The route to corporate success rarely involves reaching out to the poor. However, the Mexican Cement company CEMEX did just that, transforming life in the rural communities and their own economic growth in the process.
The Mexican economic crash of 1994 led to a greatly devalued peso and a soaring unemployment rate. Cemex, a cement manufacturer, faced a financial crisis, as sales to the construction industry were down by 50%. As Cemex searched for new market opportunities, they found that sales to do-it-yourself builders were down only 10-20%.
This group included Mexico's poorest residents. However, their numbers were enormous. An estimated 40% of the country's 110 million people lives below the poverty line. Though sales to each individual were tiny, they promised a large and more stable market. Cemex decided to reach out to these neglected homebuilders as a balance to the unpredictable nature of the rest of their business.
The program Cemex developed is called Patrimonio Hoy. Do-it-yourself builders without credit or property enter into a long-term but affordable financial agreement with Cemex, who provide building materials in stages, along with construction and architectural advice. For Mexico's poor, Patrimonio Hoy leads to homes built faster and better than before, with significantly less waste. For Cemex, this opens up a market that could top $500 million annually.
Based in Monterrey, Mexico, Cemex is the largest manufacturer of cement in the Americas ...