La historia de tiendas D1 | El gran error de Michel Olmi — Transcript

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1. 0:00The daring owner of D1 stores, who sold
2. 0:02the brand to the Santo Domingo Group
3. 0:03and later set up competition against
4. 0:05them with Justo&Bueno stores, but ended
5. 0:07up failing and going bankrupt. How did
6. 0:08all of this happen? I am Mario Díaz
7. 0:10Granados and I welcome you to the
8. 0:12exciting business history of D1 stores.
9. 0:15And if you like learning how the great
10. 0:16brands that are part of our history
11. 0:17today were born, subscribe and hit the
12. 0:19bell because every week I tell you a
13. 0:20new story that will surprise you. As
14. 0:23always, let's start at the beginning.
15. 0:25And the beginning is that D1 stores is
16. 0:27a retail format called a hard discount,
17. 0:29whose business model is based on
18. 0:31offering very, very cheap products that
19. 0:33achieve a very favorable
20. 0:34cost-to-quality ratio compared to the
21. 0:36competition. This is achieved by having
22. 0:39small, low-rent locations,
23. 0:40private-label suppliers, and low labor
24. 0:43costs. This model began in 1948 in
25. 0:46post-war Germany, in a small town
26. 0:48called Essen, where two brothers, Karl
27. 0:50and Theo Albrecht, created Aldi stores,
28. 0:52a hard discount chain that sought to
29. 0:54offer its compatriots good but very
30. 0:57cheap products to help them recover
31. 0:59from the devastating havoc caused by
32. 1:01World War II. But let's return to
33. 1:04Colombia, as on March 25, 2009, Chilean
34. 1:06entrepreneur Michel Olmi, a mechanical
35. 1:08engineer who graduated in the United
36. 1:10States, began the retail revolution in
37. 1:12Colombia, taking this Aldi business as
38. 1:14a reference and opening the first D1
39. 1:16store in the San Pío neighborhood in
40. 1:18Itagüí, Antioquia. A model that
41. 1:21banked on small stores and essential
42. 1:22products, but at competitive prices.
43. 1:24His focus from the beginning was to
44. 1:26develop suppliers with private labels
45. 1:28that would be exclusive to D1 stores.
46. 1:30Initially, payment was only accepted in
47. 1:32cash, thus avoiding the financial costs
48. 1:34of using card terminals. Thanks to
49. 1:36these strategies, Michel Olmi achieved
50. 1:38exponential growth, finishing 2009 with
51. 1:40six stores, all located in the Aburrá
52. 1:41Valley, which is the metropolitan area
53. 1:43where Medellín is located. Olmi then
54. 1:46saw how the path began to open up in
55. 1:482010. And in his second year of
56. 1:50operation, Michel already managed to
57. 1:52quadruple his stores, closing the year
58. 1:53with 25 locations open. By 2011, the
59. 1:56brand had already reached the
60. 1:57impressive figure of 100 operating
61. 1:58stores and was already beginning to
62. 2:00change the rules of the game for
63. 2:01supermarkets in the country. Michel
64. 2:04Olmi was starting to reach for the
65. 2:06stars, and thanks to his business
66. 2:08success, the powerful Santo Domingo
67. 2:10Group set its sights on D1, acquiring a
68. 2:1220%stake in his holding company through
69. 2:14Valorem. But it was clear their entry
70. 2:17into the business wasn't intended for a
71. 2:18supporting role. The Santo Domingos
72. 2:21then began a strategy to acquire the
73. 2:22brand with the ultimate goal of taking
74. 2:24full control of the company. In 2013,
75. 2:27with 200 D1 stores already operating in
76. 2:29Colombia, the Santo Domingos acquired
77. 2:31an additional 5%of the shares. This
78. 2:33alerted Michel Olmi to a possible
79. 2:35future move by the Santo Domingos to
80. 2:37take over the company. However, the
81. 2:39Chilean businessman continued to enjoy
82. 2:41his success and remained fully focused
83. 2:43on the stores 'growth. In 2015, when
84. 2:45the D1 operation reached the
85. 2:47spectacular figure of 350 open stores
86. 2:49and annual sales of 1.16 trillion pesos
87. 2:52, the Santo Domingo Group made its
88. 2:54final move, presenting the board with
89. 2:56an offer impossible to refuse. They
90. 3:00offered 68.9 million dollars for the
91. 3:0335.25%of shares that belonged, at that
92. 3:05time, to its founder Michel Olmi. Faced
93. 3:09with this unexpected situation, there
94. 3:11was no choice but to accept, leaving
95. 3:13the Santo Domingo Group with 60.25%of
96. 3:15the shares in D1 and, consequently,
97. 3:17control of the company. As a curious
98. 3:20detail that will be relevant later,
99. 3:22when the Santo Domingos took control of
100. 3:25D1, Colombia's largest retailer at the
101. 3:27time was the Éxito Group, which was
102. 3:29outperforming D1 by nine times.
