Los Grobo: Farming's Future?

Abstract

This case describes the international expansion plans of the second largest grain producer in Latin America, Los Grobo. Based in Argentina with US$550 million in annual sales, Los Grobo also operated in Brazil, Uruguay, and Paraguay -- usually with local partners. Los Grobo had an unusual business model: it did not own land nor farm machinery. Instead, it created a network of partnered producers and suppliers. In other words, it outsourced as much as possible. CEO Gustavo Grobocopatel believed that Los Grobo's network model was the best way to work within "farming's new paradigm," in which knowledge and technological advancements were farmers' most important tools.

Learning Objective: Discuss Los Grobo's asset-light business model and contrast it with traditional farming set-ups. Look at the role of IT in farming today. Discuss the idea of farming's "new paradigm." Already operating in four countries with varying degrees of success, Los Grobo's expansion experience illustrates some of the opportunities and obstacles to international expansion for a modern agricultural company. Also, the case offers the opportunity to discuss if an agriculture company should own land to be successful.