-Competitive Profile

Matrix (CPM)

-External Factor

Evaluation: (EFE)

Matrix

-Competitive Analysis:

Porter's Five Forces

Model

-Political, Governmental,

and Legal Forces

-Social, Cultural,

Demographic, and

Natural Environment

Forces

-Competitive Forces

-Technological Forces

-Economic Forces

Social, Cultural, Demographic, and Natural Environment Forces

External Analysis

The following factors have an impact not only on how they are behaving today but the history of trends and projections to the future. There are social, cultural, demographic, and natural environment variables that affect out industry and out company.

Some rates and numbers can lead us to some conclusions, for example the decrease of births and marriages can be united with the gender roles because since women are taking charge of the income of the household, the number of children they can have is lowered.

The attitudes of the Colombian market have to be taken in awareness since we have to know how out customers tend to live and act according to the cultural and economical tendencies respectively.

These factors are not only an advantage to knowing the market that the company is entering but are also useful and needed for future projects and goal establishment.

Childbearing rates

Colombia has a childbearing rate of 16.47 births per 1000 population estimated by the Central Intelligence Agency of the United States of America in 2015.

Number of special interest groups

These are the ones that make the company socially responsible, that has three main groups, the internal stakeholders (employees and shareholders), external (society), and public agencies that are intermediate interest groups.

Some of the special interest groups that we could aply to are:

Global Exchange
- Focuses on human rights and promotes social, economical and environmental justice around the world.
Sierra Club
- Has as a purpose to explore, enjoy, and protect the wild places on earth.
Latin America Working Group
- It encourages US policies towards Latin America to promote rights, justice, peace and sustainable development.

Number of marriages

The database Passport stated that in 2015 Colombia had 146,367 marriages with an average age of about 22 years for woman and 25 years for men. The rate of marriages is 3 (per 1000 people).

Number of divorces

Between the months of January and March of 2015 there were 7721 divorces filed, that means a growth of 11.22% compared to the year before. The same months from 2014 were only registered 6942 divorces.

Number of births

National wise the number of births is 477, 116 and the larges group of mothers is in the age of 20 to 24 years.

Number of deaths

The estimated rate of deaths in 2015 in Colombia is 5.4 deaths/ 1000 population. In 2013 there were 191 880 deaths registered, therefore the number of deaths was reduced by 7 271 less than the year before.

Immigration and emigration rates

The number of displaced people per year since 1995 in Colombia had a peak in 2002 and then it has been stabilizing year after year. The migration rate per 1000 population is low (-0.64 migrants) in 2015.

Social security programs

The increasing rate of men and women that get registered in social security has build up to 50.7% of men and 49.3% of women of the total population.

Life expectancy rates

The life expectancy rate at birth is 75.48 years for the total population of Colombia, 72.34 male, and 78.8 years. In comparison to the world, Colombia is in the 98th level.

Per capita income

The average income per hour in thousands of Colombian pesos has been rising exponentially since 2009. In 2011 men were having an income of 4.4 and women 4.3, while in 2007 it was in average 3.7.

According to DANE the per capita income in 2014 was $578.422 COP with an increasing rate of 7.8% compared to 2013.

Attitudes toward businesses

Dinero stated in an article, published the 9th of September of 2015, that 91% of Colombian managers perceived corruption in the business world.

Now Colombia is in the 126th place of the ethical list, and was qualified as 2,5 out of 7 of ethical business concern. Transparencia por Colombia and University of the Externado also stated that only 38% of the Colombian businesses have in mind the implementation of ethical practices to lower the rate of bribery. Never than less 58% of the managers think that many negotiation cannot be done without bribery.

Lifestyles

The unsatisfied rate of basic needs in Bogota in 2012, according to the DANE was 9.2% and national wise the rate reached 27.78%.

Economy
Society
Environment

Traffic congestion

According to the Colombian Security Comity there are 90 daily car accidents in Colombia of which 16 of them are mortal.

In 2013 there has the peak of the accident rate in Colombia with 3.34% increase. This makes an average of more than 5 thousand deaths per year due to vial accidents. The Instituto de Medicina Legal has qualified the car accident factor as the second reason in the mortality rate in the country.

Inner-city environment

The urban population is about 76.4% of total population in 2015 and the annual rate of change from 2010 until 2015 is 1.66% annually.

