...| case study | | | 17/02/2014 | Natura : Global Beauty Made in Brazil | | David Molina 11185093 | case study Natura : Global Beauty Made in Brazil | | | What are the key success factors in the cosmetics industry?We’re going to go with a step by step analysis, similar to a PEST analysis, in order to find the key factors in the cosmetic industry, especially in Brazil and according to the article.First, the political reforms in Brazil in the 1990s has led to a better openness of trade and investment from the global market. From 1995 to 2000, it has created a more decentralized and market-driven environment through the deregulation of state monopolies and prices, according to the WTO report of trade policies in Brazil in November 2000. It also explains the influence of better resource allocation and greater flexibility of the Brazilian market on the recovering from the financial crisis that lead to the floating of the real in 1999, and thus show an increasing resistance of the market.On the other side, the economic structure of Brazil was supporting the development of the cosmetic market. In 2005, it has 180 million of people which 83% were located in urban areas, which are targeted consumers for cosmetic products. Also there was a strong demand for cosmetic products in Brazil, the country being among the top ranked countries in term of sales. Before the 1990s, there was also a lack of international competition in Brazil, a few multinational were eager...
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...------------------------------------------------- The McGrew Company Mini case 15.1 Lorissa Talavera Ronald Seeger Bryan Quevedo California Baptist University Professor. Flaherty BUS 334 August 4th, 2013 1. Assume you are Joan Beal. Prepare a list of all the options, and give the advantages and disadvantages of each. It appears The McGrew Company has been utilizing the indirect exporting phase as its primary business model in Brazil. Rather than simply exporting its products to Brazilian distributers and selling it for a markup, McGrew could exercise different options. OPTIONS * Direct Exporting Direct exporting would allow for The McGrew Company to handle its own sales and marketing within the country of Brazil. This would enable manufacturing to continue to in its current location while also cutting mark-up costs from the local distributors. Employees within the current manufacturing location may handle the documentation such as billing, shipping, and other activities while a team in Brazil will work in a local parent-type company. This local Brazilian company will perform as a distributor however it will be owned and operated by the manufacture directly. By working this option you allow for the opportunity to cut cost without moving your manufacturing capital to a foreign country. * Turnkey Project This opportunity is facilitated by a contractor who will basically build a business from the ground up within the country of choice, in this case, Brazil. The name Turnkey project is taken literally...
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...Brazilian market for Crosswell International (U.S.). Crosswell’s president and CEO, Hector Lans, is convinced that Precious Ultra Thin Baby Diapers will be a big seller in Brazil. In their role as brokers for Crosswell, the Mathieuxs have been exploring a number of different distribution channels in the Brazilian market. To date, the distributor response to Precious diapers has been enthusiastic, particularly in light of Precious diapers’ superior quality compared to locally manufactured alternatives. The problem, however, is the price. Brazilians base many purchasing decisions — at least in regard to disposable diapers — on cost, not on quality. The Mathieuxs find that distributors do not believe they can compete in the market with the relatively high prices offered by Crosswell, even with higher quality diapers. After much debate over how to improve the price competitiveness of Precious diapers, the Mathieuxs believe they may have found a solution. Their proposal is to combine extended credit terms to local distributors with Brazil’s high domestic interest rates to effectively lower the diapers’ price to Brazilian consumers. The Brazilian Diaper Market Until the latter part of the 1980s, most Brazilians had never heard of a disposable diaper, and not surprisingly, the disposable hygiene market in Brazil was virtually non-existent. By 1995, however, the personal care market was booming. This growth was largely a result of new-found economic stability and a growing middle...
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...Brazil – The Belo Monte Dam In 2013, approximately 201 Million people were living in Brazil, making it the biggest country in South America and the fifth biggest country in the world. Of course this population needs a vast amount of energy to handle daily life issues. This demand of energy makes Brazil the 8th largest energy user and the 10th largest energy producer in the world. Oil and other liquid fuels with 47%, followed by hydroelectricity with 35% and natural gas with 8% form the largest shares of Brazil's total energy consumption. Additionally, Brazil is consuming increasing amounts of biomass in both the residential and industrial sectors.[1] Geographically, the Brazilian landscape consists of about 50% rainforest, including a complex system of rivers like the Amazon and the Paraná. The Amazon rainforest is one of the most biodiversed tropical forests in the Americas with the highest biodiversity of plants species on earth. The other part of the countryside is diverse and is characterized by hills, mountains, plains, highlands and scrublands.[2] Due to the country’s large river system and its eight major drainage basins, Brazil wants to expand its hydroelectricity sector. The country already holds the second largest dam, after the Chinese Three Gorges Dam, the Itaipu Binacional dam. Currently the government is building the world’s third largest dam in the Amazon rainforest, the Belo Monte Dam, which is located on the Xingu River in the state of Pará. The...
