Mexico’s Healthy Food: Using Innovation to Create Commercial Ties with Suppliers

Abstract

The southern region of the State of Mexico is characterized as having great agricultural potential; however, there are practices that do not allow the standardization of production processes, which leads to a commercial problem between farmers and intermediaries. Obsolete practices, in addition to causing conflicting relationships, lead to the supply of products with low quality standards and an undetermined quantity of product. Despite these setbacks, Mexican entrepreneurs engaged in buying and selling agricultural products continue to invest in this sector. “Mexico’s Healthy Food”, a fruit and vegetable company, presents one of its greatest challenges in the face of the possibility of acquiring new North American investors. While confronting this task, Mariana Mendoza, its commercial manager, must solve a logistics and supply problem that has been the-problem-to-solve during recent years.

Appendices

Appendices

Appendix 6.1: Mexican General Data

	1990	2000	2010	2016
World view
Population, total (millions)	85.36	101.72	117.32	127.54
Population growth (annual %)	2	1.4	1.6	1.3
Surface area (sq. km) (thousands)	1,964.40	1,964.40	1,964.40	1,964.40
Population density (people per sq. km of land area)	43.9	52.3	60.4	65.6
GNI per capita, Atlas method (current US$)	2,760	5,810	8,940	9,040
People
Life expectancy at birth, total (years)	71	74	76	77b
Fertility rate, total (births per woman)	3.5	2.7	2.3	2.2b
Adolescent fertility rate (births per 1000 women ages 15–19)	83	80	68	62b
School enrollment, primary (% gross)	110.7	106.2	103.4	103.4b
School enrollment, secondary (% gross)	53	70	83	91b
Economy
GDP (current US$) (billions)	262.71	683.65	1,051.13	1,046.92
GDP growth (annual %)	5.1	5.3	5.1	2.3
Inflation, GDP deflator (annual %)	28.1	10.8	4.5	4.6
Agriculture, value added (% of GDP)	8	4	3	4
Industry, value added (% of GDP)	28	35	35	33
Services, etc., value added (% of GDP)	64	62	61	63
Exports of goods and services (% of GDP)	19	26	30	38
Imports of goods and services (% of GDP)	20	27	31	40
Time required to start a business (days)	..	..	8b	8
Tax revenue (% of GDP)	11.8	9.9	10.2	13.9
Military expenditure (% of GDP)	0.5	0.5	0.6	0.6
Mobile cellular subscriptions (per 100 people)	0.1	13.6	77.5	88.2
Individuals using the Internet (% of population)	0	5.1	31.1	59.5
Global links
Merchandise trade (% of GDP)a	32	51	58	74

1. ^aMerchandise trade as a share of GDP is the sum of merchandise exports and imports divided by the value of GDP, all in current US dollars
2. ^bThis figures refer to periods other than those specified
3. Source: World Development Indicators database
4. Last Updated: 02/16/2018

Appendix 6.2: United States General Data

	1990	2000	2010	2016
World view
Population, total (millions)	250	282	309	323
Population growth (annual %)	1	1	1	1
Surface area (sq. km) (thousands)	9629	9632	9832	9832
Population density (people per sq. km of land area)	27	31	34	35
GNI per capita, Atlas method (current US$)	24150	36070	48950	56810
People
Life expectancy at birth, total (years)	75	77	79	79b
Fertility rate, total (births per woman)	2.1	2.1	1.9	1.8b
Adolescent fertility rate (births per 1000 women ages 15–19)	57	46	34	21b
School enrollment, primary (% gross)	105.2	102.5	100.6	100.1b
School enrollment, secondary (% gross)	91	93	94	98b
Economy
GDP (current US$) (billions)	5,979.6	10,284.8	14,964.4	18,624.5
GDP growth (annual %)	1.9	4.1	2.5	1.5
Inflation, GDP deflator (annual %)	3.7	2.3	1.2	1.3
Agriculture, value added (% of GDP)	..	1	1	1b
Industry, value added (% of GDP)	..	23	20	20b
Services, etc., value added (% of GDP)	..	76	78	79b
Exports of goods and services (% of GDP)	9	11	12	12
Imports of goods and services (% of GDP)	11	14	16	15
Time required to start a business (days)	..	..	6b	6
Tax revenue (% of GDP)	10.4	12.9	8.6	10.9
Military expenditure (% of GDP)	5.1	2.9	4.7	3.3
Mobile cellular subscriptions (per 100 people)	2.1	38.5	91.3	127.2
Individuals using the Internet (% of population)	0.8	43.1	71.7	76.2
Global links
Merchandise trade (% of GDP)a	15	20	22	20

