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Infinite, sustainable growth ideas and examples for strategic thinking executives every Sunday

THE BLOG

Innovate Africa With Dotun Adeoye Every Sunday

Infinite, sustainable growth ideas and examples for strategic thinking executives every Sunday

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South America ? What Are The Opportunities

Your business can access an entirely new customer base and establish connections with local partners when language barriers are no longer in your way. Unlock the untapped potential in South American markets with the help of a translator!

Potential International Expansion Opportunities in South America

If you are looking for potential international expansion opportunities, South America is a great place to look. It is home to some of the world’s largest economies and several large companies that have been around for over 100 years. However, this region must be more competitive with many major global brands.

In this article, we’ll go over the following:

  • The current economic outlook in 2023
  • Mistakes to avoid when expanding into new markets
  • The country’s factual data

Recent Economic Outlook in 2023

With its diverse cultures, rapidly-growing economies and potential for short- and long-term stability, South America is becoming an increasingly attractive market. Peru’s consistent rise in GDP per capita from USD 5600 to USD 9000 between 2013 – 2018 has created a robust consumer spending climate, with industrial production also increasing. By contrast, Venezuela serves as stark proof of what economic downturns can bring about due to political turmoil, social upheaval and hyperinflation—each reason enough in itself why businesses must thoroughly consider their strategies before entering these markets.

Brazil

Brazil is the largest country in South America, with a population of over 200 million people. It is also the 8th largest economy in the world, with a GDP of over $1.9 trillion. A major exporter of coffee and sugarcane, Brazil’s economy has been on an upswing since 2016. In addition to their agricultural exports, which accounted for over half of their total exports in 2017 according to data from UNCTAD (United Nations Conference on Trade and Development), Brazil also has a large market for consumer goods and services—particularly mobile phones and other electronics.

A new President is coming into power for a second term after battling the immediate past president. It should be an exciting period to understand the new leader’s priorities.

According to forecasts by Euromonitor International, between 2019-2025, there will be an expected annual growth rate (CAGR) of 1% for all sectors except automobiles which is expected to decline by 0%. during this same period; there will also be moderate increases in disposable income levels, which could lead consumers towards higher priced products such as cars or refrigerators instead of cheaper electronics such as smartphones or televisions that they might otherwise purchase today.”

Chile

Chile is the most developed country in South America. It has the highest GDP per capita, low unemployment rates and stable economic growth. Chile’s economy is also diversified, with a strong manufacturing base that makes it less dependent on exports than other Latin American countries. As a result, the country has been attracting investment from multinational companies such as Google, Intel and Sony, which are attracted by its educated workforce, favourable business climate and low taxes.

Argentina

Argentina is the second largest country in South America and has an expansive population of 45 million. Additionally, Argentina’s GDP ranks 19 on the list of countries with the highest GDPs. Yet, despite having a solid economy and a large base of consumers, Argentina has not been able to fully capitalise on its potential as an international market for many western-based companies. The reasons for this are numerous:

The vast majority of Argentines are bilingual (Spanish and English). However, only 0.5% have high-level English proficiency; as such, creating effective advertisements requires translation services that cost significantly more than those provided by Google Translate or other online translation tools. In addition to this difficulty with language barriers between countries like the United Kingdom,  United States and Argentina, which share common language roots but differ in idiomatic expressions and colloquialisms used frequently by native speakers within those countries themselves!

Argentina began its rise as an economic powerhouse during Juan Perón’s presidency (1946–1955) when he established nationalized industries such as steel production, among others, under state ownership during World War II because they were deemed essential services needed by all citizens regardless how much money they had saved up in savings accounts was necessary so that people could still get necessities without having access to them quickly enough without worrying about getting sick or dying from hunger because there wasn’t enough food available anymore since everything had been taken away from them before being placed back under control again once again after being taken away some time ago.

