Our clients always value straightforward and honest feedback, and comments don’t come any sharper than Manuel Alves’, an expert in international business who I met on LinkedIn commenting on this recent Times article on Latin America. Manuel has 18 years’ international business experience having worked and lived in five countries in two continents. He has developed Latin American markets for textile capital equipment, HoReCa machines and payment terminals for car wash and laundry. Most of his work has been with OEMs. He has worked with Italian and British companies in Latin America (apart from Russian and German ones), and he strongly thinks that Italian companies outperform British ones for specific reasons that, if analysed properly, could help British companies improve their performance in the region. So I invited him to join us…
First of all, says Manuel (who’s originally Portuguese and lives in the UK), it’s all down to culture. “Latin American people are warm, welcoming, polite and very personable. They are always curious about who crosses their path. They communicate verbally but also with mannerisms like Southern Europeans. Italians fit this totally. They communicate with their hands as much as with their voice. They get familiar very quickly. They are welcoming. Brits are very rigid. There is no amusing tone. Everything is very formal. So culturally Italians are much closer to Latin Americans than Brits.”
I personally find that this is important for when British companies recruit international staff or when they hire consultants to bridge the gap between their practices and Latin America. I find that a lot of Brits can play the “reliable Brit” card but balancing it with “I-am-not-as-rigid-as-you-think”. I have worked with CEOs, MDs, sales directors, sales managers and account managers from the UK that would beat any Italian at this! But then, my sample is biased!
Then, Manuel, says, it’s down to language, too, a hot topic of conversation among export consultants. “I have seen Italians speaking Portuguese and Spanish. Even if Italians could to some extent be understood in Latin America, I find that they make the effort to communicate in the local language. Brits here are at a clear disadvantage since their language is not that similar to Spanish and Portuguese, but they can only fault themselves: they are not good with languages. They strongly believe that English is the language all ought to speak in business. An example of how Brits look at languages very lightly: I was at an HoReCa show in Italy, a British company was selling table top hot drinks machines. The company had translated the brochure and the stand banners using Google translate – the translation resulted in the product being called “kitchen top” instead of “table top hot drinks machines”. What a disaster”.
I am with Manuel on this one. If you can’t afford to translate materials, reconsider whether you are ready at all for that export market. And Google translate might be good for the odd email, but not for marketing materials. Our client, Ellis, who manufacture cable cleats in Rillington, North Yorkshire, have spent thousands of pounds translating the website into different languages, as well as some of the catalogues. It takes time, money and commitment. But shortcuts can backfire. I am also lucky enough to work with British clients who are very conscious of their language limitations and who are not arrogantly monolingual. One of them has just emailed me to ask about dress code for a Brazilian trade show – it means he cares about first impressions and is humble enough to understand that dress codes from other parts of the world don’t necessarily apply here.
Manuel mentions flexibility in business as another area whey Italians outperform Brits in Latin America. He says: “for an Italian company to adapt a product to a specific market is much easier than for a British company that is very rigid in its internal processes. Rigid does not mean rigorous. As a consequence, Italians are more agile, more effective and more responsive. This is key for a new market. Moreover, no Italian ever told me “this is how we do it in Italy” whereas “this is how we do it in the UK” is more common than it should be. This shows how willing you are to understand your new market and to adapt if required. Pricing for Italians is often not an issue and neither are payment terms. For British companies those are usually stumbling blocks. Another barrier is the evident ignorance about Latin America free trade areas.”
Management and education are also important explanations, and Manuel expresses that “For Italian management there is no market “too far” where for British management is all about “revenue” and budgets from as early as 6 months. Italians are much more patient. They understand the market does not open up overnight. Another critical difference is how management approaches sales targets: Italians are very realistic when setting these and try and reaching consensus. Some of the most demotivated sales teams I ever saw were British. Also compare sales people recognition when exceeding targets: Italians throw in great meals or weekends for the sales person and his/her spouse. Sometimes nice trips away. The companies I know in UK at best give a cheap champagne bottle and some M&S vouchers.”
As you know, I am a strong advocate for “Made in Britain”, but Manuel has something to say about “Made in Italy”: “it sells tremendously well and is usually synonym of design and flair. Even with very basic products Italians always make a more interesting design.” And, controversially, he adds “the Italian quality in the products I dealt with is in many cases superior to the British made products and on top there is the design. Pricing however many times is lower that British made products. It is interesting to see in some exhibitions the duality between: design and good enough quality from Italy and the super quality of Germany or Switzerland that has less design.” Where do British products fall, do you think?
Attitudes towards Latin America’s past can also play a part, says Manuel. “Latin America has had tough times with military dictatorships, drug trafficking, social inequality and violence, but things are improving and have consistently improved for many years for a lot of countries. Italians look at those problems but they don’t really see them as a limitation in the sense that “if others do business so can we”. On the other hand, I also hear British companies saying: “they are corrupt there”, “we won’t ever get paid” and this without even attempting it first.”
Personally, I see lots of advantages of British companies against Italians, the most evident being reliability. I have come across disappointed clients and distributors of Italian brands across the region, in many sectors, who think that Italian sales people overpromise and underdeliver. But I have also learnt a lot from Italians doing business in Latin America.
Manuel’s controversial conclusion is “in my opinion, Italians seek a reason to enter Latin America while Brits seek a problem for not doing so”.
Hand in heart, how accurate do you think Manuel’s opinions are? Needless to say, most of our clients are actually exceptions to these generalisations (or they wouldn’t have come to us for support!) but they do resonate with me, even if it hurts! What is your experience? And, more importantly, is there anything that you can do as a British company to beat your Italian competition in Latin America? Leave your comments below!
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