other European countries, North Africa, Australia, Asia and South America, sporadically. As I have mentioned earlier, we operate in Mexico through a small society that would make it possible, in the future, our introduction with more force in the South of United States. This is possible with the help of companies that they based their business in the after sales service.
