Doing Business in Brazil as a foreigner - Starbucks

 Doing business in Brazil as a Foreigner

When I stayed in London my favourite place to go on the Isle of Dogs, Canary Wharf is a part of the Isle, was the Starbucks in the underground shopping centre in Canary Wharf. Why in all of those of options, and even on the Isle, was that my favourite? Because it was always the same relaxed atmosphere and comfort foods and beverages. Exactly the same every time. My brain could switch off and expect and get exactly what it liked every time. I lived on the Isle of Dogs and thus for me life on the Isle was the Starbucks and Reebok gym in Canary Wharf. 

When I moved to Sao Paulo Brazil in 2006 the first place I looked for was a Starbucks. No Starbucks. I couldnt figure this out and started asking people why there was no Starbucks in Brazil. 99% of the time the answer is why would an American coffee franchise setup in the land of coffee with its milky coffee and shakes? No need for it. It would be totally stupid. I tried explaining that the locally coffee houses and bakeries had a different feel to the local Starbucks. I tried explaining that milky coffee can actually be quite comforting. I explained about the donuts being really nice. Nope, all the locals said, no need for a Starbucks here. 

Who would try sell coffee in Brazil the land of coffee?

Today there are 128 Starbucks in Brazil! In December 2006, the same year I moved to Brazil, the first store opened up at Morumbi Shopping centre. I went about 5 times to try get a coffee there on the other side of the city. I gave up. Every time there was huge queus that would take 1 hour for you to get your coffee with nowhere to sit in the Starbucks. 

So why did Starbucks get their ´´doing business in Brazil´´ right? I think everything. 

1-Their coffee really is good. And exactly the same every time. And fresh too. Well balanced. The local ´´padarias´´ often serve coffee out of large stainless flasks - old coffee. And when it is off the express coffee maker use cheap coffee, or worse make it too strong.

2-Brazilians love American products. Its like eating or drinking ''first world''. You can now afford to drink or eat out like Americans do. Eating at a McDonalds for a lot of Brazilians is an expensive event and a treat. There is a bias towards imported products. Assuming they are naturally better than local made just because they are imported. 

3-The ambience was different to what Brazil offered normally to drink your coffee at. It was a modern, comfortable stylish place. Normally at the time most coffee houses or padarias were completely functional, ie a place to stop and drink someting on the way to somewhere else. And not a place to stay and feel good. 

4-Efficient and everything standarized. Much like why McDonalds does not do the best burgers but yet does well globally.  

5-I was reading up some locally reports on why Starbucks did really well here in Brazil and most said their marketing was great. I accept that too. 

6-My favourite reason however is nostalgia. Most Starbucks are found in high income regional Shopping Centres. People travel to the States. Get used to using the Starbucks there, come home, and want that holiday feeling or relive that memory from somewhere elese in the world. Like for me Canary Wharf.  

So in brief when getting started in Brazil do a Drucker: 

1-Great marketing (satisfy people´s needs).

2-Innovate always on your product or business model.