QUESTION/ANSWER FORUM DOING BUSINESS WITH BRAZIL...Est. 2015 Freight Forwarder / Mexican Customs. ....
Transcript of QUESTION/ANSWER FORUM DOING BUSINESS WITH BRAZIL...Est. 2015 Freight Forwarder / Mexican Customs. ....
QUESTION/ANSWER FORUM:DOING BUSINESS WITH BRAZIL
THE SCARBROUGH GROUP
Est. 1984 International Freight / U.S. Customs
Est. 1988 Own Trucking Fleet
Est. 2003 NVOCC Operations
Est. 2014 NAFTA Truck Brokerage
Est. 2015 Freight Forwarder / Mexican Customs
www.scarbrough-intl.com
Fabio Yukio YamadaManaging Director
TRADEBRZ [email protected]
ABOUT THE SPEAKERS
Chad Clooten, CESSupply Chain Specialist
Scarbrough International, [email protected]
T: 816-584-2425
www.scarbrough-intl.com
Darcy BarnesSenior Export Operations Expert
Scarbrough International, [email protected]
T: 314-592-5325
ABOUT BRAZIL
www.scarbrough-intl.com
• Population: 208 Million• GDP: USD1.8 Trillion• GDP per Capita: USD8,651• GDP Growth in 2018: 3%• Unemployment: 13%• Inflation: 3%• International Reserves: USD 356 Billion• Exports = USD191 Billion• Imports = USD171 Billion
RECESSION IS OVER
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• GDP Growth: 1%• Expected inflation in 2017 < 4.5%• Peaceful transition• Brazilian officials are confident: the
worst is over• Exceptional gains in a few months –
stock market soared in Jan & Feb 2018
BRAZILIAN CULTURE
GREETINGS– Women: kiss both cheeks– Men: handshakes – Shake hands with everyone when arriving and exiting– Hugging and a nice pat on the back are also quite common
TIMING AND SCHEDULING– In metropolitan regions, meetings are scheduled from 9 AM to 5 PM.– Executives usually arrive at 9 AM and leave at 7 PM.– Meetings can be brief or last hours - one hour is a good average.– Delays can be expected on both sides – 15 minute is acceptable– Even though it is difficult to move in metropolitan areas, it is advisable to schedule
meetings at the prospects’ place– When our company is responsible in scheduling meetings, we allow extra time for
eventual delays between them and we limit to 4 meetings per day.
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BRAZILIAN CULTURE
BODY LANGUAGE
• When conversing, good eye contact is important. To not do so is considered impolite.
• A good, warm handshake is the traditional greeting in Brazil. However, the Brazilians show affection easily.
• People in Brazil will also shake hands when arriving and departing. There may also be a touching of the forearm or elbow, and often a pat on the back.
• If you are conducting business, be certain to bring a plentiful supply of business cards because these are always exchanged.
• Also, during business meetings expect to be served (often) small cups of very strong coffee.
• Since this is more of a touching society, people stand close together when conversing or when standing in lines.
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BRAZILIAN CULTURE
LANGUAGE AND COMMUNICATIONS• English is spoken by 20% of the Executives.• Spanish and Portuguese are close but not identical – Brazilians understand Spanish, but the
contrary is not a rule, once Brazilians tend to speak their own “Portunhol”• Good conversation topics are football (soccer), family and music. • Bad conversation topics are politics, poverty, religion. Also it is not common to ask personal
questions, such as age, salary, marital or job status.
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CORPORATE AND CULTURE• During a conversation a lot of touching of the arms and back is
common. Brazilians tend to speak in very close proximity, with lots of physical contact.
BRAZILIAN CULTURE
MEALS & MEETINGS• Exchange business cards during introductions.• In Brazil, constant interruptions while someone is talking is often
considered acceptable.• Good eye contact is expected.• Negotiations are known to occur over meals, often lunch
WHAT TO WEAR• Although Brazilian culture tends to be relatively informal,
Brazilians are quite fashion conscious. It is important therefore to dress smartly and conservatively.