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...between the cultural divides of our great planet. Verbal, as well as nonverbal, messages must be adapted to meet the needs of whichever country is being courted. Brazil is no different. While there are many similarities between the U.S. and Brazil, one major difference, on the business front, is the communication style. While most U.S. business offices are very formal in terms of ideas and debate, utilizing mostly written protocol, Brazilian business professionals tend to communicate matters more orally. According to “Brazilian Communication Styles” (2010) website, the manner in which meetings are discussed can be extremely emotional and often theatrical when compared to the traditional U.S. model. Exaggerated body language and intense eye contact can illuminate any board meeting. If one were to not understand this cultural contrast, certain negative implications could arise. The top echelon of the American business world is dominated by males, this is a known fact. Therefore, most companies are not used to catering to female leaders. However, Brazil is leading the way for a new breed of CEO, the educated and motivated woman. Hewlett (2011), “In Brazil, 14% of the CEOs of large companies are female” (para. 4). For an American business attempting to negotiate terms for mergers or hiring of a woman in Brazil, they must not forget to make any necessary adjustments needed to maintain compatibility between cultures. Business culture in the U.S. is usually dictated by...
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...Exploding across the region: On Dec 1, the World Health Organization cited the laboratory proof linking Zika to microcephalus in an consultative to its member countries. it'll think about on Tuesday whether or not to declare a global emergency. The United Nations agency aforementioned in Geneva on Thursday that Zika within the previous few months has unfold "explosively" to over twenty different countries within the Americas and will infect as several as four million folks. Whether the health authorities in Brazil and also the leadership at the WHO have taken too long to urge to the current purpose may be a subject of discussion among the international health community. The Brazilian government says its response once it had been 1st alerted by the doctors regarding the weird symptoms they were seeing was driven by the proof. “It was too early," told Claudio Maierovitch, director of the health ministry's Dept of malady investigation. "There were such a lot of different infectious prospects and Zika had ne'er been seen during this half of a sphere." And the person told that once Zika was known, the authorities’ response was supported information of the malady. Previous outbreaks of Zika, an epidemic 1st known in 1947 in Republic of Uganda, had occurred in little and scattered rural populations in Africa and Southeast Asia and also the symptoms were relatively kind. "We based mostly our response on the knowledge base obtainable, that Zika caused a gentle unwellness...
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...International Business Business Customs Paper County: Brazil When conducting business in Brazil, there is a lot to know about how this country interprets gestures, how they perceive Americans and the best ways to conduct business that will impress them. There are some formalities and policies we may not be aware of in the US. They are important to know in order to conduct successful business in Brazil. Relationship building is key, along with formal attitude and attire and always showing professionalism. Brazil is quite different from the US, so remembering and practicing all of the following will help to insure your business will be successful in Brazil. One important aspect to understand when conducting business with Brazil is their negotiations. In Brazil, business is negotiated in a way that shows Brazilians expect things to go “their way.” This is because they do not have a lot of experience negotiating with other countries. However, younger generations may be more flexible in this aspect. (Global Negotiation Resources) Brazilians also do not like loud and boisterous behavior or anyone who acts rude or impatient towards them. No matter how enthusiastic or heated a discussion may get, theses emotions should never be shown. When initiating contact with a Brazilian, choosing to use a local intermediary, or despachante, is highly recommeneded. This will help create a connection between US and Brazilian culture and business will be more effective. (Global...