103. 3:32Returning to our story, Michel Olmi was
104. 3:34left out of the business he had founded
105. 3:36himself and led to success. However, he
106. 3:39was not about to let things stay that
107. 3:40way. And since Olmi clearly knew the
108. 3:42path to success for this business model
109. 3:44, he made the risky and controversial
110. 3:46decision to create the very thing he
111. 3:48knew best: competition for his beloved
112. 3:50D1. In 2016, he surprised the market
113. 3:52with the Justo&Bueno store chain, which
114. 3:54had a similar, if not identical, model
115. 3:57to D1, with some innovations like a
116. 3:59more pleasant shopping experience and a
117. 4:01greater variety of products. This news
118. 4:05did not go over well at all in the
119. 4:07offices of the Santo Domingo Group, who
120. 4:09considered this decision a disloyal
121. 4:11move by Olmi, as he began poaching D1
122. 4:13employees to work for his new brand. At
123. 4:17first, Michel Olmi could see that his
124. 4:19decision to open Justo y Bueno had been
125. 4:20the right one, as it experienced
126. 4:22exponential growth during its first
127. 4:24year of operation, supported, among
128. 4:25other things, by the money he had
129. 4:27received from the sale of his D1 shares
130. 4:29. The first year, Justo y Bueno closed
131. 4:32with 175 stores and 35 billion pesos in
132. 4:34sales. Definitely a complete success.
133. 4:38Olmi relived the satisfaction and joy
134. 4:40of the achievement, just as he did when
135. 4:42he founded Tiendas D1, to the point
136. 4:43that it became the second-largest hard
137. 4:45discount retailer in Colombia. Olmi was
138. 4:48already hot on the heels of his beloved
139. 4:50D1, but he was facing a monster, the
140. 4:52most important economic conglomerate in
141. 4:54Colombia. The Santo Domingos were not
142. 4:57going to sit idly by, and they had the
143. 4:59financial muscle to withstand an
144. 5:00aggressive pricing strategy that sought
145. 5:02not to make the path so easy for Olmi
146. 5:04and Justo y Bueno. But the Chilean, far
147. 5:07from giving up, continued his
148. 5:08aggressive expansion by opening
149. 5:10hundreds of stores in a very short time
150. 5:12, almost without a judicious financial
151. 5:14analysis and driven mainly by the ego
152. 5:15of wanting to dethrone Tiendas D1. This
153. 5:19poor management, added to the arrival
154. 5:21of the COVID-19 pandemic, ended up
155. 5:22putting Justo y Bueno in check; after
156. 5:24achieving annual sales of 3.2 trillion
157. 5:26pesos, it ended up with debts of 1.2
158. 5:28trillion, ultimately leading to
159. 5:30bankruptcy. If you want, in a future
160. 5:32video, we can talk in more detail about
161. 5:34the story of Justo y Bueno, which in
162. 5:36itself is a fantastic story. And well,
163. 5:38while all this financial disaster was
164. 5:39happening to Michel Olmi, the Santo
165. 5:41Domingos with D1 were consolidating
166. 5:42their reign in Colombia. Do you
167. 5:44remember me telling you at the
168. 5:45beginning that when the Santo Domingos
169. 5:47took control of Tiendas D1, the Éxito
170. 5:49group led the market, selling nine
171. 5:50times more than them? Well, in 2023, D1
172. 5:53reached sales 1.73 times higher than
173. 5:56those of Éxito, meaning they sold 17.4
174. 5:58trillion pesos while Almacenes Éxito
175. 6:01only managed to invoice 10.2 trillion.
176. 6:04The game with the Santo Domingo Group
177. 6:06is definitely on another level. Today,
178. 6:08D1 is consolidated as the largest
179. 6:10retail chain in Colombia with more than
180. 6:1224,000 employees, more than 2,500
181. 6:14stores throughout the country, and a
182. 6:16totally promising future. Tiendas D1
183. 6:19arrived in Colombia in 2009 to
184. 6:21definitively change consumption habits,
185. 6:23and 16 years later, it reaffirms its
186. 6:24leadership. Remember that I have
187. 6:27created my storytelling course, "
188. 6:28Stories That Connect," where I teach
189. 6:29you how to tell stories—stories that
190. 6:31inspire and generate emotions. Because
191. 6:33when you know how to tell your story
192. 6:34well, the world listens to you
193. 6:36differently. Go to
194. 6:37historiasqueconectan.com/comience right
195. 6:39now, I've left the link in this video's
196. 6:41description, and start telling stories
197. 6:43like the pros.