By now, you probably already know that Brazil is the largest economy in Latin America and is consistently ranked in the top 10 biggest economies in the world.
So, since the economy is so healthy, is doing business in Brazil a viable option for your company in 2021?
Countless factors can make the international business climate in Brazil risky, so you’ll need some insights before you enter this lucrative market!
Continue reading to discover 6 hot-off-the-press doing business in Brazil tips that help you stand out when expanding your international business in 2021.
1. Capitalize on E-commerce Opportunities
E-commerce is a must in Brazil! Online marketplaces such as Mercado Livre and Americanas.com both rank far ahead of Amazon in Brazil as popular sales sites.
Before jumping into the e-commerce game, there’s a few practical pointers to make sure your investment will pay off.
Go Mobile to Improve UX
First, be sure all of your e-commerce transactions are mobile-friendly for users. Brazillians conduct the majority of their online shopping from mobile devices and mobile usage growth was accelerated by the pandemic.
Next, keep in mind that the calendar is also important. Brazilian shoppers are dedicated to shopping holidays and will wait to make purchases when the time is right. Review the calendar and pay attention to trends – smaller, less-traditional holidays have grown in sales significance.
With the increased prevalence of mobile e-commerce, data services and cloud computing grab tons of attention in Brazil.
2. Stay on Trend with the Data/Cloud Storage Industry
Right now, the General Data Protection Act (LGPD) in Brazil is creating a HUGE buzz around data services and cloud computing. The LGPD was passed back in 2018 and will finally become enforceable beginning in August 2021.
This is the first national personal data protection law in Brazil. Your business will have to comply if you complete transactions with Brazilian citizens, even if your company isn’t physically located in Brazil.
Here’s the good news: this means that companies all across Latin America will be in the market for safe, secure data and cloud computing support and platforms.
3. Invest in Market Research
Did you know that Brazil has 26 estados (states) with varying characteristics? The norms and values of the people will differ and it’s truly essential that you approach your audience the right way if you plan on doing business in Brazil.
For instance, the preferred payment method in a certain state in Brazil might be through a debit card, a local credit card, or installment payments. You’ll want to know what your customer finds easiest if you are doing e-commerce because this will boost user experience.
Other barriers to entry to look out for as you research include
- Labor unions
- Technical requirements
Despite lingering economic ramifications that were exacerbated by COVID-19, Brazil still has high potential. Get the full picture of your industry and think about the long term return on your investment.
4. Practice Patience with Supply Chains in Brazil
Here’s a fact: Brazil is the 5th largest country in the world by size. That means there is a huge need to move goods across the country! However, there is a lot of room for improvement when it comes to infrastructure.
It’s tough to move items quickly when the infrastructure is lacking and it can be costly to reach far-flung areas of the country.
Here’s the good news: Brazil surprisingly tends to succeed with direct sales channels.
Furthermore, Brazil’s geographical position in South America also puts it in an ideal location to play a part in international supply chains – if you are willing to navigate the regulations. Trade agreements via Mercosur and Bric can also be advantageous!
5. Don’t Forget about Agriculture
Next, let’s dig into the topic of doing business in Brazil through agriculture.
In 2021, agriculture is still central to the Brazilian economy. Don’t make the mistake of forgetting about it! Agriculture accounts for 20% of all jobs, 25% of the GDP, and 46% of Brazil’s exports.
Furthermore, Agritech is a subsector that creates space for start-ups and encourages the innovation that keeps this industry growing. The food industry is particularly large, and with Brazil’s roughly 213 million citizens, productivity and efficiency are key!
6. Keep an Eye on Ever-Changing Politics
With its beautiful Amazon rainforest, growing economy, and vibrant population, Brazil is a complex place! And the same goes for its legal and political sectors.
In fact, politics have a heavy influence on business law and regulation in the country. The tax system in Brazil is notoriously tricky to navigate and is always a topic of debate.
For instance, tax reform plans are currently at the top of the agenda in Brazil, but political factors could change the outcome. Implementation will surely take significant time.
So, for our last tip on successfully doing business in Brazil, we recommend that you monitor the updates about the 2021 Brazilian tax system to avoid any problems!
Need Help Expanding Your Business in Brazil?
Brazil is known as a very welcoming country to foreign investors. However, doing business in Brazil is definitely no small task!
Therefore, you’ll want to consult services and resources that can help you with common obstacles and legal regulations to have an easier experience entering this dynamic market.
Colibri Content can help your business navigate the rough waters and help you succeed in Brazil. Colibri Content is an expert on market entry in Latin America. For more Brazilian insights and trends, visit the Colibri blog and discover how to successfully set up your business in Brazil.