FEDERATIVE REPUBLIC OF BRAZIL : COUNTRY OVERVIEW

Economic

Geographic
th

Socio-Political

7 Largest World Economy w.r.t GDP, PPP (World Bank, 2013)

Current
$11,875 (IMF, 2012) 199.321 M, 5th populated worldwide
Largest
LA,Per
5thCapita
LargestGDP
Worldwide
LeadingUrban
GRDI Population
Index for 3 (IGBE)
consecutive years (AT
Kearney,
2013)
84.35%
Largest
Latin
American Democracy
Member
the rapidly
developing
MMA:
So of
Paulo,
Rio de Janeiro,
BeloBRIC Group
Leading Regional Power, Emerging
Mixed economy with abundant natural resources
Horizonte
Global Power
Key Industries: Agricultural, Mining, Manufacturing, Service Sector
Major Exports: Aircraft, Electrical Equipment, Textiles, Footwear, Coffee
Largest regional skilled labor force, 107 M (Thomas White, 2013)
Stable economic growth, low inflation rate, strong economic reform policy
Cultural
Credit favoring customers (AT Kearney, 2011)
Upcoming Events expected
to reverse ethnic
GDP growth
slowdown (World Bank, 2013)
Portuguese-African
majority
Cultural hotspot; Carnaval, WC14, SO16
Tourist hotspot: 5 M Visitors in 2010
Cultural Exports: Cuisine, Art, Literature, Cinema

BEM-VINDO AO BRASIL

MARKET FAVORABILITY ANALYSIS

P
Privatization oriented economic policy
under
L Dilma Rouseff (Bloomberg, 2012)
Liberal FDI Regulatory Law (Economy
Heavier corporate taxation; 34%
Watch, 2008)
(Canon, 2011)
Free trade
with EU,
BRIC
Trade agreement
within Mercosur,
Common
nations
Market of the South
Stringent Consumer Protection Code ,
Minimum
Wage Laws (The Brazilian
S
Business,
2011)
Rise of entrepreneurial,
cash rich
Middle
Class (Thomas
White, 2013)
Establishment
of new Brazilian
Strong social Law
welfare
schemes
leading
Competition
(Mondaq,
2012)
to declining poverty rate
Relatively high National Minimum
Wage, 41.8% of GDP PC (WDID, 2013)

E
Stable GDP Growth rate (2.2%),
Ereversing slowdown (World Bank, 2013)
Cleanest Energy Matrix among LA
Relatively low inflation rate (5.9%),
Countries (Renewable Energy world,
Conditional Cash Transfer Program
2011)
Flexible exchange rate policy, stable
Growing
shift
towards sustainable
currency
(Economonitor,
2013)
manufacturing practices , GM pioneering
(Deloitte)

Strong IT infrastructure, LA leader,

Government supported advancement,

Innovation Law (Etzkowitz, 2005)
$245.5 M organized investment in R&D
facilities by GE (Bloomberg, 2012)

MANUFACTURING COMPETENCE

Most important industry, constitutes for 1/5 National GDP

Leading Latin American manufacturing country in terms of aircraft, heavy machinery &
textiles
Major producer of textiles, clothing, and footwear since early 19th century
Chief Exports: Manufactures, iron ore, soybeans, footwear, coffee
Chief Imports: Machinery and equipment, chemical products, oil, electricity
2014 WC & 2016 Olympics expected to accelerate infrastructure improvements &
subsequently manufacturing competence

ORGANIZED RETAIL SECTOR

$ 230 M Organized Retail Industry (Thomas White, 2013)

7% YOY growth for Apparel Industry since 2009 (AT Kearney, 2013)
Among 10 most engaged e-commerce markets worldwide (comScore MMX)
Exponential rise in Luxury retail sector with increased PPP & growing urban middle class
Popular retail formats - supermarkets, convenience stores, discount stores & online
Liberal economic policy, largest retail investment amongst Latin American countries

