1-GENERAL COUNTRY ENVIRONMENT
Demographic Trends
Brazil is a country in South America. It is emerging as one of the largest economies of the world. The population of the country is 208 million. According to a 2016 analysis, the population growth of the company is 0.73%. Regarding the population and demographics, the diversity is quite visible in this country (IndexMundi.Com). The birth rate in this country is 14.1 births/1,000 populations. The death rate is 6.7 deaths. 48% of people in Brazil are white, and 44% are brown. 7% of people are black, and it indicates diversity. Brazil’s literacy rate is 91.73 (Worldpopulationreview.Com).
Cultural and institutional analysis
The main language in Brazil is Portuguese. It has been observed that Brazil’s culture is rich as compared to many countries. People speak or communicate in an informal style. People in this region are well dressed. Professionalism in the business process is in the limelight, and it has been practiced quite effectively. Eye content seems meaningful in this country, and it is different in the social class. 74% of people in Brazil are Roman Catholic, 15% are Protestant, 1% spirituals, and 7% have no religion (Studycountry.Com).
Current Economic Conditions
The economy of Brazil is growing. The unemployment rate is still a major problem for the count. The unemployment rate is over 12%. The growth of GDP is 0.2% in each quarter. However, it is the eighth largest economy in the world. Overall GDB growth in 2018 is 1.0% ($ 6.559 trillion). The attitude toward foreign investment is positive. However, the government intends to bring the business into different cities to strengthen the economic position and reduce the visibility of unemployment. The ease of doing business in this country is good. The infrastructure of the country is suitable for the new business. Healthy competition and availability of resources make the new business entry quite meaningful in this country. It has been observed that local laws protect the rights of intellectual property. Interestingly, the protection intellectual; a property right is quite different as compared to the United States. Arbitration, civil actions, and criminal prosecution are three main sources to protect intellectual property. Based on the property and the nature of the business, parties can decide the appropriate channel. Thus, intellectual property is fully protected, and it opens ways for new businesses to enter this country. The buying power of people in this country seems moderate to high due to the moderate-income level. The economy is growing, and it is creating impacts on people’s buying power in different industries (Tradingeconomics.Com).
2-INDUSTRY-SPECIFIC COUNTRY ENVIRONMENT
Competition
The furniture production in Brazil is in the limelight due to production maximization and growth. For Instance, furniture production growth in 2018 is 28.5%. It has been revealed that this growth of the furniture industry is the highest in the history of the Brazilian furniture industry. The latest industry trend is to make different customer segments and make durable products for people. For Instance, householders and businesses are two major segments of companies in this industry. Making durable products for both customer segments is a key success factor in this competitive industry. The competition in the Brazilian furniture industry is high due to the existence of prominent furniture designers and manufacturers. For Instance, Madrin Export Ltda, Rotta Solid Wood Furniture, Hermanns Intl Assessoria Ltda, Sohag Stillo Brasil, and Remarket Comercio Exterior Ltda are main furniture giants. Interestingly, these companies are looking to enhance the competition due to differentiation. The differentiation has been done in this industry through attractive and creative design for both households and businesses. Moreover, these firms are working with international timber suppliers to have fine wood for the production process. To gain and sustain the competitive advantage in this industry, concentration on the supply chain process is necessary (Furnitureandfurnishing.com). Entering the Brazilian furniture market is a good decision because the firm may have some strategic partner. Also, to gain an early market share in this market, local giants can be integrated for mergers or acquisition (Haigh). Despite having high competition in this industry, it is still the potential market for the new business. The furniture and Homeware segment in Brazil is growing, and it can be depicted by increasing revenue streams. The revenue of this segment is US$1,009m. It is a fact that the user presentation is 10.0% in 2018 and it is expected to increase by 12.3% in 2022. It indicates an increased market share (Statista.Com).
Regulation for the furniture industry
The furniture industry in Brazil I triggered by some business regulations. Wood resources are diminishing in this country, and different companies are regulated in this regard. Production is to be maximized by integrating with the law. In the furniture business, it is the responsibility of new and old companies to contain ethical business considerations. Instead of focusing on profitability and strengthening the supply chain, the most important thing is to regulate the supply chain and production. Integrating with the Brazilian environmental sustainability law is effective to sustain the business in this market for a long run. Using modern technology can make furniture production sustainable. The most important thing is to reduce the impact on the environment, and it seems the best approach to make the difference (Bruha).
Starting the business in Brazil is not a big challenge. However, it is necessary to derive several insights from this analysis and make the strategic decision. This analysis is a source for the company management to come up with some thoughtful considerations in the Brazilian furniture industry.
Work Cited
Bruha, Patrick. “Regulatory Environment for Business in Brazil.” The Brazil Business. The Brazil Business, 23 July 2014. Web. 30 October 2018. http://thebrazilbusiness.com/article/regulatory
-environment-for-business-in-brazil.
Furnitureandfurnishing.com. “Brazil Furniture Industry.” Furniture and Furnishing. Furniture and Furnishing, 10 October 2016. Web. 30 October 2018. http://www.furnitureandfurnishing.com/html/
jul13/market-outlook-brazil-furniture-industry.php.
Haigh, John. “Brazil’s Furniture Makers Vow to Go Global with Bespoke Local Designs.” Economists. Economists, 8 September 2015. Web. 30 October 2018. http://economists-pick-research.hktdc.com/business-news/article/International-Market-News/Brazil-s-Furniture-Makers-Vow-to-Go-Global-with-Bespoke-Local-Designs/imn/en/1/1X000000/1X0A3LWD.htm.
IndexMundi.Com. “Brazil Population growth rate.”
Index Mundi. Index Mundi, 20 January 2018. Web. 30 October 2018. https://www.indexmundi.com/brazil/population
_growth_rate.html.
Statista.Com. “Furniture & Homeware.” Statista. Statista, 1 January 2018. Web. 30 October 2018. https://www.statista.com/outlook/255/115
/furniture-homeware/brazil.
Studycountry.Com. “Religious Beliefs and Spirituality in Brazil.” Study Country. Study Country, 2018. Web. 30 October 2018. https://www.studycountry.com/guide/BR-religion.htm.
Tradingeconomics.Com. “Brazil GDP Annual Growth Rate.” Trading Economics. Trading Economics, 31 August 2018. Web. 30 October 2018. https://tradingeconomics.com/brazil/gdp-growth-annual.
Worldpopulationreview.Com. “Brazil Population 2018.” World Population Review. World Population Review, 1 July 2018. Web. 30 October 2018. http://worldpopulationreview.com/countries
/brazil-population/.
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