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Great brazilian entrepreneurs: Samuel Benchimol

January 2024

The creation and existence of G5 Partners are closely associated with two fundamental elements: the entrepreneurial vein of its partners and their vocation to serve and relate with business families. This article inaugurates a short story-telling series we prepared on selected entrepreneurs who, through visionary skills, strategic sensitivity, clarity of thought and, above all, positive attitude amidst adversity, understood how to forge the Brazilian development dream while establishing, at the same time, the necessary values and competencies for their descendants to carry on their business legacy. We believe that preserving and disseminating the memory and achievements of those who came before us are fundamental attributes to guide the actions that, in due course, will build our own legacy. According to Pedro Nava, a memorialist from Minas Gerais: “Keeping the memory of those who age […] is the basic element for the construction of a family tradition. It creates a folklore that lives on from the relationship between the young and the old, as only the old man understands that, on certain occasions, the personal knowledge of an individual is worthless, but its evocation is an overwhelming poetic opportunity”. In this sense, choosing Samuel Benchimol as the first “Great Brazilian Entrepreneur” to be portrayed in this series is not by chance. Quite the contrary, it is a simple but fair tribute to one of the most admirable and successful Brazilian business families with whom we have had the privilege of creating and maintaining a close and friendly relationship. This tribute is extended to all of Samuel’s direct and indirect heirs, including his great-nephew and founding partner of G5 Partners, André Benchimol. 

Samuel Benchimol

During Brazil’s rubber cycle, in the mid-19th century, a group of families of Jewish origin and faith immigrated from Morocco to settle in the Amazon region. One of these immigrants was Israel Isaac Benchimol, who settled in the Tapajós (Pará) region and became a street vendor, navigating the region’s rivers. Israel Isaac died at an early age, leaving only one child, Isaac Israel who was born in 1887. During part of his childhood and teenage years, Isaac was sent to Morocco to receive basic training in accounting and languages, later returning to Belém do Pará, where he found a job in the city’s local commerce. Soon after, Isaac began his entrepreneurial journey with the exploration of rubber plantations mainly on the borders of the southwestern Amazon region, where the states of Rondônia and Acre are currently located. He started his own family and prospered, becoming a wealthy businessman. However, in 1923, the same year in which his third son, Samuel, was born, the Amazon economy suffered a devastating setback with the entry of southeastern Asian rubber into the local market. In just three years, Isaac and most of the local business owners would lose most of the heritage built during previous decades. It was just a matter of time before the young businessman was forced to declare bankruptcy. 

Living in Manaus, Isaac was trying to get himself back on his feet financially by working as an accountant and business representative. During this period, the family began to live under strict financial limitations since a relevant portion of Isaac’s income was used to pay off his commercial debts for him to lift his bankruptcy charges. This tough period of deprivation shaped Samuel’s entire early life and remained in his memory forever. But he also knew how to honor his father’s example and did not rest until all his debts were paid and his reputation preserved. Samuel was emancipated by his father at the age of 19. He began his studies at the Law School in Manaus and partnered with his older brother, Israel, at Benchimol & Irmão, a pharmaceutical representation company founded in 1942 known as the Bemol brand. Samuel attended college in the mornings, worked with his brother in the afternoons, and lectured Political Economy classes at the Solon de Lucena School of Commerce in the evenings. During his school years, Samuel was mainly interested in Sociology, which led him to carry out a field research on the migration of Northeastern Brazilians to the Amazon region. The excellence of his graduation thesis was such that he became a well-known figure in the Brazilian Academy. In 1946, just six months after graduation, he received a graduate scholarship to the Miami University, in Ohio, USA, where he spent 18 months studying Sociology, Economics, Anthropology, Culture, Ecology and Regional Human Geography. This period would turn out to be decisive to complete the scientific and humanistic training of a man with innate curiosity, broad interests and who would remain faithful to his land and his roots throughout his entire life. 

When he returned to Manaus, Samuel resumed his activities at Bemol and, with the experiences and relationships he developed during his period in the United States, he sought to expand the company’s operations. One of his important achievements was the exclusive representation rights with the Cutter laboratory in Berkeley (California), which produced some of the antibiotics that were revolutionizing the treatment of numerous diseases at that time. The success of a new penicillin drug allowed him to set up a network of sales representatives in Manaus and other states in the North of Brazil. As the years passed, Samuel’s entrepreneurial and dynamic nature resulted in the expansion of Bemol’s operations. In just a few years, the company began to purchase and distribute flour from Pará and tobacco from Bragança. A short while later, the Bemol’s product portfolio would include salt, beer, European cambric linen and even insurance policies to cover transportation, fire, and personal accidents. Larger deals were closed shortly after for the import of wheat flour from the United States and cement from Europe. In the cement business, Samuel soon realized that freight costs to bring cement from Europe was an important component of the product’s total cost, which lead him to charter a ship specialized in this type of transportation, guaranteeing a final import cost 20% cheaper than his competitors. From this experience, the Benchimol brothers began to diversify and increasingly expand their import activities to include staple food products such as Norwegian cod, Portuguese olive oil, chestnuts and walnuts, and Dutch potatoes and onions. Instead of buying from large importers in Rio de Janeiro, which was a common among most traders in Manaus, Bemol negotiated directly with European producers and achieved great commercial and financial success. 

