When Carlos's company, Cofinet, went from 200 to only five orders in a given week, the young Colombian entrepenuer feared his business would collapse under the weight of the pandemic.
But Carlos managed to keep Cofinet running despite the economic and logistical challenges that COVID-19 brought to Australia and the world.
His company’s operations were sustained thanks to his team's capacity to innovate and respond rapidly in order to adapt to the new environment and logistical challenges.
Carlos grew up in Quindio, a small city in Colombia, in a family with a significant agricultural tradition.
Since he was a child, he enjoyed his weekends on the family farms surrounded by coffee, oranges, and avocados.
His father, Jairo Arcila, worked for more than 40 years at one of Colombia’s largest coffee exporters.
Carlos studied Civil Engineering at Universidad de los Andes and in Australia he completed a master's degree in International Business at Macquarie University.
Jairo Arcila, father of Carlos and Felipe dedicated more than 40 years to the coffee industry. He is the third generation of coffee growers. Source: Supplied
After more than three years working at a construction multinational, Carlos had to make the decision of whether to stay in Australia or return to Colombia.
“At that time the mining sector was in freefall; they sent 95 per cent of the workforce home. I thought that moment was the right time to start my business.
After working for this large company, I started tinkering with the idea of creating my own business, Cofinet.
"This meant a lot to me because it was a way of working with my family and it meant continuing to be involved with my childhood memories.”
Carlos saw this fork in the road moment as a great opportunity and a sign to put his idea finally into practice.
Carlos has always been connected with Colombian coffee.
Felipe, one of the co-founders of Cofinet looking at the coffee harvest. This is in the coffee farm, El Vergel, located in Pijao, Quindío. Source: Supplied
For two years, he kept in contact with insiders from the industry to craft his business idea. For Carlos, it was essential to create a family business; that's why his brother also joined the company.
Cofinet started as a Colombian coffee importer, but Carlos managed to position his company in the tastebuds of customers across several regions, including Australia, Singapore, New Zealand, the United States and the United Kingdom.
“It was hard work. The first two years after realising the rapid growth of Cofinet we decided to look at other countries. The first overseas office was New Zealand.
"New Zealand was a fundamental piece to understand that what we were doing had legs and that it could be replicated."
Later, Carlos and his team understood that the product was well valued and with its success he decided to replicate the business model, adjusting some details, to take Cofinet to other parts of the world.
Business lessons during the pandemic
The main lesson for Carlos and his team during the COVID-19 pandemic was that change is constant.
“We learned to quantify and react to risk. The first four weeks were very shocking, from having 200 orders per week we only had five. We wondered how much time was left for us to operate, when would we run out of cash.
"We learned the team's knack for adaptability and innovation is huge. We made a lot of mistakes, but we also accomplished incredible things."
Carlos, one of the co-founders of Cofinet walking through one of the coffee farms in Quindío, Colombia. Source: Supplied
The financial and logistical aspects of running a business
For a transnational business like Cofinet, it is important to consider three key aspects.
Firstly, the impact of macroeconomic risks. Some key economic indicators are whether employment in the region is growing or not, what is going on with wages, internist rates or other inputs to the production process.
A second key element is changes in exchange rates. When operating internationally, firms sell, buy, and pay costs in different currencies. Variations in the bilateral exchange rate strongly impact profitability and must be managed very closely.