Average disposable income

DANE made a research of 23 cities in Colombia including Bogota, Medellin, Cali, Barranquilla, and others, to define some income rates. They analyzed 3,604,775 household and found that the average income was $543.378 COP, the total income $1,938,000, the minimum income $1,458 and the maximum income they found in these households was $38,833,333.

Trust in government

Transparencia por Colombia is a non-profit organization that aims for transparency in governmental and fights against corruption, situated in Bogota. This organization made a rate of perceived corruption in 2014 about the public sector of Colombia. They concluded that the last years the rate has been shifting dramatically and Colombia had a raiting of 37 out of 100 (being 0 the most corruptive perception). This situated Colombia in place 94 of 175 countries that were evaluated.

Attitudes toward government

The citizens of Colombia are filing the most tutelage because of the dissatisfaction towards the public health insurance, but petitions are the most rights that have been demanded for the last 7 years. Every day there are 360 tutelage been made about the public health insurance.

Attitudes toward work

Colombia as a whole has reduced the rate of unemployment from 9.7% to 9.4%, comparing the first semester of 2014 and 2015. As the chart below shows, the rate of unemployment has decreed since 2010 until 2015 and the one of the lowest years of employment rate was the first semester of 2007.

Comparing the total employment and unemployment in Colombia to Bogota the rates of employment are higher since in the beginning of 2015 it was 65.3%. This means that Bogota was a higher number of employees per capita than the rest of the country in average.

Buying habits

In an article that SURA published, a Colombian insurance company, about a market research of buying habits. These showed that the Colombian market is more prominent to spend in the second semester of the year, while the first semester they are more conscious about saving. Fashion wise they tend to spend 68% in the second semester.

Their eating habits are the first months o the year healthy, then they tend to eat more fish until the festivities come and there is almost nonexistent health consciousness. Nine months after festivities, depending on region, the most births are taken place and also a peak in spending’s. Mothers are worldwide known as one of the best clients and best spenders, therefore all the possible industries are constantly looking for them.

Ethical concerns

According to Movimiento Social, Colombia is having an ethical crisis that stands out even more in the government were the usual “everything counts” is an everyday way of thinking. Some of the factors that have influenced to this ethical crisis are:

Popularity increases when scandals happen
Tolerance towards illicit groups
Lack of sensibility to social programs of the government
Corruption in the highest levels of the government
Manipulation of the massive media
Discredit the negotiation of peace and political solutions

Attitudes toward saving

The Colombian market has a low tendency of saving since the eighties; some of the reasons are the following:

Lack of saving culture
Low salariesSocial and economical inequality
Low economical education

The following map shows the saving rates according to the regions.

Sex roles

Since 1993 women are getting more education and therefore many of them are starting to have jobs and even becoming the main economical source in the household. The magazine from the DANE called ib stated that the economical instability and the increasing poverty have been some of the reasons of women having to start leaving their homes and becoming working mothers. This has even impacted the rate of birth in Colombia that has been lowering year after year.

Also a study made by the Consejeria Presidencial para la Equidad de la Mujer called “Investigaciones sobre Genero y Desarrollo en Colombia” states that the leadership in the household of woman has increased and for the men decreased since 1997 until 2003.

Attitudes toward investing

Yanhass made a study of attitudes of the Colombians towards investing and saving, making an inquiry to 600 people over the age of 18.

They found that men tend to invest more than women and that the most liked places of investment are Ecopetrol, ETB, ISA, and Davivienda. Stratum 6, 5, and 4 like to invest more in Ecopetrol.

Racial equality

The population of Colombia is divided in 84.2% mestizo and white people, 10.4% afro-Colombian, 3.4% Amerindian and the other 2.1% is unspecified.

Use of birth control

The fertility rate of children born per woman is 2.04 and the contraceptive prevalence rate 79.1%. This shows that about 80% of population is using contraceptive and the cultural impact is not an disadvantage.

Average level of education

The total population of literacy in Colombia is 94.7% of which in average 94.6% of the population of men and 94.8 are woman.
The expectancy of school life from primary to tertiary education is 14 years (13 years for men and 14 for woman). According to the DANE, the average years of school expectancy for men and women from the age of 15 to 24 is 9.4 years.

Government regulation

In Colombia, the business sector is classified into micro, small, medium and large companies; this classification is regulated by Law 590 of 2000, and its modifications (Law 905, 2004), known as Mipymes Law. (Pymes represent a 99,9% of total companies in the country.)

