Should I go to Brazil?
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Transcript of Should I go to Brazil?
Should I go to BrazilShould I go to Brazil??
David BaramManaging partnerBase Investments
© All rights reservedBut only if you…
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MARKET? PRICING? BUDGET?
PATIENCE!!!!!!!PLAN?
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Do I have a marketDo I have a market??
Consumers behavior
Competition – No competition? Why? / Crowded market? Time!! / Strong Brazilian? Price!
Talk to:
1. Distributers2. Consumers (Hospital, Doctor, Patient(
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RegulationRegulation
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PricingPricing
TAXATION!!!!!!!!!!!!!!!!Your ExWorks price – compromise?Suply Chain length?Exporting country (Israel? China?)Exceptions (Mercosul)
Price without taxes (1) 3.70 Price without taxes (1) 3.70
PIS (Social Contribution) 5.09 1.65% 0.08 PIS (Social Contribution) 5.09 1.65% 0.08COFINS (Social Contribution) 5.09 7.60% 0.39 COFINS (Social Contribution) 5.09 7.60% 0.39ICMS (Value Added Tax) 5.09 18.00% 0.92 ICMS (Value Added Tax) 5.09 18.00% 0.92
Price before IPI (2) 5.09 Price before IPI (2) 5.09IPI 5.09 6.00% 0.31 IPI 5.09 6.00% 0.31
Total Raw Material Price 5.39 Total Raw Material Price 5.39
Labor and other costs (3) 0.56 Labor and other costs (3) 0.56
Gross margin (4) 0.81 Gross margin (4) 0.15PIS 1.87 1.65% 0.03 PIS 0.97 1.65% 0.02COFINS 1.87 7.60% 0.14 COFINS 0.97 7.60% 0.07ICMS 1.87 18.00% 0.34 ICMS 0.97 18.00% 0.17
Price before IPI 1.87 Price before IPI 0.97IPI 1.87 0.00% 0.00 IPI 0.00
Final Price to *** 1.87 Final Price to *** 0.97
Raw material and services costs 5.06 Raw material and services costs (5) 4.96
Other costs (5) 5.06 15.00% 0.57 Other costs (6) 4.96 11.45% 0.57
Gross margin (5) 10.67 20.00% 2.13 Gross margin (6) 9.78 21.82% 2.13
PIS 10.67 1.65% 0.18 PIS (5) 9.78 0.65% 0.06
COFINS 10.67 7.60% 0.81 COFINS (5) 9.78 3.00% 0.29ICMS 10.67 18.00% 1.92 ICMS 9.78 18.00% 1.76
Price before IPI 10.67 Price before IPI 9.78
IPI (6) 10.67 0.00% 0.00 IPI (7) 9.78 0.00% 0.00Total before ICMSst 10.67 Total before ICMSst 9.78
IVAst (deemed margin of resellers) (7) 58.04% IVAst (deemed margin of resellers)(8) 58.04%Total ICMSst 16.87 18.00% 3.04 Total ICMSst 15.46 18.00% 2.78(-) ICMS (1.92) (-) ICMS (1.76)ICMSst due 1.11 ICMSst due 1.02
SALLING FROM *** TO THE *** SALLING FROM *** TO THE ***
DESCRIPTION TAX BASIS RATE VALUES DESCRIPTION TAX BASIS RATE VALUES
TAX BASIS
SCENÁRIO VI - INCOME TAX CALCULATED ON THE ACTUAL PROFIT SCENÁRIO VIA -INCOME TAX CALCULATED ON THE DEEMED PROFIT
ACQUISITION OF RAW MATERIAL BY ACQUISITION OF RAW MATERIAL BY
LOCAL MANUFACTURER - MANUFACTURE BY ORDER INTERSTATE OPERATIONS
RATE VALUESDESCRIPTION TAX BASIS RATE VALUES DESCRIPTION
INDUSTRIALIZATION SERVICES BY MANUFACTURER FOR *** INDUSTRIALIZATION SERVICES BY MANUFACTURER FOR ***
DESCRIPTION TAX BASIS RATE VALUES RATE VALUESDESCRIPTION TAX BASIS
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Operation ModelsOperation Models
Lower cost
Lower cost
Control
Control
Price & Lead Time
Price & Lead Time
Control &
Suply chain
Control &
Suply chain
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Choose Your ModelChoose Your Model11stst decision point decision point
Or
Can you finance it?
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Choose Your ModelChoose Your Model22ndnd decision point decision point
• Market validation• Reduced price justifies increased cost?• Classification?• Lead time
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DistributorsDistributors
NationalRegionalStateCityMaster DistributerImporter?Government / Private sector
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The upside
Your competitors face the same challenges!
Israeli products are welcomed in Brazil!
Mercosul agreement gives an advantage over non Israeli competition!
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How LongHow Long??
Longer than you thought.
http://www.anvisa.gov.br/listadepeticoes/index.asp
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How LongHow Long? ?
Market Research 3M
Hosting Owner 1-2M
Registration Class 1,2 12-18M
Distributer 6-18 M
HostingHosting
ANVISA
ANVISA
Distributer
Registration Class 3,4 18-36M ANVISA
INMETRO
INMETRO
ANVISA
GMP
GMP
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How MuchHow Much? ?
Market Research 3M
Hosting Owner 1-2M
Registration Class 1,2 12-18M
Distributer 6-18 M
HostingHosting
ANVISA
ANVISA
Distributer
Registration Class 3,4 18-36M ANVISA
INMETRO
INMETRO
ANVISA
GMP
GMP
Registration fees:- ANVISA fees 1000 us$
- Hosting Company fees 1500us$/product Monthly Hosting 650$ per product/family
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How LongHow Long? ?
Market Research 3M
Registration Class 1,2 12-18M
Distributer 6-18 M
DistributerDistributer
ANVISA
ANVISA
Registration Class 3,4 18-36M ANVISA
INMETRO
INMETRO
ANVISA
GMP
GMP
© All rights reserved
How MuchHow Much? ?
Market Research 3M
Registration Class 1,2 12-18M
Distributer 6-18 M
DistributerDistributer
ANVISA
ANVISA
Registration Class 3,4 18-36M ANVISA
INMETRO
INMETRO
ANVISA
GMP
GMP
© All rights reserved
How LongHow Long??
Market Research 3M
Registration Class 1,2 12-18M
Distributer 6-18 M
Registration Class 3,4 18-36M
INMETRO
INMETRO
Local Manufacture
Local Manufacture
ANVISA
ANVISA
ANVISA
Manufacture Partner 3-9 M
ANVISA
© All rights reserved
How MuchHow Much? ?
Market Research 3M
Registration Class 1,2 12-18M
Distributer 6-18 M
Registration Class 3,4 18-36M
INMETRO
INMETRO
Local Manufacture
Local Manufacture
ANVISA
ANVISA
ANVISA
Manufacture Partner 3-9 M
ANVISA
© All rights reserved
How MuchHow Much