2014_08_07_post_marcas_v2Over recent years, the scenario of employment rate, inflation under control and relatively stable exchange rates – along with a young population and 50 million people entering the new middle class, eager to consume — makes Brazil one of the most attractive emerging markets for Retail. The result: about 50 international brands have entered the Country and other 30 are expected to land here over the next two years.

Business models can range between independent operations and operations with local partners, already acquainted with current law and bureaucracy (master franchising), and including hybrid models and joint ventures. Regardless of the model, all of them demand long term strategies. “Given the increasing competition, there is no point in venturing into the Country without prior planning”, explains Carla Kauffmann, Retail Manager at C&W.She adds: “There are serious difficulties in finding properties in regular streets with parking and security infrastructure. Thus, Shopping Centers, where Brazilian families spend about 6 hours a week, turn out to be the main destination for shopping and leisure. International playersdemand full and unrestricted regularity in the whole process”.

The main expanding segments are fast fashion, luxury and sports market. New Balance, for instance, bets on the first concept stores in the Country, settling in São Paulo and Rio de Janeiro. The already known Nike and Adidas are in their expansion phase. Leisure operations are also flowing in abundance, with playgrounds (such as Kidzania), movie theaters (IMAX) and casual dining — over 2014, Johnny Rockets, Red Lobster, Tony Roma’s and PJ Chang’s will be here.

It is worth mentioning the location that is normally selected for the first store in the Country. In over 80% of cases, the initial stores are located in the axis São Paulo- Rio de Janeiro. “But the future expansion of brands is targeted to other capitals and larger cities in the countryside, where competition is lower and the potential cash generation is higher”, explains Carla. In this sense, luxury brands are currently investing in cities as Recife, Salvador, Brasília, Belo Horizonte and Curitiba, besides Campinas and Ribeirão Preto.