Olympic-size opportunities for e-Commerce in Brazil

LinkedIn Twitter Facebook

 

Author: Oliver Dowson, CEO, International Corporate Creations

There’s been more media coverage of Brazil in the last few weeks than in most years.

That’s of course been driven by the Olympics, with all the associated questions about infrastructure, environment, what future benefits there will be for the locals after all the investment and whether and where the money could have been better spent. You’ll also have seen the recent impeachment process of Dilma Roussef, followed by demonstrations suggesting the country may be descending into chaos.

 

But no, Brazilians are just getting on with life, and it’s very much business as usual. And for eCommerce companies, that means great opportunities. It may be a developing country, but it’s certainly not third-world in any sense, and has a rapidly-growing middle class. It has a population of over 200 million, of which over 50% are aged between 15-44, and over 90% of those have smartphones. As the only reliable TV signal is via cable (there are 2 main operators), most houses and apartments have high speed internet too.

 

Most people rely on mobile networks for internet - the four main operators, Vivo, TIM, Claro and Oi (all overseas-owned) all have 4G networks covering all urban centres (and therefore around 90% of the population) and 3G coverage is ubiquitous across all populated areas of the whole country. Use of smartphones is so universal that, unlike almost any other country, WhatsApp has become the main communications medium for both B2C and B2B trade.

 

eCommerce in Brazil during Rio Olympics

 

Recent studies show that over 80% of the 15-44 demographic now shop online at least once a month, so it should be a highly promising market for eCommerce. Perhaps the only obvious downside is that disposable incomes are relatively low. However, it’s also not so easy to break into the market from overseas, and new entrants would be well advised to plan to set up a base, however modest, in the country.

 

It’s not just a matter of language – although websites need to be in Brazilian Portuguese, translations are usually easy to implement. The biggest issues to overcome are taxation, import regulations, payment and infrastructure.

 

Brazilian bureaucracy is byzantine and the taxation system is a nightmare to understand, even for local accountants. Any single sale is likely to attract at least 3 separate taxes, and rates and rules can vary from state to state and city to city. The business itself will also be taxed both on turnover and profit. Import duties are simpler – but not by much, and the rates can be eye-watering for some products.

 

eCommerce in Brazil during Rio 2016 Olympics

 

Brazilians are used to buying almost everything (even groceries and fuel for the car) on interest-free credit, with the vendor charging the purchaser’s debit card in 3, 6, 10 or more equal monthly transactions. The credit arrangements are operated directly by vendors, not by banks or card issuers.

 

Solve all those issues, and if you’re selling physical goods you’ve still got to get them to the customers. Courier services are improving continuously, but – perhaps unsurprisingly given the size of the country and remoteness of some areas – there’s no such thing as fixed prices or delivery times regardless of destination.

 

Discouraged? You shouldn’t be. Brazil is a great country with huge potential and can be an ideal market for so many businesses. You just need help – and at every step of the way, from initial research and planning through to implementation and ongoing operations. Success can be achieved much more quickly and affordably than most business people think.

 

The overwhelmingly young workforce is increasingly well-educated, and it’s easy to hire professionals in most sectors who have very good English – and they will all be enthusiastic about eCommerce. In my experience, productivity levels can be impressive. It’s also one of the most pleasant countries to live, work and do business. If the weather alone doesn’t lift one’s spirits, the enthusiasm and “can do” attitude of the Brazilian people will.

 

LinkedIn Twitter Facebook

Black Friday growing strongly in Brazil

Black Friday growing strongly in Brazil

The phenomenal performance of Black Friday rippled around the world and Brazil was no different with eCommerce Brasil reporting billions in sales. So what are the figures coming out of Brasil on this bargain-hunting shopping day?
eCommerce in Brazil: Going local is key

eCommerce in Brazil: Going local is key

As with anywhere, Brazil has its fair share of problems – but with a population of 200 million, a tech-savvy and consumption-driven middle class and arguably the most internet-connected population in the world, is Brazil seen as a necessary evil for international merchants looking to expand internationally?
Why international e-tailers should re-visit the top of the funnel

Why international e-tailers should re-visit the top of the funnel

The role of brand awareness is increasingly critical to international expansion and with various platforms offering better reach and targeting than ever before, why is it important for international retailers to revisit the top of the funnel to help create a more compelling picture?
Quality of delivery offer important to Dutch shoppers

Quality of delivery offer important to Dutch shoppers

Cross-border eCommerce in Belgium and the Netherlands is making big strides and with a population of 28 million people and combined GDP of €1.08trn and English spoken widely, it’s no wonder it offers an attractive market to international merchants looking to expand into new territories. But does the quality of delivery offered that important to Dutch shoppers?
How to maximise your chances of success in India

How to maximise your chances of success in India

eCommerce is growing at an unprecedented rate in India thanks to a number of factors and with the percentage of online retail sales growing rapidly, what do retailers need to consider in order to maximise their chances of success in India?
What do Russian consumers want when it comes to cross-border shopping?

What do Russian consumers want when it comes to cross-border shopping?

Russia is the 9th biggest country in the world with roughly 30 million online Russian shoppers in 2015 which only continue to grows in 2016. However, with cross-border shopping being the fastest-growing segment of the Russian eCommerce market, what do Russian consumers want when it comes to cross-border shopping?
The importance of understanding what it is to be Russian

The importance of understanding what it is to be Russian

Russia, in terms of internet penetration, did lag behind most other European countries but is rapidly playing catch up. Not surprisingly, eCommerce has increased alongside internet penetration with an estimated 148 million orders generated in 2015. But with so many unknowns surrounding entering the Russian market, what are the golden rules?
What should retailers know about Russian attitudes to parcel deliveries?

What should retailers know about Russian attitudes to parcel deliveries?

Russia offers a potentially attractive market for international merchants, however the market needs careful consideration in order to get it right. Things to take into account include the distinctly different Russian way of thinking, along with the legal rules and political context of the country. So what are the key things retailers need to know?
Retail Pricing in a post-Brexit world

Retail Pricing in a post-Brexit world

Since Brexit, a number of events have taken place which has meant the price of items has significantly dropped in the UK. But what are the affects of the UK leaving the European Union on retail pricing?
Australia extends tax to foreign eCommerce

Australia extends tax to foreign eCommerce

For a number of valid reasons, Australia is still a destination firmly in the minds of any business looking to expand into the APAC region. With an attractive foreign eCommerce tax law favoring companies coming into Australia, what are the big changes coming down the line in 2017?

Contact Us

eCommerce Worldwide
2 Ching Court
49-53 Monmouth St
London
WC2H 9EY

Tel: 0203 696 0980
2016© eCommerce Worldwide

Keep In Touch

powered by Affino

About eCommerce Worldwide

eCommerce Worldwide provides online retailers with all the information, and resources, they need to develop cross-border strategies for entering new markets around the world
Read More