Ongoing economic relations with EU, 50% of FDI investment in the country
2014 Football World Cup and 2016 Summer Olympics major drivers for increase in travel
related retail

FASHION RETAIL SCENARIO

Brazils apparel market: large, growing & mostly untapped by multinational competitors
Local brands dominate in Brazil the worlds fifth largest apparel marketplace
Po de Acar, Lojas Americanas, Casas Bahia, Ponto Frio, Extra, Renner, Hering; local
brands now at par with international brands in the country w.r.t sales figures
International brand presence: Mango, Zara (1999), C&A, Topshop in High street,
LV, Hermes, Lanvin, Prada, Balmain, Gucci, Burberry in luxury
Mode of entry: Mainly JVs. Leading players JHSF Group, JK Iguatemi & Cidade Jardim

Challenges for global players: differing product demands, strong preference for local
fashions, fluctuating interest rates & high cost of imports

jhsf group

JIMMY CHOO

EMILIO PUCCI

REDVALENTINO

VALENTINO

HERMS

MARKET PENETRATION: OPINION LEADERS

Designer: Lorenzo Merlino, first Brazilian

to showcase in Paris

Model: Gisele Bundchen , international

supermodel, Victorias Secret Angel

Designer: Alexandre Herchocovitch,

known for avant-garde designs , electric
prints, trademark skulls

Model: Adriana Lima, International

model /actress, Victorias Secret Angel

Music Artist: Sergio Mendes, Funk & Jazz

with bossa nova
Artist/Photographer: Vik Muniz, art
history, pop culture, unexpected everyday
objects
Football Player: Ronaldinho, Pele, cultural
icons

Performer: Luma de Oliveira, former

model, actress & carnival queen
Retail: Finta (F.1987), iconic sportswear
brand, football wardrobe sponsor

Retail: Colcci (F.1986), premium clothing

label with presence in US, UK, Italy,
France & Spain

BRAZILIAN RETAIL INDUSTRY: FUTURE POTENTIAL

Positive Economic Scenario, Low Risk

Wider economic reforms towards

completely open economy for Global
TPower status
Global Slowdown & Economic Recession
Projections of surpassing China in the
present
5th largest global
Low
pacedecade,
of reforms
economy
Bottleneck economic growth, stagnation
PreGDP
Saltgrowth
development (6th major oil
in
reserve) infra-structure investment
China dependency for imports/exports
Strengthening e-commerce, franchisee
model, 19.5% & 93.1 M in past decade

th Highest GDP, 54th highest PCI

W
6

Empire of laws / Heavy Bureaucracy

Supporting tax rebates, industry incentives
&
low interest
Corruption
duerates
to tax & legal system
Strong domestic market, growing middle
Regional
inequalities
class
Structural
to growth
Substantialbarriers
credit equity,
sustainable
growth rates
Rich in natural resources, leading textile
exporter

WC14 & Summer Olympics 2016

REFERENCES
AT Kearny Global Retail Development Index (2013)
http://www.atkearney.com/consumer-products-retail/global-retail-developmentindex/full-report/-/asset_publisher/oPFrGkbIkz0Q/content/2013-global-retaildevelopment-index/10192
IBGE http://www.ibge.gov.br/english/
Jornal do Brasil / Info Money
Trading Economics http://www.tradingeconomics.com/brazil/indicators
Thomas White http://www.thomaswhite.com/global-perspectives/retail-sector-in-brazilriding-the-wave-of-middle-class-growth-and-consumer-credit-boom/
Euromonitor http://www.euromonitor.com/retailing-in-brazil/report
Interbrand http://www.interbrand.com/en/BestRetailBrands/2013/countryoverviews/riding-a-wave-of-prosperity.aspx

OBRIGADA PELA SUA PACIENCIA

Marina Makeeva | Disha Jain | Sade Harper | Kanica Sethi | Ankita Chowdhury | Prerika Rao