For small and medium-sized enterprises (SMEs) looking to expand internationally, Brazil presents a unique opportunity. As one of the largest economies in the world, its vast population and growing market make it an attractive destination for foreign businesses. 

However, like any market, success in Brazil requires careful planning, strategic partnerships, and a deep understanding of the local landscape. 

During a recent Global Growth Series event co-hosted by Communitech Outposts and World Trade Centre - Toronto, experts shared key insights into what it takes for SMEs to break into this market.

The panel discussion was moderated by Leandro Guimaraes, Senior Account Manager at BDC, and featured Arnon Melo, President of MELLOHAWK Logistics, Carlos Hernandez, CEO at Enskl and Cinthya Ortiz, Area Director, South America at the Ministry of Economic Development, Job Creation and Trade. 

Hernandez emphasized that Brazil’s large GDP and dynamic consumer base offer undeniable potential. But entering Brazil isn’t something to rush into. Companies need to thoroughly evaluate whether their product or service will fit the local culture and market demand. 

“Brazil is an attractive market because of its size, but the culture is different. You need to ask yourself, why Brazil?” Hernandez said. “Take the time to understand what sets Brazil apart from other markets and prepare for the long haul.”

Ortiz noted that even the initial market discovery process could take up to a year. She stressed that SMEs should ensure they have the time, human resources, and financial capacity to handle such a commitment. 

“It’s important to know that the process won’t be quick or simple,” she said. “Make sure that your company has the time, human and economic resources for it.”

One crucial step that often gets overlooked by companies is engaging with the right resources early on. 

Ortiz and Melo both recommended making the Trade Commissioner Service (TCS) your first point of contact since it has a wealth of knowledge on everything from market competition to legal regulations and can connect businesses with pre-screened partners in Brazil. 

“This service is not only free but essential, helping companies avoid costly mistakes and navigate local complexities,” Melo said. 

Hernandez echoed this, saying, “I would never hesitate to use these services. It’s fantastic.”

The importance of local partnerships was another key theme throughout the discussion. Hernandez shared his personal experience, explaining how engaging with a trusted local partner helped him navigate the complexities of importing hardware into Brazil. 

“Having a plan makes a huge difference, not just for the support of TCS, but also to ensure you know why you’re going to Brazil,” he said. 

Building connections with reputable partners who understand the local landscape is crucial, especially when dealing with Brazil’s complicated logistics and tax systems. 

“When it comes to hardware imports, companies need to work with partners who can handle all aspects of the process, from logistics to customs clearance,” Melo said. 

Understanding the competitive landscape is also key to thriving in Brazil. Ortiz suggested that SMEs leverage AI tools to assess their competition and price their products strategically. 

“Get a good understanding of where you’re standing,” she said, noting that the TCS can also help evaluate which Brazilian states offer the most favorable conditions for your business.

Beyond logistics and market strategy, the panel highlighted the importance of relationships in Brazil. Melo stressed that building personal connections is vital to long-term success in the region. 

“You need to be present, shake hands and talk,” he said. “Immersing yourself in the local culture and getting to know your business partners on a deeper level can make all the difference.”

The panelists also touched on the importance of thinking locally when it comes to pricing. 

Hernandez advised SMEs to base their pricing strategies on the specific needs of the Brazilian market, rather than trying to replicate what works in Canada. 

“Accept that the market is going to be different,” he said, urging companies to listen to local customers and adapt accordingly.

For SMEs looking to expand into Brazil, the path may be challenging, but with the right preparation, local partnerships and support from services like the TCS, the opportunities are immense. 

“Have a plan, get help, and make sure you have a reputable partner who knows the processes,” Hernandez said. “With these key steps in place, you can confidently navigate the complexities of the Brazilian market and achieve long-term success.”

Growing globally can become easier with a reliable team on the ground to manage local operations and that's where Communitech Outposts can help. Whether you're looking to hire talent in Brazil or need help navigating international logistics and compliance, Outposts can help you set up and manage a remote team seamlessly. 

Learn more about how Communitech Outposts can be your global expansion partner.