1. ^aMerchandise trade as a share of GDP is the sum of merchandise exports and imports divided by the value of GDP, all in current US dollars
2. ^bThis figures refer to periods other than those specified
3. Source: World Development Indicators database
4. Last Updated: 02/16/2018

Appendix 6.3: Mexican Exports and Imports Data

Agricultural and livestock a products balance (thousands of dollars)
	Exports	Imports	Exports vs. imports
2015	$12,970,645	$11,240,977	1.2b
2016	$14,672,300	$11,468,233	1.3
%2016 vs. 2015	13.1%	2.0%

1. ^aAn agricultural and livestock product is the result of agricultural crops and the raising of animals
2. ^bExport is 1.2 times the amount of import
3. Source: SAT, SE, BANXICO, INEGI. Balanza Comercial de Mercancías de México. SNIEG. Información de Interés Nacional
4. Last Updated: 08/10/2017

Appendix 6.4: Main Export Vegetables and Fruits. (Published by SAGARPA)

Appendix 6.5: Hispanic or Latino Origin Population by Type: 2000 and 2010

Origin and type	2000		2010		Change, 2000 to 2010 a
	Number	Percent of total	Number	Percent of total	Number	Percent
Hispanic or Latino origin
Total	281,421,906	100.0	308,745,538	100.0	27,323,632	9.7
Hispanic or Latino	35,305,818	12.5	50,477,594	16.3	15,171,776	43.0
Not Hispanic or Latino	246,116,088	87.5	258,267,944	83.7	12,151,856	4.9
Hispanic or Latino by Type
Total	35,305,818	100.0	50,477,594	100.0	15,171,776	43.0
Mexican	20,640,711	58.5	31,798,258	63.0	11,157,547	54.1
Puerto Rican	3,406,178	9.6	4,623,716	9.2	1,217,538	35.7
Cuban	1,241,685	3.5	1,785,547	3.5	543,862	43.8
Other Hispanic or Latino	10,017,244	28.4	12,270,073	24.3	2,252,829	22.5
Dominican (Dominican Republic)	764,945	2.2	1,414,703	2.8	649,758	84.9
Central American (excludes Mexican)	1,686,937	4.8	3,998,280	7.9	2,311,343	137.0
Costa Rican	68,588	0.2	126,418	0.3	57,830	84.3
Guatemalan	372,487	1.1	1,044,209	2.1	671,722	180.3
Honduran	217,569	0.6	633,401	1.3	415,832	191.1
Nicaraguan	177,684	0.5	348,202	0.7	170,518	96.0
Panamanian	91,723	0.3	165,456	0.3	73,733	80.4
Salvadoran	655,165	1.9	1,648,968	3.3	993,803	151.7
Other Central Americanb	103,721	0.3	31,626	0.1	– 72,095	– 69.5
South American	1,353,562	3.8	2,769,434	5.5	1,415,872	104.6
Argentinean	100,864	0.3	224,952	0.4	124,088	123.0
Bolivian	42,068	0.1	99,210	0.2	57,142	135.8
Chilean	68,849	0.2	126,810	0.3	57,961	84.2
Colombian	470,684	1.3	908,734	1.8	438,050	93.1
Ecuadorian	260,559	0.7	564,631	1.1	304,072	116.7
Paraguayan	8,769	–	20,023	–	11,254	128.3
Peruvian	233,926	0.7	531,358	1.1	297,432	127.1
Uruguayan	18,804	0.1	56,884	0.1	38,080	202.5
Venezuelan	91,507	0.3	215,023	0.4	123,516	135.0
Other South Americanc	57,532	0.2	21,809	–	– 35,723	– 62.1
Spaniard	100,135	0.3	635,253	1.3	535,118	534.4
All other Hispanic or Latinod	6,111,665	17.3	3,452,403	6.8	– 2,659,262	– 43.5