• Suits are often used by lawyers and government officials.• When attending a Brazilian’s home, it is customary to bring the
host flowers or a small gift
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BRAZILIAN CULTURE
BUSINESS RELATIONSHIPS
• Brazilians negotiate with people not with companies, therefore, building a positive relationship (via small talk) is necessary while discussing business matters.
• It is believed the further north you go the more relaxed the attitude is in regards to business.
• Try not to show feelings of frustration or impatience as this will reflect poorly on you as an individual. Brazilians pride themselves on their ability to be in control, so acting in a similar fashion will improve your relationship and interactions with your Brazilian counterparts.
• Brazilian business is hierarchical. The final decisions are usually made by the highest ranking person; therefore, it takes some time to make a deal.
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REQUISITES TO ENTER BRAZILIAN MARKET
MARKET ASSESSMENT:
• Demand• Customer needs / behavior
analysis• Competitor pricing• Channel analysis• Regulatory environment
mapping• Entry barrier analysis• Cost driver analysis
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• Sales Agent
• Distributor
• JV with Exiting Company
• Acquisition
• Greenfield
Prioritization of potential market opportunities
Evaluation and prioritization of potential entry options
BUSINESS OPPORTUNITIES
Food Industry
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Agricultural Equipment & services
Medical Equipment & Devices
Life Science, Bioscience
Aircraft & partsChemicals
IT and ICT
• 540 local and international pharmaceutical• USD 22 Billion• Growth 7% in volume• Industry imports, 18% are from USA
• Raw materials• Equipment
• Nutritional Supplements – growth of 25% per year
LIFE SCIENCE / BIOSCIENCE
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MEDICAL EQUIPMENT & DEVICES
• Largest market in South America• Imports – 30% are from the US
(USD60 to USD100 Mil per year)• There are 6630 hospitals & 491,600 beds –
705 are private
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FOOD INDUSTRY
• Healthy food – organic ingredients• Equipment for the food industry: meat processing, cold
cuts. • Brazil is one of the top three exporters of protein
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AGRICULTURAL EQUIPMENT & SERVICES
• Niche for sophisticated agricultural equipment.• Market of USD5.5 billion in 2015 – USD100 Million from US
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AIRCRAFTS & PARTS
• Brazil imported USD5.2 Billion of aerospace goods from US• Embraer imported USD2 Billion from US• Second largest fleet of Executive Jets (15,000)• Third largest of helicopters
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CHEMICALS
• Potassium Chloride• Insecticides• Urea• Ammonium Dihydrogenorthophosphate• Drugs• Drugs with heterocyclic composts• Human antibodies• Fungicides• Fertilizers• Glyphosate
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TECHNOLOGY
• IT• CAPEX USD42 Billion in 2016
• ICT• Capex USD 180 Billion in 2016• 257 Million cell phones & 120 Million internet
users• Internet of Things – USD 4.1 Billion in 2016• Business Analytics – USD 811 Million in 2016• Cloud Computing – Growth of 20%• Online Payment – 30% of all transactions in 2016
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INDUSTRY SECTORS BY REGION
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HOW TRADE BRZ CONSULTING CAN HELP
• Tradebrz’s Market Intelligence identifies business opportunities in all industries:
• Find the right product for the right channel at the right price• Estimate demand• Value chain analysis• Competition analysis and gaps• Overcome entry barriers• Market Entry Strategies & Action Plan• Implementation of Business Plan• Locate ideal partners and prospects• Follow up & follow up• Next steps planning
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HOW TO FIND A BUYER OR SUPPLIER
• Tradebrz finds reliable buyers and suppliers• Sets up introductions & expectations on both
sides.• Intermediates calls and meetings• Checks performance in the local market and
background checks.• Recommends
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SHIPPING TO BRAZIL
Importers & Exporters must Register with the Foreign Trade Secretariat (SECEX)
• All Brazilian importers and exporters must be registered with the Foreign Trade Secretariat (SECEX) of the Ministry of Industry, Commerce and Tourism (MICT). The inscription number in the General Taxpayer Register of the Revenue Ministry (CGC), of the consignee must appear on the commercial invoice or other documentation for clearance.