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...Introduction Brazil is the economic leader in South America. It is located in eastern South America bordering the Atlantic Ocean. Almost 85% of South American countries border Brazil. Most of the country is located below the equator and it has a total area of 8,511,965 square kilometers (Brazil Facts) making it the fifth largest country in the world behind the U.S. Brazil has a distinctive topography, in the north and west you can find the Amazon Basin with tropical-like weathers. Brazil is also facing deforestation losing about 52,000 square miles of amazon each year. In the south east of the country you will find its highlands and plateaus. Brazil also has a distinctive climate. The climate is generally classified into five subtypes: equatorial, tropical, semiarid, highland tropical and subtropical but 90% of the country is mostly considered tropical. (Climates of Brazil) Social Economic and Cultural Factors As for being the fifth largest country in the world land wise, Brazil is also the fifth largest country when it comes to population. According to the CIA Brazil’s population in 2012 was over two hundred million. 26.2% of the population in 2011 is between 0-14 years of age, 67% of the population in 2011 is between 15-64 years of age, and 6.7% of the population in 2011 is 65+ years of age.(CIA Fact book) Because Brazil was colonized by the Portuguese the primary language in this country is surprisingly Portuguese! Other slightly common languages you might also hear are...
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...Business Investments Brazil’s diversity places it in a position of distinction in the South American continent and strongly influences the attraction of foreign investment. It is the fifth largest country on the planet, with a population of 180 million inhabitants, responsible for a very promising, predominantly urban, market. The country has the possibility to overcome the situation of exclusion from the digital world for a large portion of its population (approximately 28 million Brazilians have internet access, the highest rate in Latin America), due to an increase in telephone services, particularly in the case of prepaid mobile telephones. In addition, the development of a specific model of digital television makes the Brazilian market a gigantic laboratory for the use of applied technology. Furthermore, Brazil has the largest and most diversified system of science, technology and innovation in Latin America, a result of the accrual of accomplishments in the last 50 years, which include the capacity for oil prospection in deep waters and the ability to build aircrafts. Furthermore, the country invests in space and nuclear programs, as well as in new areas currently at the border of knowledge, such as nanoscience, nanotechnology and biotechnology. Infrastructure and partnerships Within the area of infrastructure, due to the urgency in the social agenda, the demand for modernization is shared between the State and capital from the private sector, in initiatives...
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...(1) As of the date of the case and as explained in the case: is Brazil leading the BRICs? Please explain and defend your position. (We will discuss more recent data in class if time.) I’d like to say that Brazil was leading the BRICs as of the date of the case. Several facets were noticed as below: • Growth of economy: Brazil had sustained an average annual GDP growth of 4% since 2000. Between 2002 and 2009, inequality and poverty had declined significantly and more than 30 million Brazilians had advanced from lower income strata to the middle class. • Brazil held important leadership positions in the Group of Twenty (G-20) and had become a major player in multilateral trade negotiations. • Brazil’ s success in World Trade Organization (WTO) disputes concerning developed country agricultural subsidies, use of WTO compulsory licensing provisions to break patents, and diplomatic negotiations with Iran had generated tensions with the United States and the European Union. • A Leading role in WTO negotiation: Brazil stood out as a leading voice of emerging markets, led the creation of the WTO G-21, a block of developing countries that negotiated collectively at WTO meetings. Whereas the United States and the European Union were at the forefront of tariff negotiations in the past, the shift in trade topics put Brazil and other middle-income countries at the center of the Doha round. • Public health: Brazil’ s government purchased drugs to treat infected patients and coordinated...
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...macro exposure of Grendene, a Brazilian shoe manufacturer will be analysed. Grendene’s vulnerability and market exposure will also be accessed. Moreover the level of protection of the company will be approached. 2. Macro effects of an increase in world interest rate on the Brazilian economy Brazil is one of the fastest growing countires in the world and is part of the so called BRIC economies (Brazil, Russia, India and China). Currently the Brasilian Central Bank basis rate SELIC (Brazilian Central Bank’s rate for overnight lending) is at 8,50% p.a. (COPOM - Committee of Monetary Policy). Even if this rate is low compared to historical rates (Figure 1) it continues to be one of the highest interest rates in the world, atracting a high flow of international investments. Due to the large capital inflows, the Brazilian Real has appreciated in the last years diminishing the competitiveness of Brazilian products in the world market. Since 2009, Brazil has experienced high capital inflows mainly due to abundant global liquidity and high interest rates compared to developed countries (OECD, 2011). [pic] Figure 1: Historical interest rates in Brazil (Source: Banco Central do Brasil) In a general point of view, an increase in interest rates will cause a decrease in aggregate demand as it will lower consumption and investments (Begg & Ward, 2009). The cost of borrowing will increase, diminishing the demand for money. Furthermore, the propensity to...