On the other hand, iNNpulsa Colombia is the entity of the Government that promotes the business innovation and entrepreneurship with global scope, understanding them as instruments that contribute to the sustained growth of the economy.

Now, when it comes to create and organization, there’re some aspects we have to take into account:

Political Constitution of Colombia

Mainly article 38: Freedom of association

Article 333: Economic Freedom

Article 158: Unit of matter

Law 344 of 1996

This norm is very important since it corresponds to the creation of companies.

Article 16: Access to resources for incubator projects associated with Sena.

Law 550 of 1999

Establishes a system that promotes and facilitates business revival, the restructure of local territorials to ensure the social function of the organizations, achieve harmonious development of the regions and it dictates dispositions to harmonize the existent legal regime with the norms of this law.

Law 789 of 2012

It dictates the rules to support employment and extend social protection.

Decree 934 of 2003

It regulates the operation of ‘Fondo Emprender (FE)’

Article 40 of law 789 of 2002 created FE as an independent and account attached to the National Apprenticeship Service, Sena, which will be managed by that entity whose exclusive objective will be to finance business initiatives within the terms already established.

Law 905 of 2004

Law 590 of 2000: Promotes the development of micro, small, medium businesses.

Law 1014 of 2006

Dictates laws for the promotion of the entrepreneurship culture in Colombia.

Sentencia C- 392 of 2007

The ‘Sala Plena de la Corte Constitucional’ supported the creation of micro-enterprises under the Impersonal Companies regime, provided in article 22 of Law 1014 of 2006, ‘Ley de Fomento al Emprendimiento’.

According to this Sentencia, this law applies for companies that have to ten employees and less than 500 minimum salaries—this are constituted as Impersonal Companies.

It is also important to be aware of any possible risks in the warehouse, especially for employees.

There are some precautionary measures we have to take into account for any company such as:

- Keep traffic areas free of obstacles

- Working tables must be cleaned at the end of the day

- Respect ‘wet floor’ signs

- Save sharp objects after using them

- Use the railing in the stairs

- Be aware of the emergency exits

- Learn/know first aids

Among other things

It is very important to take into account the regulations at the moment of creating a business because these allow us to be legal and aware of things

BANCOLDEX, ¿Qué es pyme?, [Online], Available at: https://www.bancoldex.com/Sobre-pymes/Que-es-Pyme.aspx [Accessed Feb 17, 2016]

Dinero, (2015) ¿Por qué fracasan las pymes en Colombia?, [Online] Available at:

http://www.dinero.com/economia/articulo/pymes-colombia/212958 [Accessed Feb 17, 2016]

BANCOLDEX, Programas especiales de Bancóldex, [Online] Available at: https://www.bancoldex.com/contenido/contenido.aspx?conID=3870&catID=92&pagID=1592 [Accessed Feb 17, 2016]

Encolombia, Normativa en Guía de Emprendimiento, [Online], Available at:

https://encolombia.com/economia/economiacolombiana/emprendimiento/normativa/ [Accessed Feb 17, 2016]

FORPAS, Manual de seguridad y salud en oficinas, [Online] Available at: http://www.forpas.us.es/documentacion/041_33_02.pdf [Accessed Feb 17, 2016]

Attitudes towards retirement

Ministerio de Trabajo announce3ed that from 2014 on the retirements would be from the age of 57 years for women and 62 years for men. Which means that the age was increased by two years duo to the wellbeing of the people and the life expectancy rate.

Before the retirement was seen as the time of depression and abandonment, the people were educated for their active and productive life but not for the retirement. This now is beginning to be seen as the opportunity for education and growth, as Monica Meza describes in her article.

Attitudes towards leisure time

El Tiempo published an article called “TV, leisure, and social live, plans that the Colombians make in their free time” that mentions the main activities that the people do during their free time. The most preferred activities is the use of electronic devices by 71% of the population, followed by what the DANE calls “passive leisure” that is the act of not doing anything.

In general the Colombian population is not very active and prefers to stay at home than going to the theater or even reading, since the average Colombian reads only two books per year.

The third most liked activity is the social life of going out with friends to dance or reunions. The average person in Colombia has 13 free hours in weekdays and still this time is not spend on sports or cultural activities.

