Brazil's Abimad gets serious about exports
By Gary Evans -- Furniture Today, February 25, 2007
Sao Paulo, Brazil — A major point of pride at the high-end Brazilian furniture show Abimad here recently was the red-and-black signage displayed at the entrances of about 75 of the exhibition's 175 showrooms.
The posters, displaying an image of the planet and an English "Quality for Export" proclamation, signified that companies had fulfilled a list of qualifications certifying that they are prepared and ready for export.
The certification is the latest in the association's campaign to show that its members are serious about growing their export business, which currently totals $950.2 million annually. About $290 million of those shipments go to Brazil's largest importing partner, the United States.
The association has gone all out to do its part in helping members sell furniture. Its emphasis during the past year has been in bringing prospective foreign customers — all expenses paid — to the show, and in finding ways to overcome the strong Brazilian currency, the real, which has risen from over three reais to the U.S. dollar a few years ago to about two reais now.
During this year's event, the association announced that the four-year-old show has acquired space for a permanent exhibition center and will be holding two markets each year instead of one, with smaller mini-events during the year.
The next show will be held Aug. 20 to 23.
"The association is growing, getting stronger and is more well known," said Tiago Lecey, foreign trade analyst with Abimad. "We want to transfer this asset to the international market as well."
The new exhibition center, a former electronics factory, has 500,000 square feet of exhibition space, equal to that of the Imigrantes Center where the show has been for the past four years. Where Imigrantes is located within Sao Paulo, the world's third largest city, the new center is located near the international airport on the outskirts, cutting out a gridlocked drive that often takes anywhere from 40 minutes to two hours.
Importantly, since the show is held in February, still the summer season of South America, the new venue will be totally air conditioned — something Imigrantes lacks. In addition, exhibitors can set up permanent space.
Lecey said both exhibitors and buyers like the idea of a permanent showplace, as well as an extra show. "All the retailers I've talked to have been very positive."
The five-day show here earlier this month drew about 10,000 people, including 600 Brazilian and 50 international buyers either partially or completely subsidized by the government's effort to promote furniture. The sponsorship, particularly of international buyers, is designed to build new business for Brazilian manufacturers.
In addition, Abimad's international department has been actively participating in international home furnishings fairs in High Point, Las Vegas and Dubai.
The staff also has visited retail stores in the United States, South America and the Middle East to promote the Brazil show and gain a better understanding of international business and product requirements.
Domestic sales of Brazilian furniture were flat in 2006, much like those in the United States. But recently, the central bank has loosened interest rates, making it easier for Brazilians to buy homes and consumer goods like furniture.
Domingos Savio Rigoni, the 2000–2006 president of Abimovel, the umbrella organization that oversees the government's furniture promotions, said that last year's weak sales have created high expectations for 2007. He predicted that increases "should be in the ballpark of 8.5% in comparison with last year."
Sales to the main countries importing Brazilian-made furniture fell across the board in 2006, including a 26% decrease for the United States. Some of this can be attributed to currency fluctuations. But despite this big challenge, Abimad keeps plugging along — actively promoting the country's products in preparation for when business conditions improve.
The certification of companies is the latest tool deployed by Abimad. Companies participating are expected to attend seminars before the show opens that teach executives how to prepare presentations for prospective customers (translators are supplied). In addition, Abimad opens the show exclusively to foreign buyers the day before the actual show begins.
An Abimad official also visits company factories to determine if a company has the capacity to deliver as promised. The industry has 432 of what it describes as midsized companies (50 to 99 employees) and 312 large companies (over 100 employees). In addition, there are more than 15,000 companies that range from a handful of workers to under 50 employees.
A number of individual exhibitors here said their efforts in the U.S. market have been gratifying, particularly in urban areas where the Brazilian contemporary style is more acceptable.
Arte Nova, for instance, showed earlier in High Point but found that the market was too traditional for its modern look. A warehouse/showroom has been more successful in Miami.
"We're betting on the U.S.," said Marco Martins, sales manager. "It's a very promising market. You just have to find the right places."
Indoor/outdoor producer Domila, with retail stores across Brazil and a U.S. office in Orlando, Fla., has doubled its customer base in the past two years, selling to major retailers such as Neiman Marcus, hotel chains and boutique stores.
"We're in all the major markets in retail," said Fred Panosso, a company executive, who notes that the company will introduce new product at Showplace during the March High Point Market.
"We've really concentrated on design and commercial applications and established our brand and recognition," Panosso said, adding that the company has built a strong service bond with its customers.
"We learned a long time ago that we couldn't sell the product and walk away," he said.
Formanova, a case goods and entertainment producer, has been exporting for 10 years and shows in both High Point and Las Vegas.
"It's always good to see our products out in the world," said Bruno Carvalho, export assistant.
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