Farmcomp builds long-term business relationship
The Finnish manufacturer of moisture meters for farmers, Farmcomp, is off to a flying start in Colombia thanks to support from Finnish consultants Camaleonte and Finnpartnership.
The company is looking to build a long-term business partnership in the country. Setting up in a new land and finding new partners usually takes some time, but moisture meter manufacturer Farmcomp has had an exceptional start in Colombia. In December 2014, the Tuusula-based company was contacted by Finnish consultants Camaleonte that, in turn, had been approached by Ricardo Rodríguez Clavijo, a Colombian agricultural engineer. Clavijo had come across the Finnish manufacturer Farmcomp’s moisture meter and wanted to test it at his coffee farm. Camaleonte then introduced Clavijo to Farmcomp and informed the Finnish company about Finnpartnership.
Farmcomp contacted Finnpartnership for assistance on a partnership identification and feasibility study in Colombia. According to Farmcomp export manager Ksenia Plyusnina, the application was processed very quickly and Farmcomp has received significant support from Finnpartnership. As a small company, Farmcomp would have struggled to get started in Colombia on its own. “Finnpartnership also helped us gather information before our trip. We received answers to our questions very quickly,” says Plyusnina about the support from Finnpartnership. Part of the financial assistance Farmcomp received was used to train its Colombian partner. “We explained the meter’s features and tested it on site at coffee farms with the farmers,” says Plyusnina.
Emphasis on maintenance and training
The Finnish consultants Camaleonte helped Farmcomp with practical arrangements and finding contacts. In Colombia, Farmcomp found out about statutory requirements governing moisture content measurements. After the fact-finding trip, the company was able to make minor adjustments to its device to ensure that it would meet the needs of Colombian farmers. It also had a good idea of a suitable business model for Colombia. Ricardo Rodríguez Clavijo’s company Inversiones Magazi is now Farmcomp’s local representative, handling equipment sales, marketing, maintenance and user training in Colombia.
According to Plyusnina, Farmcomp is looking to build a long-term business partnership in the South American country. “We want our local representative to be able to give equipment users the best service possible. The product life of these devices is several decades, but they need maintenance and calibration every two years or so in order to maintain measurement accuracy.”
Helping support small farmers
Moisture measurements are important when working with dried agricultural products such as coffee and cereals. If the moisture content is too high, beans and grains will develop mould. On the other hand, the moisture content also affects the price of crops. “Farmers get the best price for coffee beans which have a moisture content of 10-14%.” Farmcomp markets its moisture meters specifically to coffee, cocoa and grain farmers. With their own moisture meters, farmers are better positioned when making deals. “Farmers used to have to rely on the buyer’s moisture content measurements. Now the buyer can no longer dictate the price.”
Farmcomp has striven to bring down the device unit cost so that farmers can buy them independently or pair up with a neighbouring farm and share one. Depending on the model, the meter costs €300-€700 in Colombia. “Good tools like the moisture meter help farmers increase their profits. Families are able to make a living from their produce and they are not forced to abandon the countryside.”
Demand is growing fastest in developing countries
Since agriculture is one of Colombia’s main economic sectors, the moisture meter has a large market. Plyusnina believes that there is also untapped potential in other Latin American countries. “We believe that we can replicate our Colombian business model in other countries.” In this, Finnish consultants Camaleonte with vast experience and extensive network can help the company.
Farmcomp is Finland’s market leader in agricultural moisture meters, but most of its sales come from abroad. Ksenia Plyusnina estimates that the company has sold meters to more than 80 countries so far. “On the mature European market, demand grows very slowly. The focus is now on Asia, Africa and Latin America.”