Attitudes towards product quality

The competition with quality has risen since the accessible technology environment has been descended. For many years in Colombia if a customer of a supermarket hat a claim they would be ignored and that treatment would be assumed. Now a days social media got more power than the best marketing strategies, because the customer began to have more options of product and also the opportunity to make the bran look bad.

Since then the certificates have become a competition in which these are the leaders in quality in 2016:

Alpina
Exito
Coca Cola
Bancolombia
Cerrefour
Postobon
Carulla Vivero
Nutresa
Bavaria
Colgate

Attitudes towards customer service

The CEO of Contact Center Americas, Jorge Enrique Cote, estimates that the customer service industry has over 106 thousand employees, makes $1.88bilion COP per year of which $330.000 million are from exportation services.

This shows that Colombia has a growing industry known international wise. Never than less the Colombian customer does not see the customer service as a good one because of the lack of organization in the administrative are that influences and damages the customer service attention.

Pollution control

According to the annual report of 2015 of CREG, Colombia had to be flexible and let smaller power plants work in the industry of mayor companies because of environmental changes (El Niño).

Attitudes towards foreign people

Santiago Montenegro, a columnist of El Espectador, emphasizes how the foreigners have a positive effect in Colombia because they make a notable contribution to social services, education and science. Therefore the laws that regulate the strict entry, compared to other countries, have to be lowered so we can have the investment on monetary, social and educational contribution in Colombia.

When a foreigner wants to work in Colombia he/she has the following rights of labor according to Ministerio de Trabajo:

A contract
Salary payment according to worked services
Health insurance
Payment of social benefits
Compensation fund affiliation
Vacations

Energy conservation

The energy production was in 2012 57.81 billion kWh that states that Colombia compared to the world is in position 48 in energy production. Their consumption was an estimated of 48.38kWh the same year. The main source of electricity is from hydroelectric plants (67.2%) and fossil fuels (32.1%).

Even though Colombia was placed at 49th in the list of consumption of energy worldwide, the lack of access to energy because of non-connected zones that are 66% of the national territory. Only 1440 of the 12000 zones have access to energy 4 to 5 hours a day.

Social programs

The DNP, Departamento Nacional de Planeacion, has a list of programs that are been worked on:

Rural Sustainable Development
Environment
Enterprise Development
Territorial Developmen
Social Development
CreditInvesting and Public Finance
Justice, Security and Government
Economic Studies
General System of Dividends
Generation of IncomeSynergy

Number of churches

The Colombian population is 90% Roman Catholic brought by the spaniel invasion. According to the “Secretaria de Planeacion” Bogota has about 1544 places of worship.

The most common religions are:

Catholic
Evangelistic
Pentecostalism
Neopentecostalism
Protestantism
Jehovah’s Witnesses
Islam
Orthodox

Number of church members

According to the magazine of the University Javeriana 58.2% of the population consider themselves that they are believers of a religion and also practice the religion. This means that about 28.1 million people in Colombia should be church members.

Social responsibility

The current president, Juan Manuel Santos, asked to the ministers for awareness of the consumption of water and energy because of the massive effects of the phenomenon of El Niño. In the article published by the Ministerio de Ambiente he explained hoy the months of October and November should be the months of rain in the year but the stated rain will not be sufficient for the consumption of the country.

The president explain how many resources were given for the control of environmental damages but that all Colombians had to contribute by saving energy mainly and water.

The Colombian government began to make campaigns to lower consumption of water and energy in the household and the citizens realize the urgency of the matter and react to it.

Attitudes towards careers

According to “Observatorio Laboral del Ministerio de Educación” the best-paid graduate careers are engineering, architecture, urbanism. After this branch of careers come mathematicians, and natural science mayors with 1,794,194 COP per month.

Engineering, architecture, and urbanism
Mathematics and natural sciences
Social Studies
Economics, Business, and accountancy

Population changes by race, age, sex, and level of affluence

Colombia began to have more women in average in 1980 but in 2010 men began to have a lead in population per capita.

Attitudes towards authority

The attitude towards authority depends on how the corruption is perceived and the rate has been going down, this means that the people are perceiving Colombia a less corrupted country year by year.

Population changes by city, county, state, region, and country

The population of Colombia has been increasing since 1960 until this year cording to statistics of the DANE, but the rate of growth of the population has been decreasing. This can be a substantial problem for future retirees.

