Doing Business in Brazil: Part One

Brazilians acknowledge that a very substantial investment in infrastructure, venues and logistics will be required to realise their visions for the 2014 FIFA World Cup and Rio 2016 Olympic Games, writes MEI’s editorial director, Rachael Church-Sanders in part one of this feature looking at doing business in Brazil based around major events. They further recognise that not all of the expertise is readily available in Brazil. This suggests that the required political will and funding will be in place and that there is a willingness to see significant participation from overseas businesses.

Whilst publicly the major construction companies in Brazil (such Oderbrecht, Vitorantim and Camargo Correia) support the political approach that lead headline contractors for major projects should be Brazilian, they accept privately that more broadly based consortia, partnerships and supplier networks will be required to realise the events. Oderbrecht has been candid in this respect and has been keen to develop a good working relationship with foreign companies. The company has approached MEI locally in Brazil for example to share some of its ideas and strategies in order to encourage participation.

Personal and constant contact is key to doing business in Brazil. Finding a local partner that can provide a constant contact base and nurture this relationship in the local language – Portuguese – is vital.

Global sports agency Chime has gone step further by establishing offices in Brazil through CSM Brazil. The company has 70 people now in Rio, Sao Paolo and Belo Horizonte.

Communications agency Vero, established in January 2006 by Mike Lee, the former director of communications and public affairs during London's successful 2012 Olympic bid, has also established a company office in Rio, offering campaigning style communications, brand positioning, campaign planning and media relations solutions to Brazilian clients.

Drawing on Vero's experience, which includes the successful Rio 2016 Olympic Bid campaign, MLA True Communications as the company is known, is looking to capitalise on sports industry opportunities in Brazil ahead of the 2014 FIFA World Cup and the Rio 2016 Olympic and Paralympic Games.

“Our work with Rio 2016 has been at the heart of all of this,” says Vero chairman Mike Lee. “The campaign and our ongoing work has enabled us to establish new networks, forge links and establish credibility in the Brazilian market. Our London 2012 related projects have also been important in showcasing what we offer."

Vero now has a new client base in the country, including the city of Belo Horizonte “where our brief is to support the city's promotional and communication initiatives and international outreach ahead of the 2014 FIFA World Cup,” adds Lee.

Vero has witnessed an increased interest in Brazil following London 2012 from UK companies in particular. “UKTI has been doing a great job and the prime minister David Cameron recently led a delegation of more than 50 UK companies to Brazil. Of course being involved with London 2012 does count but it is a very competitive market and naturally there is strong competition locally and from other countries.”

With many 2014 FIFA World Cup and Rio 2016 projects behind schedule and, more importantly, still requiring a major amount of work, there are still hundreds of tenders, supply contracts, specialised technology requirements, advisory roles, etc still to come, not to mention added opportunities stemming from inevitable design alterations and last minute changes. For overseas businesses able and willing to win work on Brazil 2014 projects, the fact tenders are still being released not only shows that the window of opportunity is still open, but that things are likely to start moving a lot quicker than they have been up until now. Furthermore, the previously hazy details surrounding most projects are now coming into sharper focus, so a much clearer picture of potential opportunities are set to emerge over the coming months.

According to Dennis Mills, chief executive of Major Events International, it is not too late to get into the 2014 FIFA World Cup market in Brazil. “Indeed opportunities are still cropping up because a lot of things are running late. For example, in Recife a procurement for overlay has only just gone out. There will be plenty of opportunities in the build up to Rio 2016 and beyond as well although often contracts get awarded to local suppliers, some of which that are relatively unknown. In contrast, in Qatar, companies have to enter the market much earlier for any chance of success.”

In the next issue we will look at some of the challenges facing overseas companies sourcing work in Brazil around major events.

Additional information