Always looking out for new opportunities, Samuel gained interested in the import of sewing machines in the 1960s. This market was dominated by Singer back then, but a competitor named the New Yorker had recently launched a new machine, with good quality and manufactured in Japan at very competitive prices. Bemol decided to import the machine, which proved to be a decision that would completely change the company’s trajectory. In order to compete with Singer, they sold the product directly to end consumers through a commercial network and offered a credit system in which clients were able to sign an agreement to pay in 12 to 24 monthly installments. Once this new financing system was implemented, Bemol naturally expanded its product portfolio and began to include other household appliances, such as refrigerators, appliances, fans, cabinets, and stoves under the same conditions. 

During this period, Manaus was preparing for the operational startup of an oil refinery plant to produce gasoline, kerosene, diesel oil and liquefied petroleum gas (LPG). Realizing the opportunity that was presenting itself, Samuel founded a new company, Fogás, with his brothers Israel and Saul. In yet another moment of entrepreneurial geniality, Fogás anticipated the operational startup of the Manaus Refinery and purchased a batch of Brasil brand stoves and two thousand residential gas cylinders from Mangels, which were filled with LPG gas from Companhia Paulista de Gás and shipped to Manaus. At that moment, Samuel achieved yet another successful business milestone. Over the following years, Fogás, which was managed by Samuel and his brothers, expanded its geographical presence to include operations in the states of Acre, Amazonas, Rondônia, Acre, Roraima, Pará, Amapá and Mato Grosso, and acquired several tug ferries for the distribution logistics of LPG to become feasible. A few years later, Fogás became the undisputed leader in the distribution of LPG across the Amazon region. 

In Samuel’s biography, written by Professor Jacques Marcovitch, the author mentions another admirable aspect of Samuel’s trajectory: “as if his intense entrepreneurial activities were not enough, Samuel also managed to maintain his university career as a teacher and researcher throughout his life. He was a Political Economy professor at the Law School, from 1954 to 1974, an Introduction to Economics professor at the Faculty of Social Studies, from 1974 to 1977, and an Introduction to the Amazon professor at the Law School, from 1979 to 1999, when he became professor emeritus at the University of Amazonas. His vast intellectual abilities resulted in the production of 110 publications, including articles and books on economics, sociology, history, administration, politics and ecology, all of associated with the Amazon region”. For all his contributions, Samuel became one of the leading specialists in the Amazon region. He also contributed with the field study of the social economic aspects of the Amazon region. He was also one of the first individuals to defend the need to promote sustainable development in the region, respecting four fundamental pillars: economic feasibility, ecologically sustainable, politically balanced, and socially fair. In recognition of this important legacy, the Brazilian government instituted the “Professor Samuel Benchimol” award in his honor, which is granted annually in three categories to individuals who have substantially contributed to the understanding of the Amazon region. Contrary to many who argue that business and family matters should not be mixed, Samuel believed that business families have important advantages since they operate under the same set of values and principles to guide all their daily decisions. But he also did not ignore the enormous challenge that any family business faces in terms of succession. He reflected on this in advance and decided that the company should be run by a single successor, not by a group. His successor “should not be imposed but emerge naturally, through leadership style and consensus among family members”. Judging by the success of the companies founded by Samuel Benchimol until this day, all of which received contributions from several second and third generation family members, including children, nephews, son-in-law and grandchildren, it is clear that, once again, Samuel knew how to put into practice all his humanistic sensibility and entrepreneurial talent to join family unity with business success. 

[1] MARCOVITCH, Jacques, Pioneiros & Empreendedores – A Saga do Desenvolvimento no Brasil, Volume 3, ed. Universidade de São Paulo, 2012. 

[2] BENCHIMOL, Samuel, Eretz Amazônia: Os Judeus da Amazônia, ed. Valer, 1998. 

[3] NAVA, Pedro, Memórias: Baú de Ossos, ed. Sabiá, 1972. 

[4] https://pt.wikipedia.org/wiki/Samuel_Benchimol 

 

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