Brazil
- GDP nominal: 2,416 billion USD
- Unemployment rate: 6.8%
- Population: 206 million
- Ease-of-doing-business rank: 116th
Brazil has the world's 7th largest economy by nominal GDP, and the 6th largest by purchasing power parity (PPP). The Brazilian economy is characterized by moderately free markets and an inward-oriented economy.
From 2000 to 2012, Brazil was one of the fastest growing major economies in the world, with an average annual GDP growth rate of over 5%, with its economy in 2012 surpassing that of the United Kingdom, making Brazil the world's 6th largest economy. However, Brazil's economy growth has decelerated in 2013 with inflation, business stagnation followed by a recession.
Corruption costs Brazil almost 41 billion a year, with 70% of the country's firms identifying the issue as a major constraint in successfully penetrating the global market.
In 2012 Forbes ranked Brazil as having the 5th largest number of billionaires in the world, a number much larger than what is found in other Latin American countries, and even ahead of United Kingdom and Japan.
Direct Selling in Brazil
- GDP Growth Constant USD 2014: 0.1%
- YoY Industry Growth Constant USD 2014: 0.2%
The Direct Selling industry in Brazil is the 5th largest market in the world representing approximately 13 billion USD in 2014.
The Economy of Brazil has been heavily impacted by corruption scandals coupled with political instability.
Estimated GDP growth for 2015 is -3.7% and will certainly remain largely negative in 2016. Inflation is high (6.5% in 2014) and projected at 10% for 2015.
Brazil’s consumption expenditure being 60% of the GDP, high-inflation as well as a high unemployment rate (6.5%) will impact Brazilian’s real wages and prevent the economy’s short-term recovery.
Brazil is an overly concentrated market with only 2 companies (one local, one from the U.S.) accounting for more than half of the industry revenue. During difficult economic times Direct Selling is more than ever an answer in providing opportunities to supplement income. With a large and young population (200 million, median age of 30), the industry is represented by 5 million Direct Sellers, which is only 2.5% of the population.
Single-level Direct Selling forms are predominant in Latin America and particularly in Brazil. Although in competition with traditional and online retail, the Brazilians enjoy purchasing products through personal relationships, family, and friends.
The Cosmetics and Skin Care categories represent 85% of industry revenue. The last few years have seen the development of traditional Direct Selling companies implementing Omni-channel strategies and diversifying their product offerings.
An increasing amount of Multi-level international companies are entering the Brazilian market, supporting the industry’s development (CAGR of 6.7%), despite the difficult economic situation of the country.
Sources: ASENSHIA, World Bank, WFDSA, Euromonitor, Wikipedia
CAGR: Compound Annual Growth Rate expressed in Constant USD 2014, between 2011 and 2014
