As the fifth largest country geographically and representing the fifth largest market opportunity in the world, Brazil is a nation that offers an abundance of promise for those looking to do business there. Rich in mineral wealth including iron and oil, and with its large population of over 194 million, predominantly comprising a young and highly-motivated workforce, the potential for doing business in Brazil should not be underestimated by any organisations who have a strong drive to expand globally.
Just as Brazil’s commercial potential should not be underestimated neither should the challenges of doing business in Brazil. Corruption remains an enduring obstacle to establishing a business in Brazil – a nation seemingly locked in a cycle of rife corruption and political misconduct which results in inevitable economic crises and which means Brazil’s commercial potential is often seldom realised.
It is worth noting that Brazil is regarded as ‘mostly unfree’ in terms of economic freedom, with the administration implementing extremely protectionist policies making market entry difficult. Inadequate infrastructure, unyielding labour laws, complex tax and regulatory requirements all contribute to the notorious ‘Custo Brasil’ (Brazil Cost), which also makes some professionals wary of doing business in Brazil.
Despite the Brazilian government’s openness to foreign investment being below average, low domestic productivity and commonplace corruption, the untapped potential for commercial success in Brazil cannot be ignored. As is the case with any country, understanding Brazilian commercial culture remains one of the underlying keys to professional prosperity. As doing business in Brazil is extremely restricted by bureaucracy ‘jeito’, taking a flexible approach is widely practiced. This translates to meeting agendas not being strictly followed and the qualities of appearing relaxed and ‘going with the flow’ being highly respected.
Relationships are cherished in Brazil. Those entering the market there would benefit from nurturing healthy relationships with local despachantes (middlemen) and working closely with native lawyers and accountants to secure help overcoming the challenges that ‘Custo Brasil’ causes. Fostering trust with local despachantes will also prove helpful in understanding the finer details of internal politics within a Brazilian company.
The World Business Culture website is the perfect place to learn about the work-related culture of Brazil, providing invaluable tips such as to avoid speaking Spanish so as not to offend the Brazilian pride of being a uniquely non-Spanish speaking South American nation. The website also supplies key advice on logistics, tax and market entry to help ensure those doing business in Brazil do it in the right way.