• This is referred to as the CNPJ number (short for CadastroNacional de Pessoas Juridicas).
All Brazilian Importers must have a Brazilian Broker
• They will be a critical partner in ensuring smooth clearance and delivery. Scarbrough International is affiliated with several networks of partners, allowing us to have a global reach with local contacts in Brazil that can deal with issues immediately.
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Original Packing Lists
Requirements of Documents
• 3 colored copies of each• Signed in blue ink• Docs must show
• Freight• Insurance• Other charges (when applicable) as
separate line items
INVOICE AND PACKING LIST
Original Commercial Invoices
• INCOTERMS must be stated on the commercial invoice. DAP is allowed, but discouraged.
• DDP is strictly prohibited in Brazil due to tax reasons.
*All required Regardless of Incoterms
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BILL OF LADING REQUIREMENTS
NCM NUMBER
This number is a local classification system in Brazil, and is consistent with the Harmonized Tariff System classifications
Brazil requires that the NCM number (Nomenclatura Comum do MERCOSUL) be stated on the bill of lading.
It is only mandatory that the first 4 digits of the NCM number be listed.
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REQUIRED DOCUMENTS
Scarbrough International is proficient at assisting in the completion of various other documentation such as certificates of origin and insurance certificates. As long as we know the particular requirements of the customer, we can customize our documentation packet and process to meet those needs.Other documentation may be required
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• Original, rated bills of lading are required for Brazil. • “As Agreed” or “Prepaid” will not be accepted• The rate must be shown.
As such, Scarbrough always utilizes our trusted partner in Brazil in order to protect your interests and keep your costs confidential, passing along only the necessary documentation required for clearance to the actual consignee.
ORIGINAL BILLS OF LADING
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THE IMPORTANCE OF DETAILS
• We have an accuracy checklist specific to Brazil that is used for each file. Once the MBL is received from the carrier, the MBL, HBL, and commercial documents are checked against each other and this checklist immediately by another team member.
Ideally this is done with 24 hours of sailing.
• Once this internal check is completed, the documentation is then sent to our reliable partner in Brazil, to once again check over all the documentation for any discrepancies.
Having a representative in Brazil that deals with their Customs procedures as part of daily routine is a big advantage. After this second safeguard, the documents are then emailed to the final consignee for their approval before the originals are sent by courier to destination.
This includes, but it not limited to:
Piece count
Commodity description
Port of loading
Port of discharge
Weight
Container
Seal number
Specific Details between MBL, HBL and Commercial Docs must match exactly.
Scarbrough takes ACCURACY serious.
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YET, MORE DOCUMENTATION RULES
All documentation needs to be presented timely
• Originals must be in-hand at destination absolutely no later than 5 days before cargo discharges at first port of call in Brazil.
Correct documentation is VITAL!
• There is a very limited window of opportunity to correct documentation, so ensuring accuracy from the beginning is crucial. Once cargo gets stuck in Brazilian customs, it can be a lengthy, expensive process to get it released.
Correction letters issued for
discrepancy are subject to penalties up to USD$50 per
occurrence.
Penalties for late documentation
presentation are up to $5000 (USD)
per HBL.
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Sao Paulo / Santos
Paranagua
Rio Grande Itajai
Vitoria
Belem
MAIN OCEAN PORTSRio De Janeiro
Fortaleza Manaus
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Sao Paulo / Guarulhos International Airport
(GRU)*Passenger
Rio de Janeiro (RIO)
MAIN AIRPORTS
Sao Paulo / ViracoposInternational Airport
(VCP)*Cargo Only
Porto Alegre (POA)
www.scarbrough-intl.com
Fabio Yukio YamadaManaging Director
TRADEBRZ [email protected]
ABOUT THE SPEAKERS
Chad Clooten, CESSupply Chain Specialist
Scarbrough International, [email protected]
T: 816-584-2425
www.scarbrough-intl.com
Darcy BarnesSenior Export Operations Expert
Scarbrough International, [email protected]
T: 314-592-5325