UK trade with Latin America made it to The Times! Not the crisis in Venezuela, not the drug problems in Mexico, not the footballing stories, but an article focusing on doing business between the UK and Latin America. You must excuse my excitement (and my sarcasm).
This time, Joanna Crellin, Britain’s new Trade Commissioner for the region, discusses some of the barriers around doing business here and I couldn’t agree more with her. Education, and even ignorance, are powerful barriers preventing British companies from seriously considering Latin America. A lot of exporters know that, too, and that’s why they get in touch, meet us at events, and even pay us to overcome that barrier.
And the reader comments just add to that point. And that’s why I decided to reply to them, something I rarely do (check out my responses, and the insightful questions, here).
From the totally expected “all Latin America is corrupt and you must bribe everyone” kind of comment (my reply: Latin America has over 20 countries and some, such as Uruguay and Chile, are as corrupt as the UK) to the “customs are a nightmare” (my answer: yes, they are, but not everywhere, pick carefully), we had them all.
I also wonder how Britain expects that trade outside the EU is going to be like (thanks, Brexit). Do you expect every customs office to work smoothly such as within the EU, and if it’s any harder, you just won’t bother? Tackling a complex market like Brazil can take years, maybe some of those readers should adjust their expectations, would you expect to crack India, China or Russia in 12 months and with 20 quid? Maybe a market like Brazil requires a lot of creative thinking, not copy-pasting solutions that might apply to Belgium or Australia, but not here. But again, Latin America is not Brazil. Ruling out Latin America because Brazil doesn’t work is the equivalent of ruling out the whole of Asia because China didn’t work or ruling out the whole of Europe because Germany didn’t work.
I am also waiting for the unavoidable “if you do business there you’ll get shot” comment, and here’s my preemptive reply to that…
An interesting question that kept coming up was along the lines of “what can we sell them that they can’t get already from China or the USA (and cheaper, in volume, etc)? That’s when I recommend that you look at other British exporters and see what they’re doing. In the past seven years, we have helped over 45 British companies open up markets in Latin America. These companies sell into the region cable cleats, pollination bags, static eliminators, abrasive products, lifting and positioning solutions, food and drink, furniture, fertilisers, animal feeds, marine equipment… Yes, I understand the question about volume, it’s difficult to fight in volume with China (if you follow that argument then no-one in the world would be exporting anything because China would be selling everything to everyone), but it’s the quality and the niche characteristics (specifications) that make British products stand out. At the same time, British companies tend to set themselves apart from Chinese and American companies in Latin America because of their honesty and reliability (and humility!). Made in Britain also pays, believe me.
I travel across the region a fair bit, and I have seen British jams and Wellington boots, British water filters and biscuits, British outdoor equipment and horticultural solutions…
But the “what can we sell them that they don’t already have” is not a bad question, as it highlights the importance of doing serious market research and demand analysis. It’s not just about bombarding the region with whatever you sell, but making sure that the region actually wants and needs what you’re selling, at the price you can offer it. And maybe it’s about adjusting your offer to these export markets?
And that’s even without starting to discuss services: English language education, financial services, tourism, engineering, consultancy…
In addition to these comments, we’ve had the odd one on LinkedIn, too. For example: “most financial and tax advisors you talk to say “don’t do it”. Hard to get business buy in when those are the quotes you are fighting against.” That is interesting. I would personally ask these advisors how much they know about the region – and what part of the region exactly. My guess is that they need some “education”, as Joanna mentions, too!
Don’t get me wrong. Latin America might not be the best region for all UK exporters. We sometimes say to businesses “try somewhere else first and come back later” or “you’re just not ready” or “Latin America is not ready for you” – and these businesses thank us for that. And Latin America does have some serious barriers (we live here, we suffer them all!). But what matters is that as the decision-maker in your business, you get a real understanding of what those barriers are, and the potential of the opportunities on the other side. Is the region worth the investment/time/money/people/hassle? Only you can tell, but only if you’re equipped with the intelligence to make those crucial decisions. Leaving prejudices aside, can Latin America deliver for you?
With thanks to Gareth Moore from Santander UK for spotting the article and sharing it on Linkedn.
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