A shining light from Mexico
March 14, 2017
Bimbo’s growth from its humble start in Mexico 71 years ago reflects rapid growth prodded by committed leadership, a willingness to take risks and appreciation for the desire of a multitude of customers for the best quality.
Considering the vitriol that has been unjustly heaped on Mexico by the Trump administration, both before and after the election, it is fitting that a heartfelt tribute be paid to a citizen of Mexico who died last month leaving as his legacy an international baking business hugely admired. Of course, the reference is to Don Lorenzo Servitje and the company he helped found and lead for many years, Grupo Bimbo S.A.B. de C.V. From headquarters in Mexico City, where Mr. Servitje’s son, Daniel Servitje, has been the company’s chief executive officer, Bimbo has grown to attain rank as the largest baking company not just in Mexico, not solely in the United States, but in the world.
Just watching Bimbo’s evolution and growth, as did many participants in baking, provides affirmation of just how remarkable it is and how it tells a story in stark contrast to what has been falsely claimed too many times in the past year or so. Bimbo’s growth from its humble start in Mexico 71 years ago reflects rapid growth prodded by committed leadership, a willingness to take risks and appreciation for the desire of a multitude of customers for the best quality. It is by understanding just what growth in population and the economy mean for baking where Bimbo excels.
Don Lorenzo Servitje helped lead the company through its initial growth phases, when new plants were strategically built in Mexico, and the U.S. market, mainly in California, provided the testing ground for international expansion. Credited with the ability to inspire, Don Lorenzo Servitje lived to 98 before his death last month. He witnessed firsthand and participated in many corporate moves that resulted in Bimbo covering nearly all of the Western Hemisphere. Its leadership in America, implemented through carefully conceived and well financed acquisition plans, means that Bimbo owns an array of brands that stand by themselves as portraying the history of the industry in the United States.
With Daniel Servitje at the company’s helm since his father’s retirement in 1994, Bimbo is recognized as not just a major player, but as a company willing to provide leadership. The latter alone is no small task in light of the need to deal with revolutionary changes under way in the consumer marketplace as well as the quandaries facing baking and many other food industries from the presidency of Donald J. Trump. No one else in baking comes to this task better experienced than Daniel Servitje does in light of the amazing reach of his business through this hemisphere and importantly also into what is termed Iberia in Western Europe. This is a company with $10 billion of annual sales, with just about half in the United States. Its market capitalization is also right at $10 billion, where the Servitjes own nearly 40%, placing them among the world’s wealthiest families.
Anyone tempted to look upon the current scene where Bimbo is active and to conclude that little room remains for surprises would probably be wrong on several counts, the most important being the unwillingness of the company itself to stand still. Just how initiatives that may be tried by the Trump administration prompt response is unpredictable except to be sure that some of the more outrageous steps might draw equally striking reactions. There’s always the hope that the Bimbo success should provide a guide to how benefits may flow from a Mexico-based success, and that instead of prompting untoward moves the best action would be to spur the sort of sane growth experienced recently. Disclosed in connection with Don Lorenzo Servitje’s death is the Bimbo collaboration with an affiliate of the Carlos Slim family (he is Mexico’s and one of the world’s wealthiest) to manufacture in Mexico an electric vehicle. Knowing what Bimbo has done in baking makes perfectly reasonable that it would spark Trump-contrariness by starting to make cars in Mexico for sale to Mexicans.