Bogota has the most population of the cities in Colombia with 7.86 million people.

Value placed on leisure time

The IPC rated by the Banco de la Republica shows the following trends from 1998 until January of 2016:

We can see how it has been growing slowly but duplicated in more than 15 years. This can be analyzed as the average level of the prices and the changes in the cost of life. The more the IPC there more it costs and less the people have to spend in additional not necessary factors that could increase their quality of life.

Regional changes in tastes and preferences

Fenalco stated, in their annual meeting, some of the tendencies for 2016. The first tendency is that the consumers are going to have a more environmental conscious mindset in the moment that they are choosing between products. The second tendency of buying habits is the obsession with health, referring to healthy food and lifestyle.

Only the first and most important or significant buying habit of 2016 customer can be an opportunity to sell a product that will be attractive for customer with environmental consciousness.

Number of woman and minority workers

In the management levels the white people have 62% of the jobs, mestizos 30%, African-Colombian 6% and indigenous population only 1%. Out of these

managers 2 out of three are woman, therefore the minority workers are woman in general and colored people.

Number of high school and college graduates by geographic area

In 2009 the technical programs graduates grew from 28388 in 2002 to 80254 and the difference between the wage of men and woman is reducing. The rate of graduates has risen to 64.7% in the last ten years. In 2009, after a rise in the rate of graduates, 77801 people in Colombia graduated from a superior education system.

Recycling

According to the Ministerio de Ambient, Colombia has around 10 million tons of solid waste per year of which only 2 million are recycled. The main source of recycling are the so-called “recicladores” that are independent people that collect the waste that can be recycled and sell it to governmental and private entities.

In March of 2015 the Minister of Environment, Gabriel Vallejo, had a meeting with the recicladores to make a space for the government to communicate and go over rights and requests of the recicladores were the Government can help them due to their exceptional job.

Waste management

The economic growth in Colombia has made the waste management of dangerous residue more difficult to control and has as a result a negative impact in the environment. The main sources of chemical or other dangerous residuals are the industrial activities, agriculture, services and domestic activities.

The Colombian National Government published in 2005 a regimen were the objective was to prevent the unconscious management of waste and promote the environmental respect. This improves not only the environmental impact but also the well being of the population.

Air pollution

PM is a “Particulate matter is the sum of all solid and liquid particles suspended in air many of which are hazardous. This complex mixture includes both organic and inorganic particles, such as dust, pollen, soot, smoke, and liquid droplets.”. This means that than higher the weighted PM concentration, then higher the air pollution is.

The Sustainable Development Department made a report named “Colombia: Strengthening Environmental and Natural Resources Institution” to analyze the heath of Colombia’s environment. As one of the conclusion we can see in the following table Bogota has the highest weighted PM concentration followed by Area Metropolitana del Valle de Aburra.

Water pollution

The improved drinking water sources in Colombia are accessible for 96.8% of the population in urban regions and 73.8% in rural regions. The unimproved drinking water source is for 3.2% of the urban population and 26.2% of the rural population.

In the following graph are the places in Colombia where are the principal clean water extraction sources. Quindio has the highest rate with 76.9%.

The principal factors that create the most water pollution are domestic, industrial and agricultural overuse.

Ozone depletion

The governmental entity that is in charge of the ozone depletion is La Unidad Tecnica Ozono, also known as UTO. They are in charge of making the design and implementation of strategies to eliminate the consumption of products that can damage the ozone.

Endangered species

There are over 7 million animals that are being sold illegally in other counties. This action is making it even harder for Colombia to take care of their endangered species list and continues to add creatures to the list.

The Mininisterio de Ambiente y Desarrollo Sostenible made a list of the most endangered species, which include 1203 species (173 are in critical danger, 390 are in danger and 640 are vulnerable).

Some of the programs that are tiring to protect these creatures are the following:

• Programa de Conservación de Oso Andino
• Programa Conservación del Género Tapirus
• Programa Nacional para la Conservación del Cóndor Andino.
• Programa Nacional para la Conservación de Tortugas Marinas y Continentales de Colombia.
• Programa Nacional para la Conservación del Caimán Llanero.
• Programa Nacional para la Conservación de los Felinos en Colombia.
• Programa Nacional para la Conservación de Serpientes en Colombia.
• Programa Nacional para la Conservación de la Especie Endémica Tití Gris