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...Executive Summary Brazil is Latin Americas largest economy and since the 1990’s has shown steady economic reforms. These reforms were necessary as Brazil suffered years of hyperinflation as high as 1000% and deficit spending. The government decided to pursue economic policies that changed the Brazilian economy into a dynamic market based system. Some of the key policy changes made were the privatization, of state owned enterprises, deregulation that allowed for greater domestic and foreign competition, perusing regional and multinational free trade agreements and the removal of red tape associated with foreign investment. The mainstay of all these reforms was the Plano Real (Real Plan). This real plan involved the scrapping of the old currency, the cruzeiro and replacing it with a brand new currency the real. The plan was to drive out inflation by adhering to strict monetary policies. The government decided to peg the real to the United States (U.S.) dollar and not allow it to depreciate more than 7.5 % against the US dollar per year. The government also increased the interest rates repeatedly to maintain the value of the real against the dollar. The economic reforms in Brazil were fairly successful, the country saw the inflation rate drop to 2% by 1998 and the economy grew by 3 to 4% annually as well as foreign investment soaring to $ 22 billion in 1998, but not all was well. Brazil was facing a huge trade deficit due to an overvalued real. There were also huge budget deficits...
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...more than 25 million people around the world who base their livelihoods on its production” (Watson and Achinelli 2008). The producers of these coffee beans are often small-scale farmers who are reliant on faceless consumers, large corporations. Coffee is now one of the world’s most traded goods, it is important for both consumers and producers to understand the impact the production of coffee is having on the farmers at a local level. The western culture of coffee is rapidly expanding. As the globalization of coffee spreads to consumers, corporations are becoming more and more disconnected from the coffee producers. The research will look at specific case studies of how the coffee impacts on Latin America. In addition, I’ll be also looking at the specific effects of economic change of coffee production on farmers and children in Brazil. Through the introduction of the crop into the Caribbean in the early 1700’s, became of economic importance in the mid-1800s. It has been in the last thirty years or so the practices and economy of coffee in Latin America has seen the greatest change as modernization and dependence on coffee production has grown. The coffee land in Latin America is becoming increasingly industrialized. The traditional practices of coffee production in Latin America were much more like gardening. With a pair of shears,...
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...Brazil is amongst the leading developing nations and has sustained a decent economic growth for years (Alfaro & White, 2013). This commodity boom gave rise to the country’s export. However, the “Custo Brasil” was harming domestic manufacturing, while foreign opportunities threatened to overwhelm Brazilian marketplaces. The Custo Brasil has become the biggest factor in declining competitiveness of the country followed by poor infrastructure and undeveloped education system. According to Alfaro & White (2013), “poor infrastructure further hindered national growth.” In 2009, Brazil’s (2013) investment-to-GDP ratio dropped causing some analysts to suspect that weak infrastructure investment would be a future “bottleneck to growth.” Under the leadership of Dilma Rouseff, Brazil’s economic growth had gone stale and Rouseff’s administration battled to get the best balance between reducing inflation, maintaining exchange rate, and enhancing the competition of its exports. The government expenditures (2013) consume more than 40 percent of gross domestic product (GDP). Its overall pace of regulatory reform had slowed and the ax burden is much heavier than other emerging economies. It could be government corruption, insecurity of private property rights, or it’s dependent on commodity exports. Rouseff and her administration worked to improve competitiveness by addressing the issue of improving infrastructure. Its strategy was the public-private partnership aiming to provide jobs...
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...The intention of this paper is to discuss about the advantages and disadvantages for Ecuador if it becomes a member of the Mercado Común del Sur (Mercosur). Currently, the world is going through a change in important ways in the economy, the importance of belonging to an economic bloc is that through this you can get "mutual benefits in international trade" The Mercosur as we know is a South American economic bloc that “is integrated by Argentina, the Federative Republic of Brazil, the Republic of Paraguay, the Oriental Republic of Uruguay and the Bolivarian Republic of Venezuela” (Exhibit 1). The countries that belong to the MERCOSUR are differentiated by the alliance of values held and reflected in its democratic and pluralistic societies, the protection of human rights, the environment and sustainable development. MERCOSUR is also committed to strengthening democracy, eradicate poverty and strengthen the economic and social development of the members with equity. In recent years the President of Ecuador Econ. Rafael Correa expressed his desire to become a member of this economic bloc, but what does it mean to Ecuador to join to this organization? This economic bloc offers attractive proposals for countries; among them is the establishment of a common external tariff, plus the free movement of goods and services between the member countries. For a developing country like Ecuador, it is difficult to make the decision of belonging to an economic bloc, as it must evaluate...
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