When it comes to global e-commerce, Brazil may not be top of mind. But it should be. While the country’s economy – the largest in Latin America and the second-largest in the hemisphere after the United States – has struggled to recover from it its worst-ever downturn, online purchases have skyrocketed.
More than 80% of consumers confirm having made a cross-border purchase using e-commerce, according to the UPS Pulse of the Online Shopper (POTOS) global study. This year alone, Brazil’s e-commerce sector is projected to jump at a 12% growth rate with sales estimated to reach R$ 53.5 billion (more than $15 billion dollars).
Such growth comes even as residents grapple with rising unemployment, inflation and corruption that helped topple the former president. Imagine how much more e-tail there will be when the world’s fifth-largest internet and mobile economy overcomes its hurdles.
Tapping into this potential isn’t as easy as posting pics on a website and watching orders come in. For online retailers looking to get their share, here are some basics get you started:
Do your homework: Brazil can be complex to newcomers. High tariffs boost the cost of imported goods, while the customs system is fickle. Smaller paperwork errors can spark lengthy processing delays. Meanwhile, both exporters and importers must register with the Foreign Trade Secretariat (SECEX) and comply with the Brazilian Customer Protection Code, which heavily favors buyers. (Even honest mistakes can result in litigation.) For these reasons, the U.S. Department of Commerce encourages smaller exporters to join forces with a reputable local partner to develop a new business.
Study logistics: Brazil is known for its rainforests, which don’t have the infrastructure to make travel easy. The World Economic Forum ranks Brazil as 107th out of 144 countries in level of development, one reason why the U.S. Commerce Department warns that logistics “pose a particular challenge” for companies doing business in Brazil. This means you need to find a local logistics partner like UPS that knows literally knows how to navigate the terrain. It also offers brokerage expertise that can be a difference maker in expending clearance.
Learn about the locals: Once you’re ready to begin operations, think about what makes shoppers in Brazil different. For this market, the UPS POTOS study recommends that online retailers offer flexible delivery options, such as in-store pickup, alternate delivery location choices, expedited delivery, and service during flexible hours (after 5 p.m. and weekends). When it comes to alternative delivery locations, 55 percent of respondents prefer them, a spike from just 26 percent three years earlier. Brazilians are also more patient than shoppers in other regions. While some nations are working on same-delivery options, they’re willing to wait, on average, seven days if paying for shipping and 11 days if using free shipping.
Be smart, be mobile: While some nations are filled with laptop or tablet users, 90% of online shoppers in Brazil use smartphones, well above the 81% reported in Canada and 79% in the United States. If that doesn’t convince you to have a mobile-friendly site, consider that 59% of e-shoppers have made a purchase on a smartphone, up from 40% in 2015, according to the UPS POTOS. The frequency of using smartphones are especially higher in Brazil when using devices to locate stores and store-related information, track orders, compare prices and research products prior to visiting a store.