Businesses have been beset by upset in recent times, with every aspect of their operations becoming increasingly complex. No company has been untouched by the changes at play, but some have fared better than others.
Fortunately, cash management provider Prosegur China falls into the second basket, according to outgoing Managing Director Luis Macias.
Although he anticipates a challenging year ahead, Macias reports an impressive growth trajectory that shows little sign of easing. "We grew 50 percent last year and 50 percent this year," he reveals. "We are doing well."
Macias credits much of the company’s recent local success to Executive Director and CEO Gary Gu, who joined in 2019 after stints with GE Digital and IBM. "He’s doing a very good job," he confirms.
In China, there is still a lot of potential. Our business is very critical and sensitive, so our Chinese approach is different to our approach in the rest of the world.
"In China, there is still a lot of potential. Our business is very critical and sensitive, so our Chinese approach is different to our approach in the rest of the world."
While the company’s global focus is on both the top and bottom line, in China, it is prioritizing the top line. "It’s more about growing the business, more deals, more clients with a corporate approach – it’s a different view," he says.
Strengthening its presence
When Macias last spoke with The CEO Magazine, the conversation revolved largely around Prosegur’s global mergers and acquisitions. In Spain, the company had recently formed a joint venture with one of the country’s biggest telcos, Telefonica, which gave rise to Movistar Prosegur Alarmas.
"Our alarm business has grown a lot thanks to this partnership," he explains. "We’re working together, pushing heavily on B2C and growing the residential business. B2B decreased a little bit but overall, the business is growing a lot."
Since then, an Australian merger has also taken place with former rival Armaguard – a major deal that is being scrutinized by the Australian Competition & Consumer Commission as it essentially puts Prosegur in control of the entire market.
In terms of China, the onus is on growing the business organically. "China is quite fragmented. We think we can bring a better value proposition," Macias says. "Before, we were not able to compete with Chinese local players but I think the environment is changing, so we are going to be more competitive in price.
China is quite fragmented. We think we can bring a better value proposition.
"We have a different solution and approach that will make us different in the Chinese or Asian market."
Indeed, 2023 marks the conclusion of Prosegur China’s latest strategic plan with it currently in the process of preparing the next one. It’s perfect timing, according to Macias.
"The economic environment is changing," he reflects. "Our previous plan was working on the bottom line, trying to improve efficiency."
Now the focus must shift as labor costs increase, with digitalization high on the agenda. "We are bringing a lot of innovation, working on a lot of robotics," he says.
Hybrid security is an important area of development for the company, blending traditional security with high-end technological developments.
A More Sustainable Future
With supply chains significantly impacted by the pandemic and other ongoing challenges, Prosegur has partnered with risk monitoring and validations service GoSupply as an analysis tool covering its 23,000 suppliers in all 18 markets around the world in which it operates.
The process looks at a variety of areas including financial concerns, sustainability, regulatory compliance, cybersecurity and geopolitics.
The first phase of the partnership’s implementation is now complete, producing sustainability scores for Prosegur’s top 3,600 suppliers across Spain, Portugal and Colombia. It will gradually be rolled out across all global partners.
"Our deal with GoSupply furthers our ambition to deliver the most sustainable business model in our industry," Prosegur Global Media Management Director Curro Beral said in a statement.
"Properly managed supply chains play a crucial role in this. We also want to involve our suppliers in this continuous improvement process so that we can have a positive impact beyond our organization."
An innovative approach
Its partnership with Microsoft feeds nicely into this. Now in its second year, the "co-innovation" project has included the automation of Prosegur’s processes and the training of its staff while enabling it to optimize its operations.
"We also see a lot of potential in cybersecurity, so we are driving forward there," Macias says. "There are different players coming. This is a big field, so we have part of the cake and we want to get more slices."
With a growing number of Chinese companies eyeing international expansion under the country’s Belt and Road Initiative, Prosegur China is able to leverage its global strength in its dealings with customers.
"We’re a global company, but you need to adapt solutions and services for the local market," he admits.
However, in Macias’ view, many of the challenges that lie ahead are the same the world over. He highlights inflation and the rising cost of labor as pressing issues. Nonetheless, he remains unfazed.
"The company’s doing very well, but I think we are at the start of a very big recession – I am very pessimistic about the economic outlook. Our clients are going to face problems, but we still see opportunities. In this type of environment, security businesses normally grow."
Prosegur has indeed been doing just that, which Macias believes will deliver opportunities in time.
"We are different to our competitors in that we have a global presence but we try to be very efficient," he points out. "We have a global footprint but if we are not as strong in a country, we exit."
We have to look at how to make this transition from very traditional to more value-add services integrating technology.
The merger in Australia is to drive efficiency, which will help position the company well for any future disruptions, as will the company’s growing focus on hybrid security. However, the latter comes with its challenges in terms of implementing the new technology solutions and then selling them to its customers.
"And then, we have to look at how to make this transition from very traditional to more value-add services integrating technology," Macias reflects as he prepares for the next chapter in his professional journey.
"But the company is doing quite well and I’m happy with how we’re doing on a global scale as well as in China and Asia."
Sponsored by: Climax Technology
Specializing in the innovation and manufacturing of wireless home security systems, medical alarms, home automation systems, IP cameras and an extensive range of accessories.