How to Export to Brazil - Sprint Lazio

Brazil – Ministry of External Relations
When dealing with intermediary products or capital goods, whose consumers are
companies, the exporter’s strategy should focus on Brazilian importers that have a
demand for the product, regardless of the state in which they may be located. To this
end, the exporter can make use of the Brazilian Importers Directory, made available
by Brazil’s Ministry of External Relations to all the embassies and Trade Promotion
Sectors of the other South American countries, and also found on the website address
http://www.braziltradenet.gov.br, accessible via the “PSCI” link.
IV.2. Business practices
Doing business with Brazilian importers requires that the foreign exporter be firm
about the sale and payment conditions that are intended to be set during the
preliminary negotiations, be it by e-mail or personally. The Brazilian buyer usually
makes a detailed research on the existing suppliers in the world market and will
certainly have contacts with companies from other countries that may offer the product.
The exchange of substantial technical and business information about the operation
is a common practice. Only after analyzing the viability of the proposition, will the
importer request the Pro Forma Invoice (see section III.4.2) to be sent. Even then, this
paper formality will not imply the placement of an order, as the importer will use the
Pro Forma Invoice only to perform the company’s internal procedures. The effective
approval of the purchase from a given supplier will occur later on.
There are three essential issues to be dealt by the parties during preliminary
negotiations : the price, delivery time and the forms of payment (see section III.8.1).
As for the unit price, in addition to negotiating a possible discount, the buyer will
wish to determine the conditions of the sale represented by the Incoterms currently in
use in international trade.
The deadline for the cargo delivery in the country of destination is yet another important
issue for the buyer. The duration of the trip up to the arrival of the goods in Brazil,
which depends basically on the means of transportation used and the time required
for their nationalization in customs, are factors that influence the decision to import
from a neighboring country or from a competing supplier in another region.
With regard to the forms of payment, there are no currency restrictions on Brazilian
imports, in conformity with the current Central Bank regulations. But it must be noted
that the Brazilian importer is unlikely to perform purchases with payment in advance,
although some buyers require the bank guarantee called Refundment Bond, which
allows the importer to recover the advanced money, if the exporter fails to ship the
merchandise.
Brazilian importers usually prefer the form of payment known as documentary
credit, which can be paid up-front or in instalments, and through which the buyer
bypasses the bank charges of opening a letter of credit. This practice relies on the
level of trust that the exporter sets on the client, as the banks do not give financial
guarantees on the merchandise after shipment.
78 How to export to Brazil