Last month I participated in the International business round organized by FENACCE in Fortaleza/Ceará with the support of the Brazilian government. . Here is my perceptions about reasons and challenges faced by those who are willing to import high-end handicrafts and home decor from Brazilian artisans (informal businesses).
1. THE LANGUAGE:
most of artisans are not able to provide an export price list in English, including product information or box dimensions in inches or cm. Furthermore, the USD is not the currency used in the main offers.
2. THE SHIPPING COSTS:
it is harder to define when handmade products demands shipping estimations. They are custom-made or the raw material features are inherent to the nature and may vary one-by-one. Even for a courier, door-to-door service, it is a tough task to provide.
3. EXPORT BILLING:
It requires more attention to details such as the currency conversion and the unit measurements. Some materials must be specified and calculated by price per kilogram, for instance. In addition, even if the national law determines that : "There is not taxes to export from Brazil" in practice some social contributions are applied and taxes are also applied to the shipping and custom clearance services.
4. PRODUCT PRICING:
You might understand that if it is unclear the taxes that exporter may be paying for selling abroad, it would be even more challenging pricing the goods. Add to that the currency volatility (R$ x USD), the fiscal system instability for custom clearing and the long distances travelled which demands sturdy packages. Indeed, usually the easy solution is adding a safety margin into the basic price, then losing competitiveness.
5. CONTINENTAL DISTANCES:
A Trading company may help for consolidating your order. Keep in mind that the distance from the northernmost point of Brazil to the southernmost point, and from the westernmost point to the easternmost point is approximately:
North to South: 4,395 kilometers (2,731 miles).
West to East: 4,319 kilometers (2,682 miles).
It may increase the logistic cost of the operation or demanding FCL (full-container-load) operations to justify fixes costs.
6. SHORT-TERM vs. LONG-TERM:
Sometimes the short term deal goes against the long term business. Exporting is not a magic solution for increasing profits. In addition, foreign markets are usually not as vaste as the Brazil is, so defining a commercial policy for launching a brand or a new product in a new country requires careful planning. For instance, pricing higher for end-customers, providing marketing tools to retailers or working with a distributor (centralizing all demands coming from this specific market where the importer is based), are examples of strategies to keep in mind. Usually, the players familiarized to sell in the local market consider exporting a deal of " mandar pra fora " or "shipping out". There is not any out, the other part is a importing company willing to make money and be assured that agreements are upheld in the long term.
7. MARKETING AND COMMUNICATION:
Rather than turning a beautiful story into a case of success, experienced importers of handicrafts are usually begging for receiving the complete marketing solution. In this point, professional photos, videos, manual of instructions, technical sheets informing and highlighting the main advantages of each item or collection is a goal. Importer do not want to waiting until the goods arrive to them for asking for the sake of help because it is imposible to clarify to their customers how amazing is the product. The best catalog or marketing materials are those that enable a salesperson to simply point to the answers needed to address a buyer's initial concerns during a business meeting.
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