Making business in Brazil

Incluyo el texto de una conferencia que hace poco di en un encuentro en el IESE sobre Brasil

I am going to try to give you a few tips to get you started on how Brazil works. Before going to Brazil some preparations, homework, so to speak, must be made.
Brazil is very bureaucratic and the processes to set up a new company and make it operative (such as creating a legal structure, opening the accounts, etc) are very slow and burdensome.
For that reason, the first mistake a company could make when trying to set up an office in Brazil would be to incur in costs to become operative such as renting an office, travelling etc. at the same time the company is being set up. To avoid wasting time in relatively easy-to-do matters, like opening a bank account or setting up a phone line, my first advice would be not to incur in the cost of sending a person there until the structural issues are sorted, or at least, more organized. Otherways, the person becomes just an operative.
Secondly, another absolutely essential previous work to do, in case of wanting to work with Spanish companies, is to speak to these companies before settling in Brazil, to understand their needs in that market. We’ve got to bear in mind that at present there is a huge amount of Spanish companies in Brazil, and most of them have not done this kind of homework in advance. Therefore, all the Spanish companies are receiving services offers from hundreds of Spanish providers.
Thirdly, a good competition and market analysis must be done. Brazil is a huge country and so are our competitors. As a company we must not fear this competition, but we need to analyse carefully their offer and be clear about our strengths and distinct values and advantages.

We’ve got an example in the communications market. Here in Spain and Portugal, we have a staff of 167 people, being in the Top 12 PR Companies in Europe, by the PR Holmes Report. In Brazil our main competitor has a staff of 250, what means it’s so much bigger than us, so like I said earlier we have to take into account the size of the country and of our competitors.
Another piece of advice, once in the country, is to find out a suitable language and tone.
In Brazil, Spaniards are renowned for being terribly blunt and aggressive. We are told about this constantly. When I attended to meetings with prospective clients, my main worry was to avoid this image of aggressiveness, so I spoke softlier with a huge smile in my face. What I found out afterwards was that/ my interlocutors asked me very blunt questions, the kind of questions you would not even think about asking in Spain, for instance “ok, you are in Brazil not because you believe you can offer us a differential value, but because you are escaping/getting away from Spain and Europe as neither your countries have no future, nor ways to solve their problem, you’re too old and also you`ve got economic rules that limit the companies freedom to take action to face the crisis effectively” or “you’re coming here despite there are already very good and experienced PR and communications companies in Brazil”.
These kinds of questions must not be answered with a smile to avoid an aggressive perception; they must be answered with strength and pride that what makes us different. In our case, Inforpress has over 20 years experience operating in a very competitive market, being leaders, despite competing with US companies in Spain. This is due to our efforts in research projects. For example, with the Business School IESE, we have a forum in which we research the new financial communications trends. We have also a research institute on Internal Communications and this together with our experience in developing global projects with IBEX companies in corporate positioning or CSR, is what give us these competitive advantage/ and we have to explain it in a soft tone but firmly.
Finally, another aspect important is the language. In Brazil everyone understands Spanish perfectly, what its more, not only they understand Spanish but they speak it wonderfully too, and of course they speak English too. Therefore it’s easier for Spaniards to communicate but after each meeting they think of you as an stranger who has got there to speak about something but ignoring the main points of their market, the language…
So we have to lose all sense of shame, which is very Spanish, and try to speak at least in “Portignol”, like saying “Fale Portignol mais bosto”.
Third point: to get surrounded with the best. It’s a market very enthusiastic with luxury, and excellence firms. Therefore, the only way for us to go into this rich market, is to offer something excellent, “inspiring” adding-value. That means that we need to hire good, local professionals. Of coursed that means a heavy investment to set up a good team even before having business/clients to pay for it.
Finally, the last advice would be to “understand the market”, not only in his dimensions, (for example, the Communications Groups are huge, much larger than Spanish ones), but also in the way they work. In Brazil it’s important to be friends before making business, so we have to put time into keeping and building relationships. The associations are extremely powerful there, and they attach very big value to the networking processes. We should be members of those associations, go into their social life and invite the people in them to dinner, so a good advice for Brazil would be to make friends always when business is involved.
But be careful, because this massive wave of Spanish companies settling in Brazil has led to the rise of “opportunists” (people who take advantage), who assure you networking and business under false promises, but you it might be too late when you realize you’ve lost your investment.
Thank you all for your time.