1. – Percentage rounds to 0.0
2. ^aThe observed changes in Hispanic origin counts between Census 2000 and the 2010 Census could be attributed to a number of factors. Demographic change since 2000, which includes births and deaths in a geographic area and migration in and out of a geographic area, will have an impact on the resulting 2010 Census counts. Some changes in the Hispanic origin question’s wording and format since Census 2000 could have influenced reporting patterns in the 2010 Census. Additionally, changes to the Hispanic origin edit and coding procedures could have impacted the 2010 counts. These factors should especially be considered when observing changes for detailed Hispanic groups
3. ^bThis category includes people who reported Central American Indian groups, “Canal Zone,” and “Central American”
4. ^cThis category includes people who reported South American Indian groups and “South American”
5. ^dThis category includes people who reported “Hispanic” or “Latino” and other general terms
6. Source: U.S. Census Bureau, Census 2000

Appendix 6.6: Percent Distribution of the Hispanic Population in the United States by State: 2010

Source: US Census Bureau, 2010 Census Summary File 1

Appendix 6.7: Top Five States for Detailed Hispanic or Latino Origin Groups with a Population size of One Million or More in the United States: 2010

Origin	Total	Rank
		First	Second	Third	Fourth	Fifth
Mexican
Area	United States	California	Texas	Arizona	Illinois	Colorado
Population	31,798,258	11,423,146	7,951,193	1,657,668	1,602,403	757,181
PuertoRican
Area	United States	New York	Florida	New Jersey	Pennsylvania	Massachusetts
Population	4,623,716	1,070,558	847,550	434,092	366,082	266,125
Cuban
Area	United States	Florida	California	New Jersey	New York	Texas
Population	1,785,547	1,213,438	88,607	83,362	70,803	46,541
Dominican
Area	United States	New York	New Jersey	Florida	Massachusetts	Pennsylvania
Population	1,414,703	674,787	197,922	172,451	103,292	62,348
Guatemalan
Area	United States	California	Florida	New York	Texas	New Jersey
Population	1,044,209	332,737	83,882	73,806	66,244	48,869
Salvadoran
Area	United States	California	Texas	New York	Virginia	Maryland
Population	1,648,968	573,956	222,599	152,130	123,800	123,789
Other Hispanic a
Area	United States	California	Florida	Texas	New York	New Jersey
Population	8,162,193	1,393,873	1,221,623	1,030,415	917,550	516,652

1. Source: U.S. Census Bureau, 2010 Census Summary File 1
2. ^aThis category includes all remaining Hispanic groups with population size less than 1 million

Appendix 6.8: National and International Fairs

• A. Exporgánicos

Exporgánicos is a Mexican Fair specialized in organic products. As its web page explains:

This fair is attended by organic producers representative of different products and areas of Mexico to show their products to national and international buyers. Impulso Orgánico Mexicano brings buyers from Europe, Canada and the United States and schedule business tables with these buyers so that they know all the products that are on display, their characteristics, their productions and the possibilities that these products can have in their national markets.

• B. Fruit Logistica

Fruit Logistica is a European Fair specialized in fresh products. As it’s web page explains:

Fruit Logistica includes all business areas and participants of the fresh produce market, a complete overview of all the news, products and services throughout the process. Fruit Logistica offers opportunities to establish contact with the main target groups at the decision-making level. Fruit Logistica is in the whole spectrum of the fruit and vegetable sector:

• Fresh fruits and vegetables

• Nuts and dried fruits

• Packaging and labeling

• Transport and logistics systems

• Stock and storage management

• Press and media

• Computer and internet solutions

• Cultivation techniques

• Greenhouses and greenhouse technology

Source: exporganicos.com; fruitlogistica.de