Apparel exports are opportunity for small Brazilian businesses

The falling price of the Brazilian real versus the US dollar is opening up opportunities for domestic products to become more attractive in the foreign market. One example of this is in the apparel industry: according to a recent study by the Brazilian Textile and Apparel Industry Association (Abit), the volume of exported goods should grow by 1.5% this year. This is the scenario that the Apparel report from the Industry Intelligence System (SIS) is analyzing, listing tips for small businesses in the industry to take advantage of the positive exchange rate to sell to other countries.

In 2015, even with the depreciation of the Brazilian real, the apparel industry was less competitive, due to the economic crisis in Brazil. Both domestic production and Brazilian exports in this segment shrunk by 10%. The biggest import market was Paraguay, which accounted for 20.9% of foreign sales, followed by the USA (15%), Uruguay (11.7%), Bolivia (8.2%) and Chile (5.2%).

Santa Catarina was the largest exporter of apparel items in 2015, responsible for 33.4% of total sales to other countries, ahead of Sao Paulo (31%) and Rio de Janeiro (12.3%). The state also had the lowest dip in production among the biggest exporters – the industry in Santa Catarina was down 2.46% from May 2015 to April 2016, while the average for these states was 17%. Basic t-shirts were the biggest selling export item, accounting for a total of USD 5.8 million in business (14% of the total). Another highlight was cotton shirts, dress shirts and women’s blouses, in addition to circular knit fabric and cotton items for babies – an opportunity for entrepreneurs in this in the industry to grow their sales this year.

The Brazilian Trade and Investment Promotion Agency (Apex-Brasil) had developed a tool to report on the best trade opportunities for each segment. For apparel, Uruguay, Paraguay, Bolivia, Peru and Cuba stand out as countries that are consolidating, where the best opportunities are for Brazilian exporters. Countries like Argentina and Angola are defined as recovering countries, markets where Brazil is losing space or increasing its market share at a slower pace than its competitors, that is, these are markets that need to be conquered again.

Minas Gerais-based brand Candida Maria made its first attempt at internationalization by sending product samples to Mexico and Europe in 2011. Because of a lack of knowledge of the local market, the project was unsuccessful, but two years later, owner Candida Bomfin de Almeida made contact with a company representing Brazilian fashion in California and the brand began to export 5% of its products to the USA that same year. Santa Catarina-Based Elian, from the city of Jaragua do Sul, exports kidswear to 11 countries, with Bolivia and Paraguay being major importers. Yet it has also begun to dedicate strategies to the Middle Eastern market and has begun to use Arabic tags to sell to countries such as Saudi Arabia and Palestine. The two brands are currently members of Texbrasil, the Brazilian Fashion Industry Internationalization Program, developed by Abit in partnership with Apex-Brasil.

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