Supply Chain Frontiers issue #32. Read all articles in this issue.
Brightstar Corporation started life as a trading company in the mobile phone business, and has since grown rapidly into a full service supply chain organization for wireless network operators and retailers. Company founder and CEO Marcelo Claure recently traced the company’s evolutionary arc at the Center for Latin- American Logistics Innovation (CLI).
Claure was speaking at the Leaders of the Value Chain conference in Bogota, Colombia, May 6, 2009, organized by supply chain research and education company LOGyCA and CLI (see Value Chain Focus at CLI Conference news story for more details). The company’s impressive growth story underlines how breakthrough products such as mobile phones can spawn new types of service providers.
Brightstar opened its doors in 1997 as a Miami-based trading business focused on Latin American markets for mobile phones. About a year later it opened its first international subsidiaries in Bolivia and Brazil, and by 2007 had become the largest Hispanic-owned business in the United States. Last year the company delivered one in 20 of the world’s 1.2 billion wireless devices.
In parallel to this rapid growth, Brightstar’s business model has become more sophisticated. As volumes increased it began offering logistics services to wireless OEMs. The services developed into a fully-fledged third-party logistics services provider platform, and subsequently into the company’s current iteration: the deployment of fully integrated supply chain solutions for the wireless industry. In the 10 years since 1998 Brightstar has achieved a gross revenue annual compound growth rate of almost 52%. The products Brightstar delivers include cell phones and accessories, wireless data equipment, and prepaid wireless products
Much of the momentum for this growth has come from Latin America, where adoption rates for wireless phone technology have been spectacularly high over the last decade. But Brightstar’s rise also owes much to the way the wireless industry has changed, and the company’s ability to adapt its business model to a dynamic business environment.
Ten years ago wireless manufacturers and network operators were concerned primarily with gaining customers. The goal required them to develop efficient supply chains that delivered devices to diverse markets in multiple countries. As these markets matured the emphasis shifted to retaining customers; to consolidating the territories that the manufacturers and network operators had carved out for themselves.
Today there is less concern in the industry about supply chain management, and more about the need to maintain service levels and solidify a loyal customer base. The shift has created a gap for a company like Brightstar that offers the supply chain expertise wireless companies need to deliver product and support the services that buyers have come to expect.
The change in emphasis is reflected in Brightstar’s range of offerings. The company’s areas of coverage now encompass light manufacturing operations such as adding accessories to devices, general distribution, logistics, purchasing and invoice management, point-of-sale distribution and management, and reverse logistics.
Brightstar serves its two main customer groups, network operators and retailers, through a network of 21 sales and distribution facilities in 18 countries serving 34 countries. Its service mix is tailored to each national market. For example, in Mexico the company purchases product and manages the entire supply chain to point of sale; in the Dominican Republic it provides devices and manages the end-to-end supply chain to other distributors and authorized agents from distribution centers in two cities.
Claure described Brightstar’s service model in terms of a recipe of familiar business models: one part Accenture (supply chain innovation, process re-engineering and organizational learning), one part IBM (outsourcing, global benchmarking and system integration), one part DHL (operational excellence, global reach, rapid delivery), and one part Oracle (end -to-end IT tools, fit-for-purpose solutions).
“The success of Brightstar illustrates the growing importance of supply chain management in fast growing sectors in Latin America and other emerging markets. Supply chain adaptability in the face of constant uncertainty will continue to provide a sustained competitive advantage in those regions,” said Dr. Edgar Blanco, Executive Director of SCALE Latin America at the MIT Center for Transportation & Logistics. “There is a lot to learn from these regions”, he added.
For more information on the Leaders of the Value Chain conference contact Maria del Mar Hermida at LOGyCA, mhermida@logyca.org . For more information on research in emerging market supply chains contact Dr. Edgar Blanco, eblanco@mit.edu .