brazil report 2007

Foods food 1318 american electronics 1302 korean elma

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Unformatted text preview: Brazilian Avipal Food 969 Brazilian Personal Care 850 American Company name Louis Dreyfus Samsung Johnson & Johnson 11 2006/2007 FROM SÃO PAULO TO SHANGHAI New consumer dynamics: the impact on modern retailing* Brazil Category 2005 Gross Sales (USD m) Controlling Shareholder LG Electronics 847 Korean Semp Toshiba Electronics 807 Brazilian Kaiser / Femsa Beverages 775 Mexican Aurora Food 750 Brazilian Doux Frangosul Food 718 French Coteminas Textiles 734 Brazilian Vicunha Textiles 714 Brazilian Food 713 Brazilian Company name Caramuru Source: Exame Melhores e Maiores, Balanço Anual Gazeta Mercantil Although there are some multinational companies with relevant marketshare, there are also important local players in certain market segments who lead regional consumer goods companies, with strong brands, modern manufacturing facilities, in-depth knowledge of consumer preferences and well-customized distribution. The market concentration process that has taken place in the Brazilian retail market over the past years has helped larger consumer manufacturing goods companies, since they are in a better position being large scale suppliers. Brazilian companies like Sadia, Perdigão, Ambev, Bertin and Friboi in the food and beverage sector, and Natura in the personal care and cosmetics products sector, have also expanded overseas through exports or the opening of subsidiaries abroad, and so have prepared themselves to compete against other multinationals in different countries. Food and beverages An expanding food and beverages sector According to the Brazilian Food Industries Association (ABIA), this sector expanded by 4.7% in 2005, obtaining revenues of BRL184.2 billion and accounting for 9.5% of GDP. The beverage segment showed a strong expansion of 8.9% in comparison with 2004, with total revenues of BRL25.7 billion. In 2005, Brazil retained its leading position as one of the largest meat exporters, being the first in the bovine meat segment, the second in poultry and the fourth in pork. 12 2006/2007 FROM SÃO PAULO TO SHANGHAI New consumer dynamics: the impact on modern retailing* Brazil In addition to the strong competitiveness of Brazil as a food producer, its domestic market offers huge growth potential. A very significant contingent of potential consumers has currently not attained the minimal levels of consumption and any increase in the income of this group will likely boost demand, particularly in this industry. This growth perspective has attracted financial and strategic investors such as AIG, Nestlé, Cargill, Ambev and Coca-Cola. Most of them are interested in strengthening their market position, adding production capacity or are even looking for opportunities for geographic consolidation. In fact, there still are a significant number of companies in the second-tier, most of them facing succession issues and needing to step-up revenues to become sizeable in a market that is in the process of concentration. Limited resources for cashing-out to shareholders and cashing-in for capital and marketing expenditure creates room which is favourable to strategic and...
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