Brazil aims to receive a niche in the world’s arena. The actions and decisions taken by the government are directed to the improvement and constant progress. According to the recent statistics, Brazil was the seventh country with the largest economy in 2010 (Kieff & Paredes, 2012). The country laid the focus upon the closing industry. Due to the development of the manufacturing segment and the popularity of the clothes and apparel made in Brazil, the domestic market faced a rapid progress. The reason for the development of the textile sector is understandable as the government benefits from the raw material, namely cotton. The primary purpose of the paper is to evaluate the success of the textile industry in Brazil.
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Textile and Apparel
The production of textile and apparel in Brazil comprises three percent of the global production. As the matter of fact, the country takes the first place in textile production across Latin America. Due to this fact, a number of people work in the industry. According to the statistics, almost two million of people worked in the textile production in 2006 (Bruzzi & Gibson, 2013). The most used materials are leather and fibers.
It is worth stating that clothes and shoes made in Brazil and valued for high-quality materials. The fashion industry is improving in Brazil, and more than 30,000 of companies provide people with workplaces (Choi & Cheng, 2015). According to the recent researches, the vast majority of workers are women. Since 2007, more than ten billion of dollars were invested in the development of the textile and apparel production. It has already made Brazil one of the most influential retailers.
As the income of people increases and more people can be considered as the representatives of the middle class, the society faces a bigger demand for designers. Most of the garments presented on the Brazil market are imported from China. The reason for it is obvious as the textile production in Brazil is expensive as well as the labor force. Moreover, the bureaucratic system is one of the most difficult in terms of import and export. That is, the apparel is produced for the domestic market. According to the recent findings, only fifteen percent of the textile production is exported. In contrast to the countries of the Eastern World, Brazil is more orientated to the domestic market, rather than on export.
The textile industry in Brazil is beneficially affected by the raw material, cotton (Fleury, 2011). Fabric and thread can be purchased locally, however, for the price-cutting, the materials can be imported from Vietnam or China as the labor force is chipper in the Eastern countries.
Brazil is the country where taxation on import is very strict. This fact can be considered as the disadvantage for the foreign investors. The tax on import was designed for protection and economic security. It is used to provide the fair competition on the Brazil market with the domestic and imported products. The system of taxation is complex and varies with the consideration of product and manufacturer country.
There are six main taxes that will influence the value of the imported product; among them are the following, namely “the merchant marine renewal tax, import tax, industrialized products tax, merchandise and service circulation tax, contribution to the social integration program and civil service asset formation program, and contribution to social security financing” (Seyoum, 2014). The merchant marine renewal tax applies only to the sea import and is a twenty-five percent tax. The import tax aims to protect the Brazil manufacturers from intense competition with the imported production.
The tax varies from zero to thirty –five percent. The industrialized products tax is developed not only for foreign goods but for local as well. The rate can go up to twenty percent. Merchandise and service circulation tax is a value-added tax that is taken from local and imported products. The essential products can be sold without the tax, however, luxury ones with the twenty-five percent tax (Luna & Klein, 2014).
Free Trade Agreements
Brazil is the member of trade free organizations, namely the World Trade Organization and Mercosur. As the globalization process gains momentum and the countries become closer, the trade flow should be controlled to provide the countries with secure relationships. Textile and apparel industry plays an important role in the development of the country. It should be pointed out that the extension of the domestic market would not be possible without the improvement of the textile industry. In addition, the textile and apparel sector provides people with workplaces. Brazil is one of the largest producers of yarn and fabric. The industry contributes to the increasing of the government’s revenue.
There are a lot of companies in Brazil that produce high-quality apparel. To focus the production of underwear and swimsuits, the following companies should be taken into consideration, namely:
- Mary’s Lene (Antonio Roque De Almeida, Str. 50, Nova Friburgo, Rio de Janeiro, Contact Person: Ms. Crislene Lene, 55-22-25271039);
- Luciana Rosa (Guilherme Piccione, str, Franca, Brazil, Contact Person: Mr. Luciana Rosa, 55-16-81657665);
- NEO Swimwear (40 General Severiano Flat 614 Botafogo, Rio de Janeiro, Contact Person: Ms. Andrea Amaral, 55-21-3873 1006).