Uruguay

Uruguay is a small country with a population of 3 million and a GDP per capita of $21,200. However, it has the most robust economy in South America and is considered one of the most developed nations in Latin America. Uruguay’s diverse population includes descendants from European settlers and indigenous groups and immigrants from other countries who have settled there over time.

Uruguay boasts many historical monuments such as Colonia del Sacramento, which Portuguese colonists founded in 1680; Punta del Este, which was initially established as a seaside resort town but now hosts some significant events such as the Miss Universe pageant every year; Montevideo itself (the capital city), known for its beaches; La Plata River basin area with its waterfalls and green landscape.

Guyana

Guyana is a country in South America. It’s the only country in South America that uses English as an official language, and it was a former British colony. Regarding geography and climate, Guyana resembles the Eastern United States more than any other country on Earth (it has been described as “Caribbean Appalachia”).

Because it’s relatively small—approximately 75 miles wide by 295 miles long—and close to major markets like Venezuela and Suriname, Guyana is ripe for economic growth.

Suriname

Suriname is a country in South America. French Guiana borders it to the east, Brazil to the south, Guyana to the west, and the Atlantic Ocean to the north. Suriname was a Dutch colony between 1667 and 1975.

Suriname is known for its rainforest habitats, waterfalls, and diversity of bird species. The capital city of Paramaribo has many historic sites, including Fort Zeelandia (1624), which was later used as a prison during slavery, and Fort Nieuw-Amsterdam (1642), where enslaved people were kept before being shipped overseas.

French Guyana

French Guyana is a country in South America, located on the northern coast of South America. Suriname borders it to the west, Brazil to the east and the Atlantic Ocean to the north.

The capital of French Guyana is Cayenne, which has around 100,000 inhabitants. As a region in France, it shares many similarities with Europe though it has a tropical climate due to its location near Guyana’s coastlines.

Bolivia

Bolivia is the world’s third-largest producer of tin, and it is also one of the poorest countries in South America. It has a large indigenous population, seen by its brightly coloured clothes and handcrafted jewellery.

The building infrastructure in Bolivia is dated, and there is an obvious opportunity for affordable housing. Many buildings are old because there is little money to build new ones or repair old ones due to the challenging economic level. Bolivia is prime for affordable products and services. 

Falklands Islands

The Falkland Islands are an archipelago in the South Atlantic Ocean, located approximately 300 miles off the coast of Argentina. The islands’ population is about 2,900 people, with a per capita gross domestic product (GDP) of $34,300.

This may be your chance to get in on the ground floor! But first, you’ll need to make sure that you’re able to cater to their unique cultural nuances and understand how best to capitalize on opportunities for innovation.

Paraguay

Paraguay is a landlocked country in South America, with a population of about 6 million. The economy is the second largest in South America after Brazil, growing steadily. The government has attracted foreign investment from companies such as Mitsubishi Motors and Nissan—which both have manufacturing plants—because of their low labour costs and a large pool of skilled workers.

Peru

The fourth largest country in South America, Peru, is a land of great geography and opportunity. The world’s second-largest producer of silver and copper, Peru has also been ranked as the world’s largest exporter of fishmeal and anchovies. In addition to these natural resources, its people are renowned for their culinary traditions—specifically ceviche.

While many countries have built their economies on the backs of natural resources like oil or minerals, Peru has succeeded by expanding beyond traditional industries into more culturally relevant products like seafood. This is a smart move: research shows that consumers across cultures will pay more for local produce than imports or foreign goods with low transport costs.

Colombia

Colombia is the fourth largest country in South America, with a population of over 50 million people. It also has the second-highest GDP in South America after Brazil. According to Forbes magazine, Colombia’s economy is expected to grow by 4.1% this year, and its GDP per capita will continue to rise as well (by 2%).

Colombia’s tourism industry is growing at an average rate of 6% annually, making it one of the fastest-growing sectors in Colombia’s economy. This trend can be attributed mainly to increased security measures that have been put into practice since 2015, when an agreement was signed between the government and FARC rebels, resulting in less violence within Colombia’s borders.

