CEMEX

Business Case
Ana Carmen González De Luna
ID: 2634116
CEMEX
 Mexican company that provides building products.
 CEMEX has become one of the leading cement manufacturers in the
world with a presence in 50 countries.
 The company has gone through many challenges, but they have been
overcome thaks to its business strategy.
“Cemex was known as an
innovator since the early 1990’s
when they began to globalize its
market”.
BUSINESS ENVIRONMENT
 Nowadays Mexican economic and political situation is in our favor
 Mexico is currently one of the largest and most open economies in the world.

Structure of Mexico’s GDP (Gross Domestic Product)

Services: 61.8% Industry: 34.2% Agriculture 4.1%

“According to the World Bank, in the year 2013, Mexico’s economy was
the 14th largest economy in the world.”
“Cemex is part of the industry
sector, which means that the
company is an important source of
income for the country”
 1989: CEMEX acquired Tolteca, after this the company formed part of the top
10 list of world cement producer
 1992: The company entered to Spain, then to Venezuela, Panama and the
Caribbean.

SPAIN VENEZUELA PANAMA

Its primarly industrial Rich country in natural Panama’s economic

sectors are food, textile resources, it has a huge situation is positive due
and electronic oil gas reserve but it to its pro-growth reform
production industries. also has a poor and its openess to
Spain counts with a business environment global commerce.
well-developed due to its crime rates
infrastructure and corruption.
Most important CLUSTERS & LOCAL
ECONOMIES in mexico

Automotive cluster Aerospace Medical Device

There are other local economies that are also consider as important players
for our economy such as the agriculture, livestock and textile industry.
MEXICO’S TRADE
AGREEMENTS

Since 1986, the decade when CEMEX began its globalization to

2015, Mexico has signed 10 Free Trade Agreements with 45
countries, 32 Reciprocal Investment Promotions and Protection
Agreements with 33 countries, 9 trade agreements within the
framework of the Latin American Integration Association (ALADI) and
it is a member of the Trans-Pacific Partnership Agreement.
How does this trade agreements have
helped CEMEX?

 This FTA have provide the company facilities to open up foreign

markets.
 Reduce export and import barriers
 Protection to the company’s investments in a foreign country
ECONOMIC
ACTIVITIES OF MEXICO

 Primary sector: Agriculture, livestock, forestry and fishing

 Secondary sector: Mining industry, electricity, gas and water

supply, oil, construction and manufacturing industries

 Tertiary Sector: Transportation, warehousing and financial

sector

“CEMEX is an important player of the secondary and tertiary sectors

due to its participation in the construction and manufacturing industries
and its services such as laboratory services, technical evaluation of
existing installations, plant risk assesment, plant and equipment
relocation, between others.”
MEXICAN
Context
CULTURE &
DIVERISTY
 Mexico is the 14th largest country in the world

 Ethnic Groups: Mestizo(60%), Amerindian(30%), White(10%)

 Spanish is spoken by 92.7% of mexican population

 6% speaks indigenous languages

 89% of the population is Catholic

 Family is a very important part of mexican’s life

 Mexicans are very warm, love to have close relationships

 Important holidays: Independence Day, “El día de la Virgen de Guadalupe”

and the day of the Death
DEMOGRAPHICS
“According to a Mexico Demographics Profile of 2014, the population of Mexico is
around 120, 286, 655 people, with a median age of 27 years and a life expectancy
of 75 years.”

Major cities population:

 Mexicto city (capital)- 20.446 million
 Guadalajara- 4.525 million
 Monterrey- 4.213 million
 Puebla- 2.335 million

“CEMEX is located in two of the

principal cities in Mexico, the company
has plants in the city of Monterrey and
Puebla”.
 FINANCIAL FRAMEWORK

 The Banco de México, is the one in charge of the Financial framework of the country,
the bank perfom the following functions, according to the Banco de México Law

 The Bank is the one that commit to introducing policy and legal reforms, and to
develop financial infrastructure, in order to promote responsible financial inclusion

“One of the strategies of CEMEX company is to have a close

relationship with this authority to make sure they are investing their
money appropiately in and out the country”.
POLITICS & POLICIES
The mexican political structure is divided into an executive, legislative and
judicial branch.

To own a company in Mexico, there are

some requirements that every company
should have in mind, you need:

 Zoning Permit.

 Environmental Regulations. (The

Ministry of the Environmental Natural
Resources and Fisheries
(SERMANAP).

 Health or Sanitary Licenses.

Every country has its own context and
business environment, so CEMEX had to
think in the better way to get through this
challenges, that is why the “CEMEX Way”
was created.
THE CEMEX
Way
“THE CEMEX WAY”
The CEMEX Way was created to standardized processes, technology and
organizational structure across all countries. It is a benchmarking driven by 5
main points.
 Efficiently manage the global knowledge base
 Identify and disseminate best practices
 Standardize business processes
 Implement key information and Internet- based technologies.
This model is based on 3 fundamental elements:

 Process of post- acquisition integration.

The company is able to reduce costs, to identify the best practices
and to standardize business processes.

 Use of the technology and global communication systems.

 The leveraged buyout of the assets and a down payment

financing through reinvestment of free cash flow generated in each
acquired company.
 Which variables can affect the
strategy?

Experience and knowledge

of the directive team
Technology

Culture
Who are the ones that help us to grow
and become stronger?

SUPPLIERS GOVERNMENT

INVESTORS SOCIAL MEDIA

SUSTAINABLE
DEVELOPMENT STRATEGY
The Cemex Way wasn’t the only strategy that CEMEX created to grow against the
competition, they also count with Sustainable Development Strategies such as:

 Provide Resilent Infrastructure and Energy- Efficient Building Solutions

 Enable a low-carbon and resource- efficent Industry
 Implement a high- impact social strategy to empower communities
“With this strategies they make sure to cover the
needs of their employees, providing them attractive
opportunities for a personal and profesional
development, they also cover the needs of their
business partners, and take care of the
environment”.
“It is important to be aware of the challenges that
the companies face entering into the international
market in order to create an ideal business
strategy to avoid future losses and problems in its
development”
THANK
YOU!
#TogetherwecanhelpMexico
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