Amaru – Native Spirit from Araucanian Llamas

2010. Babson Collegue Case Collection.

Maria Etchebarne L, Camilo Drago C, Brad George

Abstract:

In August 2009 Alejandra von Baer was preparing the business plan for her new company so she could apply for funding from INNOVA-CORFO, a Chilean government agency for innovative ventures. Alejandra was hoping that the US$75,000 grant she was requesting would allow her small firm, Amaru, to implement the critical actions that were necessary for its success. Alejandra, in her early 30's, had created Amaru in 2008 to produce high-fashion clothing out of wool from Llamas del Sur, her family's camelid-breeding business. Her parents had started breeding and selling camelids (alpacas and llamas) in 1989, and Alejandra is currently the veterinarian and general manager of the farm. She began creating clothing from the wool as a way to diversify from an unstable and declining niche market. Amaru was selling its products at about a dozen locations in hotels and boutiques in Chile. But the sales, financial results, and resources were modest and the challenges were daunting, starting with the business plan. Alejandra had received support from a business incubator and her family in identifying and implementing several actions critical for success in the local and international markets. She realized, however, that she needed more professional marketing skills. Her main challenge was to develop a clear business plan based on limited market information that she could use for her grant application and to run the company. She also needed to define her target market in order to maximize her limited financial and marketing resources. 

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