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brazil report 2007

Limited resources for cashing out to shareholders and

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Unformatted text preview: financial investors. Multinational companies are market leaders or relevant players in segments such as beer, soft and alcoholic drinks, tobacco and confectionery. Brazil’s beer market is the fifth largest in the world and produces more than 9 billion litres in 2005. Ambev is the major company with a market-share of around 68%, followed by Schincariol which accounts for approximately 13% of participation. The Brazilian soft drinks market is the third largest in the world, with a production of around 12 billion litres in 2005. Coca-Cola and Ambev (which produces and distributes Pepsi locally) topped the rank of producers representing more than 70% of the market. The ready-to-drink juice market has shown a two-digit yearly growth rate since the Mexican company Del Valle started local operations in 1999. Motivated by changes in the consumer behaviour that are connected with healthier food and beverage habits, many companies in this industry have been launching their own product lines or even acquiring established operations and brands, like Coca-Cola did when they acquired Sucos Mais in 2005. Also in the confectionery market, Brazil appears as one of the largest in the world, being second in the candies segment and fourth in chocolate. Total production in 2005 (including exports) was estimated at BRL8.5 billion, with chocolate products accounting for BRL5.6 billion. Major multinational companies are Nestlé and Kraft Foods. 13 2006/2007 FROM SÃO PAULO TO SHANGHAI New consumer dynamics: the impact on modern retailing* Brazil Cosmetics and personal care A promising cosmetics and personal care market Brazil is the fourth largest cosmetics and personal care market in the world. In 2005, revenues increased by 14.1% in comparison to 2004 and were over BRL15.3 billion. The real compound annual growth rate in the period of 2000 to 2005 was 10.7%, which is quite impressive when compared with the modest Brazilian average GDP annual growth rate of 2.2% in that period. The growing participation of women in the labour market and the increase of life expectancy have brought about a new pattern. The necessity to maintain a wealthy and youthful appearance have stimulated producers to launch new products focused on these new demands and to invest heavily in process and development technologies, increasing productivity and allowing price reductions. The diversity of the Brazilian natural forests has been increasingly a source of inspiration and supply to this industry which has just started exports based on products developed from oils and essences extracted from exotic plants. The Brazilian cosmetics and personal care market is consisted of 1,367 manufacturers, of which 15 are large companies with revenues of over BRL100 million, accounting for 71.7% of total revenues. The traditional distribution channel is predominant although door-to-door and franchising channels are also used. Multinational companies like Unilever, Avon, Colgate-Palmolive, Johnson & Johnson, Procter & Gamble and BDF Nivea, among others, account for t...
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