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How to do business with Latin America

joshadekane | Jun 8, 2010 |

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Latin America is a very big emergent market that encompasses over 20 countries with a population of 570 million people. This region has weathered the global economic quite well and manages to still post some positive growth rates in the majority of its countries. It is no surprise that international companies are rushing to this area to take advantage of business opportunities in LAtin America to increase their global sales.

Things You Will Need

In order to start to export to Latin America , you will need some time and patience to thoroughly investigate and gather as much information as possible. This market is emerging therefore it will not necessarily have the infrastructures that you might be used to in more developed countries. Patience is key.

Step 1

Determine the countries you want to pursue and invest in

The top 5 strongest economies in Latin America are:
*Brazil
*Peru
*Colombia
*Chile
*Uruguay

This would be a good start but your selection will greatly depend on the product and services you want to promote to new markets.

Step 2

Contact embassies and consulates

Embassies and consulates have a wealth of information, data and statistics that can help you determine your strategy to export or import . For example, if you sell electronics, try to find the countries that have the highest demand for this item. Also determine which of your competitors are already on the market so you can manage accordingly.
The level of service and help to your project will greatly depend on each embassy unfortunately.

Step 3

Contact Chamber of Commerce

These association can also give you support by organizing several networking events you can attend. This is a great opportunity to meet potential business partners. Unfortunately, membership are not free most of the time. You will need to pay a few hundred dollars per year which can be hard for small businesses.

Step 4

Register on B2B Marketplaces and Trade Portal

A B2B marketplace is a great way to test your products and services with very little risk. These websites main purpose is to connect buyers and seller. This is achieved by allowing its user to post trade leads that can searched by the entire internet community.
There are lots of free features for you to use. Premium feature can also be purchased which allows better branding of your company. This way, you will stand out and better attract potential clients. The prices vary depending on the portal.
The most successful B2B marketplace that has a strong focus on the Latin American market is www.mercatrade.com

Step 5

Attend Tradeshows

This venue is still a very popular way to find Latin America opportunities. Search for the most important tradeshows in your industry and try to go. This will cost you a little more as you need to pay travel costs but it is still a very effective way to network, meet contacts in person and possibly negotiate some orders.

Step 6

Contact Export Credit Agency

Once you have found your clients and are ready to sell your products, you need to contact Export Credit Agencies. What they do is insure your order in case your client defaults on their payment or problem with the order. In return, they will charge a low percentage of the invoice. This will vary depending on the risk level of the country.
I strongly encourage my clients to use these services to minimize risks especially in the first few orders where you don't necessarily know the client you are dealing with.

Step 7

Order Credit Reports

Credit reports are another great way to minimize your risks. These reports allow you to check the legal, financial and other important information about the company you are about to start a transaction with.
This precious information will then be help you better make decisions. Prices vary between $79.00USD to $299.00 USD depending on the level of information you require.

If you are looking to expand your business to new markets, Latin America should definitely be on top of your list. This market represents endless business opportunities that any company should look into.

Tips & Warnings

If your client do not pay you

If you find yourself in a situation where your client has not payed you and you have not insured yourself, do not panic. You can still contact a Debt Collection Agency to try to collect some of your money back.