The Emergence of Franchise Trends in Brazil
Brazil has been an area that has seen tremendous growth in the 2010s. At the same time, the Franchise industry also saw tremendous growth. Learn why this is the right time to invest in Franchise Industry in Brazil.
Important aspects of creating a strong and successful franchise are finding a place where a one has a strong customer base and little interference when implementing the franchising system faces few barriers. One country that has implemented this profitable system along with having one of the strongest GDPs per capita is Brazil. The country has implemented the franchising system since the early 1950s, and although most franchises are domestic, the market continues to grow internationally because of the promising potential markets seen throughout the diverse nation.
Franchising governance has become a large part in the opportunities given to businesses when trying to expand an international network. Some nations have strict legalities that grip the franchising system and make it challenging for a company to expand. However, Brazil has adopted and is open to foreign investors coming in throughout the vast regions. In 2019 Brazil enacted a new law that gave contractual guidelines within the country, and included consumer protection laws to franchising agreements, more detailed information within disclosure documents, and franchises were allowed to sublease commercial spaces.
The system put in place was very favourable to new franchises because it helped them create the business before being burdened by it and gave clear laws going forward. This law is just one part of a movement that has begun in Brazil over the past decade. From 2018 to 2019 alone, there was a 13% growth in international franchises in the company to 214 total. Franchising revenue grew 34% between 2015 to 2019 as well. Diversification has played a large role in the past decade or so as well. Franchising that operated in towns with fewer than five hundred thousand people was only 43.6% in 2014, but in 2019 it grew to 48.2%. This is an indication that more companies are exploring more markets besides the high-density urbanized cities and can be a future landmark for the potential of business throughout the different regions.
The positive effects of franchising and the system that Brazil has put in place is evident throughout the country. Franchising alone has created 1.36 million direct jobs along with countless others. Even now, with all the success companies have had coming into Brazil, people are still looking to expand and transform their own business models that take advantage of the variety of locations in Brazil’s different terrains. The strong franchising domestic sector has created a strong foundation for international franchisors to come in and make an impact quickly. The addition to the international franchising aspect growing within Brazil would allow more economic growth than that which has already begun domestically. Especially in a country with vast regions that have different needs, such a trending industry will allow quick growth with great upside in a future of an expanding international market and allow more value to the domestic industries from it.
Start a New Business in Brazil With MBE
MBE provides very good business opportunities for Brazil. To learn more about the opportunity, contact us and we will provide you with more details on the opportunity.