Venezuela

Venezuela is located in South America, with a population of 32.5 million and a GDP of $1.2 trillion. Its currency is the Bolivar (VEF), which has been devalued since 2016 due to hyperinflation.

The Venezuelan economy has suffered from years of economic mismanagement and shortages due to low oil prices; this has led to widespread food and medicine shortages, mass migration to neighbouring countries like Brazil or Colombia, and political unrest as citizens demand change from their government officials who have failed them time after time.

Ecuador

Ecuador is a country in northwestern South America, bordered by Colombia on the north, Peru on the east and south, and the Pacific Ocean to the west. The capital city of Ecuador is Quito.

Ecuador has an area of 283,560 square kilometres (109,468 sq mi) and 16 million inhabitants as of 2016.

The highest point in Ecuador is at 4761m above sea level; Chimborazo Volcano is located in the Cordillera Occidental mountain range with numerous other volcanoes and peaks over 4000m high.

Mistakes to avoid

If you’ve been thinking about expanding into South America, here are some key things not to do:

  • Failure to understand the market. It’s easy to assume that all needs are identical, but they’re not. Some markets have different values and operating styles than others, so it’s essential to know these differences before entering a new market. For example, if you’re used to working in countries where everyone speaks English as a second language (like the UK, Canada or Australia), being in Argentina may feel like an entirely new world because Argentinians speak Spanish as their first language. If this is your situation, ensure that you have someone on board who understands and can communicate with local employees so that communication isn’t an issue later when things get busy!
  • Failure to understand the culture. Every country has its values and beliefs around business practices; At the same time, some may seem similar across borders, and others may be less recognizable or even foreign. So if something seems strange or unexpected during your expansion process—and especially if something goes wrong—it might be because cultural differences played into it somehow!

Opportunities for Innovation

  • Products and services. Do you have an innovative product or service? This could include a new software application to a new business model.
  • Business models. If your company doesn’t have any products or services that are particularly innovative, consider ways to use technology to improve your existing offerings (for example, implementing mobile apps that allow clients to buy products on the go and get instant feedback).
  • Technology. Does your company have access to advanced technologies that could be used in a way that no one else is using yet? For example, if you work in the IT sector, are there any emerging technologies you can leverage at home and abroad?
  • Marketing methods: Can you think of ways in which people would be receptive towards purchasing products or services from your company that don’t currently exist?

Establishing a successful business requires planning, research, and a little bit of luck.

Businesses looking to expand into the South American markets must take a deep dive beyond boundaries and prepare for an exciting journey. From researching local culture, regulations, and laws specific to their industry and rivals in the market, digging through financials and staying abreast of dynamic legal changes – this analysis is essential before venturing forth on any business endeavour.

Bottom-Line

As we have seen, many potential pathways exist to expand into South America. However, it is just as essential to assess the financial investments required to develop abroad against the rewards of gaining market share and access to new demographics. Furthermore, if you need more detailed advice on regional considerations or any other matter related to exploring growth opportunities in South America, I am happy to help. Please get in touch through my website so we can discuss your business needs in greater detail. With a firm understanding of the broader landscape across the continent, I am confident that together we can find a way for you to pursue sustainable expansion opportunities throughout South America.

Who am I?

I am Dotun Adeoye, a Business Growth Strategist & Author of the 5 Pillars of Business Growth.

I’ve built up my experience via serial entrepreneurship, consulting leadership roles in business growth, business development and product innovation in large companies worldwide in the last 30 years.

Today, I consult with large businesses on how to sustainably grow their businesses, sustain infinite growth, ensure business continuity and achieve a legacy.

Hire Dotun Adeoye to Speak Virtually or In – Person at your company’s event to cover this or other topics. You can also get in touch via +44 203 097 1718 or dotun at dotunadeoye.com.

 

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Innovate Africa

With Dotun Adeoye

Every Sunday

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 Teaching business leaders how to grow their businesses & leave their legacy.