The difficulty in finding suitable partners and the huge bureaucracy were some of the reasons that made foreign brands stay out of Brazil for the last few years, but for 2013 and 2014 the growth of the Brazilian market moved the country on the radar of these major companies.
Brands that were already established in the country, but had walked away from the market, are negotiating their return. Companies like Sears, Dunkin’ Donuts and Mango, left behind the unsuccessful attempts developed in Brazil in the past, and made the search for a lucrative future in the country a new target.
Others, like Gap, had already opened their first Brazilian stores, while many other foreign companies are planning their expansion to Brazil for 2014. This promises a large economic diversification for the retail sector.
Plenty Space for Market Growing
In Brazil, the imported products most purchased online are clothes, shoes and accessories, followed by cosmetics and beauty items. Jewelry and watches came in third, with electronics ranked in the last position.
Foreign Brands Rising Through E-commerce
With Brazil between the three countries in which e-commerce purchases are most popular, the country has become a target for foreign companies working in that trade platform. For 2013, the prediction is that Brazilians will spend approximately 2.5 billion BRL in foreign web pages.
Fast Fashion Phenomenon
There are also foreign brands with a more aggressive strategy that instead of staying in the virtual world, will disembark in Brazil with the same products sold abroad.In the United States and Europe, some brands are known as popular shops, located in the busiest streets and supporters of the fast fashion concept, with quick exchanges of collections and cheapest prices. But in Brazil, they will are assuming new strategies, and a new status named as “affordable luxury” market, which means prices on average 35% higher than the ones commercialized abroad.
Mass retail chains like GAP, Top Shop, Sephora and The Body Shop are some of the brands that opted to open their doors in most sophisticated points of Brazil. Others, like Forever 21 and Desigual will also follow this path in São Paulo.
1) Dunkin' Donuts (United States)
The American network of bakeries, Dunkin’ Donuts, famous by their doughnuts and that established in Brazil in the 1980 decade and closed doors in 2005, wants to open new stores in 2014 in São Paulo, Rio de Janeiro and Brasília. The objective of the company is to reach 20 to 25 unities in each one of these cities in the next five years.
The return to Brazil is also related to the importance that Latin America markets have to Dunkin’ Donuts. Today, the company has more than 300 unities in countries like Chile, Colombia and Peru. The company aims to come back to Brazil with new ideas, by incorporating some Brazilian culinary to their menu and by closing partnerships with companies specialized in the restaurant sector.
2) Johnny Rockets (United States)
Apart from the two establishments that will be open in São Paulo in the end of 2013, in Shopping West Plaza and in a Jardim Paulista street, both located in São Paulo, the American chain of restaurants Johnny Rockets confirmed its entrance in Rio de Janeiro for 2014. The country cities of São Paulo State are also a target, being Sorocaba a potential city for the brand expansion. From 2015, Johnny Rockets aims to open units in Belo Horizonte, Curitiba and Brasília.
3) Casa do Galo (Portugal)
The Portuguese restaurant chain Casa do Galo decided to invest in Brazil, due to the losses caused by the financial crisis in Portugal. The company aims to reach the country offering dishes made with chicken by 15.00 to 20.00 BRL, an average of prices lower than those charged by the competition in Brazil. The target audience is the middle class who searches for quality food with a low or reasonable price. The brand pretends to open establishments in shopping malls and streets across the country.
4) Mr. Bricolage (France)
Mr. Bricolage is a French construction-materials store that aims to enter the Brazilian market in 2014. It’s the third largest brand segment in France and has an international network of more than 700 stores in France and 52 stores in 10 other countries. It is already in South America, with a location in Uruguay. The shop operates with sales of products in the categories of construction, decoration and gardening. The brand differentiates itself by various value-added services such as decorating tips, assistance with household projects and other services performed in the store.
5) Sears (United States)
Another brand that has fixed eyes in Brazilian market is the North American Sears. The company had already large department stores in the country that used to sell clothes and home products. Opened in the 1940 decade, the store in Botafogo Beach, in Rio, had three floors. However, the company closed its doors when other large department stores, like Mappin and Mesbla, also came through economic crisis.
Now, Sears aims to enter the Brazilian market again, but only commercializing electronic, electrodomestic appliances and tools. The company plans to open new stores in the country during 2014.
6) Apple (United States)
The first Apple Store on Brazilian lands should open its doors in Rio de Janeiro just in 2014 just at the Village Mall, a luxury shopping mall which is attached to the Barra Shopping in the West Zone of Rio de Janeiro.The launch of the first Brazilian store was delayed, due to the difficulty in finding staff with the required qualifications to work in the establishment, even with the good salaries starting at 5,000.00 BRL for the "Genius" (salespeople trained by Apple).
However, the delay could be a good deal for the company, since its opening will be even closer to the 2014 World Cup. That not only will be hosted in Brazil, but will also have many in games in Rio, attracting people from all over the world to the city.
7) GAP (United States)
The American brand, GAP, had been rehearsing its entrance in Brazil for many years. The plan was finally achieved in September of 2013 with the opening of its first store in Brazilian lands in JK Iguatemi Mall, and later in October, with the opening of another store in Morumbi Mall both located in São Paulo.
The brand lands in Brazil through Blue Bird, a company from GEP group, that also own Cori, Luigi Bertolli and Emme, all with stores in Brazil. With 20 stores in Latin America, GAP believes that Brazil is the key point for the brand’s success in the continent. Even presenting competitive prices, they are higher in Brazil than in United States.
8) Top Shop (United Kingdom)
The British chain of clothing Top Shop that was launched in Brazil in 2012 in São Paulo, plans to open its third store in Sao Paulo in 2013 and four others units in 2014, being one of them located in Rio. Top Shop prices are 60% more expensive in Brazil than in London, but according to the brand manager in Brazil, Daniela Valão, Top Shop accepted the model of smaller stores in order to circumvent the local costs. Even with higher prices, the shop is still more competitive than the national stores that work with the same public.
9) Forever 21 (United States)
The American chain of clothes stores, Forever 21, has secured its space of 1078.79 m² in the Village Mall in Rio de Janeiro, and in Morumbi Mall in São Paulo. The entry into the Brazilian market is part of an expansion strategy involving Latin America announced by the brand in 2012. Markets in Brazil, Costa Rica and Colombia are the ones that will gain special focus. However, the popular and short prices from which the store is known abroad won’t be applied in Brazil. The brand prices will be significantly higher in the country if compared with the competitive prices practice abroad.
10) H&M (Sweden)
In 2012, the Swedish Hennes & Mauritz (known as H&M), the second largest retailer in the world, aimed to open more than 270 stores in different parts of the world, none, however, placed in Brazil. For 2014 the plans are different, and the fashion chain might open doors in the Paulista Avenue in São Paulo.
The Brazilian operation of H & M has been the subject of speculation for more than five years. But plans began to come true after the chain had entered South America in March of 2013in Chile. The opening was so successful than more than 2,500 people waited 12 hours on a queue waiting for H&M Chile open.