The chosen companies have the similar level of quality and are guided by the principle of providing the customers with the outstanding products using only best materials. The rights of workers are respected, and they are provided with good working conditions. However, the issue regarding the low wage is urgent and demands the solution.
The success in business depends on the ability of the person to adjust and appreciate the culture of the country. As the matter of fact, understanding the culture can improve business and help to achieve goals. There are some peculiarities of the Brazilian culture that should be taken into consideration while making business.
Negotiations in Brazil
To be successful in business negotiations in Brazil, people should be aware of the peculiarities of the culture. People in Brazil are friendly and diplomatic; however, during business negotiations, they prove that they are skilled and smart as well. They understand the problems the country has, like corruption and issues with the education, however, usually do not like to discuss it (Robles, Wiese, & Torres-Baumgarten, 2014). During the direct conversation, such topics should be like corruption and issues with the education, however, usually do not like to discuss it. While the direct conversation, such topics should be omitted. People in Brazil value personal space, however, usually speak to the partner from a small distance. The business meetings can last for hours, and it is impolite to leave earlier.
The proper greeting involves shaking hands. Communicating face-to-face is more acceptable for the business meetings than the writing one. Eye contact and shaking hands are essential for the business to succeed.
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Bringing gifts are acceptable in Brazil. However, the gifts are varying in accordance with the occasions. The most popular gifts are the following, bottle of wine or flowers.
The dress etiquette requires dark business suits. Three-piece suits are commonly worn by people who obtain higher positions, for example, executives; whereas two-piece suits are designed for the employees who work in the office. As for the women, it should be pointed out that the dress etiquette requires elegant dresses. In addition, one should keep in mind that the manicure and natural makeup are integral parts of the appropriate business style.
Although dark colors are preferable for the business suits, it is worth stating that light colors can be acceptable in summer.
Although businessmen can come to the dinner or meeting a couple of minutes later. Nevertheless, it is always better to come on time to avoid misunderstandings. Eye contact and shaking hands are the common greetings. In the case, there is a woman; she can shake a hand of the business partner as well. When there are not so many people in the group, it would be appreciated if the person shakes hands with everyone. The vast majority of business dinners is not formal and usually starts with a small conversation. Interruption is acceptable in Brazil and shows that the person is interested in the topic. Dining is significant for the development of the business relationships. The most popular types of food are Italian and Chinese.
There are not many taboos that exist in Brazilian culture. However, there are some things that should be avoided. Politics is not the best topic for discussion during business meetings. In addition, it is not acceptable to discuss the colleagues in front of the team. Although there are some tips that should be taken into account while making business with people in Brazil, one should keep in mind that respect and natural behavior will contribute to the establishment of the long-lasting relationships.
Bruzzi, S., & Gibson, P. (2013). Fashion cultures revisited: Theories, explorations and analysis. London: Routledge, Taylor & Francis Group.
Choi, T., & Cheng, T. (2015). Sustainable fashion supply chain management from sourcing to retailing. New York, NY: Springer.
Fleury, A. (2011). Brazilian multinationals: Competences for internationalization. Cambridge, U. K.: Cambridge University Press.
Kieff, F., & Paredes, T. (2012). Perspectives on commercializing innovation. Cambridge: Cambridge University Press.
Luna, F., & Klein, H. (2014). The economic and social history of Brazil since 1889. New York, NY: Cambridge University Press.
Robles, F., Wiese, N., & Torres-Baumgarten, G. (2014). Business in emerging Latin America. New York, NY: Routledge.
Seyoum, B. (2014). Export-import theory, practices, and procedures (3rd ed.). New York, NY: International Business Press.