Angles on the Americas

Business tips: Steering clear of potential pitfalls

June 9, 2006

Brazil, South America’s largest economy, offers great business opportunities for exporters who have researched and targeted this complex market. CanadExport offers a few quick tips to consider if you plan on taking your business to this challenging yet rewarding market.

Get local, get in

There are many ways for Canadian companies to enter the Brazilian market. All the customary import methods exist including agents, distributors, import houses, trading companies, and subsidiaries of foreign firms. Most Canadian exporters use local sales representatives with technical capabilities or distributors.

As direct sales to the end user are rare, the key to success is to maintain a solid and reliable relationship with a suitable local firm, capable of protecting and promoting your company’s interests. During sales contract negotiations, local buyers will almost always place an emphasis on quality, technical assistance and training.

The most common way for Canadians to do business in Brazil is through a sales representative or agent. Although some Brazilian companies import directly from overseas manufacturers without local representation, the presence of a local agent or distributor is essential in most cases. As in other markets, the selection of an agent requires careful consideration.

In Brazil, larger representatives have sales offices in several cities to supply buyers throughout the country, whereas smaller representatives may either supply companies in a limited region or appoint “business opportunity finders” in different regions outside of their operational area.

The ability of an agent to cover the country depends in large part on the item being sold. If your product has just a few buyers throughout Brazil, one agent may be enough. However, if your product sells to a wide potential market, the need for countrywide service facilities could place a much greater demand on a single agent.

When in Rio...

Culturally, Brazil is as diverse as all other countries that make up Latin America, so a business approach that is sensitive to this is required. Business is often conducted in English, but promotional material should be in Portuguese, Brazil’s official language. You can get by with Spanish, but many local businesspeople may prefer to speak English. Of course, learning Portuguese would be greatly appreciated. Most importantly, however, it sends a strong message to your local contacts that you are committed and respectful of local culture.

Know before you go

Local import regulations can be confusing to a first-time seller to Brazil. However, complying with local requirements are the responsibility of the importer, who will normally process necessary paperwork through a customs broker. Nevertheless, Canadian exporters should understand the process and be familiar with the regulations involved to avoid costly delays related to the non-compliance of regulations.

While patience and understanding are crucial for doing business in new markets, demonstrating a long-term commitment to the market is key. Make frequent visits to gain first-hand knowledge of the people and place. It will help steer you clear of potential pitfalls.